State of Union 2015: Obama’s pitch to middle class America

THE US President has laid out steps to aid Americans in his State of the Union address to a sceptical Congress.

US President Barack Obama delivers his State of the Union address to a joint session of Congress on Capitol Hill in Washington.

US President Barack Obama has declared an end to the US economic crisis as he made the case to Americans, and a sceptical Congress, that now is time to shift focus to resolving the most stubborn impediment to a full-fledged recovery: lagging progress among the middle class.

In his annual State of the Union address, Mr Obama outlined a broad vision for his remaining two years in office, emphasising what he described as “middle-class economics” and making a personal plea for lawmakers of both parties to “commit ourselves to an economy that generates rising incomes and chances for everyone who makes the effort.”

“The shadow of crisis has passed,” Mr Obama said. “At this moment — with a growing economy, shrinking deficits, bustling industry, and booming energy production — we have risen from recession freer to write our own future than any other nation on Earth.”

The president’s vision, however, faced a deeply uncertain path in a Congress that for the first time in his presidency is fully controlled by Republicans, as it hinges on raising taxes on high-income Americans to fund initiatives to benefit those at lower income levels, The Wall Street Journal reports.

Mr Obama also declared that US leadership and military intervention “is stopping” the advance of Islamic State militants and called on Congress to pass a resolution authorising force against the group. And Mr Obama called on Congress to pass legislation to toughen cybersecurity.

Republicans and Democrats alike cite a stagnant middle class as the most vexing economic problem facing the country, but GOP lawmakers have long opposed Mr Obama’s call for tax increases on wealthier Americans to fund programs that benefit those further down the income scale. Still, the two parties’ shared interest in speaking more directly to economic anxiety and wage stagnation has the potential to push them to find common ground. Mr Obama’s plan also extends the discussion beyond corporate taxation to include individual taxes, as Republicans want.

New Senate Majority Leader Mitch McConnell (R., Ky.) said Mr Obama’s expected proposal to raise taxes on high-income Americans —$320 billion over 10 years — damped hopes for making progress on an overhaul of the tax code. But underscoring the prospects for deal-making, remote as they may be, Mr McConnell didn’t rule out an eventual compromise on taxes. He also cited trade pacts and cybersecurity legislation as potential areas of agreement with the president.

“The American people aren’t demanding talking point proposals designed to excite the base but not designed to pass” in Congress, Mr McConnell said. “What they said they’re hungry for is substance and accomplishment. They want Washington to get back to work and focus on a serious jobs and reform agenda.”

The coming months will tell how far Mr Obama and GOP leaders might go in pushing their parties’ core supporters to compromise for the sake of agreement on taxes and other matters. Mr Obama has primarily shown interest in pushing his party only on one issue recently — to allow easier passage of trade deals that he and most Republicans support.

Only a handful of Democrats have come forward to support the renewal of legislation for trade-promotion authority, known as fast track, which would ease the passage of a trade pact with Japan and 10 other Pacific nations, as well as a trade deal with the European Union.

While his party suffered significant setbacks in the November elections, the president arrived at the Capitol Tuesday night with some political momentum, given that the economic outlook continues to brighten and his job-approval ratings are ticking upward. Some 46% of Americans approved of Mr Obama’s job performance in a Wall Street Journal/NBC News poll released this week, up from 40% in September.

But despite economic growth and a drop in the unemployment rate, anxiety among middle-class Americans has persisted. Mr Obama sees the issue as an unfinished piece of his legacy.

His middle-class agenda also relies on changes in housing and education policies and increasing workforce participation with family-friendly initiatives such as paid leave. He has proposed making community college free for millions of students and announced the Federal Housing Administration would cut annual mortgage-insurance premiums to help make homeownership more affordable.

His plans include some $235 billion in new spending, which he proposes raising through an increase in top capital-gains tax rates and new taxes on many inheritances, among other measures.

Democrats have welcomed the president’s proposals for tackling income stagnation and other problems burdening the middle class. “All the indicators that tell us that progress has been made in our economy — and indeed it has — it isn’t reflected in the paychecks of America’s working families,” House Minority Leader Nancy Pelosi said.

But even before the president spoke, House Speaker John Boehner made his scepticism clear in a video posted to Facebook in which he said “tonight isn’t about the president’s legacy, it’s about the people’s priorities. Making government bigger isn’t going to help the middle class.”

Mr Obama addressed the nation at a time of heightened anxiety about threats overseas. Since last year’s State of the Union, the US has entered into a new war in Iraq and Syria against Islamic State, while Russia has ramped up its intervention in Ukraine and crises have emerged from the Middle East to Africa, from where the spread of Ebola reached the US.

On cybersecurity, the president said, according to the prepared remarks, “If we don’t act, we’ll leave our nation and our economy vulnerable.”

Mr Obama asked Congress to hold off on passing additional economic sanctions on Iran until the US and other world powers completed negotiations with Tehran over its nuclear program. The deadline for the talks, which have twice been extended, is June.

The president also affirmed his belief that the detention facility at Guantánamo Bay, Cuba, should be closed, White House officials said. He was to note that the number of prisoners there had been reduced but that much work remained to be done.

Mr Obama addressed other issues likely to generate fights between the two parties. He argued that his decision to begin normalising US relations with Cuba was the right move and urged Congress to lift the embargo against the island nation.

The resistance Mr Obama faces in calling for warmer relations with Cuba was to be on display in the House chamber. Mr Boehner and Sen. Marco Rubio (R., Fla.) brought Cuban dissidents as guests, while first lady Michelle Obama hosted Alan Gross, the American who was freed last month as part of Mr Obama’s deal with the Castro regime to resume diplomatic ties.

Mr Obama made a push for policies that address climate change, which draw a cool response from Republicans. He also made clear that he intends to block any congressional effort to roll back his executive changes to the immigration system, which offered safe harbour from deportation to millions of illegal immigrants.

He addressed questions about the much-discussed Keystone XL pipeline in the context of a pitch for a broader effort to rebuild the nation’s infrastructure. Such a move on a larger scale would create jobs and bolster the economy, officials said. The president told lawmakers that they should set their sights higher than a focus on one pipeline.

Mr McConnell expressed frustration over the White House’s threats to block some of the first bills being considered by the new Congress, including measures to approve Keystone XL and make changes to the Affordable Care Act. “Hopefully, some of the things we enact he will agree to,” including the ability to fast-track trade agreements through Congress and cybersecurity legislation, Mr McConnell said.

The Wall Street Journal