Obama noted that the Constellation Program, which had sought to send astronauts back to the moon by 2020, is behind schedule, over budget and overall less important than other space investments.And
"By the mid-2030s I believe we can send people to orbit Mars and bring them safely back to Earth," Obama said. Landing on Mars will follow, and "I expect to be around to see it," he said.So... they can't put together a program to send people to the moon. But he expects that they will be able to put together a program to send people to Mars?
Beyond that, Obama is gambling on two other things. Firstly, that NASA can come up with some as yet unknown form of propulsion to go beyond Earth orbit. While its noble to invest in such ground-breaking technologies, why not continue the Constellation program in addition to searching for new propulsion technologies? Secondly, that some commercial enterprise will fill the gap that NASA currently occupies ferrying people and items up into space. If getting into orbit is so easy that private companies can do it, then why hasn't anyone achieved it yet?
Most of the plans I've heard of from private enterprises only involve getting into space 'technically' and not being truly functional 'space ships' let alone 'ferries'.
I'm willing to bet that this had more to do with politics (erasing Bush's 'stain') than it did science or good policy.