Obama Speech on Advanced Manufacturing Partnership

Barack Obama toured the robotics lab at CMU and met Ned one of the advanced robots developed there.  He also operated a small robot designed to go through and inspect sewer lines.  looking at the DARPA car he quipped “they don’t let me drive.”  He then addressed the assembled group with these remarks:

THE PRESIDENT:  Hello, hello, hello!  (Applause.)  Thank you very much.  Everybody, please have a seat.  Thank you.  Hello, Pittsburgh!  (Applause.)  It is good to be back.  Thank you, Senator Casey, and Mayor Ravenstahl, County Executive Dan Onorato, State Auditor Jack Wagner, and all of you for having me back here at Carnegie Mellon.  It is good to be here.

And it seems like every time I’m here I learn something.  So, for those of you who are thinking about Carnegie Mellon, it’s a terrific place, and you guys are doing just great work.

I just met with folks from some cutting-edge companies and saw some of their inventions here in your National Robotics Engineering Center.  But that’s not the only reason I’m here.  You might not know this, but one of my responsibilities as Commander-in-Chief is to keep an eye on robots.  (Laughter.)  And I’m pleased to report that the robots you manufacture here seem peaceful — (laughter) — at least for now.

This is a city that knows something about manufacturing.  For generations of Americans, it was the ticket to a middle-class life.  Here and across America’s industrial heartland, millions clocked in each day at foundries and on assembly lines to make things.  And the stuff we made — steel, cars, planes — was the stuff that made America what it is.  The jobs were good.  They paid enough to own a home, to raise kids, send them to college, to retire.  They were jobs that told us something more important than just how much money we made, what was in our paycheck.  These jobs also told us that we were meeting our responsibilities to our family and to our neighborhoods, and building our communities, and building our country.

But for better and worse, our generation has been pounded by wave after wave of profound economic change.  Revolutions in technology have transformed the way we live and the way we work. Businesses and industries can relocate anywhere in the world, anywhere that there are skilled workers, anywhere that there is an Internet connection.  And companies have learned to become more efficient with fewer employees.  In Pittsburgh, you know this as well as anybody — steel mills that once needed a thousand workers now do the same work with a hundred.

And while these changes have resulted in great wealth for some Americans and have drastically increased productivity, they’ve also caused major disruptions for many others.  Today, a high school diploma no longer guarantees you a job.  Over the past 13 years, about a third of our manufacturing jobs have vanished.  And meanwhile, the typical worker’s wages have barely kept up with the rising costs of everything else.  And all this was even before a financial crisis and recession that pounded the middle class even more.

Now, we’ve made some tough decisions that have turned our economy in a positive direction over the past two years.  We’ve created more than 2 million new jobs in the private sector over the past 15 months alone, including almost 250,000 in manufacturing.  But we still have to confront those underlying problems.  They weren’t caused overnight, and we won’t solve them overnight.  But we will solve them.  And we’re starting to solve them right here in Pittsburgh, and right here at Carnegie Mellon. (Applause.)

And by the way, that’s why I ran for President.  Not just to get us back to where we were — I ran for President to get us to where we need to be.  I have a larger vision for America — one where working families feel secure, feel like they are moving forward and that they know that their dreams are within reach; an America where our businesses lead the world in new technologies like clean energy; where we work together, Democrats and Republicans, to live within our means, to cut our deficit and debt, but also to invest in what our economy needs to grow — world-class education, cutting-edge research, and building the best transportation and communication infrastructure anywhere in the world.  That’s what it’s going to take for us to win the future.  And winning the future begins with getting our economy moving right now.

And that’s why we’re here.  Carnegie Mellon is a great example of what it means to move forward.  At its founding, no one would have imagined that a trade school for the sons and daughters of steelworkers would one day become the region’s largest — one of the region’s largest employers and a global research university.  And yet, innovations led by your professors and your students have created more than 300 companies and 9,000 jobs over the past 15 years — companies like Carnegie Robotics.

But more important than the ideas that you’ve incubated are what those ideas have become:  They’ve become products made right here in America and, in many cases, sold all over the world.  And that’s in our blood.  That’s who we are.  We are inventors, and we are makers, and we are doers.

If we want a robust, growing economy, we need a robust, growing manufacturing sector.  That’s why we told the auto industry two years ago that if they were willing to adapt, we’d stand by them.  Today, they’re profitable, they’re creating jobs, and they’re repaying taxpayers ahead of schedule.  (Applause.)

