Obama: Income inequality a defining challenge

WASHINGTON -- President Barack Obama prodded Congress to raise wages and secure the social safety net as he issued an overarching appeal Wednesday to correct inequalities that he said make it harder for a child in the United States to escape poverty.

"That should offend all of us," he declared. "We are a better country than this."

Focusing on pocketbook issues Americans consistently rank as a top concern, Obama argued the dream of upward economic mobility is breaking down and the growing income gap is a "defining challenge of our time."

"The basic bargain at the heart of our economy has frayed," the president said at a not-for-profit community center a short drive from the White House in one of Washington's most impoverished neighborhoods.

Though he offered no new initiatives, Obama blended a call for Congress to act on pending short-term economic measures with a long vision aimed at correcting a growing level of income inequality in the United States. The speech came amid public doubts over Obama's stewardship of the economy, as his overall approval ratings sink and as he seeks to move past the health care troubles that have consumed his presidency in recent months.

He acknowledged his administration's "poor execution" in rolling out the flawed website that was supposed to be an easy portal for buying insurance, while blaming Republicans for a "reckless" shutdown of the government.

"Nobody has acquitted themselves very well these past few months," Obama said. "So it's not surprising that the American people's frustrations with Washington are at an all-time high."

Worse for Americans, he added, are their growing difficulties in trying to make ends meet no matter how hard they work.

The speech coincided with growing national and international attention to economic disparities -- from the writings of Pope Francis to the protests of fast-food workers in the U.S. The president cited the pope's question of how it isn't news when an elderly homeless person dies from exposure, but news when the stock market loses two points.

And he noted that in the United States, a child born into the bottom 20 percent of income levels has less than a 5 percent chance of making it to the top income levels and is 10 times likelier to stay where he is -- worse than other industrial countries such as Canada, Germany and France.

House Speaker John Boehner blamed Senate Democrats and Obama for the lack of action on jobs-related legislation. He said bills passed by the Republican-controlled House that would help the economy and create jobs have been blocked in the Democratic-controlled Senate.

"The Senate and the president continue to stand in the way of the people's priorities," he said on the House floor.

Obama conceded "the elephant in the room" is the political gridlock that has prevented congressional action. He said issues of inequality of upward mobility would not likely be resolved even over the next five years. But he pointed to the health-care law as one example he said is helping families by providing insurance coverage to more Americans and by pushing down the costs of health care.

Obama called on Congress to increase the federal minimum wage from the current $7.25 an hour. A Democratic bill by Sen. Tom Harkin of Iowa would raise the minimum wage to $10.10 an hour in three steps and tie automatic annual increases to changes in the cost of living. No vote has been scheduled on the proposal.

Obama also pressed Congress to extend jobless benefits to 1.3 million long-term unemployed people. The benefits are set to expire just three days after Christmas.

The additional weeks of benefits have been extended each year since 2009, but a senior Republican lawmaker, Rep. Tom Cole of Oklahoma, said Tuesday that Republicans oppose yet another extension.