A champion of bipartisan politics, the still unsteady Giffords repeatedly was helped in rising to applaud Obama's speech by her Republican colleague from Arizona, Rep. Jeff Flake.
"It was the least I could do," Flake, a staunch conservative and frequent critic of the president, said. Asked if fellow Republicans thought he stood up so often to support what Obama was saying, Flake said in reference to Giffords: "I think most people would understand I support my colleague and friend."
Obama began and ended the 65-minute speech by praising U.S. troops for unity and teamwork that can serve as a model for facing the country's problems.
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President hugs Gabby Giffords
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He called for lowering corporate taxes and providing incentives for U.S. manufacturers to bring overseas jobs back to America, while ending tax breaks for businesses that continue to outsource. At the same time, Obama said, every multinational company should pay a basic minimum tax, while giving American manufacturers a tax cut.
"It's time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America," Obama said, adding a challenge to Congress he repeated throughout the night to send him a bill that he pledged to sign "right away."
He also challenged Congress to act on comprehensive immigration reform, a major election-year issue for the important Hispanic-American vote. Short of a major overhaul, he called for legislation like the DREAM Act that provides children of illegal immigrants who go to college or serve in the military a path to possible citizenship.
In response to Republican criticism of his energy policy, Obama said to applause he was ordering his administration to open up 75% of potential offshore oil and gas resources. At the same time, he also said U.S. oil production was at the highest level in eight years, countering GOP claims he was stifling oil development.
On income taxes, Obama repeated his longstanding call for the wealth to pay more in taxes, including a specific proposal for millionaires to have a tax rate of 30%. Earlier Tuesday, millionaire Republican presidential candidate Mitt Romney revealed his actual tax rate was lower than 15%.
Obama enters the House chamber
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Obama's presidency so far has been mostly defined by the ideological battle between Democrats and Republicans over the role of government in American society.
Bolstered by the conservative tea party movement that helped deliver the House majority in 2010, Republicans have pushed for shrinking government to ease mounting federal deficits and debt.
Obama and Democrats argue that deficit reduction must include both spending cuts and revenue increases in a balanced approach that maintains the essential role of government in American prosperity and opportunity.
The partisan divide has led to repeated congressional showdowns over budget and tax issues, with public dissatisfaction with Congress at historically low levels and the U.S. credit rating downgrade.
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