State of the Union: Obama calls for end to inequality


Obama renewed call for the Buffett Rule on taxation

US President Barack Obama has attacked income inequality, using his third State of the Union speech to set the tone for his re-election bid.

Mr Obama emphasised the importance of an economy that works for everyone, in the nationally televised address to Congress.

The speech saw a renewed call for higher taxes on the wealthy, something Republicans strongly oppose.

The US economy is on the mend, but unemployment remains high at 8.5%.

The annual State of the Union address - one of the most keenly watched events in US politics - traditionally includes policy prescriptions from the White House for the upcoming year.

Mr Obama will now take the themes of Tuesday night's speech on the road, spending three days visiting manufacturing companies and higher education institutions in five states - all seen as important in November's election.

'Reclaim American values'

President Obama's speech on Tuesday in the Republican-dominated House of Representatives was delivered with an eye on November's presidential election, when he will seek another four years in office.

Start Quote

At the heart of this speech is a president, defiant. Defending the role of government and what he wants it to do”

End Quote

He said: "We can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by.

"Or we can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.

"What's at stake are not Democratic values or Republican values, but American values. We have to reclaim them."

Mr Obama said the economy was bouncing back from the 2007-09 recession.

He sounded a warning to his conservative opponents, as he added: "I intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place."

US media reaction

For the New York Times, Mr Obama went in the right direction in challenging the Republican notion that excessive government spending was to blame for the country's economic plight. "He sounded many of the same themes as last year, but his tone was sharper and he was far more willing to apportion blame," it says approvingly.

There was a very different view in the Wall St Journal, which accuses him of trying to campaign as an incumbent whose every move has been stymied by Congress. "For two years he had the largest Democratic majorities in Congress since the 1970s and achieved nearly everything he wanted." But those achievements have resulted in such weak, unpopular results, the paper argues, that he is forced to resort to the "politics of envy".

For Time, Mr Obama's "startlingly blunt" insistence that America was not in decline was not, according to polls, shared by the vast majority of the American people. And this optimism characterised the whole of the speech. "He came out swinging, with positive data, happy anecdotes and an energy that he rarely displays these days when he's off the campaign trail."

Fox News' depiction of this optimism was laced with a little more scorn. "Don't worry, America," writes Rich Lowry. "There's nothing that ails this country that can't be made right by a catalogue of piddling proposals that will be forgotten tomorrow - and oh yeah, more taxes on the rich. Such was the message of President Obama's State of the Union address."

Mr Obama also made a renewed call for his Buffett Rule - a principle that millionaires should not pay a lower tax rate than typical workers.

The idea is named after billionaire investor Warren Buffett, who famously complained that his secretary pays a higher rate of tax than he does.

Mr Buffett's secretary, Debbie Bosanek, watched the speech alongside First Lady Michelle Obama from the gallery.

Pledging no tax increases for those earning under $250,000 (£160,000), Mr Obama said: "If you make more than $1 million a year, you should not pay less than 30% in taxes."

"Now, you can call this class warfare all you want," he added. "But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense."

Republicans have repeatedly rejected Mr Obama's call for higher taxes on the wealthy and accuse him of resorting to class warfare to get elected again.

Mr Obama also proposed:

  • tax reforms to make it less attractive for US companies to transfer jobs overseas
  • allowing homeowners with privately held mortgages to refinance at lower interest rates
  • a new trade enforcement unit dedicated to deterring unfair practices by rival economies, such as China

A wave of unity swept over the chamber as Democratic Representative Gabrielle Giffords, who was shot by a lone gunman in Arizona shortly before the last state of the union, attended during her last week serving as a congresswoman.

What is the State of the Union?

  • The US Constitution (Article II, Section 3) requires the president to "from time to time give to the Congress Information of the State of the Union"
  • Making a speech to Congress is not required by the constitution
  • The tradition of making a speech only took hold in the early 20th Century
  • President Calvin Coolidge (1923) made the radio address, and Harry Truman (1947) the first televised one
  • In 2002 President George W Bush made the first address to be streamed online

Source: Encyclopaedia Britannica

Ms Giffords, who announced on Sunday that she would resign to focus on her recovery, was embraced by Mr Obama, amid rousing cheers.


Indiana Governor Mitch Daniels, delivering the Republican Party's response to Mr Obama's speech, called it "pro-poverty".

He said: "No feature of the Obama presidency has been sadder than its constant efforts to divide us, to curry favour with some Americans by castigating others."

The address put the political spotlight firmly back on the Democratic president, after months of focus on the Republican candidates vying to challenge him for the White House.

Earlier, one of those contenders, Mitt Romney, was forced by political pressure to release his tax returns.

Mitch Daniels gives Republican reaction

The forms revealed the private equity tycoon earned nearly $22m in 2010 and paid an effective tax rate of about 14%, a lower rate than most other Americans pay.

On Tuesday morning, the former Massachusetts governor held his own "prebuttal" on the campaign trail in Tampa, Florida, saying that the "real state of our union" was high unemployment and record home foreclosures.

Mr Obama will promote the ideas outlined in his speech over the coming days in five states key to his re-election bid: Iowa, Arizona, Nevada, Colorado and Michigan.

Opinion polls show his approval numbers languishing beneath 50%, with most Americans disapproving of how he has handled the economy.

More than 13 million people are out of work and government debt stands at a record high of $15.2 trillion, up from $10.6 trillion when he took office.

However, surveys also show that Congress is far less popular than Mr Obama, with many blaming Republicans more for the gridlock in Washington.

Partisan warfare on Capitol Hill almost shut down the federal government three times last year.


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  • rate this

    Comment number 194.

    economic fairness - Hmm lofty words, but tricky to define and virtualy impossible to implement.

