WASHINGTON — On election night in Chicago two months ago, President Barack Obama triumphantly pledged to fight for a middle class he’d appealed to relentlessly — and successfully — on the 2012 campaign trail.

“I believe we can build on the progress we’ve made and continue to fight for new jobs and new opportunity and new security for the middle class,” Obama said. “I believe we can keep the promise of our founders, the idea that if you’re willing to work hard … you can make it here in America.”

The central challenge of Obama’s second term is whether he can keep that founder’s “promise” to working Americans. It won’t be easy, and in an era of divided government and amid cries for austerity and budget cuts, it does not seem likely that the president will offer sweeping new proposals to do so. The administration has said that its top two priorities at the outset of its second term are immigration reform and gun control. Despite an ongoing jobs crisis, creating quality jobs seems to have fallen a few slots on the president’s to-do list.

As Obama implicitly acknowledged, the American middle class has fallen on hard times, saddled with historic levels of debt, skyrocketing health care costs and flat wages. By most accounts, middle-class Americans are no better off than they were when the president took office in 2009, in the wake of an unprecedented financial crisis and in the midst of the Great Recession.

The arithmetic is stark. Median household income is lower than when Obama took office, according to Census Bureau data — lower even than when President Bill Clinton left office in 2001. The middle 60 percent of households — those earning between $20,262 and $101,582 — captured a smaller share of aggregate income in 2011 than they did in 2009, while the top fifth, which already made more than the other groups combined, captured more. Surveys of public opinion reveal a middle class that is smaller, poorer and less optimistic than ever. And although the unemployment rate fitfully has fallen below 8 percent for the first time since Obama’s 2009 inauguration, most new jobs are too low-paying to sustain middle-class families.

There is more to the plight of the American middle class than numbers can express — and a greater threat to the country than economists can quantify.

Democracy, after all, can’t thrive without a broad, strong, educated core of citizens. But today they find themselves buffeted by the remorseless dictates of global capital, the need for evermore education and training and the burdens of higher taxes to pay for social programs they need, such as health care.

Battling these global and cultural trends is difficult. In fact, it is unfair to ask any one person — even a president, even Barack Obama — to overcome them all. The president’s first responsibility in 2009 literally was to do his part to save the world’s frozen capital, banking and trade systems — without which the American middle class would have had no prospects at all.

Most fair-minded observers would say that Obama did his part, and acquitted himself well under crushing circumstances. A workable and affordable health care system, the central legislative success of his first term, can (if he sets it up properly) be of great benefit to middle-class workers.

But now he must make good on his own promise — not always central to his discourse or decision making — to find more good-paying middle class jobs.


On the stump this year, the president made manufacturing a centerpiece of his vision, arguing that a combination of tax reform, investment and education could help repatriate quality jobs to U.S. soil and stabilize the middle class. Perhaps sensing the political popularity of such an idea in Rust Belt states like Ohio and Michigan, the Obama campaign set the lofty but achievable goal of creating a million new manufacturing jobs during the president’s second term.

In a recent interview on “Meet the Press,” the president renewed his commitment to investing in infrastructure, which he called “broken,” as another way to create good-paying jobs.

With the conversation in Washington focused not just on austerity but how much austerity to apply to a sputtering economy, it’s hard to imagine what kind of rebooted jobs plan the president could propose for his next term while staying within the bounds of political reality.

“In the short term, we are in a pretty difficult spot,” said John Schmitt, an economist with the left-leaning Center for Economic and Policy Research who studies economic inequality and unemployment. “Even if there was a serious commitment on the part of the administration towards a jobs program of some sort, it would run into a lot of trouble in the Congress.”

Without a clear and politically viable policy objective for jobs — unlike, say, banning high-capacity magazines to address mass shootings — the administration is likely to continue the piecemeal approach to economic recovery that it took for most of the president’s first term, observers say.

Obama’s landmark 2009 stimulus bill pumped billions of dollars into the ailing economy, stemming the loss of hundreds of thousands of jobs each month. The bill addressed the short-term fallout in the private sector by cutting taxes and pouring money into infrastructure projects and expanded unemployment insurance benefits.

But since then, additional spending has been all but off the table. Obama has repeatedly proposed more infrastructure spending, but the White House has routinely given up such demands in negotiations with congressional Republicans.

The lack of stimulus since the initial package — aside from the repeated extensions of long-term unemployment insurance — has exasperated left-leaning and centrist economists.

“The answer is very clear: We need substantial additional stimulus to support the economy,” said Heidi Shierholz, an economist at the Economic Policy Institute (EPI), a left-of-center think tank. “We are choosing, as a country and as a town [Washington], not to do it, with millions of jobless workers.”