That’s why we’ve launched a partnership to retrain workers with new skills.  That’s why we’ve invested in clean energy manufacturing and new jobs building wind turbines and solar panels and advanced batteries.  We have not run out of stuff to make.  We’ve just got to reinvigorate our manufacturing sector so that it leads the world the way it always has — from paper and steel and cars to new products that we haven’t even dreamed up yet.  That’s how we’re going to strengthen existing industries; that’s how we’re going to spark new ones.  That’s how we’re going to create jobs, grow the middle class, and secure our economic leadership.

And this is why I asked my Council of Advisors on Science and Technology — what we call PCAST — a while back to look at the state of American manufacturing and the promise of advanced manufacturing.  The concept of advanced manufacturing is not complicated.  It means how do we do things better, faster, cheaper to design and manufacture superior products that allow us to compete all over the world.

And so these very smart folks, many of whom are represented here, wrote up a report which is now up on the White House website.  But we didn’t want to just issue a report, we wanted to actually get something done.  So we’ve launched an all-hands-on-deck effort between our brightest academic minds, some of our boldest business leaders, and our most dedicated public servants from science and technology agencies, all with one big goal, and that is a renaissance of American manufacturing.

We’re calling it AMP, A-M-P — the Advanced Manufacturing Partnership.  It’s made up of some of the most advanced engineering universities, like Carnegie Mellon, Georgia Tech, Stanford, Berkeley, Michigan; some of our most innovative manufacturers, from Johnson & Johnson to Honeywell, Stryker to Allegheny Technologies.  I’ve asked Susan Hockfield, the President of MIT, who is here — there’s Susan — (applause) — and Andrew Liveris, the CEO of Dow Chemical — (applause) — to lead this partnership, and to work with my own advisors on science, technology and manufacturing.

Throughout our history, our greatest breakthroughs have often come from partnerships just like this one.  American innovation has always been sparked by individual scientists and entrepreneurs, often at universities like Carnegie Mellon or Georgia Tech or Berkeley or Stanford.  But a lot of companies don’t invest in early ideas because it won’t pay off right away. And that’s where government can step in.  That’s how we ended up with some of the world-changing innovations that fueled our growth and prosperity and created countless jobs — the mobile phone, the Internet, GPS, more than 150 drugs and vaccines over the last 40 years was all because we were able to, in strategic ways, bring people together and make some critical investments.

I’ll take one example.  The National Science Foundation helped fund Stanford’s Digital Library Project in the 1990s.  The idea was to develop a universal digital library that anybody could access.  So two enterprising Ph.D. students got excited about the research that was being done at Stanford — this is funded by NSF.  So these two Ph.D. students, they moved from campus to a friend’s garage, and they launched this company called Google.  And when the private sector runs with the ball, it then leads to jobs, building and selling, that is successful all over the world.

This new partnership that we’ve created will make sure tomorrow’s breakthroughs are American breakthroughs.  (Applause.) We’re teaming up to foster the kind of collaborative R&D that resulted in those same early discoveries, and to create the kind of innovation infrastructure necessary to get ideas from the drawing board to the manufacturing floor to the market more rapidly — all of which will make our businesses more competitive and create new, high-quality manufacturing jobs.

Now, to help businesses operate at less cost, the Energy Department will develop new manufacturing processes and materials that use half as much energy.  That will free up more money for companies to hire new workers or buy new equipment.

To help businesses discover, develop, and deploy new materials twice as fast, we’re launching what we call the Materials Genome Initiative.  The invention of silicon circuits and lithium-ion batteries made computers and iPods and iPads possible — but it took years to get those technologies from the drawing board to the marketplace.  We can do it faster.

To help everyone from factory workers to astronauts carry out more complicated tasks, NASA and other agencies will support research into next-generation robotics.  And I just met with folks from a local company, RedZone Robotics, who make robots that explore water and sewer pipes.  And I have to say, it is fascinating stuff, when you watch — the robot is about this big. It can go through any sewer system.  It’s operated remotely by the municipal worker.  It’s got a camera attached so it can film everything that it’s seeing.  It then transmits the data.  It goes into a citywide database, and can enhance the productivity of these workers by three or fourfold, and help the city make even better decisions.  Potentially this can save cities millions in infrastructure costs.  Companies also are training new workers to operate the robots, and analysts to pore through the data that’s being collected.

