Washington: Democrats in the US Congress have defied the president and voted down part of a package of bills designed to speed negotiations for the Trans-Pacific Partnership.
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The loss is humiliating for the president, who on Friday morning had for the first time ever travelled to the Capitol building in order to directly appeal for a specific piece of legislation.
As protesters gathered in sweltering weather outside, the president attended the Democratic Caucus meeting and reportedly told members that a vote against the bill would be a vote against him.
He also appealed to party unity, which in recent years has been strong in the face of a divided Republican Party.
"What I don't want us to do is to start becoming like the other party," he said.
Shortly afterwards the party's leader in the House, Nancy Pelosi, urged them to do just that, speaking out against the bill.
"Whatever the deal is with other countries," she said, "we want a better deal for America's workers."
She urged members to "slow down the fast track to get a better deal for the American people."
In the end just 40 Democrats sided with the president, while 144 voted against the bill.
The bill in question would have provided a package of assistance to American workers who might be affected by an eventual Trans-Pacific Partnership.
It was linked to an even more significant bill that would give the president what is known as fast track authority, to complete the negotiations.
In the past Congress has given presidents such fast track authority in order to conclude trade negotiations. It allows the White House to negotiate a deal and then present it to Congress, which can ratify or block, but not amend. This gives other signatories to trade treaties confidence that any deal arrived at with the White House will not later be altered to suit vested interests.
Though the fast track authority narrowly passed, the whole package will now have to be considered again.
The White House sought to downplay the significance of the defeat.
The White House spokesman, Josh Earnest, cast the blow as a "procedural snafu", using the same term he had employed to describe a similar recent defeat in the Senate.
"At the time, you'll recall that I colourfully described the situation as a legislative procedural snafu, and to the surprise of very few, another procedural snafu has emerged," he said. "These kinds of entanglements are endemic to the House of Representatives."
America's trade union movement celebrated a victory.
"The House of Representatives has done the right thing, but the fight isn't over," read a statement by Richard Trumka, of the AFL-CIO, America's peak union organisation.
"This is a significant day. American workers came together and spoke with one voice about the path their country and economy should follow.
"We are very grateful for all the activists, families, community leaders, and elected officials who worked so tirelessly for transparency and worker rights in international trade deals. "
The defeat of the bill is seen as a significant blow not only to Mr Obama's authority, but to his overall second term agenda.
He has not only made the TPP the focus of his efforts in trade and economic policy, but cast it as crucial to America's strategic stance in Asia.
As Democratic Congressional resistance to the TPP has grown in recent months the White House has sought to cast it as integral to America's national security and its rebalance to Asia and the Pacific.
In a statement the president said the House's failure to pass the bill would hurt American workers.
"Republicans and Democrats in the House failed to renew [TAA] today – and that inaction will directly hurt about 100,000 workers and their communities annually if those Members of Congress don't reconsider," he said.
"I urge the House to pass TAA without delay so that more middle-class workers can earn the chance to participate and succeed in our global economy."
