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Obama predicts tough fight for Dems in November poll

By Ross Colvin

LOS ANGELES (Reuters) - U.S. President Barack Obama acknowledged on Monday that Democrats face a hard fight in holding on to their majorities in Congress in the November election because of uncertainty over the economy.

"November is going to be tough. It is always a tough race if you're the incumbent in this kind of economic environment. Even though it is picking up, people are still hurting," Obama said on a campaign jaunt to raise money for California Senator Barbara Boxer, an ally who is in a tight race for re-election.

Obama renewed his attack on Wall Street practices that triggered the financial crisis that pushed the country into recession and again vowed to push financial regulatory reform through Congress within weeks.

"The notion that we would stick with the status quo that created a situation in which Wall Street could gamble with somebody else's money" and make taxpayers pick up the cost "makes absolutely no sense," he said.

However, he predicted a "big battle" in getting the bill passed. Republicans in the Senate unanimously oppose it, saying it will lead to more taxpayer-funded bailouts of financial firms, a charge Obama dismissed as false.

Obama heads to New York on Thursday to reiterate the importance of financial regulatory reform and will call for swift passage of the bill in the Senate, the White House said in a statement.

The California fund-raising trip was part of a stepped-up effort by Obama to swell the Democratic Party's war chest before the congressional election, in which a newly energized Republican Party hopes to loosen the Democrats' grip on the Senate and House of Representatives.

As the election approaches, Obama will have to balance an already full domestic and foreign agenda with his role as fundraiser-in-chief to help vulnerable Democratic lawmakers who fear being punished by voters still skeptical about his healthcare overhaul and worried about high unemployment.

With polls showing the economy as the No. 1 concern for voters, Democrats will likely emphasize the steps Obama has taken to restore growth, while Republicans will focus on the country's huge budget deficit and the lack of jobs.


Boxer, a three-term senator and chairman of the Senate's environmental committee, faces several wealthy Republican challengers, including former Hewlett-Packard chief Carly Fiorina and former congressman Tom Campbell.

Political analyst Jennifer Duffy of the nonpartisan Cook Political Report said Boxer was "not in solid shape" and was facing the same sort of anti-incumbent fervor that candidates in other parts of the country are encountering.

All 435 House seats and one-third of the 100-seat Senate are up for election in November, with Democrats holding a wide majority in each chamber.

The nonpartisan Center for Responsive Politics, which tracks money in U.S. politics, says its conservative estimate is that the November elections may cost more than $3.7 billion. It says Democrats received about 57 percent of all campaign donations in the current election cycle as of December 31.

The Democratic National Committee expected to raise up to $3.5 million at the three fund-raising events attended by Obama in Los Angeles. The money is to be shared between Boxer and the party, a DNC official said.

During a speech at one of the events, Obama was repeatedly heckled by a group of protesters calling on him to repeal "don't ask, don't tell."

"We are going do that" he said in an apparent reference to his intention to repeal a policy that allows gays to serve in the military only if they keep their sexual identity secret.

He looked visibly agitated when the heckling continued. Angry supporters chanted his 2008 campaign slogan "Yes we can" to drown out the protesters.

(Additional reporting by Steve Holland and Joanne Allen in Washington, editing by Chris Wilson and Vicki Allen)