    I find equality of opportunity to be noble but, if he means equality of opportunity he should say equality of opportunity instead of "income inequality" which IS classwarfare.

  • rate this

    Comment number 193.

    ProfPhoenix wrote:

    "and he spoke of universal values not American values"

    An obvious problem with the man.

    "With luck he will.... convince many UK critics of America that his country is worthy of left wing respect"

    Why would you think most of us Americans would care what the UK thinks about us, especially from the anti-American left?

  • rate this

    Comment number 192.

    Obama is right to take the fight to the hypocritical religious right. Their Jesus Christ preached that the poor needy and hungry should be care for. Apparently, according to the Republicans, that is "pro-poor" and should not be allowed. How hypocritical can a Republican be? As an Atheist I find that appalling!

  • rate this

    Comment number 191.

    185"I'm sure there's no connection to Romney's tax return. Right."

    Actually when I typed that I had yours in mind.

    Looking at what other nations choose or are stuck with for leaders, whatever Obama's faults and shortcomings I wouldn't trade him in for any of them. By comparison they're all midgets, there isn't one who could hold a candle to him.But I kept asking myself what took you so long?

  • rate this

    Comment number 190.

    A country where the rich have means to escape paying taxes is a “sick” country. The idea that the rich create jobs is a fallacy as they create more jobs for robots than for the USA people and jobs for people are created in India and China and other countries.

  • rate this

    Comment number 189.

    ProfPhoenix wrote:

    "and he spoke of universal values not American values"

    An obvious problem with the man.

    "With luck he will.... convince many UK critics of America that his country is worthy of left wing respect"

    Why would you think most Americans would care what the UK thinks about us, especially from the anti-American left.

    Just hope he doesn't knock out any more Bin Laden's too soon.

  • rate this

    Comment number 188.

    Obama's critics "accuse him of resorting to class warfare to get elected again".

    Oh dear, how unfair! - appealing to the peasants to try and level the playing field against their Lords and masters. Democracy (as I understand it) gives the majority (the underclass) a way of balancing their world order without resorting to violent revolution. The 1% ought to heed the rumblings.

  • rate this

    Comment number 187.

    This is not a discussion forum.
    There is no reply button.
    No-one will read through hundreds of comments to follow your conversation.

  • rate this

    Comment number 186.

    Hate him or love him, he has a point. Why is it that it is fine for the most powerful country to claim responsibility, but not it's most powerful citizens? Why is it fine for soldiers to lay down their lives to protect the wellbeing of their people and society, but those who benefit from it most pay the least? It's time things changed.

  • rate this

    Comment number 185.

    175. Suilerua

    "Soak the rich"

    Yes, that pretty much sounds like Obama's presidential campaign strategy.

    I'm sure there's no connection to Romney's tax return. Right.

  • rate this

    Comment number 184.

    svejkam wrote:

    "Access to health services is a basic human right. ..40% of the Americans do not have."

    Nonsense. Once you eliminate all the illegals and all the ones that *choose* to not purchase health insurance, even though they can afford it, you are left with a small %.

    The only human right there is is to be left alone to live and express your life without imposing on or harming others.

  • rate this

    Comment number 183.

    Never mind about taxing the richest more than the poorest , the first law that needs to be enacted is one that clearly states that whatever tax breaks someone uses (such as giving money to the church or the NRA or moving money off-shore) they cannot get an effective tax rate (on income AND capital gains) that is less than (say) 80% of that which Joe "wage slave" Public pays.

  • rate this

    Comment number 182.

    2. beammeup

    I listened to Obama's speech and thought he said everything anyone could wish to hear.

    Yes, this is his tendency. His problem is not saying what people want to hear. It's doing it.

  • rate this

    Comment number 181.

    Well on paper it sounds like the way things should be but, Congress is in the employ of the rich so I don't see anything positive happening.

  • rate this

    Comment number 180.

    I would only make 1 comment as to politicians in Congress,GET OUT and work for a living; Pay what we pay in tax.

  • rate this

    Comment number 179.

    @ Arthur (#162)

    "lets impoverish that 1% and vote for communists"

    So, if you're not for full-on, exploitative, unregulated capitalism (and willing to shoot whatever stands in your way), then you're a communist?

    No-one said 'impoverish' the rich, just pay a fair amount of tax and help people who need it. That includes war vets etc - not just us 'commies'.

  • rate this

    Comment number 178.

    You Americans have yourselves to blame. You voted for the frankly dim- witted Bush, who hadn't a clue and created the mess. You gave Obama less than two yeasrs, then voted back a Repubilcan Congress, so Obama could do nothing thereafter. The mid- term election system makes Federal government unworkable, ensuring that nothing really changes.

  • rate this

    Comment number 177.

    Obama has failed to introduce just about all of the promises he made before being elected. He looks and sounds great but without any substance. If judged on his deeds then he is no better than the last puppet. The US needs is a President with real conviction and a proven track record instead of the richest candidate buying an election. US tax rates will never change in favor of fairness.

  • rate this

    Comment number 176.

    @162.arthur - your ignorance astounds me. No-one is talking about impoverishing the 1%.

    Unless you count taking their wealth down to a responsible level and increasing the wealth of the poorest, impoverishing the 1%.

    For example a person with 1 million who is taxed 70% (to use your example) still has 300k after tax.

    I wouldn't call that impoverished.

    But hey, ignorance is bliss...

  • rate this

    Comment number 175.

    Soak the rich.I like it.Off with their heads.Especially bankers, politicians, and other assorted swindlers.While we're at it, throw in media pundits for good measure.Let the punishment fit the crime.They'd never be missed. A more humane Mikado never did exist.The middle class empire strikes back.Obama seems to be getting the hang of this job.It would be a shame to have to break in a new one now.


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