To help smaller manufacturers compete, federal agencies are working with private companies to make powerful, often unaffordable modeling and simulation software easier to access.  And I just saw an example.  A few years ago, Procter & Gamble teamed up with the researchers at Los Alamos National Labs to adapt software developed for war to figure out what’s happening with nuclear particles, and they are using these simulators to dramatically boost the performance of diapers.  (Laughter.)  Yes, diapers.  Folks chuckle, but those who’ve been parents — (laughter) — are always on the lookout for indestructible, military-grade diapers.  (Laughter and applause.)

But here’s what’s remarkable:  Using this simulation software that was developed at Los Alamos, Procter & Gamble has saved $500 million — half a billion dollars — as a consequence of this simulator.  Now, through the new partnership that we’re setting up, Procter & Gamble is offering its powerful fluid dynamics simulator to smaller manufacturers, and it’s doing it for free.

Now, this is not just because Procter & Gamble wants to do good.  It’s also they’ve got thousands of suppliers, and they’re thinking to themselves, if we can apply this simulation technology to our smaller suppliers they’re going to be able to make their products cheaper and better, then that, in turn, is going to save us even more money.  And it has a ripple effect throughout the economy.

Starting this summer, federal agencies will partner with industries to boost manufacturing in areas critical to our national security.  I just saw an example backstage.  The Defense Department scientists — we call it DARPA — the folks who brought us stealth technology and, by the way, who brought us the Internet — wanted to see if it was possible to design defense systems cheaper and faster.  So they found a small company in Arizona called Local Motors, and they gave them a test:  You have one month to design a new combat support vehicle, and you’ve got three months to build it.

Their CEO, Jay Rogers, is here today, and as an ex-Marine who lost a couple of buddies in combat, understood the importance of increasing the speed and adaptability and flexibility of our manufacturing process for vehicles that are used in theater.

So Local Motors solicited design ideas on their website, chose the best out of 162 that it received, built and brought this new vehicle here ahead of schedule.  We just took a look at it.  Not only could this change the way the government uses your tax dollars — because think about it, instead of having a 10-year lead time to develop a piece of equipment with all kinds of changing specs and a moving target, if we were able to collapse the pace at which that manufacturing takes place, that could save taxpayers billions of dollars.  But it also could get products out to theater faster, which could save lives more quickly, and could then be used to transfer into the private sector more rapidly, which means we could get better products and services that we can sell and export around the world.  So it’s good for American companies.  It’s good for American jobs.  It’s good for taxpayers.  And it may save some lives in places like Afghanistan for our soldiers.

So that’s what this is all about.  As futuristic and, let’s face it, as cool as some of this stuff is, as much as we are planning for America’s future, this partnership is about new, cutting-edge ideas to create new jobs, spark new breakthroughs, reinvigorate American manufacturing today.  Right now.  Not somewhere off in the future — right now.

It’s about making sure our workers and businesses have the skills and the tools they need to compete better, faster, and smarter than anybody else.  That’s what we’re about.  We are America, and we don’t just keep up with changing times, we set the pace for changing times.  (Applause.)  We adapt; we innovate; we lead the way forward.  (Applause.)  

It’s worth remembering, there was a time when steel was about as advanced as manufacturing got.  But when the namesake of this university, Andrew Carnegie — an immigrant, by the way — discovered new ways to mass-produce steel cheaply, everything changed.  Just 20 years after founding his company, not only was it the largest, most profitable in the world, America had become the number one steelmaker in the world.

Now, imagine if America was first to develop and mass-produce a new treatment that kills cancer cells but leaves healthy ones untouched; or solar cells you can brush onto a house for the same cost as paint; or flexible display soldiers — flexible displays that soldiers can wear on their arms; or a car that drives itself.  Imagine how many workers and businesses and consumers would prosper from those breakthroughs.

Those things aren’t science fiction — they’re real.  They’re being developed and deployed in labs and factories and on test tracks right now.  They sprang from the imagination of students and scientists and entrepreneurs like all of you.  And the purpose of this partnership is to prove that the United States of America has your back, is going to be supporting you — because that’s the kind of adventurous, pioneering spirit that we need right now.  (Applause.)

That’s the spirit that’s given us the tools and toughness to overcome every obstacle and adapt to every circumstance.  And if we remember that spirit, if we combine our creativity, our innovation, and our optimism, if we come together in common cause, as we’ve done so many times before, then we will thrive again.  We will get to where we need to be.  And we will make this century the American century just like the last one was.

