State of the Union: Obama Makes Case for Economic 'Fairness,' Second Term

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Obama also repeated his call for no tax increases on the middle class, including an extension of the payroll tax cut through the end of 2012 – a line that drew bipartisan applause.

To enforce the rules in a "fair shot" economy, the president envisioned two new government agencies. A Financial Crimes Unit within the Justice Department would target large scale financial fraud, he said, while a new Trade Enforcement Unit would work to hold international trading partners accountable for unfair practices.

"A return to the American values of fair play and shared responsibility will help us protect our people and our economy," Obama said.

He said the fairness doctrine should apply to federal government and educational institutions as well, with rules prohibiting lobbyists from bundling for political candidates and bundlers from lobbying; a ban on insider trading by members of Congress; and an end to federal aid for colleges that don't keep net tuition down and provide good value.

On housing, Obama proposed a new plan to let every homeowner who has kept up with mortgage payments to re-finance at current low rates, including those who have equity in their homes.

While on education, he called on every state to require students to stay in high school through graduation or age 18, a policy 20 states already have in place. He also reiterated a pledge he's already made to make college more affordable and loans less burdensome by boosting tax credits and increasing federal student aid.

Republicans Respond

Republicans greeted the ideas – some of which are not new -- largely with disapproval, blasting the president before he even began speaking for what they characterized as a campaign-style approach on the heels of three months of public castigation of lawmakers as a "do-nothing Congress."

"The president checked out last Labor Day. He spent the last four months doing nothing but campaigning. He hasn't been engaged in the process," House Speaker John Boehner told CBS News ahead of the address. "If the President wants us to be engaged in the process, it takes two to tango."

There is simmering anger among congressional Republicans that came to a head recently over the recess appointments of Richard Cordray to the Consumer Financial Protection Board and three others to the National Labor Relations Board. And there's a lingering resentment over the bruising payroll tax cut fight and the rejected Keystone XL oil pipeline, a shovel-ready project Republicans said would create thousands of jobs.

Boehner invited three small oil company executives he dubs "job creators" who say their businesses would receive a boost from the Keystone plan.

Indiana Gov. Mitch Daniels, who delivered the official Republican response to Obama's speech, cast aside the president's economic class contrasts -- which some conservatives have decried as "class warfare" -- calling instead for a "passionate pro-growth approach" that benefits everyone.

"No feature of the Obama presidency has been sadder than its constant efforts to divide us, to curry favor with some Americans by castigating others. As in previous moments of national danger, we Americans are all in the same boat," Daniels said.

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