Mitch Daniels: Obama has divided America, stifled growth

In the official Republican response to State of the Union address Tuesday night, Indiana Gov. Mitch Daniels took aim at Obama for "efforts to divide" the American people and accused the president of obstructing economic growth in the United States.

The president spent much of his speech touting his administration's economic achievements and announcing initiatives related to trade.

"Anyone who tells you that America is in decline or that our influence has waned, doesn't know what they're talking about," the president said at one point in his address.

But Daniels, former budget director for George W. Bush, sharply countered that glowing perspective in his response.

"The president did not cause the economic and fiscal crises that continue in America tonight," Daniels said in a speech given in Indianapolis, Ind. "But he was elected on a promise to fix them, and he cannot claim that the last three years have made things anything but worse: the percentage of Americans with a job is at the lowest in decades."

Daniels castigated the president for his economic initiatives--saying government under Obama has "held back" economic recovery. The governor criticized the administration's attempts to build a middle class using "borrowed dollars" and reckless spending.

"In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt," Daniels said. "And yet, the president has put us on a course to make it radically worse in the years ahead."

Daniels criticized the president for rejecting the Keystone XL pipeline project and other energy-related measures Daniels labeled as "extremism" by the Obama administration.

After advocating a simplified tax system and lower regulations, Daniels stood up for Republicans in Washington, in contrast to Obama, who blamed the GOP for obstruction (though Obama also called out Democrats.)

"It's not fair and it's not true for the president to attack Republicans in Congress as obstacles on these questions," Daniels said. "They and they alone have passed bills to reduce borrowing, reform entitlements, and encourage new job creation, only to be shot down nearly time and again by the president and his Democrat Senate allies."

Daniels characterized Republicans as the party able to create a better future for the country.

Accusing the president of stoking class warfare has been a key Republican talking point in recent months, prompted by Democrats' unsuccessful efforts last year to remove tax loopholes for the country's wealthiest earners--something which Obama doubled down on during his address Tuesday night.

Daniels hit that point home:

The State of the Union was a chance for Obama to remind voters of his record during what has become a competitive race for the GOP nomination. Republicans were eager to use their response to boost the GOP label, despite public infighting.

The selection of Daniels, a Republican star who was heavily courted to run for president, signals Republicans' eagerness to position themselves as the fiscally responsible party.

"We will advance our positive suggestions with confidence, because we know that Americans are still a people born to liberty," Daniels said of the GOP. "There is nothing wrong with the state of our Union that the American people, addressed as free-born, mature citizens, cannot set right. Republicans in 2012 welcome all our countrymen to a program of renewal that rebuilds the dream for all, and makes our 'city on a hill' shine once again."

Indiana limits governors to two successive terms in office and Daniels is nearing the end of his second term, only increasing talk that he might still consider entering the Republican race. Today, Dick Armey, chairman of the conservative group FreedomWorks told CNN he believes Daniels could still jump in. "You still have an opportunity that somebody like Mitch Daniels could make himself, declare himself available," Armey said. "The person who may very well end up being the Republican Party's nominee may not be on the field at this moment."

Other popular Yahoo! News stories:

• State of the Union preview with David Chalian

• Mitt Romney's tax returns show more than $42 million income over last two years

• Why Bloomberg Businessweek passed on 'bloody' Mitt Romney cover

Want more of our best political stories? Visit The Ticket or connect with us on Facebook, follow us on Twitter, or add us on Tumblr.

Handy with a camera? Join our Election 2012 Flickr group to submit your photos of the campaign in action.