Thank you very much, everybody.  (Applause.)  God bless you.  And God bless the United States of America.  (Applause.)

President Obama Speaks at CMU

The President visited Pittsburgh today to give a prepared speech on economic policy at Carnegie Mellon University.  Seeing as the event was five hours away and I have Democratic Talk Radio tomorrow morning I wasn’t able to attend.  Here are the President’s remarks:

Remarks of President Barack Obama

Carnegie Mellon University

Pittsburgh, Pennsylvania

Wednesday, June 2, 2010

Good afternoon.  It’s great to be back at Carnegie Mellon, and in the beautiful city of Pittsburgh.  I love visiting a good sports town.  Last year, I stole Dan Rooney to serve as my ambassador to Ireland.  But to make it up to you, I invited both the Steelers and the Penguins to the White House to celebrate their championships.  And seeing as how the Blackhawks are headed to Philly tonight with a 2-0 lead in the Stanley Cup Finals, let’s just say I’m glad to be on this side of the state today.

Of course, we meet here at an incredibly difficult time for America – among other things, it’s a time when the worst environmental disaster of its kind in our nation’s history is threatening the Gulf Coast and the people who live there.  Right now, stopping this oil spill and containing its damage must be the top priority of my Administration, and we are waging this battle every minute of every day.

But at the same time, we are continuing our efforts to recover and rebuild from an economic disaster that has touched the lives of nearly every American.  And that’s what I want to talk about today – the state of our economy, the future we must seize, and the path we choose to get there.

It has now been a little over sixteen months since I took office amid one of the worst economic storms in our history.  And to navigate that storm, my administration was forced to take some dramatic and unpopular steps.

Those steps have succeeded in breaking the freefall.  We are again moving in the right direction.  An economy that was shrinking at an alarming rate when I became President has now been growing for three consecutive quarters.  After losing an average of 750,000 jobs a month during the winter of last year, we have now added jobs for five of the last six months, and we expect to see strong job growth in Friday’s report.  The taxpayer money it cost to shore up the financial sector and the auto industry is being repaid, and both GM and Chrysler are adding shifts and operating at a profit.  Despite temporary setbacks, uncertain world events, and the resulting ups and downs of the market, this economy is getting stronger by the day.


Of course, none of this means that the recession is over for the millions of Americans who are still looking for a job or a way to pay the bills.  Not by a long shot.  The devastation created by the deepest downturn since the Great Depression has hit people and communities across our country hard.  And it will not be a real recovery until people can feel it in their own lives.

In the immediate future, this means doing whatever is necessary to keep the recovery going and spur job growth.  But in the long-term, it means recognizing that for many middle-class families, a sense of economic security has been missing since long before this recession began.  Over the last decade, these families saw their income decline.  They saw the cost of things like health care and college tuition reach record highs.  They lived through a so-called economic “expansion” that generated slower job growth than any prior expansion since World War II.  No wonder some have called the last ten years “the lost decade.”

So the anxiety that’s out there today isn’t new.  The recession has certainly made it worse, but that feeling of not being in control of your own economic future – that sense that the American Dream is slowly slipping away – that’s been around for some time.

For better or worse, our generation of Americans has been buffeted by tremendous forces of economic change.  Long gone are the days when a high school diploma could guarantee a job at the local factory – not when so many of those factories have moved overseas.  Pittsburgh, a city that was once defined by the steel industry, knows this better than many.  And today, the ability of jobs and entire industries to relocate wherever there’s skilled workers and an internet connection has forced America to compete like never before.

From China to India to Europe, other nations have already realized this.  They’re putting a greater emphasis on math and science, and demanding more from their students.  Some countries are building high-speed railroads and expanding broadband access.  They’re making serious investments in technology and clean energy because they want to win the competition for those jobs.

So we cannot afford to stand pat while the world races by.  The United States of America did not become the most prosperous nation on Earth by sheer luck or happenstance.  We got here because each time a generation of Americans has faced a changing world, we have changed with it.  We have not feared our future, we have shaped it.

America does not stand still.  We move forward.  That is why I’ve said that as we emerge from this recession, we cannot return to the pre-crisis status quo.  We cannot go back to an economy that was too dependent on bubbles and debt and financial speculation.  We cannot accept economic growth that leaves the middle-class owing more and making less.  We must build a new, stronger foundation for growth and prosperity – and that’s exactly what we’ve been doing for the last sixteen months.  

