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Barack Obama told a Virginia school last year, "I think it's time we treated our teachers with the same level of respect right here in the United States of America."

I totally understand what he's saying, but I want to ask how that 'treated' is grammatically possible? Cause he's saying 'It's time we~', which means he's talking about what we should do in the future (?), but why did he say that past verb?

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According to Cambridge Dictionary we can use the expression it’s time either + subject + past verb form to refer to the present moment:

I think it's time we treated our teachers with the same level of respect right here in the United States of America.

or with a verb in the to-infinitive:

I think it's time to treat our teachers with the same level of respect right here in the United States of America.

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It's the past subjunctive of the verb "to treat". You could use the present subjunctive in that situation as well, but never the present indicative or past indicative.

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