Barack Obama's acceptance speech: video and full text

"I believe we can seize this future together because we are not as divided as our politics suggests."

Thank you.  Thank you.  Thank you so much.

Tonight, more than 200 years after a former colony won the right to determine its own destiny, the task of perfecting our union moves forward.

It moves forward because of you.  It moves forward because you reaffirmed the spirit that has triumphed over war and depression, the spirit that has lifted this country from the depths of despair to the great heights of hope, the belief that while each of us will pursue our own individual dreams, we are an American family and we rise or fall together as one nation and as one people.

Tonight, in this election, you, the American people, reminded us that while our road has been hard, while our journey has been long, we have picked ourselves up, we have fought our way back, and we know in our hearts that for the United States of America the best is yet to come.

I want to thank every American who participated in this election ... whether you voted for the very first time or waited in line for a very long time.

By the way, we have to fix that. Whether you pounded the pavement or picked up the phone...

... whether you held an Obama sign or a Romney sign, you made your voice heard and you made a difference.

I just spoke with Governor Romney and I congratulated him and Paul Ryan on a hard-fought campaign.

We may have battled fiercely, but it's only because we love this country deeply and we care so strongly about its future.

From George to Lenore to their son Mitt, the Romney family has chosen to give back to America through public service and that is the legacy that we honor and applaud tonight.

In the weeks ahead, I also look forward to sitting down with Governor Romney to talk about where we can work together to move this country forward.

I want to thank my friend and partner of the last four years, America's happy warrior, the best vice president anybody could ever hope for, Joe Biden.

And I wouldn't be the man I am today without the woman who agreed to marry me 20 years ago.

Let me say this publicly:  Michelle, I have never loved you more. I have never been prouder to watch the rest of America fall in love with you, too, as our nation's first lady.

Sasha and Malia, before our very eyes you're going up to become two strong, smart beautiful young women, just like your mom.

And I'm so proud of you guys.  But I will say that for now one dog's probably enough.

To the best campaign team and volunteers in the history of politics...

The best.  The best ever.  Some of you were new this time around, and some of you have been at my side since the very beginning.

But all of you are family.  No matter what you do or where you go from here, you will carry the memory of the history we made together and you will have the life-long appreciation of a grateful president. Thank you for believing all the way, through every hill, through every valley.

You lifted me up the whole way and I will always be grateful for everything that you've done and all the incredible work that you put in.

 I know that political campaigns can sometimes seem small, even silly.  And that provides plenty of fodder for the cynics that tell us that politics is nothing more than a contest of egos or the domain of special interests.  But if you ever get the chance to talk to folks who turned out at our rallies and crowded along a rope line in a high school gym, or saw folks working late in a campaign office in some tiny county far away from home, you'll discover something else.

You'll hear the determination in the voice of a young field organizer who's working his way through college and wants to make sure every child has that same opportunity.

You'll hear the pride in the voice of a volunteer who's going door to door because her brother was finally hired when the local auto plant added another shift.

You'll hear the deep patriotism in the voice of a military spouse whose working the phones late at night to make sure that no one who fights for this country ever has to fight for a job or a roof over their head when they come home.

That's why we do this.  That's what politics can be.

That's why elections matter.  It's not small, it's big.  It's important. Democracy in a nation of 300 million can be noisy and messy and complicated.  We have our own opinions.  Each of us has deeply held beliefs.  And when we go through tough times, when we make big decisions as a country, it necessarily stirs passions, stirs up controversy.

That won't change after tonight, and it shouldn't.  These arguments we have are a mark of our liberty.  We can never forget that as we speak people in distant nations are risking their lives right now just for a chance to argue about the issues that matter, the chance to cast their ballots like we did today.

But despite all our differences, most of us share certain hopes for America's future.  We want our kids to grow up in a country where they have access to the best schools and the best teachers.

A country that lives up to its legacy as the global leader in technology and discovery and innovation, with all the good jobs and new businesses that follow.

We want our children to live in an America that isn't burdened by debt, that isn't weakened by inequality, that isn't threatened by the destructive power of a warming planet.

We want to pass on a country that's safe and respected and admired around the world, a nation that is defended by the strongest military on earth and the best troops this -- this world has ever known.

But also a country that moves with confidence beyond this time of war, to shape a peace that is built on the promise of freedom and dignity for every human being.  We believe in a generous America, in a compassionate America, in a tolerant America, open to the dreams of an immigrant's daughter who studies in our schools and pledges to our flag.