It’s a foundation based on investments in our people and their future.  Investments in the skills and education we need to compete.  Investments in a 21st century infrastructure for America – from high-speed railroads to high-speed internet.  Investments in research and technology, like clean energy, that can lead to new jobs and new exports and new industries.

This new foundation is also based on reforms that will make our economy stronger and our businesses more competitive – reforms that will make health care cheaper, our financial system more secure, and our government less burdened with debt.

In a global economy, we cannot pursue this agenda in a vacuum.  At the height of the financial crisis, the coordinated action we took with the nations of the G20 prevented a global depression and helped restore worldwide growth.  And as we have recently witnessed in Europe, economic difficulties in one part of the world can affect everyone else.   That’s why we must keep working with the nations of the G20 to pursue more balanced growth.  It’s why we need to coordinate financial reform with other nations so that we avoid a global race to the bottom.  It’s why we need to open new markets and meet the goal of my National Export Initiative:  to double our exports over the next five years.  And it’s why we need to ensure that our competitors play fair and our agreements are enforced.  This too is part of building a new foundation.

Now, some of you may have noticed that we have been building this foundation without much help from our friends in the other party.  From our efforts to rescue the economy to health insurance reform to financial reform, most have sat on the sidelines and shouted from the bleachers.  They said no to tax cuts for small businesses; no to tax credits for college tuition; no to investments in clean energy.  They said no to protecting patients from insurance companies and consumers from big banks.

Some of this, of course, is just politics.  Before I was even inaugurated, the congressional leaders of the other party got together and made a calculation that if I failed, they’d win.  So when I went to meet with them about the need for a Recovery Act, they announced they were against it before I even arrived at the Capitol.  Before we even had a health care bill, a Republican Senator actually said, “If we’re able to stop Obama on this, it will be his Waterloo.  It will break him.”  So those weren’t hopeful signs.      

But to be fair, a good deal of the other party’s opposition to our agenda has also been rooted in their sincere and fundamental belief about government.  It’s a belief that government has little or no role to play in helping this nation meet our collective challenges.  It’s an agenda that basically offers two answers to every problem we face:  more tax breaks for the wealthy and fewer rules for corporations.

The last administration called this recycled idea “The Ownership Society.”  But what it essentially means is that everyone is on their own.  If no matter how hard you work, your paycheck isn’t enough to pay for college or health care or child care, you’re on your own.  If misfortune causes you to lose your job or your home, you’re on your own.  And if you’re a Wall Street Bank or an insurance company or an oil company – you pretty much get to play by your own rules, regardless of the consequences for everyone else.

Now, I’ve never believed that government has all the answers.  Government cannot and should not replace businesses as the true engine of growth and job creation.  Government cannot instill good values and a sense of responsibility in our children like a parent can.  Too much government can deprive us of choice and burden us with debt.  Poorly designed regulations can choke off competition and the capital businesses need to thrive.

I understand this argument.  After all, one-third of the Recovery Act we designed was made up of tax cuts for families and small businesses.  Despite calls for a single-payer, government-run health care plan, we passed reform that maintains our system of private health insurance.

But I also understand that throughout our nation’s history, we have balanced the threat of overreaching government with the dangers of unfettered markets.  We’ve provided a basic safety net – because any one of us might experience hardship at some time in our lives, and may need some help getting back on our feet.  And we have recognized that there have been times when only government has been able to do what individuals couldn’t do and corporations wouldn’t do.  That’s how we have railroads and highways; public schools and police forces.  That’s how we’ve made possible scientific research that’s led to medical breakthroughs like the vaccine for hepatitis B and technological wonders like GPS.  That’s how we have Social Security, a minimum wage, and laws to protect the food we eat, the water we drink, and the air we breathe.  That’s how we have rules to ensure that mines are safe and that oil companies pay for the spills they cause.    

There have always been those who’ve said no to such protections and investments.  There were accusations that Social Security would lead to socialism, and that Medicare was a government takeover.  There were bankers who claimed the creation of federal deposit insurance would destroy the industry, and automakers who argued that installing seat belts was unnecessary and unaffordable.  There were skeptics who thought the cleaning of our water and our air would bankrupt our economy.  

All of these claims proved false.  And all of these reforms led to greater security and prosperity for our people and our economy.

