Editor’s note: “The state of the union is good,” and the attitude of President Barack Obama in his annual speech to Congress was upbeat. Good economic news and no more election campaigns were the backdrop to the president’s “ambitious agenda” and “assertive” call to action. Here scholars from around the US give their reactions to particular items that the president has put on that agenda.
Tax proposals progressive but not populist
Elizabeth Pearson, University of California Berkeley
President Obama’s State of the Union tax proposals formed the building blocks of the commitment to “middle class economics” he outlined in his speech.
These proposed tax changes are more progressive than populist: the plan would increase taxes for the very richest Americans and use new revenues to fund proposals aimed at middle- and working-class families, but the speech did not emphasize the tax system’s role in addressing income equality or poverty.
According to specifics from the White House, the tax increases have three main components: raising the top rate for capital gains taxes, imposing a fee on large financial institutions, and removing a tax break for wealthy estates.
Higher revenues would fund expanded child-care tax credits, a new tax credit for two-earner households and additional tax credits for higher education.
Although Republicans in Congress are open to the idea of using tax credits to deliver benefits to working families, using higher taxes on wealthy Americans and firms to pay for these credits is sure to be a non-starter. Obama’s State of the Union tax proposals are best viewed as an effort to set the agenda for a 2016 Democratic party platform focused squarely on middle-class households.
President Obama and the budget: expect more gridlock, no solutions to long-term problems
Philip Joyce, University of Maryland, School of Public Policy
State of the Union speeches are opportunities for Presidents to tell us what they stand for and President Obama’s speech was no exception.
The policies that he outlined -— free community college, improvements in infrastructure, tax credits for child care — are consistent with his past agenda. He would apparently pay for those policies by raising taxes on the top one percent -— a recurring idea from this administration.
Regardless of what one thinks about the substance of these ideas, there are two things that we can say with reasonable certainty.
The tax proposals aren’t going anywhere. With both parties of the Congress in Republican hands, we are more likely to see tax cuts for the top one percent pass than tax increases for any Americans.
While the President is correct that budget deficits have come down by two thirds between fiscal years 2009 and 2014, the federal debt has risen from 50 percent of GDP to more than 70 percent of GDP over this same period; it is projected to remain there over the next ten years. We heard nothing in the speech about policy proposals -— tax increases for deficit reduction, or entitlement reform – that would put the budget on a sustainable path for the future.
There seems to be little question that the President’s proposals represent his policy preferences; there is also little doubt that they remind us that we should expect two more years of partisan gridlock.
How education is the key to a model nation
Stella M. Flores, Vanderbilt University
President Obama issued a State of the Union address that emphasized global leadership on economy and education.
What was not explicitly stated is what scholars Laura Perna and Joni Finney, among others, document: that a key factor distinguishing economically prosperous nations from their poorer counterpart nations is the extent to which the poorest of citizens are provided the opportunity for increased education, which can can be translated into skills that enhance national economic growth.
Although the president’s proposals were short on detail, their substance indicates that small steps are indeed being taken toward regaining global leadership on educational attainment.
Obama highlighted notable successes in math scores, high school graduation rates, and college enrollment. But these rates for the poorest Americans remain unacceptable. A proposal for free community college – the new standard for the 21st century American Dream – could be a remedy and here is why.
Free college may provide the greatest opportunity for middle-class entry into the 21st century economy not previously imagined for many. The proposal is not without challenges but it could provide a clear and strong signal to those who otherwise are receiving little or confusing information about their ability to access higher education.
President Obama did not venture into discussing his administration’s controversial proposals to put together a new college rating system. Instead he focused on providing the bricks and mortar to build the new educational standard for Americans and to reduce student debt.
This strategy addresses opportunity gaps for the poor who still believe in mobility as well as how to sustain any hard-won mobility. The next generation will be stronger because of such efforts.
A lost opportunity to chart education
Arnold F. Shober, Lawrence University
President Obama’s sixth State of the Union was a missed opportunity for American education.
Yes, he used significant real estate on community college, but what was unmentioned in the speech was that two major federal laws supporting K-12 and higher education need re-authorization by this Congress.
Both the No Child Left Behind Act and the Higher Education Act were last reauthorized with bipartisan support (in 2001 and 2008, respectively).
Significantly, President Obama has shared ground with several key Republicans on both bills. For K-12 education, the president supports some school choice and public accountability for results. On higher education, some Republicans agree with his views about streamlining student-aid financing and requiring a form of college accountability. He could have used the State of the Union to offer an olive branch on these upcoming bills.
Unfortunately for the president, his community college plan is not likely to win many plaudits from the majority party.
The president called for “zero” cost community college if students kept high grades and graduated “on time.” Republicans are likely to hear a proposal to increase federal spending and expand federal mandates regarding grades and graduation. Neither is likely to sit well with Representative John Kline (R-MN) or Senator Lamar Alexander (R-TN), the chairmen of Congress’ education committees. Alexander has been an especially strenuous opponent of federal regulation of higher education.
Obama seemed at pains to tweak Republicans and propose policies a bit further left of previous addresses.
This, to my mind, is a lost opportunity. To date, the president has enacted his education agenda through temporary waivers and regulations that a future administration can easily revoke. This was his last chance to cement his vision for American education.
Chance for a new approach in energy and climate
*Michael Greenstone, The University of Chicago’s Energy Policy Institute at Chicago (EPIC) *
President Obama’s former chief of staff and Chicago’s current Mayor Rahm Emanuel once said, “You never let a serious crisis go to waste…it’s an opportunity to do things you think you could not do before.” The same is true of good luck. The recent remarkable reductions in natural gas and oil prices are good luck that we should not waste.