To address the decline in manufacturing jobs, the Obama administration has undertaken a number of modest initiatives, such as launching a manufacturing institute in Youngstown, Ohio, with $30 million in federal funding, a joint effort between industry and schools to train workers for tomorrow’s manufacturing jobs. The Youngstown facility focuses on training workers for 3-D printing technology, the kind of modern manufacturing industry where observers see a lot of potential.

The facility is an acknowledgment that tomorrow’s manufacturing jobs will be different from the ones of the past. Gone are the days when a new high school graduate could show up at the factory door, get trained on the shop floor and earn a good wage and a pension. Jobs like those in 3-D printing require more advanced training and a certain degree of computer literacy. The same goes for other areas where experts, as well as the White House, see promise, like industrial robotics or nanomanufacturing. Obama’s own tech advisers have warned that the country’s “historic leadership” in manufacturing technology is “at risk” if it can’t cultivate the right talent for these fields.

In his 2013 budget proposal, Obama called for devoting $1 billion to create a national network of institutes like the one in Youngstown — a recommendation that hasn’t exactly become a priority for Congress. Neither have the loftier goals of his earlier manufacturing package, such as extending tax breaks to companies that return jobs to U.S. shores. They appear unlikely to move forward in a second term, even if the president chooses to champion them.

“The administration has done some things but could do a lot more to help manufacturing,” said Scott Paul, director of the non-profit Alliance for American Manufacturing. What the White House has done so far is “not well-publicized or well-known. They will ultimately be helpful, but so much of the debate has become politicized, it’s hard to make progress on some of the meaningful issues.”

And in the end, the manufacturing plan still faces some cold mathematics. The U.S. lost more than 5 million manufacturing jobs in the first decade of this century, falling from 17 million to 12 million. Fewer than 9 percent of American workers have manufacturing jobs, compared with more than 20 percent in 1979. Creating a million new such jobs puts only a dent in that sector’s — and the middle class’s — long-term woes.

“It doesn’t come close to restoring manufacturing employment to what it had been,” Paul noted, adding that he still found the goal admirable.

Even setting aside the immediate joblessness crisis, Obama still faces the long-term problems of deteriorating wages and growing income inequality for the poor and middle class. Since 1979, the top 1 percent of American households captured more than 38 percent of income growth, while the bottom 90 percent received just shy of 37 percent, according to EPI.

The Great Recession technically ended halfway through 2009, but the economic recovery of the past few years is replacing office workers, real estate brokers and insurance claims adjusters with retail salespeople, restaurant workers and warehouse hands.

Mid-wage jobs — ones with median hourly wages ranging from $13.84 to $21.13 — accounted for 60 percent of the jobs lost during the recession, according to an analysis by the National Employment Law Project, a worker advocacy group. During the recovery since then, mid-wage jobs have represented just 22 percent of growth. Jobs earning less than $13.84 per hour made up 58 percent of recovery growth, according to the NELP.

The president pledged during his 2008 campaign that by 2011 he would have the minimum wage raised to $9.50 and pegged to inflation, a move that worker advocates have clamored for for years, claiming it would help raise the wage floor for the working poor and the middle class. But the federal minimum wage remains $7.25 per hour, well below a living wage in most areas.

Many of those same worker advocates tie the stagnation of real wages to the decline of collective bargaining in the workplace. The rate of unionization in the U.S. has fallen to a historic low, with just 7 percent of private-sector workers now belonging to a union. Labor leaders believe that labor law needs to be amended to make it easier for workers to join unions. Their best shot came and went under the president’s watch, when Democrats failed to pass the Employee Free Choice Act when they controlled both chambers of Congress.

“I do feel disappointment,” said Schmitt, the Center for Economic and Policy Research economist. “That said, we’re also in a [political] context where it’s extremely difficult to make any progress on the concerns of low- and middle-wage workers.”

Despite those shortcomings, and despite the acrimony on Capitol Hill, liberals like Richard Trumka, president of the AFL-CIO federation of unions, are bullish on Obama’s second term, given the focus on the middle class and jobs during the election.

“It all starts with the political will, or the national appetite, to again create jobs that are going to be family-supportive and middle-class producing, and I think that’s underway right now,” Trumka said. “People are talking about it. That’s the difference between this election and the ones in the past. We actually had a debate about what’s hollowing out the country and what isn’t. And our side won, big time.”

Now the president’s challenge is to turn that political victory into an economic one for the people who supported him.