What was true then is true today.  As November approaches, leaders in the other party will campaign furiously on the same economic argument they’ve been making for decades.  Fortunately, we don’t have to look back too many years to see how it turns out.  For much of the last ten years, we tried it their way.  They gave tax cuts that weren’t paid for to millionaires who didn’t need them.  They gutted regulations, and put industry insiders in charge of industry oversight.  They shortchanged investments in clean energy and education; in research and technology.  And despite all their current moralizing about the need to curb spending, this is the same crowd who took the record $237 billion surplus that President Clinton left them and turned it into a record $1.3 trillion deficit.  

So we already know where their ideas led us.  And now we have a choice as a nation.  We can return to the failed economic policies of the past, or we can keep building a stronger future.  We can go backward, or we can keep moving forward.

I don’t know about you, but I want to move forward.

Now, the first step in building a new foundation has been to address the costs and risks that have made our economy less competitive – outdated regulations, crushing health care costs, and a growing debt.

To start with, we cannot compete as a nation if the irresponsibility of a few Wall Street bankers and executives can bring our entire economy to its knees.  That’s why we’re on the verge of passing the most sweeping financial reform since the Great Depression.  It’s reform that will help prevent another AIG.  It will end taxpayer-funded bank bailouts.  And it contains the strongest consumer protections in history – protections that will empower Americans with the clear and concise information they need before signing up for a credit card or taking out a mortgage.

Financial reform will not guard against every instance of greed and irresponsibility on Wall Street, but it will enshrine a new principle in our financial system:  from now on, instead of competing to see who can come up with the cleverest scheme to make the quickest buck, financial institutions will compete to see who can make the better product and the better service.  That’s a competition that benefits Wall Street and Main Street.  And it’s why we cannot afford to go back.  We must move forward.  

We also know we can’t compete in a global economy if our citizens are forced to spend more and more of their income on medical bills; if our businesses are forced to choose between health care and hiring; if state and federal budgets are weighed down with skyrocketing health care costs.

That’s why we finally passed health insurance reform.  Now, let’s be clear – costs will not come down overnight because health care passed, and in an ever-changing industry like health care, we will continuously need more cost-cutting measures as the years go by.

But once this reform is in full effect, middle-class families will pay less for their health care, and the worst practices of the insurance companies will end.  People with pre-existing medical conditions will no longer be excluded from coverage.  People who become seriously ill will no longer be thrown off their coverage for reasons contrived by their insurance companies.  Taxpayers will no longer have to pay – in the form of higher premiums – for trips to the ER by uninsured Americans.  Businesses will get help with their health care costs – in fact, small businesses are already learning they’re eligible for tax credits to cover their workers.  And with less waste and greater efficiency in the system, this reform will do more to bring down the deficit than any step we’ve taken in more than a decade.

The other party has staked their claim this November on repealing these health insurance reforms instead of making them work.  They want to go back.  I say we move forward.

Making health care more cost efficient is critical, because it’s also true that we cannot be competitive as a nation if we remain dragged down by our growing debt.

By the time I took office, we had a one year deficit of over $1 trillion and projected deficits of $8 trillion over the next decade.  Most of this was the result of not paying for two major tax cuts skewed to the wealthy and a worthy but expensive prescription drug program.  And I always find it interesting that the same people who participated in these decisions are the ones who now charge our administration with fiscal irresponsibility.

The truth is, if I had taken office in ordinary times, I would have liked nothing more than to start bringing down the deficits they created.  But we took office amid a crisis, and the effects of the recession put a $3 trillion hole in our budget before I even walked in the door.  Additionally, the steps we took to save the economy from depression temporarily added more to the deficit – and if we had spiraled into a depression, our deficits and debt levels would be far worse.  

Now, the economy is still fragile, so we cannot put on the brakes too quickly.  We have to do what it takes to ensure a strong recovery.  A growing economy will unquestionably improve our fiscal health, as will the steps we take in the short-term to put Americans back to work.  

That’s why I signed a bill that will provide tax cuts for small businesses that hire unemployed workers, and why I’ve urged Congress to pass a Small Business Lending Fund, so that small businesses can get the credit they need to create jobs and grow.  I also believe it’s critical that we extend unemployment insurance for several more months, so that Americans who’ve been laid off through no fault of their own get the support they need to provide for their families and can maintain their health insurance until they’re rehired.  And we’re working to give state and local governments the resources they need to prevent the likely layoff of hundreds of thousands of public school teachers over the next few months.