In his State of the Union, president Obama issued another strong call to confront climate change and emphasized the efforts his administration has taken to act on this front. While his efforts have transformed US climate policy, there is a golden opportunity staring us in the face.
Energy price declines present a rare chance to move away from regulatory approaches and set a price on carbon. This move would not only combat climate change and very likely spur further action to reduce greenhouse gases by other countries, but it would also provide the revenues necessary to address several other national priorities, including increasing access to education, infrastructure improvements, shoring up our entitlement programs, and reducing taxes – all of which the president mentioned in his address.
Past time for regulation to deal with cybercrime
Daniel Lopresti, Lehigh University
Drawing an analogy to the war on terrorism, President Obama noted – about 41 minutes into his State of the Union address – that he is proposing legislation to protect companies and consumers against cybercriminals.
As we have just witnessed in the attack on Sony Pictures which has been connected to North Korea, such threats are very real, potentially devastating and guaranteed to escalate over time.
In an increasingly interconnected world – an era now becoming known as the “internet of Things” – anything and everything connected to a network becomes vulnerable, including not only computers, but smartphones, TVs, portions of the transportation infrastructure, public utilities, medical devices, appliances, etc.
Beyond the steps government can take to provide law-enforcement agencies with the tools needed to combat high-tech crime, we need a public educated to the nature of these threats so that they are less likely to fall victim, as well as basic research on cybersecurity and cyberdefense.
It is also important to recognize that cybercrime is fundamentally different from traditional crime in that it leverages the interconnectedness of people and systems. Hackers look for the weakest link in a chain which they then use as an entry point to escalate their attack.
That companies should be required to report when their systems have been compromised seems straightforward enough – this is one of the thrusts in the president’s message – but surprisingly regulations like this have generated pushback in part because they appear to expose one’s weaknesses to the outside world. This old-fashioned view is dangerous and we need to get over it.
Consider the case of a free, entertainment website that requires no payment and stores nothing more than a user’s login ID and password. Data harvested by attacking a weak system can be turned around and applied in attempts to gain access to more vital systems (e.g., online banking, medical records or email accounts). The weak links in your chain are the systems you use that are not carefully maintained and protected.
The need for cyberhygiene
Anupam Joshi, University of Maryland Baltimore County
The fact that cybersecurity found mention in the president’s SOTU address, among weighty issues like fundamental new approaches to taxation and foreign policy, is a testament to how important this issue is today. From (corporate) espionage and identity theft to financial crimes and ransomware, cyberspace is where sophisticated state, non-state and criminal enterprise actors are now most active.
The president correctly identified that we need to protect cyberspace to reap the benefits of the digital revolution, focusing on greater information sharing to improve security.
Presumably, this refers to passage of proposed legislation to provide targeted liability protection that would enable more information about private sector attacks to reach the Department of Homeland Security’s National Cybersecurity and Communications Integration Center. Such legislation will enable researchers to have the data to better understand, detect, and deter attacks, but there are also significant issues around privacy and data security that need to be carefully addressed.
Earlier this month, the White House suggested that better tools for law enforcement, newer requirements on reporting data breaches, and support for cybersecurity education are needed.
These are all important, but I would urge a particular focus on significantly expanding cybersecurity education far beyond the typical college-level courses to train cyber defenders.
What we need is a greater awareness of “cyberhygiene” for the average internet user – simple “preventative medicine” tactics to minimize risk for individuals and for us all. Just as kids are taught to wash hands for 20 seconds or be careful around strangers for example, they should be taught to be careful when clicking on links embedded in emails.
It’s in foreign policy that the president will make a difference
*I M Mac Destler, University of Maryland *
Obama’s economic proposals have won the headlines, but the international measures he highlighted in his State of the Union will likely be what matter most in his last two years.
Unlike his domestic tax initiatives, which cannot be realized in his presidency, serious, durable change is within reach across a range of foreign issues: Pacific and Atlantic trade, nuclear talks with Iran, relations with Cuba, global agreement on climate change. Congressional action will be needed on some of these, and on the struggle against radical Islam.
Obama is leading on key international matters, and can make a difference.
Health care: still in play
George A. Nation III, Lehigh University
The State of the Union speech made it clear that the 2016 election season has begun. The speech was about staking out political turf – not about laying out a plan to govern.
With regard to health care, the President proudly stated that today more Americans have health insurance than ever before, and that healthcare inflation is the lowest in 50 years. The President also stated forcefully that he would veto any attempt by Republicans to roll back the progress of the Affordable Care Act (ACA.) Republicans advocate repeal and replace, although they did not discuss the replacement.
The ACA is far from an unmitigated success. The Congressional Budget Office estimates 31 million Americans will still be without health insurance in 2023. The reduction in healthcare inflation is likely attributable at least as much to the recession as to the ACA and the process of acquiring insurance is still confusing to many and expensive.
Moreover, President Obama’s signature legislative achievement, according to the polls, is not popular and will likely remain so, as health insurance gets significantly more expensive when two important provisions – risk corridors and reinsurance (both of which help protect insurers) – expire in 2017.
Moreover, the survival of the ACA is in jeopardy and not just from Republicans. This spring the Supreme Court may decide that subsidies are unavailable on federal exchanges, and this would effectively kill the ACA.
While the President can veto any attempt by Congress to repeal and replace the ACA, even his pen cannot veto a Supreme Court decision.