To the young boy on the south side of Chicago who sees a life beyond the nearest street corner.

To the furniture worker's child in North Carolina who wants to become a doctor or a scientist, an engineer or an entrepreneur, a diplomat or even a president -- that's the future we hope for.  That's the vision we share.  That's where we need to go -- forward.

That's where we need to go.

Now, we will disagree, sometimes fiercely, about how to get there.  As it has for more than two centuries, progress will come in fits and starts.  It's not always a straight line.  It's not always a smooth path.

By itself, the recognition that we have common hopes and dreams won't end all the gridlock or solve all our problems or substitute for the painstaking work of building consensus and making the difficult compromises needed to move this country forward.  But that common bond is where we must begin.

Our economy is recovering.  A decade of war is ending.  A long campaign is now over.

And whether I earned your vote or not, I have listened to you, I have learned from you, and you've made me a better president.  And with your stories and your struggles, I return to the White House more determined and more inspired than ever about the work there is to do and the future that lies ahead.

Tonight you voted for action, not politics as usual.

You elected us to focus on your jobs, not ours.  And in the coming weeks and months, I am looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together.  Reducing our deficit.  Reforming our tax code. Fixing our immigration system.  Freeing ourselves from foreign oil. We've got more work to do.

But that doesn't mean your work is done.  The role of citizen in our democracy does not end with your vote. America's never been about what can be done for us.  It's about what can be done by us together through the hard and frustrating, but necessary work of self- government.  That's the principle we were founded on.

This country has more wealth than any nation, but that's not what makes us rich.  We have the most powerful military in history, but that's not what makes us strong.  Our university, our culture are all the envy of the world, but that's not what keeps the world coming to our shores.

What makes America exceptional are the bonds that hold together the most diverse nation on earth.

The belief that our destiny is shared; that this country only works when we accept certain obligations to one another and to future generations.  The freedom which so many Americans have fought for and died for come with responsibilities as well as rights.

And among those are love and charity and duty and patriotism.  That's what makes America great.

I am hopeful tonight because I've seen the spirit at work in America.  I've seen it in the family business whose owners would rather cut their own pay than lay off their neighbors, and in the workers who would rather cut back their hours than see a friend lose a job.

I've seen it in the soldiers who reenlist after losing a limb and in those SEALs who charged up the stairs into darkness and danger because they knew there was a buddy behind them watching their back.

I've seen it on the shores of New Jersey and New York, where leaders  from every party and level of government have swept aside their differences to help a community rebuild from the wreckage of a terrible storm.

And I saw just the other day, in Mentor, Ohio, where a father told the story of his 8-year-old daughter, whose long battle with leukemia nearly cost their family everything had it not been for health care reform passing just a few months before the insurance company was about to stop paying for her care.

I had an opportunity to not just talk to the father, but meet this incredible daughter of his.  And when he spoke to the crowd listening to that father's story, every parent in that room had tears in their eyes, because we knew that little girl could be our own.

And I know that every American wants her future to be just as bright.  That's who we are.  That's the country I'm so proud to lead as your president.

And tonight, despite all the hardship we've been through, despite all the frustrations of Washington, I've never been more hopeful about our future.

I have never been more hopeful about America.  And I ask you to sustain that hope.  I'm not talking about blind optimism, the kind of hope that just ignores the enormity of the tasks ahead or the roadblocks that stand in our path.  I'm not talking about the wishful idealism that allows us to just sit on the sidelines or shirk from a fight.

I have always believed that hope is that stubborn thing inside us that insists, despite all the evidence to the contrary, that something better awaits us so long as we have the courage to keep reaching, to keep working, to keep fighting.

America, 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.  I believe we can keep the promise of our founders, the idea that if you're willing to work hard, it doesn't matter who you are or where you come from or what you look like or where you love.  It doesn't matter whether you're black or white or Hispanic or Asian or Native American or young or old or rich or poor, able, disabled, gay or straight, you can make it here in America if you're willing to try.

I believe we can seize this future together because we are not as divided as our politics suggests.  We're not as cynical as the pundits believe. We are greater than the sum of our individual ambitions, and we remain more than a collection of red states and blue states. We are and forever will be the United States of America.

And together with your help and God's grace we will continue our journey forward and remind the world just why it is that we live in the greatest nation on Earth.

Thank you, America.  God bless you.  God bless these United States.

Barack Obama arrives on stage in Chicago, Illinois after winning the 2012 US presidential election. Photograph: Getty Images.
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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?