But as we look ahead, we cannot lose sight of the urgent need to get our fiscal house in order. And I believe there are four key components to putting our budget on a sustainable path.  Maintaining economic growth is the first, and health care reform is the second.

The third component is the belt-tightening steps I’ve outlined to reduce our deficit by $1 trillion.  Starting in 2011, we will enact a three-year freeze on all discretionary spending outside of national security – something that was never enacted in the last administration.  We will allow the tax cuts for the wealthiest Americans to expire.  We have gone through the budget, line by line, and identified more than 120 programs for elimination.  We have restored a simple budgeting rule that every family and business understands: Pay-as-you-go.  And we will charge the largest Wall Street firms a fee to repay the American people for rescuing them during the financial crisis – a fee that will bring down the deficit by $90 billion over the next decade.  This is only one-eighth of the amount these banks will pay out in bonuses over the same time period.

Finally, the fourth component in improving our fiscal health is the bipartisan Fiscal Commission I’ve established that will provide a specific set of solutions by fall to deal with our medium and long-term deficit.  This won’t be easy.  I know that some like to make the argument that if only we eliminated pork and foreign aid, we could eliminate our deficit.  But such spending makes up just three percent of our deficit.  Three percent.  So meeting this challenge will require some very difficult decisions about the largely popular programs that make up the other 97%.

It means we’ll have to sort through our priorities and figure out what programs that we can do without.  On this point I strongly agree with my friends in the other party.  What I don’t agree with is the notion that we should also sacrifice critical investments in our people and our future.  If you’re a family who’s tightening your belt, you may sacrifice going out to dinner, but not saving for your child’s college education.  It is precisely our investments in education and innovation that will make America more competitive in the 21st century.  We cannot go back.  We must move forward.  

That’s why I’ve made education reform a top priority – because countries that out-educate us today will out-compete us tomorrow.  And so we want every citizen to have the skills and training they need in a global economy – from the day you’re born through whatever career you may choose.

Last year, we launched a national competition to improve our schools based on a simple idea:  instead of funding the status quo, we only invest in reform – reform that raises student achievement, inspires students to excel in math and science, and turns around failing schools that steal the future of too many young Americans.  And to achieve my goal of ensuring America once more has the highest proportion of college graduates in the world by 2020, we passed a law that will make college more affordable by ending the unnecessary taxpayer-subsidies that go to financial institutions for student loans.  It’s a bill that will also revitalize our community colleges, which are a career pathway to the children of so many working families.

In addition to training our workers for the jobs of the future, we’re also investing in the innovation that will create those jobs in America – the research, technology, and infrastructure that will secure our economic future.

Right now, the Recovery Act is putting Americans to work building a 21st century America – because there’s no reason that China should have the fastest trains or that rural Pennsylvania should be without high-speed internet access.  From the first railroads to the interstate highway system, this nation has always been built to compete.  So we’re investing in new infrastructure – expanded broadband, health information technology, advanced manufacturing facilities, and America’s first high-speed rail network.

We’re also investing in the ideas and technologies that will lead to new jobs and entire new industries.  Consider what we’ve done with clean energy.  The tax credits and loan guarantees in the Recovery Act alone will lead to 720,000 clean energy jobs in America by 2012.  To take just one example, the United States used to make less than 2% of the world’s advanced batteries for hybrid cars.  By 2015, we’ll have enough capacity to make up to 40% of these batteries.  

And this brings me to an issue that’s on everyone’s mind right now – namely, what kind of energy future can insure our long-term prosperity.

The catastrophe unfolding in the Gulf right now may prove to be a result of human error – or of corporations taking dangerous short-cuts that compromised safety, or a combination of both.  And I’ve launched a National Commission so that the American people will have answers on exactly what happened.

But we have to also acknowledge that there are inherent risks to drilling four miles beneath the surface of the Earth – risks that are bound to increase the harder oil extraction becomes.  Just like we have to acknowledge that an America run solely on fossil fuels should not be the vision we have for our children and grandchildren.

We consume more than 20% of the world’s oil, but have less than 2% of the world’s oil reserves.  So without a major change in our energy policy, our dependence on oil means that we will continue to send billions of dollars of our hard-earned wealth to other countries every month – including countries in dangerous and unstable regions.  In other words, our continued dependence on fossil fuels will jeopardize our national security.  It will smother our planet.  And it will continue to put our economy and our environment at risk.

