U.S.
Win McNamee/Getty Images

Obama to confront GOP Congress, looming legacy in SOTU speech

Few surprises expected in address to nation, with tax reform likely to be main takeaway

President Barack Obama will make what is likely to be his second-to-last State of the Union address — and his first to a Republican-controlled Congress — on Tuesday after a year fraught with racial tension over police treatment of young black men and the rising threat of ISIL overseas and after a dramatic reversal of U.S. policy in Cuba.

But the estimated 30 million viewers expected to tune in to the televised speech shouldn’t expect any startling revelations. The tradition of laying out the coming year’s agenda and saving some big surprise announcements for the annual address to the nation is pretty much over.

However, the president is expected to propose closing multibillion-dollar tax loopholes used by the wealthiest Americans, imposing a fee on big financial firms and using the revenue to benefit the middle class, senior administration officials said over the weekend.

The centerpiece of the president's tax proposal is an increase in the capital gains rate to 28 percent for couples making more than $500,000 per year — the same level as under President Ronald Reagan. Obama also wants to close what the administration is calling the trust fund loophole, a change that would require estates to pay capital gains taxes on securities at the time they're inherited. Officials said the overwhelming impact of the change would be on the top 1 percent of income earners.

Though Republican leaders have said they share Obama's desire to reform the nation's complicated tax code, the party has long been opposed to many of the proposals the president is expected to outline Tuesday. For example, most Republicans want to lower or eliminate the capital gains tax and similarly want to end taxes on estates, not increase them.

More broadly, the State of the Union speech still holds ceremonial role in giving the president a forum to talk about last year’s accomplishments and next year’s goals. Obama is bound to cite his decision last month to reopen the U.S. Embassy in Havana and ease the decades-long trade embargo of Cuba.

He is set to announce other policies in the speech aside from changing tax codes, but most of them — fighting cybercrimefree community college for two years and more help for first-time homebuyers — have already been trumpeted by the White House in in a series of spoiler alerts meant to build support and momentum for the proposals.

Obama unveiled his free-tuition plan at a community college in Knoxville, Tennessee, a state led by a Republican governor, Bill Haslam, who has been friendlier to the administration than his Republican colleagues.

Congress has reacted swiftly as Obama’s proposals trickle out.

Some members of the Republican majority on Capitol Hill have rejected outright the free community college proposal, which would cost $60 billion over 10 years. Rep. John Kline, the Minnesota Republican who chairs the House education committee, said in a statement that the president was proposing “yet another multibillion dollar federal program that will compete with existing programs for limited taxpayer dollars.”

That the plan may not become a reality comes as no surprise to the Obama administration, but putting the idea out in speeches across the country and stressing the importance of community colleges in educating Americans may get some states to embrace it. That’s the administration’s hope, anyway. It’s the same strategy Obama used to encourage hiking the minimum wage. Congress didn’t approve it, but several states and private businesses did.

Obama just last week signed a memorandum directing federal agencies to offer federal workers up to six weeks paid leave for parents caring for a new child.

The president is also expected to call on Congress, states and cities to pass measures to allow tens of millions of workers to earn up to a week of paid sick time per year. “How can we support working families so they have the tools to succeed in this new economy?” he said. “We really can do something about it.” He is expected to ask for more than $2 billion to encourage states to create family and medical leave programs.

Cybersecurity legislation is one area where Congress and the White House may find themselves in rare agreement. Last month’s hacking of Sony Pictures, several breaches of credit information at major retailers and a hack of U.S. Central Command’s Twitter account this month has raised concerns that extend well beyond party lines.

Obama will present ways to protect Americans from identity theft and improve security for the government and private companies. There is still likely to be a debate over the federal government’s role in fighting hackers.

He will also talk about his plan to expand high-speed broadband Internet. Republicans may not be as warm to that proposal, viewed as costly overregulation of private industry. It’s ultimately up to states to decide if small Internet providers can compete with the giants of the industry such as Comcast and Time Warner.

The case for lowering fees on government-backed housing loans is also likely to be made, with the president arguing that it would save low- and middle-income homeowners almost $1,000 a year. But Republicans don’t like the idea of government getting deeper in the mortgage business. Obama and Republicans agree to wind down Fannie Mae and Freddie Mac, the government mortgage powerhouses — a measure that could come to a vote in the Senate.

Iowa Sen. Joni Ernst has been picked to deliver the Republican response to Obama's speech. Ernst was a little-known Iraq War veteran until she won resoundingly in November and gained national attention for her memorable television ad about castrating hogs — experience that she said would help her cut pork and make big spenders in Washington “squeal.”

GOP leaders selected the 44-year-old swing state senator to sell the Republican message to women and younger voters.

“Americans voted for change,” Senate Majority Leader Mitch McConnell, R-Ky., told reporters at a congressional Republican summit. “And Sen. Ernst will explain what the new Congress plans to do and is already doing to change and what it is already doing to return Washington’s focus to the concerns of the middle class and away from the demands of the political class.”

With wire services

Related News

Find Al Jazeera America on your TV

Get email updates from Al Jazeera America

Sign up for our weekly newsletter

Get email updates from Al Jazeera America

Sign up for our weekly newsletter