The U.S. may not have “risen from recession” quite as rousingly as President Barack Obama suggested in his State of the Union speech Tuesday night. Seven years after that severe downturn began, household income hasn’t recovered and healthy job growth is complicated by the poor quality, and pay, of many of those jobs.
It’s always problematic when a president takes credit for an improving economy, just as it is when he’s blamed for things going bad. A leader can only do so much, for better or worse, and there are two sides to every economy. But after an election in which Obama largely held off on chest-beating, he claimed credit in bold terms for what is going right.
Also in his speech, Obama skimmed over the cost to taxpayers of free community college tuition and invited closer scrutiny with his claims about U.S. support for Syrian moderates and about his record of public-lands preservation.
A look at some of his claims, and the facts and the political climate behind them, as well as a glance at the Republican response:
OBAMA:
—”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 FACTS: By many measures, the economy is still recovering from the deep scars left by the Great Recession.
Job growth has been healthy, but fueled in part by lower-paying jobs in areas such as retail and restaurants, which have replaced many higher-paying positions in manufacturing and construction. Part-time jobs also remain elevated: There are still 1.7 million fewer workers with full-time jobs than when the recession began in December 2007.
And the faster hiring hasn’t pushed up wages much. They have been growing at a tepid pace of about 2 percent a year since the recession ended 5 1/2 years ago. That’s barely ahead of inflation and below the annual pace of about 3.5 percent to 4 percent that is typical of a fully healthy economy.
That has left the income of the typical household below its pre-recession level. Inflation-adjusted median household income reached $53,880 in November 2014, according to an analysis of government data by Sentier Research. That is about 4 percent higher than when it bottomed out in 2011. But it is still 4.5 percent lower than the $56,447 median income in December 2007, the month the recession began.
Booming energy production is indeed a reality, but that’s a phenomenon many years in the making, with the development of cost-effective extraction from fracking and other means playing into the rise of the U.S. as an energy production giant.
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OBAMA: “I am sending this Congress a bold new plan to lower the cost of community college — to zero.”
THE FACTS: Zero for qualifying students; an estimated $60 billion over 10 years to the treasury.
Obama confronts a Republican-controlled Congress that can be expected to be wary of a new program costing that much. Moreover, the proposal requires states to contribute about a quarter of the money, and getting them to go along is bound to be tough. Many states refused to expand Medicaid under the health care law, for example, even though Washington is picking up the entire cost in the first years.
On the other hand, community college is an issue close to home for state government, perhaps more appealing than partnering with Washington on the health law, so the idea could have a fighting chance if it can get through Congress. Educators are divided on its merits, with some worrying that aid for a community college education could divert students and scholarships away from four-year schools.
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OBAMA: “We’ve set aside more public lands and waters than any administration in history.”
THE FACTS: Waters is the key word here. Before expanding the Pacific Remote Islands National Monument last year from almost 87,000 square miles to more than 490,000 square miles, Obama had protected far fewer acres than his four predecessors, including President George W. Bush.
Expansion of the massive Pacific islands monument puts Obama on top. It’s nearly all water, however, and the move has limited practical implications. While it bans commercial fishing, deep-sea mining and other extraction of underwater resources, little fishing or drilling occur in the mid-ocean region now.
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OBAMA: “Thanks to a growing economy, the recovery is touching more and more lives. Wages are finally starting to rise again. We know that more small-business owners plan to raise their employees’ pay than at any time since 2007.”
THE FACTS: A survey of small businesses by the National Federation of Independent Business does show that a rising proportion plans to raise wages. But plans to raise pay aren’t the same as actually raising them.
Average hourly earnings rose just 1.7 percent in December from 12 months earlier, according to the Labor Department. That’s about half the rate that is typical of a healthy economy and actually lower than the previous month. Economists generally expect wage gains to accelerate this year, as unemployment continues to fall and businesses are forced to offer higher pay to attract workers. But there is scant evidence that it is happening yet.
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OBAMA: “In Iraq and Syria, American leadership? — ?including our military power? — ?is stopping ISIL’s advance. Instead of getting dragged into another ground war in the Middle East, we are leading a broad coalition, including Arab nations, to degrade and ultimately destroy this terrorist group. We’re also supporting a moderate opposition in Syria that can help us in this effort.”
THE FACTS: The U.S. also has been slow to set up long-promised training for the moderate Syrian opposition, and has yet to begin the actual vetting of the rebels. Also, despite persistent pleas from the rebels, the U.S. hasn’t sent the more lethal weapons they want. U.S. officials have expressed concerns that the weapons could end up in the hands of insurgents.