Now, I understand that we cannot end our dependence on fossil fuels overnight.  That’s why I’ve supported offshore oil production as one part of our overall energy strategy.  But we can pursue such production only if it’s safe; and only if it’s used as a short-term solution while we transition to a clean energy economy.

The time has come to aggressively accelerate that transition.  The time has come, once and for all, for this nation to fully embrace a clean energy future.  That means continuing our unprecedented effort to make everything from our homes and businesses to our cars and trucks more energy efficient.  It means tapping into our natural gas reserves, and moving ahead with our plan to expand our nation’s fleet of nuclear power plants.  And it means rolling back billions of dollars in tax breaks to oil companies so we can prioritize investments in clean energy research and development.  

But the only way the transition to clean energy will succeed is if the private sector is fully invested in this future – if capital comes off the sidelines and the ingenuity of our entrepreneurs is unleashed.  And the only way to do that is by finally putting a price on carbon pollution.  

Many businesses have already embraced this idea because it provides a level of certainty about the future.  And for those that face transition costs, we can help them adjust.  But if we refuse to take into account the full cost of our fossil fuel addiction – if we don’t factor in the environmental costs and national security costs and true economic costs – we will have missed our best chance to seize a clean energy future.

The House of Representatives has already passed a comprehensive energy and climate bill, and there is currently a plan in the Senate – a plan that was developed with ideas from Democrats and Republicans – that would achieve the same goals.  The votes may not be there right now, but I intend to find them in the coming months.  I will continue to make the case for a clean energy future wherever and whenever I can, and I will work with anyone from either party to get this done.  But we will get this done.  The next generation will not be held hostage to energy sources from the last century.  We will not move backwards.  America will move forward.

This overarching principle – that we must invest in, and embrace, the innovation and technology of the future and not the past – applies beyond our energy policy.  That’s why we’ve decided to devote more than three percent of our GDP to research and development – to spur the discovery of services, products, and businesses we have yet to imagine.  We’ve also proposed making the research and experimentation tax credit permanent – a tax credit that helps businesses afford the high costs of developing new technologies and new products.  And last year, we made the largest investment in basic research funding in history.

The possibilities of where this research might lead us are endless.  Imagine a new treatment that kills cancer cells but leaves healthy ones untouched, or regenerative medicine that ends the agonizing wait for an organ transplant.  Imagine a lightweight vest for soldiers and police officers that can stop armor-piercing bullets, or educational software that’s as effective and engaging as a personal tutor, or intelligent prosthetics that can enable a wounded veteran to play piano again.  And now imagine all the workers and small business owners and consumers who would benefit from these discoveries.

We can’t know for certain what the future will bring.  We can’t guess with one hundred percent accuracy what industries and innovations will next shape our world.   I’m sure there were times when this city couldn’t imagine life without steel mills and the heavy smog that filled these streets.  And when that industry shrank and so many jobs were lost, who could’ve guessed that Pittsburgh would fare better than many other Rust Belt cities, and reemerge as a center for technology, green jobs, health care, and education?  Who would’ve thought that the University of Pittsburgh Medical Center’s logo would one day adorn the U.S. Steel Tower, or that this institute of higher education would be the region’s largest employer?

All of this came to be because as a community, you prepared and adapted and invested in a better future – even if you weren’t sure of what that future would look like.

That’s what America does.  That’s what we’ve always done.  The interests of the status quo will always have the most vocal and powerful defenders.  There will always be lobbyists for the bank or the insurance industry that doesn’t want more regulation; or the corporation that would prefer to see more tax breaks instead of more investments in infrastructure or education.  And let’s face it – a lot of us find the prospect of change scary, even when we know the status quo isn’t working for us.

But there’s no natural lobby for the clean energy company that may start a few years from now; or the research that may lead to a life-saving medical breakthrough; or the student who may not be able to afford a college education.

It’s our job as a nation to advocate on behalf of the America we hope for – to make decisions that will benefit the next generation.  Even if it’s not always popular.  Even if we can’t always see those benefits in the short-term.  We make decisions like this on behalf of our own children every day.  And while it’s harder to do with an entire country as large and diverse as ours, it’s no less important.

The role of government has never been to plan every detail or dictate every outcome.  At its best, government has simply knocked away barriers to opportunity and laid the foundation for a better future.  Our people – with all their drive and ingenuity – always end up building the rest.  If we can do that again – if we can continue building that foundation and making those hard decisions on behalf of the next generation, I have no doubt that we will leave our children the America we hope for.  Thank you.