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.

'Pro-poverty'

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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US Presidential Election 2012

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  • rate this
    +4

    Comment number 234.

    @211
    Where does this myth come from that fair taxation will ruin our economy? Let's face it: rich people will still be able to invest after they paid fair tax, lower income people wouldn't be overtaxed unfairly in comparison and would maybe even be able to invest themselves or have more buying power.

  • rate this
    -2

    Comment number 233.

    There is no doubt that there is fat to cut in government agencies and it should be done by future Administrations and Congress. And when done it will hurt. But all Americans should share the burden in taxation and it should be progressive and loopholeless.

  • rate this
    +2

    Comment number 232.

    Obama will end up the best president america has had in the recent time. On account of the state of the USA when he took over, if not his cleverness and level headed approach to everything, america would have been history by now. A differing opinion is just pure politics if not outright lying to oneself

  • rate this
    +8

    Comment number 231.

    Many accusing Obama of not getting his reforms on the statutes, could that have been due to hysterical opposition from the Republicans enjoyed a majority in the legislative assembly & voted down his proposals? Like the UK the US legislative machinery is covertly controlled by powerful vested interests. To all you naysayers DO SOME RESEARCH FOR ONCE IN YOUR BIGOTED LIVES! Yes they do make me angry!

  • rate this
    -9

    Comment number 230.

    Bibi

    #228

    They tried that in Russia it was called communism didnt work then and it is not going to work now.

  • rate this
    -5

    Comment number 229.

    Does he want fairness, or does he want equality?

    You can't have both.

  • rate this
    +3

    Comment number 228.

    As the poor worldwide are only too well aware, calls for fairness will do nothing. What is required, not just from Obama, but from every world leader, is a forcible redistribution of wealth, by legislation. Mankind watched the poor hunger, sicken, & be exploited for thousands of years. If we cannot right those wrongs now by peaceful means, then by force of numbers the poor will one day march & win

  • rate this
    +3

    Comment number 227.

    208.arthur
    40 Minutes ago
    If I earn $1m and have 70% of tax rate,why should I then run so big business?
    --

    Because if you had a smaller business you'd earn less money... If you don't understand this I doubt you'll be running any business...

  • rate this
    -4

    Comment number 226.

    There is no such thing as economic fairness, that's socialism. What any government can do, is to make sure that all rich people and companies pay their taxes. And not hide their hidden wealth and profits in some off shore tax haven.

  • rate this
    +4

    Comment number 225.

    207.john
    Obama idea are a step in the right direction is not the fault of is presidency if we are still in this mess.
    Until the USA and all the west world admit that the present system of capitalism is dead and bury and a new one need to be created noting will change for the best.
    --Like North Korea.

  • rate this
    +5

    Comment number 224.

    to those who say Obama has failed to make any of his promises, it’s not his fault congress always says no.
    As obamas approval is running at 46% and congresses at 11% it looks like people are fed up with congress saying no to the man they voted in.

  • rate this
    +5

    Comment number 223.

    No doubt in my mind that, at the current state of things, Obama will get re-elected, not through enthusiasm, but because he is the least-worst choice. The front-running Republican candidates all look even more uninspiring from what I'm seeing. However, as in the UK, it's pretty clear that if there was a "None of the above" party, they would walk it!

  • rate this
    -1

    Comment number 222.

    A slick, polished lawyers performance that says all the things most of us want to hear. Tony Blair was good at that sort of thing, but like Obama, the devil is in the substance instead of the spin.

  • rate this
    -2

    Comment number 221.

    210.Chris London
    This is truly just more spin, to date the big "O" has delivered nothing but continues to promise the world. I feel very let down as he generated so much hope for change. The problem is that there was never any substance behind his promises. He is to the USA what Blair was to the UK. Now he is trying the dived and rule method by playing the class card.
    ---
    And the race card too

  • rate this
    -3

    Comment number 220.

    I fail to understand how Obama can even think of running for office again! What has he achieved apart from his smooth talk and empty promises? The man was not expected to sort out all the mess he inherited from his dumb cowboy predecessor, but has he managed to achieve one single goal? Nothing, could not even just close Guantanamo Bay. He should bow out gracefully and be a lawyer again.

  • rate this
    +3

    Comment number 219.

    184.
    AllenT2
    ---
    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 %.
    --
    Whatever the reason, the richest country in the world shouldnt leave even a single citizen behind of a basic such as health service. It is not morally right to make a profit on ill.

  • rate this
    +3

    Comment number 218.

    The person who eats the most pie produces the most crumbs. Maybe you're grateful for those crumbs, but you've got to ask why you're not getting a (bigger) slice of the pie. Can't, won't or prevented from eating at the same table?

  • rate this
    +2

    Comment number 217.

    Sugar-coated political speeches are always best read between the lines - which usually means zilch. Actions speaks louder than words and the ever-increasing financial disparity between the very rich (1%) and the rest (99%) which has not been addressed by successive governments will only foment further malcontent. Everyone playing by the ‘same set of rules’ is political poppycock!

  • rate this
    0

    Comment number 216.

    Ask George Soros what he thinks.. he knows better than the puppet Obama what the future holds.

  • rate this
    +1

    Comment number 215.

    Politicans tell you what you want to hear or what they think you want to hear so they can be relected. if you believe otherwise you are a fool.

    Power is such a sweet addiction, it turns man into liars, killers and war mongers.

 

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