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— daveweigel (@daveweigel) January 21, 2015
“To everyone in this Congress who still refuses to raise the minimum wage, I say this: If you truly believe you could work full-time and support a family on less than ,000 a year, go try it,” Obama said. “If not, vote to give millions of the hardest-working people in America a raise.”
“Today, we’re the only advanced country on Earth that doesn’t guarantee paid sick leave or paid maternity leave to our workers. Forty-three million workers have no paid sick leave. Forty-three million. Think about that. And that forces too many parents to make the gut-wrenching choice between a paycheck and a sick kid at home,” Obama said. “So I’ll be taking new action to help states adopt paid leave laws of their own. And since paid sick leave won where it was on the ballot last November, let’s put it to a vote right here in Washington. Send me a bill that gives every worker in America the opportunity to earn seven days of paid sick leave. It’s the right thing to do.”
Obama went back to speaking on Rebekah and Ben, saying for a couple like them, “Friday night pizza is a splurge.”
“Because families like Rebekah’s still need our help. She and Ben are working as hard as ever, but have to forego vacations and a new car so they can pay off student loans and save for retirement,” Obama said.
“Basic childcare for [their children] Jack and Henry costs more than their mortgage, and almost as much as a year at the University of Minnesota,” Obama added. “Like millions of hardworking Americans, Rebekah isn’t asking for a handout, but she is asking that we look for more ways to help families get ahead.”
“We can’t slow down businesses or put our economy at risk with government shutdowns or fiscal showdowns,” Obama said. “We can’t put the security of families at risk by taking away their health insurance, or unraveling the new rules on Wall Street, or refighting past battles on immigration when we’ve got a system to fix. And if a bill comes to my desk that tries to do any of these things, it will earn my veto.”
Many in the chamber gave Obama a standing ovation when he mentioned “ten million uninsured Americans [who] finally gained the security of health coverage” this year.
Obama told the story of Rebekah Erler, a guest of first lady Michelle Obama at the SOTU, and her husband Ben.
“America, Rebekah and Ben’s story is our story. They represent the millions who have worked hard, and scrimped, and sacrificed, and retooled. You are the reason I ran for this office,” Obama said. “You’re the people I was thinking of six years ago today, in the darkest months of the crisis, when I stood on the steps of this Capitol and promised we would rebuild our economy on a new foundation. And it’s been your effort and resilience that has made it possible for our country to emerge stronger.”
“Tonight, for the first time since 9/11, our combat mission in Afghanistan is over. Six years ago, nearly 180,000 American troops served in Iraq and Afghanistan,” Obama said. “Today, fewer than 15,000 remain. And we salute the courage and sacrifice of every man and woman in this 9/11 Generation who has served to keep us safe. We are humbled and grateful for your service.”
“We are fifteen years into this new century. Fifteen years that dawned with terror touching our shores; that unfolded with a new generation fighting two long and costly wars; that saw a vicious recession spread across our nation and the world. It has been, and still is, a hard time for many,” Obama said at the start of his speech. “But tonight, we turn the page.”
Read the president’s full remarks as prepared for delivery here.
President Barack Obama is making his way into the House chamber now.
HuffPost’s Sabrina Siddiqui reports:
The man in charge of keeping House Democratic votes in line isn’t holding out hope that Republicans will actually cooperate with President Barack Obama.
House Minority Whip Steny Hoyer (D-Md.) said during an interview ahead of Tuesday night’s State of the Union address that it’s important for Obama to strike a conciliatory tone, but he’s seen little to suggest that Republicans plan to use their majority in both houses of Congress to find areas of common ground.
“The Republicans continue to send messages to their most conservative wing,” Hoyer told HuffPost Live. “If that’s all they’re going to do, we’re not going to go forward very quickly or very successfully.”
Read more here.
HuffPost’s Mike McAuliff reports:
President Barack Obama may have a strong message for the middle class and voters in his State of the Union address, but it won’t matter unless he and Congress first do something about the cash-flooded election system, Rep. John Sarbanes (D-Md.) argued Tuesday.
[…]
Five years after the Supreme Court ruled in the landmark Citizens United case that billionaires could spend as much money as they want on campaigns, Sarbanes wants to create a public finance system in which people get a small tax credit for political donations, which would then be matched six times over with public money.
“That means a donor is now worth 0 to the candidate,” Sarbanes said, arguing that a politician would then have incentives to visit people in living rooms, rather than catering to super PACs and billionaires. “It’s worth my going there instead of going to K Street or getting on the phone with a bunch of high-dollar donors.”
Read the full story here.
Last year's SOTU scored 33,299,172 viewers. (Nielsen only counts folks watching at home on TVs; no web streams.) This year: higher or lower?
— Brian Stelter (@brianstelter) January 21, 2015