This article is part of a series produced by The Huffington Post that closely examines the most pressing challenges facing President Obama in his second term. To read other posts in the series, click here.

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  • Obama On Taxes

    Roll back Bush tax cuts for upper-income people. He compromised with the GOP and went along with renewing the expiring across-the-board tax cuts begun by his Republican predecessor, even though he wanted to revert to higher rates for couples making over $250,000 and individuals making over $200,000. Obama is still promising to raise those rates and more – and pretty much needs to, because much of his agenda depends on getting more tax revenue from wealthier people. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Win McNamee/Getty Images)

  • Romney On Jobs

    Create 12 million jobs in four years. Romney sets a modest bar with this oft-heard pledge; economists think about that many jobs or more will be created regardless of the outcome Tuesday. To add 12 million, the workforce would have to grow by an average of 250,000 a month, a reasonable prospect when there is no recession. Since July, the economy has created an average of 173,000 jobs a month. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; EMMANUEL DUNAND/AFP/Getty Images)

  • Obama On The Deficit

    Put government on a path to cutting deficits by $4 trillion over 10 years. A tall order, and his performance on it over the next four years would help shape his legacy for better or worse. He failed in his first-term promise to cut deficits by half, instead running trillion-dollar deficits for four straight years due largely to the recession he inherited, a halting comeback and big spending to spur the recovery. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; JEWEL SAMAD/AFP/Getty Images)

  • Romney On Taxes

    “I’m not going to raise taxes on anyone,” a pledge also rendered as, “I will not raise taxes on the middle class.” Romney promises not only to keep the Bush tax cuts for all but to bring down rates a further 20 percent. He’d also eliminate the capital gains tax for families making below $200,000 and cut the corporate tax to 25 percent from 35 percent. Although the promised cuts are clear enough, just how he would pay for them is a mystery. He’s talked about reducing some deductions and exemptions in the tax code but won’t say which. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; NICHOLAS KAMM/AFP/GettyImages)

  • Obama On Foreign Oil

    Cut imports of foreign oil by half by 2020. For generations, presidents have fruitlessly held out the dream of making the U.S. self-sufficient in energy. But the boom in domestic production may at last be nudging the nation toward that goal. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Alex Wong/Getty Images)

  • Romney On Health Care

    Repeal Obama’s health care law, his clarion call since the GOP primaries. Rolling back the massive overhaul, now that it has had more than two years to sprout roots, could be a massive undertaking of its own. Some of his promises in this area are showmanship, such as his pledge to issue waivers from the law to all 50 states on the first day of his presidency. Many states don’t want out of the law, and it can’t be dismantled with the mere stroke of his pen anyway. In any event, the law’s repeal is one big promise he will be judged on, especially by the tea party activists who were suspicious early on about his conservative credentials. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by David Greedy/Getty Images)

  • Obama On Oil Companies

    End subsidies to the oil industry. A leftover promise that went nowhere in the last four years. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; CHRIS KLEPONIS/AFP/Getty Images)

  • Romney On The Budget

    Balance the budget by 2020. Vital specifics are lacking from this pledge, such as which big federal programs he’d cut and how else he would save money when also wants to cut taxes, increase military spending and restore more than $700 billion in Medicare cuts over 10 years. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Mark Lyons/Getty Images)

  • Obama On Iran

    Prevent Iran from acquiring nuclear weapons. The U.S. has imposed painful oil and financial penalties on Iran to persuade it to cease uranium enrichment activity, so far without apparent success. Obama has left open the possibility of military action if that’s what it takes to stop Iranian nuclear development. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Michael Reynolds-Pool/Getty Images)

  • Romney On Energy

    “We will achieve North American energy independence by 2020.” By that, he means the U.S. would have its energy needs completely met by its own resources and those of Canada and Mexico. As with Obama’s pledge to cut oil imports by half, Romney’s promise has become conceivable – if still a steep climb – thanks to technology and market forces that have brought vast reserves of natural gas, along with other energy sources, within reach. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Getty Images)

  • Obama On Corporate Tax Breaks

    “Take away tax breaks for companies shipping jobs overseas” as part of a plan to invigorate domestic manufacturing. A tougher slog than it might sound. U.S. corporations don’t pay U.S. taxes on overseas profits unless they bring that cash back to the United States. Obama says this encourages outsourcing. Republicans say taxing such profits would make U.S. companies move headquarters overseas, not just production. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; SAUL LOEB/AFP/Getty Images)

  • Romney On Keystone Pipeline

    Quickly approve the Keystone XL oil pipeline from Canada, delayed by Obama because of environmental concerns, as part of the push for more energy supply. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Chip Somodevilla/Getty Images)

