What to expect from Pres. Obama in State of the Union address

Posted at 3:25 PM, Jan 20, 2015

WASHINGTON – President Barack Obama has less clout on Capitol Hill now than ever before. So with little to lose, he’s making a feisty pitch for economic populism.

Instead of granting Republicans their wish for a realistic compromiser-in-chief chastened by a midterm election drubbing, Obama will try to set the terms of an economic debate that could continue into the 2016 race to replace him in the Oval Office.

At the heart of his message is a Robin Hood-style plan to raise taxes on wealthy Americans’ investments and financial institutions and use that money to foot the bill for free community college tuition and new tax credits for child care and two-worker households.

That proposal stands next to no chance of clearing Congress. But — along with campaign-style events and interviews with YouTube stars touting his initiatives both before and after the speech — Democrats hope Obama’s decision to play up the parties’ philosophical differences will remind Republicans who now control both the House and the Senate of the political force they couldn’t overcome in 2008 and 2012.

The White House said Obama will pound the theme of middle-class economics during the speech, which starts just after 7 p.m. MT.

The President will tout the improving economy — with an unemployment rate that’s dropped from a high of 10% in 2009 to 5.6% today — and focus on lifting stagnant wages.

“We still know that wages need to go up more,” top Obama adviser Valerie Jarrett said in an interview on CNN’s “The Lead.”

She said Obama’s speech will be filled with “very pragmatic steps that he will outline tonight that he thinks will strengthen that economy — and we now have a six-year track record that demonstrates that the president’s policies and programs have worked, and we need to continue those efforts.”

Republicans see a president in denial — one who hasn’t learned anything from the shellacking that cost his party the Senate in November; whose veto threats and tax-and-spend proposals are a lame duck flailing as his influence fades.

The President’s “proposals are so out of touch you have to ask if there is any point to the speech,” Republican National Committee Chairman Reince Priebus tweeted.

The White House, though, is wagering that — with free trade and cybersecurity, two potential areas for deals, as the major exceptions — there’s little to be gained in trying to bargain with a Congress already bent on forcing showdowns with Obama on immigration, the Keystone XL pipeline, Cuba, health care and more.

They see an opening: The economy has improved, the President’s approval rating now tops 50% for the first time in years, and, free of the constraints he felt ahead of the midterm elections, an emboldened Obama is unfurling a series of executive actions to check item after item off his long-stalled to-do list.

This could be his best shot at pivoting from an unending series of fiscal crises and legislative battles toward an economic debate that could set the tone for the last two years of his presidency — and for a 2016 race that had been about moving past him.

Taking top billing in Tuesday night’s speech will be the tax-and-spend plan Obama has rolled out in recent days.

The benefits would largely go to students and young families: The child care tax credit would triple to $3,000; households in which both spouses work could qualify for a new $500 credit; and college students and those repaying loans could get breaks thanks to Obama’s plan to make two-year community college degrees free.

Footing the bill are tax hikes on the rich: a total of $320 billion over 10 years by targeting wealthy individuals and banks. Paying most of the price would be couples earning more than $500,000, who would see their capital gains rate jump from 23.8% to 28%. More inherited assets would be subject to capital gains taxes and top financial firms would face new fees.

Obama is also making his own moves to give federal workers at least six weeks of paid maternity leave once their children are born — and he’s lobbying lawmakers to pass a bill allowing workers to earn up to seven paid sick days, and pushing local governments to set up their own sick leave programs.

Before the speech, Republican congressional leaders made clear that Obama’s proposals are dead on arrival.

“It all looks like the same old tax and spend that the president has been advocating for the last six years,” Senate Majority Leader Mitch McConnell (R-Kentucky) said.

He called Obama’s tax plan “another income redistribution effort” and said it won’t help Congress work on a comprehensive tax overhaul.

“Hopefully that’s just rhetoric,” McConnell said. “He knows we’re not likely to pass these kinds of measures. And we’ll still look for things that we can actually agree on to try and make some progress here.”

Here are several other issues that have dominated the news in recent weeks and are likely to come up during Tuesday night’s speech:

FIGHTING ISIS: Unrest in Yemen, where the presidential palace had been overrun by rebels who looked to be completing a coup, threw a late wrench into Obama’s speech preparations — especially since he’d held the country up as an example of international partnerships in fighting ISIS. Obama has also called on lawmakers to authorize the use of military force against ISIS in Iraq and Syria.

CUBA: Perhaps the richest pageantry of the night is over Obama’s recent move to thaw the decades-old economic and diplomatic freeze with the small island country. Obama had invited Alan Gross, the U.S. contractor whose release from a Cuban prison he had secured in November. The President’s top critic, Sen. Marco Rubio (R-Fla.), had asked Cuban activist Rosa María Payá to come as his guest. She’s the daughter of Oswaldo Payá, a pro-democracy activist who was killed in a 2012 crash in which the car’s driver has said it was deliberately targeted by Cuban government officials.

IRAN: The White House had extended the deadline for its negotiations with Iran to end the country’s nuclear program, but lawmakers have said they’ve run out of patience with the Iranian regime and want to impose new sanctions. Obama has urged them to wait.

CYBERSECURITY: The President is likely to ask Congress to approve legislation that would allow government and businesses to work together more closely to thwart online attacks — a proposal that could win the support of the GOP-led Congress.

FREE TRADE: Obama could risk angering his own base by asking lawmakers to hand him authority to fast-track Pacific Rim and European Union trade deals through Congress with limited debate and no amendments — a power seen as crucial to finalizing those negotiations with foreign leaders.

INTERNET ACCESS: In an in-the-weeds regulatory proposal that could result in much-faster Internet access for many cities and states, Obama is calling on the Federal Communications Commission to override 19 states’ laws against municipalities setting up their own broadband infrastructure.