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Obama strikes hopeful note in year-end address

U.S. President Barack Obama speaks on payroll tax cuts in Washington
U.S. President Barack Obama speaks on payroll tax cuts in Washington

(Reuters) - President Barack Obama, striking a hopeful note in a year-end weekly address, hailed foreign policy milestones while keeping pressure on Congress to further extend payroll tax cuts through the end of 2012.

The president, on a week-long vacation in Hawaii, praised Congress for temporarily extending a payroll tax cut for two months, a move he said would save average Americans $40 per paycheck. But he said more tough fights were to come in 2012.

"There's no doubt that 2012 will bring even more change. And as we head into the New Year, I'm hopeful that we have what it takes to face that change and come out even stronger - to grow our economy, create more jobs and strengthen the middle class," he said in the weekly Saturday address.

The president is entering an election year in which his prospects for winning are expected to hinge on the state of the economy and the jobless rate in particular, which at 8.6 percent is several percentage points higher than before the financial crisis that struck just before he took office.

But in his address, Obama went beyond domestic concerns to discuss his administration's foreign policy achievements of 2011, as he highlighted successes against al Qaeda and the withdrawal of U.S. forces from Iraq.

"The last year has been a time of great challenge and great progress for our country. We ended one war and began to wind down another," he said.

"We dealt a crippling blow to al Qaeda and made America more secure," Obama said, in an apparent reference to the killing of Osama bin Laden and other al Qaeda figures.

"We stood by our friends and allies around the world through natural disasters and revolutions. And we began to see signs of economic recovery here at home, even as too many Americans are still struggling to get ahead," he added.

Obama said it was the voices of ordinary Americans that led Congress to act on the payroll tax cut and on extending unemployment benefits.

"And I expect Congress to finish the job by extending these provisions through the end of 2012," he said.

"It was good to see members of Congress do the right thing for millions of working Americans. But it was only possible because you added your voices to the debate. Through e-mail and Twitter and over the phone, you let your representatives know what was at stake," he added.

Efforts to broker a full-year deal for the payroll tax cuts, which the White House has said the middle class needs until the U.S. economy heals, are expected to hang over Washington in early 2012 and may be a theme of a speech Obama is due to make next week in the battleground state of Ohio.

"As president, I promise to do everything I can to make America a place where hard work and responsibility are rewarded - one where everyone has a fair shot and everyone does their fair share. That's the America I believe in," Obama said.

(Writing by Cynthia Johnston: Editing by Alex Dobuzinskis)

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