Image: Barack Obama
Charles Dharapak  /  AP
President Barack Obama takes the stage before speaking at the AFL-CIO Labor Day picnic at Coney Island in Cincinnati on Monday.
msnbc.com news services
updated 9/7/2009 2:26:10 PM ET 2009-09-07T18:26:10

President Barack Obama insisted Monday "the time is now" for healthcare reform as he geared up for a major address to Congress this week aimed at getting his top domestic policy priority back on track.

Taking his case for a healthcare overhaul to America's economically hard-hit heartland, Obama sought to seize back the initiative on the divisive issue after losing ground to critics during a turbulent summer.

"It's time to do what's right for America's working families, to put aside the partisanship, to come together as a nation, to pass health insurance reform now -- this year," Obama told a wildly cheering crowd at a Labor Day picnic held by the AFL-CIO union coalition in Cincinnati, Ohio.

Preview of prime time speech
Obama's holiday visit to the Midwest was a preview of a prime time speech he will deliver to a joint session of Congress on Wednesday when he will lay out his proposed revamp of the healthcare system to wary lawmakers and a skeptical public.

With his poll numbers down from once-lofty heights, Obama's effort to reclaim control of the debate is seen as a key test of his leadership that could define his young presidency.

Overhauling the troubled $2.5 trillion U.S. healthcare system, by cutting costs and expanding coverage to the estimated 46 million Americans without health insurance, is Obama's top domestic initiative.

But Obama's fellow Democrats who control Congress have struggled to craft a reform bill and most Republicans have fought it.

The debate is now reaching a make-or-break point.

After a summer of sometimes bitter words, White House spokesman Robert Gibbs said on Sunday that the president will "draw some lines in the sand" in his speech on Wednesday.

‘Improve quality and bring down costs’
Obama's top aides said he still wants a government insurance option in healthcare legislation but they left room for a compromise that could disappoint his liberal backers.

Weighing in on issue in Cincinnati, Obama said, "I continue to believe that a public option within the basket of insurance choices would help improve quality and bring down costs."

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Despite polls showing Americans increasingly concerned about his healthcare strategy, Obama's reform message appeared to resonate with union members, who gave him an enthusiastic reception at Cincinnati's Coney Island Park.

Signs that read "Health care can't wait" dotted the crowd of several thousand people. Labor was a key base of support for Obama in his campaign for the presidency.

"In every debate there comes a time to decide, a time to act," Obama said. "That time is now.

With government spending and deficits soaring as the Obama administration fights the worst economic crisis since the Great Depression and inherited wars in Iraq and Afghanistan, critics say the healthcare reforms under consideration are too costly.

A key question is whether Obama is ready to drop his support for the "public option" -- a government insurance plan designed to compete with private insurance companies that has been a major feature of a proposed $1 trillion overhaul.

Trying to bridge the gap
The insurance industry strongly opposes the public option and has spent millions of dollars lobbying against it, while conservative commentators have fanned fears of a government takeover of healthcare akin to socialism.

A group of moderate Democratic and Republican senators -- known as the "Gang of Six"-- have been engaged in closed-door negotiations searching for a way to avoid to bridge the gap.

Video: Obama expresses belief in public option Congress reconvenes Tuesday after a monthlong recess, with no sign the healthcare fight will abate any time soon.

A CBS News poll last week said most Americans found the healthcare proposals discussed in Congress confusing and thought Obama had not clearly explained his plans.

Obama coupled his visit to Ohio, an industrial state especially hurt by recession, with the formal announcement he has named Ron Bloom, senior adviser to his auto task force, to lead an effort to revitalize America's manufacturing sector.

Bloom, a prominent figure in the labor movement before joining the administration, appeared with Obama in Cincinnati.

Obama also declared Monday that modern benefits like paid leave, minimum wage and Social Security "all bear the union label," as he appealed to unions to help him win the health care fight in Congress.

"It was labor that helped build the largest middle class in history. So, even if you're not a union member, every American owes something to America's labor movement," said Obama, whose run for the presidency was energized in no small part by unions.

‘Our recovery plan is working’
Obama asserted that "our recovery plan is working," but repeated that he won't be satisfied until jobs are much more plentiful.

Shortly after taking the oath, Obama confronted a rapidly deteriorating economy, a clogged credit system, failing or ailing banks and a a shaky stock market. He used his speech here to tick off a host of steps the administration has taken to steady the economy, and he made a special pitch for the health care overhaul he has pushed.

"We have never been this close," Obama said. "We have never had this broad an agreement on what needs to be done." He accused vested interests of trying to thwart it.

For their part, some elements within the labor movement have indicated frustration with Obama, who traveled to Cincinnati to speak to a state AFL-CIO gathering, because some key items such as legislation making it easier for people to join unions has languished in Congress. To vigorous cheers, Obama made a pitch for the bill in his speech. He also noted that the first bill he signed into law was one guaranteeing equal pay for equal work.

Obama spent a good deal of his time extolling the virtues of the union movement.

"We remember that the rights and benefits we enjoy today were not simply handed out to America's working men and women. They had to be won," he said.

"They had to be fought for, by men and women of courage and conviction, from the factory floors of the Industrial Revolution to the shopping aisles of today's superstores. They stood up and spoke out to demand a fair shake, an honest day's pay for an honest day's work," he said. "Many risked their lives. Some gave their lives. Some made it a cause of their lives -- like Sen. Ted Kennedy, who we remember today."

Labor Secretary Hilda Solis accompanied Obama to Ohio, and the pair appeared in front of a large American flag, nine smaller ones and red, white and blue bunting. Local union organizers handed out 10,000 tickets for access to the area where Obama was to speak. The event was moved indoors to a music pavilion because of threatened thunderstorms.

At one point before Obama spoke, some in the crowd broke into chants of "Fired up" and "Ready to Go."

The crowd gave Obama a standing ovation and cheered loudly as he came on stage. Many remained standing as he spoke, applauding and hollering throughout.

The Associated Press and Reuters contributed to this report.

Video: Fiery Obama preps for health push

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