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LINDA WERTHEIMER, HOST:

President Obama lost a couple of economic battles on Capitol Hill yesterday. But he's still hopes to win the political war. As we heard, the payroll tax cuts failed in the Senate again. Republicans also blocked the president's nominee to head a new financial watchdog agency. Mr. Obama promises to keep fighting for the broad middle class.

NPR's Scott Horsley reports on how these year-end skirmishes fit into the president's re-election playbook for 2012.

SCOTT HORSLEY, BYLINE: As President Obama spoke to reporters in the White House briefing room, an electronic clock behind him ticked down the minutes, hours, and days until year's end. That's when a payroll tax cut is due to expire, unless Congress votes to extend it.

While dueling proposals to extend the tax cut failed in the Senate yesterday, Mr. Obama insists lawmakers keep trying, as they face their own countdown to a Christmas holiday recess.

PRESIDENT BARACK OBAMA: I do not expect Congress to go home unless the payroll tax cut is extended and unless unemployment insurance is extended. It would be wrong for families. But it would also be wrong for the economy as a whole.

HORSLEY: The president also promised to keep pressing to fill the top job at a new financial watchdog agency, even if he has to use a recess appointment to do so. Senate Republicans blocked his nominee yesterday. Mr. Obama says until a director is in place at the agency, it can't police payday lenders, debt collectors, or mortgage companies that aren't tied to banks.

OBAMA: This is a big deal. About one in five people use these kinds of mechanisms to finance everything from buying a house to cashing their checks.

HORSLEY: So far, Mr. Obama has been losing these battles on Capitol Hill. But the White House is convinced he's winning the broader political argument. Day after day, the president tries to present himself as a champion of the middle class, while branding Republicans as the party of fat cats and financiers.

While Mr. Obama has grown more combative in his economic rhetoric, the administration has tried to tiptoe through other political minefields. This week, Health Secretary Kathleen Sebelius overruled scientists at the FDA, who wanted to make emergency contraceptive pills more readily available.

Mr. Obama insists he did not try to influence the secretary. But he defended her decision not to allow over-the-counter sales of Plan B pills to adolescent girls without a prescription.

OBAMA: She could not be confident that a ten-year-old or an eleven-year-old could go into a drugstore, should be able alongside bubblegum or batteries be able to buy a medication that potentially if not used properly could end up having an adverse effect.

HORSLEY: One area where Mr. Obama shows surprising strength in public opinion surveys - for a Democrat - is foreign policy. That hasn't stopped Republican presidential hopefuls from criticizing his handling of Iran or Israel. This week, several Republicans accused the president of practicing appeasement. Mr. Obama had a blunt comeback for that.

OBAMA: Ask Osama bin Laden and the 22 out of 30 top al-Qaida leaders who've been taken off the field whether I engage in appeasement.

HORSLEY: White House spokesman Jay Carney also took a club to Mitt Romney's charge that Mr. Obama spends too much time on the golf course, or planning a family vacation, when he should be fixing the economy.

JAY CARNEY: I don't remember Governor Romney complaining about this president's predecessor taking his family on vacation, spending I believe far more time on vacation than this president. So - but you never know what he might have said. So you might want to go check it.

HORSLEY: In any case, Mr. Obama volunteered to skip his family trip to Hawaii this month, if Congress doesn't act quickly to extend the payroll tax cut.

OBAMA: Get it done. And if not, you know, maybe we'll have a, you know, a white Christmas here in Washington.

HORSLEY: The countdown clocks are still ticking.

Scott Horsley, NPR News, the White House.

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