In a speech on the economy in Cleveland, Ohio today, President Obama spoke of his own family’s personal story and the economic hardships of his predecessors, with a real defense of an America where the middle class is strong and a foundation for investment in the future gets prioritized over short-term laissez-faire faith in corporate elites. He said that the Republicans represented a turn to the past, accusing House Minority Leader John Boehner of “just the same philosophy we already tried for the last decade – the same philosophy that led to this mess in the first place.”

Then, he promoted a new set of policies long favored by Republicans, including a permanent extension of the R&D tax credit and an expanded and extended tax write-off for capital investments.

These are somewhat discordant themes. So the President pitched them by treating those business tax breaks as incentives for investment and excoriated Republicans for favoring loopholes allowing corporations to ship jobs overseas, which would provide the offsets for those corporate tax breaks.

Obama did respond to one persistent criticism from his allies on the left – that he fails to look back and accuse the Bush policies for the current state of the economy.

But while all this was happening, the broader economy was becoming weaker. Job growth between 2000 and 2008 was slower than it had been in any economic expansion since World War II – even slower than it’s been over the past year. The wages and incomes of middle-class families kept falling while the cost of everything from tuition to health care kept rising. Folks were forced to put more debt on their credit cards and borrow against homes that many couldn’t afford in the first place. Meanwhile, a failure to pay for two wars and two tax cuts for the wealthy helped turn a record surplus into a record deficit.

I ran for President because I believed that this kind of economy was unsustainable – for the middle-class and for our nation’s future. I ran because I had a different idea about how America was built – an idea rooted in my own family’s story.

Obama went through the struggles of his family growing up, and how he believes in “a country that rewards hard work”:

It was an America where you didn’t buy things you couldn’t afford; where we didn’t just think about today – we thought about tomorrow. An America that took pride in the goods it made, not just in the things it consumed. An America where a rising tide really did lift all boats, from the company CEO to the guy on the assembly line.

That’s the America I believe in. That’s what led me to work in the shadow of a shuttered steel plant on the South Side of Chicago when I was a community organizer. It’s what led me to fight for factory workers at manufacturing plants that were closing across Illinois when I was a Senator. It’s what led me to run for President – because I don’t believe we can have a strong and growing economy without a strong and growing middle-class.

Obama again walked a tightrope of saying that the recovery prevented a Depression but “progress has been painfully slow.” And so he pitched his recovery package, with its three planks: 1) permanently extending the R&D tax credit, 2) allowing companies to write off capital investments in 2010 and 2011, and 3) a six-year infrastructure plan with a front-loaded $50 billion dollar investment and a National Infrastructure Bank. There was also a nod to making a college tuition tax credit permanent, a new wrinkle.

We’ve talked today about how these ideas are going nowhere, with even some Democrats in opposition.

On the policy that matters, what to do about the Bush tax cuts, the President made his position clear:

I’ll give you one final example of the differences between us and the Republicans, and that’s on the issue of tax cuts. Under the tax plan passed by the last administration, taxes are scheduled to go up substantially next year. Now, I believe we ought to make the tax cuts for the middle class permanent. These families are the ones who saw their wages and incomes flatline over the last decade – and they deserve a break. And because they are more likely to spend on basic necessities, this will strengthen the economy as a whole.

But the Republican leader of the House doesn’t want to stop there. Make no mistake: he and his party believe we should also give a permanent tax cut to the wealthiest two percent of Americans. With all the other budgetary pressures we have – with all the Republicans’ talk about wanting to shrink the deficit – they would have us borrow $700 billion over the next ten years to give a tax cut of about $100,000 to folks who are already millionaires. These are among the only folks who saw their incomes rise when Republicans were in charge. And these are folks who are less likely to spend the money, which is why economists don’t think tax breaks for the wealthy would do much to boost the economy.

So let me be clear to Mr. Boehner and everyone else: we should not hold middle class tax cuts hostage any longer. We are ready, this week, to give tax cuts to every American making $250,000 or less. For any income over this amount, the tax rates would go back to what they were under President Clinton. This isn’t to punish folks who are better off – it’s because we can’t afford the $700 billion price tag. And for those who claim that this is bad for growth and bad for small businesses, let me remind you that with those tax rates in place, this country created 22 million jobs, raised incomes, and had the largest surplus in history.

I don’t think that leaves much margin for error, but once again, the word “veto” doesn’t appear there. And also, extending the “middle class tax cuts” elides the fact that those actually help high-income earners more in terms of real dollars. If the tax rates of the Clinton era did lead to prosperity and fiscal responsibility, the logical next step would be to revert to all of them over time. But Obama made his case that middle-class folks deserve a break, given their lack of wage growth over the last decade.

Obama sharply criticized the Republicans for essentially tanking the economy on purpose, based on the idea that “If I fail, they win.” This all would be stronger if he offered a greater choice than this stew of business tax breaks along with an infrastructure plan that’s too small to make a difference. As well as without this part from the end of the speech, where he challenges Republicans to be real deficit hawks:

When these same Republicans – including Mr. Boehner – were in charge, the number of earmarks and pet projects went up, not down. These same Republicans turned a record surplus that Bill Clinton left into a record deficit. Just this year, these same Republicans voted against a bipartisan fiscal commission that they themselves proposed. And when you ask them what programs they’d actually cut, they usually don’t have an answer.

That’s not fiscal responsibility. That’s not a serious plan to govern.

I’ll be honest – I refuse to cut back on those investments that will grow our economy in the future – investments in areas like education and clean energy and technology. That’s because economic growth is the single best way to bring down the deficit – and we need these investments to grow. But I am absolutely committed to fiscal responsibility, which is why I’ve already proposed freezing all discretionary spending unrelated to national security for the next three years. And once the bipartisan fiscal commission finishes its work, I will spend the next year making the tough choices necessary to further reduce our deficit and lower our debt.

Hope over fear!

This was a political speech, and the policies more of a political document. It would be nice if they showed some contrast.

UPDATE: I should add that at the end here, Obama praised Reagan for “working to help save Social Security,” which as we know he did in part by raising the retirement age.