  • Obama On Immigration

    “I want to make sure that we get comprehensive immigration reform that gives young people who’ve been raised here a chance to live out their own American dream.” This failed before. Obama would try again, and counts it as the first thing he would do next year after a deficit-cutting deal. Without needing congressional action, he decided on a temporary measure in June letting up to 1.7 million young illegal immigrants stay and work for up to two years. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; BRENDAN SMIALOWSKI/AFP/GettyImages)

  • Romney On China

    Label China a currency manipulator. Central to Romney’s pledge to get tougher with unfair trade practices. The move would set the stage for broad trade penalties and could lead to a trade war between the two huge economies. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; EMMANUEL DUNAND/AFP/Getty Images)

  • Obama On Higher Education

    Make higher education affordable for everyone, in part by halving the growth in college tuition over 10 years. Ensure by the end of the decade that the U.S. has more people with college degrees than any other country, recruit 100,000 math and science teachers in 10 years, help 2 million workers attend community college. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by David Greedy/Getty Images)

  • Romney On Immigration

    Overhaul immigration laws. The features of Romney’s plan are foggier than Obama’s, but he favors a strengthened system of tracking illegal immigrants through their U.S. employers, supports completion of the U.S.-Mexico border fence and opposes any broad-based move to establish a path to citizenship except for those who served in the armed forces. He promises to achieve this overhaul before the two-year work permits granted by Obama expire, and he would honor those in the meantime. Promises those who study legally in the U.S. that “if you get an advanced degree here, we want you to stay here_ so we will staple a green card to your diploma.” (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; MANDEL NGAN/AFP/GettyImages)

  • Obama On Climate Change

    “My plan will continue to reduce the carbon pollution that is heating our planet_ because climate change is not a hoax. More droughts and floods and wildfires are not a joke.” From his convention speech, this was a rare reference to climate change from a president who pledged strong action in a first term, then fell mostly silent about it after promised legislation to cap emissions failed. Even so, Obama has come at the issue in other ways, treating carbon dioxide as a pollutant under the law and steering billions of dollars into cleaner energy. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; ATTILA KISBENEDEK/AFP/Getty Images)

  • Romney On Medicare

    Protect Medicare for those in or near retirement, change it for future retirees. Starting in 2022, retirees could choose to buy their own health insurance, with voucher-like payments from the government, or stay with traditional Medicare. Questions persist about whether the payments would be sufficient and whether traditional Medicare would remain as comprehensive as now. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by David Greedy/Getty Images)

  • Obama On Medicare

    Strengthen Medicare by reducing the cost of health care. Steps already taken under the health care law improve benefits while cutting payments to hospitals and other providers by more than $700 billion over a decade – cuts used to help working-age Americans get insurance. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Dennis Brack-Pool/Getty Images)

  • Romney On Medicaid

    Turn Medicaid over to the states with block grants, a huge change to a major program. Sure to cause a donnybrook in Congress – and an important step for conservatives who want states overall to gain more authority and flexibility from Washington. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Mark Lyons/Getty Images)

  • Obama On Jobs

    “We can help big factories and small businesses double their exports, and if we choose this path, we can create a million new manufacturing jobs in the next four years. You can make that happen. You can choose that future.” In October, manufacturers added 13,000 jobs after shedding 27,000 the previous two months – not the makings of a renaissance. Obama has set an ambitious target, considering that manufacturing jobs have been steadily declining for nearly two decades. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; NICHOLAS KAMM/AFP/Getty Images)

  • Romney On Trade

    Seek freer trade with Latin America and other parts of the world, a leading element of Romney’s job-creation pledge. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; EMMANUEL DUNAND/AFP/Getty Images)

  • Obama On Big Government

    Consolidate a “whole bunch” of federal agencies dealing with business issues into one new department led by a secretary of business. (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; JEWEL SAMAD/AFP/GettyImages)

  • Romney On Day One

    Day One alone: “Start the process of repealing Obamacare” with waivers, cut off federal money for Planned Parenthood and the U.N. Population Fund, reinstate the policy banning federal money to international groups that perform abortions or provide abortion information, designate China a currency manipulator, “reverse every single Obama regulation that attacks our religious liberty and threatens innocent life,” take “bold action” to create jobs, and – perhaps after lunch?_ “do everything in my power to end these days of drift and disappointment.” (Text by The <a href=”http://www.huffingtonpost.com/huff-wires/20121104/us-presidential-campaign-promises/”>Associated Press</a>; Photo by Justin Sullivan/Getty Images)