UPDATE 7-Obama hits rich on taxes in State of the Union
* Obama's speech highlights economic fairness
* Renews call for "Buffett Rule"
* Obama seeks to restore faith in economic leadership (Updates throughout)
By Matt Spetalnick
WASHINGTON, Jan 24 (Reuters) - U.S. President Barack Obama used his last State of the Union speech before the November election to paint himself as the champion of the middle class, by demanding higher taxes for millionaires and tight reins on Wall Street.
Taking advantage of the huge national platform of his annual speech to Congress, Obama defiantly defended his record after three years in office and laid blame for many of the country's woes at the feet of banks and an out-of-touch Congress.
He proposed sweeping changes in the tax code and new remedies for the U.S. housing crisis as he made the case for reducing income inequality in America.
While the biggest proposals in Obama's election-year speech are considered unlikely to gain traction in a divided Congress, the White House believes the president can tap into voters' resentment over the financial industry's abuses and Washington's dysfunction.
But even as he called for a "return to American values of fair play and shared responsibility," Obama seemed to take no blame on himself for a fragile economy and high unemployment that could trip up his re-election bid. Continued...