Tough Talk and Taxes in Obama’s State of the Union
“Middle-class economics,” immigration, and an extended role for government in the US economy and society were among the issues discussed by Obama in his combative address. Yet subsequent reactions from across the House reflected the muted response that met many of his announcements, with some critics judging his policies for the next two years to be at best ambitious, at worse unimpressive, and even downright disappointing.
The opening portion of the president’s speech focused on the recent upturn in the US economy. “The shadow of crisis has passed,” Obama said, pointing to “a growing economy, shrinking deficits, bustling industry, and booming energy production.”
But the 44th occupant of the Oval Office had additional targets already lined up. Now in the firing line, Obama revealed, was the inequality promoted by lobbyists who “have rigged the tax codes with loopholes that let some corporations pay nothing while others pay full freight.”
One tool to help level the playing field, he said, would be “middle-class economics.” Obama stated that his budget would help middle-class families to afford childcare, education, health care, and housing. In addition, Obama highlighted his “bold new plan,” soon to arrive in Congress, that seeks to offer two free years of community college to students under certain circumstances.
Moreover, the US premier argued that middle-class economics “is about building the most competitive economy anywhere,” by improving infrastructure and technology alongside investment in human capital. “Twenty-first century businesses will rely on American science, technology, research, and development,” Obama said.
“That’s what middle-class economics is – the idea that this country does best when everyone gets their fair shot, everyone does their fair share, and everyone plays by the same set of rules,” he added.
— Hillary Clinton (@HillaryClinton) January 21, 2015
Tax and Spend
Obama went on to call for Congressional backing for new laws guaranteeing equal pay for men and women, a higher minimum wage, and strengthened unions to “give American workers a voice.” He also invited the assembled Congressmen to “vote to give millions of the hardest-working people in America a raise.”
Obama further claimed that the United States is the only “advanced country” that doesn’t guarantee paid sick leave or paid maternity leave to employees. “Send me a bill that gives every worker in America the opportunity to earn seven days of paid sick leave. It’s the right thing to do,” he said.
Increased spending on childcare and education, the president suggested, would come from greater taxes on the richest, while the tax burden on those less well-off could be simultaneously reduced.
“Let’s close the loopholes that lead to inequality by allowing the top 1 percent to avoid paying taxes on their accumulated wealth,” Obama said.
Foreign Policy: Threats and Opportunities
While the president hailed the dramatic reduction of troop numbers in Afghanistan, he reiterated his commitment to Roosevelt-style Big Stick diplomacy.
“I believe in a smarter kind of American leadership,” Obama told the House. “We lead best when we combine military power with strong diplomacy.”
He reasserted that the United States will continue to combat terrorism while avoiding placing further “boots on the ground.” In this vein, he asked Congress to authorize renewed military force against the Islamic State (ISIL), likely envisioned as additional air strikes.
Furthermore, president Obama highlighted the progress achieved in the negotiations with Iran to slow down their nuclear program, and the likelihood of averting another conflict in the Middle East.
Nonetheless, Obama warned that tougher sanctions on Tehran currently being considered by Congress could jeopardize this diplomacy. “That is why I will veto any new sanctions bill that threatens to undo this progress.”
Regarding Cuba, Obama said he was “ending a policy that was long past its expiration date.” He said renewed relations with Havana could end “a legacy of mistrust in our hemisphere,” as he invited Congress to end the economic embargo of the island and “extend the hand of friendship to the Cuban people.”
— Mitt Romney (@MittRomney) January 21, 2015
Moving on to the contentious topic of migration, Obama harked back to the US tradition as a nation of immigrants, calling for legislation to enshrine the status of recent arrivals.
“I want future generations to know that we are a people who see our differences as a great gift, that we are a people who value the dignity and worth of every citizen,” he said.
Obama also urged Congress to pass proposals regarding cyberterrorism, claiming that failure to respond to online attacks would “leave our nation and our economy vulnerable.”
Joni Ernst, newly-elected Republican senator for Iowa, delivered the official GOP response to President Obama’s speech.
“President Obama will soon have a decision to make. Will he sign the bill or block good American jobs?” Ernst said.
Referring to her 20 years of service in the armed forces, she said that Congress will debate strategies to confront “terrorism and the threats posed by Al Qaeda, ISIL, and those radicalized by them.”
In addition, Ernst asserted that the Congress will work to cut wasteful spending, and “balance the budget with meaningful reforms, not higher taxes like the president has proposed.”
“With a little cooperation from the president, we can get Washington working again,” she asserted.
Mr. President, you can't wave a magic wand and declare something free. Someone has to pay for it. #sotu
— Senator Rand Paul (@RandPaul) January 21, 2015
Republican congressman for Florida’s 26th district, Carlos Curbelo, delivered the Spanish-Language Republican Address, but unlike Ernst he called for fresh immigration reform.
“We should work through the appropriate channels to create permanent solutions to our immigration system, modernize legal immigration, and strengthen our economy,” he said.
Behind the Figures
Members of the Washington-based Cato Institute also reacted to Obama’s address.
In a video response released on Wednesday, research fellow Aaron Powell argued that those “factions that turn people against one another” — as Obama mentioned in his speech — are a natural result of government policies that are “taking from people to give to other people.”
Regarding the “all-time high” graduation rate Obama highlighted, Neal McCluskey, associate director of the Institute’s Center for Educational Freedom, stated that the labor market lacks sufficient jobs to absorb new graduates.
“Essentially when we say we should give away more college … we are promising that they are going to get a whole lot of benefits with more education that we simply can’t deliver,” McCluskey said.