Even though President Obama was welcomed by a cheering, supportive audience at the National Urban League centennial conference on Thursday... he began his 45-minute speech on education reform with an attempt to first clear the air... "We were reminded this past week that we've still got work to do when it comes to promoting the values of fairness, equality and mutual understanding that must bind us together as a nation," he said, referring to his administration's hasty firing of ex-USDA worker Shirley Sherrod -- an incident that angered many African-Americans. "She deserves better than what happened last week." After admitting that his administration overreacted to an edited clip from a speech Sherrod gave in March, posted online by conservative blogger Andrew Breitbart, the President said that her full story -- one of racial reconciliation and redemption -- is one that America needs to hear. While on the subject of speaking honestly, the President transitioned into his discussion of reforming the American education system. "There's an achievement gap that is widening the income gap between Black and White, between rich and poor," he said. "We've talked about it; we know about it, but we haven't done enough about it." With too many African-American children seeing college as a far-off dream, he said his administration has strongly emphasized the education they're getting from kindergarten through 12th grade. "Over the past 18 months, the single most important thing we've done," he said, "Is to launch Race to the Top." Perhaps not so coincidentally, on Monday a coalition of civil rights groups, including the National Urban League and Rainbow PUSH Coalition, released a report slamming this initiative. A $4-billion competitive grant program, Race to the Top rewards states with education funding if they prove a commitment to the Obama administration's guidelines, such as supporting charter schools, tying teacher salaries to student performance, and raising academic standards. So far, funding has gone to Delaware and Tennessee, with winners of the second round to be announced in September. "There's been criticism from some folks in the civil rights community about particular elements of Race to the Top, and I want to address some of those today," he said, before flashing a smile. "I told you we're going to have an honest conversation." Issue #1: Competition Has No Place In Federal Education Funding Critics argue that by having states compete against other, students in low-income and minority districts stand less of a chance get funding. Obama said this is incorrect, because addressing the most disadvantage students is central to the program. "You can't win one of these grants unless you've got a plan to deal with those schools that are failing and those young people who aren't doing well. Every state and school district is directly incentivized to deal with school districts that have been forgotten and given up on." Issue #2: Are Teachers Being Punished? Teachers have called foul on Race to the Top's punitive approach to accountability, such as tying teacher pay to test scores, especially when many are overwhelmed by scarce resources and other problems in the classroom beyond their control. Obama first explained his deep admiration for teachers, calling for them to get higher salaries and better training. "I am 110 percent behind our teachers, but all I'm asking in return -- as a President, as a parent, and as a citizen -- is some measure of accountability," he said. "Even as we applaud teachers for their hard work, we've got to make sure we're seeing results in the classroom. If we're not seeing results in the classroom, then let's work with teachers to help them become more effective. If that doesn't work, let's find the right teacher for that classroom." Issue #3: There's Too Much Focus on Standardized Tests Skeptics say that high-stakes (and culturally biased) tests force teachers to restrictively "teach to the test," and wrest authority from states to set their own education standards. Obama countered that Race to the Top is about clarifying what is expected of teachers and students. "I do not want to see young people get a diploma, but they can't read that diploma," he said. He also stressed that we need better tests to avoid stifling lesson plans -- "tests that don't dictate what's taught, but tell us what has been learned." Issue #4: What's So Great About Charter Schools? President Obama champions charter schools; independent public schools formed by parents and civic leaders, as clearinghouses for innovative new teaching techniques, but their performance is uneven and not necessarily better than public schools. "Charter schools aren't a magic bullet, but I want to give states and school districts the chance to try new things," Obama said, adding that unsuccessful charters will be shut down. He cited the positive example of a Philadelphia school that was taken over by a charter program two years ago. "It went from just 14 percent of students being proficient in math to almost 70 percent," he said. "And here's the kicker... at the same time academic performance improved, violence dropped by 80 percent. That's no coincidence." The President wrapped his remarks by returning to a familiar statement: Parents have to get more involved in their children's education. "Then some people say, well, why are you always talking about parental responsibility in front of Black folks?" he said, to knowing laughs from the audience. "And I say, I talk about parent responsibility wherever I talk about education. Michelle and I happen to be Black parents, so I may add a little 'oomph' to it when I'm talking to Black parents." But ultimately, Obama said, it will take a collective effort from the federal government, states, school districts, parents and students themselves to make a difference. "I know life is tough for a lot of young people in this country," he said. "There are all kinds of reasons for our children to say, 'No, I can't.' But our job is to say to them, 'Yes, you can.' Yes, you can overcome. Yes, you can persevere. Yes, you can make what you will out of your lives." For more of Cynthia Gordy's Obama Watch stories, click here.