J. Scott Applewhite / AP

Obama touts ‘middle-class economics’ at home, ‘bluster’-free policy abroad

In State of the Union address, president vows to end tax loopholes seized upon by corporations and the superrich

President Barack Obama vowed to push forward with the "middle-class economics" he holds responsible for delivering the U.S. from recession, saying that the country could finally "turn the page" on years of economic uncertainty and overseas warfare.

"Middle-class economics works," he said in his State of the Union address. "Expanding opportunity works. And these policies will continue to work as long as politics don't get in the way."

He urged Congress to turn its back on the the partisanship that has dogged politics in Washington for much of his tenure, stressing that he would soon send to Congress a budget that was "practical, not partisan."

Part of his "middle-class economics" plan includes providing tax relief to working families and closing loopholes that allow corporations to shirk their burden and that provide "giveaways the superrich don't need."

The president's economic agenda for his remaining two years in office contains a proposal to offer free community college, a revision to the tax code intended to benefit middle-class households and expanded paid sick leave rules.

The president's speech also touched on the United States' military campaign against the Islamic State of Iraq and the Levant (ISIL) and national cybersecurity concerns. Regarding U.S. airstrikes against extremists in Iraq and Syria, Obama will request congressional authorization to approve continuation of the fighting.

"This effort will take time. It will require focus. But we will succeed," he said. "And tonight, I call on this Congress to show the world that we are united in this mission by passing a resolution to authorize the use of force against ISIL."

When the military campaign against ISIL began, the White House said it had legal authorization under the 2001 Authorization for the Use of Military Force (AUMF), which Congress passed to approve the use of military force against the perpetrators of the 9/11 attacks.

Obama also urged Congress to pass legislation that would strengthen U.S. cybersecurity after a recent breach at Sony Pictures, purportedly in retaliation for a movie depicting the assassination of North Korean leader Kim Jong Un.

"If we don't act, we'll leave our nation and our economy vulnerable," he said.

Regarding domestic policy, this State of the Union comes at a pivotal moment in America's economic history. When Obama entered the White House, the United States was in the grip of the worst economic turmoil since the Great Depression. Now, six years into his presidency, the U.S. economy is more than five years into a slow but persistent economic recovery.

Unemployment reached a six-year low in the most recent jobs report, though wages continue to stagnate and recent polling shows that most Americans still feel considerable anxiety over their household finances.

He said that the country has now "risen from recession" and that the country now has to choose what kind of economy it wants. "Will we accept an economy where only a few of us do spectacularly well? Or will we commit ourselves to an economy that generates rising incomes and chances for everyone who makes the effort?"

Citing the role of "middle-class economics," Obama said the term referred to policies that help "working families feel more secure in a world of constant change." In particular, he cited affordable child care, college, health care and retirement plans. "My budget will address each of these issues, lowering the taxes of working families and putting thousands of dollars back into their pockets each year."

In addition to reducing taxes on working families, he called for clawing more money from companies that take advantage of flaws in the tax code. "For far too long, lobbyists have rigged the tax code with loopholes that let some corporations pay nothing while others pay full freight. They've riddled it with giveaways the superrich don't need, denying a break to middle class families who do."

This evening's State of the Union address is the president's first major address since Republicans formally took control of the Senate. For the remaining two years of his presidency, Obama will be forced to contend with a Republican majority in both chambers of Congress. Although members of the Republican leadership have hinted they might be willing to find common ground with the White House, it remains to be seen whether he will be able to achieve any of his legislative priorities with a Congress held by the opposition party.

In the address, Obama urged for parties to work together on a "bipartisan infrastructure bill."

In an apparent reference to the controversial Keystone XL pipeline — a project that could split Democratic opinion as well as expose the divide between Democrats and the GOP on the issue of climate change — the president said, "Let's set our sights higher than a single pipeline."

The comment was notable in its absence of any indication of how Obama stands on the pipeline.

Not all his policy priorities require congressional approval. Over the past year, he has gradually become more assertive in his unilateral use of executive authority to achieve domestic policy goals. After the failure of comprehensive immigration reform on the Hill, he signed an executive action to shield millions of undocumented immigrants from being deported. His administration has also tightened labor regulations for federal contractors and proposed new restrictions on power plant emissions.

On foreign policy, Obama urged that the U.S. lead "not with bluster but with persistent, steady resolve." He cited the recent shift in policy on Cuba as an example of the way forward. He added that the move toward normalizing relations with the communist state and easing the decades-old trade embargo "has the potential to end a legacy of mistrust."

In the official Republican rebuttal, Sen. Joni Ernst, R-Iowa, suggested that the GOP has a mandate to lead on policy in Congress. To combat stagnating wages and unemployment, she suggested policy changes such as simplifying the tax code and promoting free trade with Europe and the Pacific — a reference to the proposed Transatlantic Trade and Investment Partnership and Trans-Pacific Partnership.

"Americans have been hurting, but when we demand solutions, too often Washington responded with the same stale mindset that led to failed policies like 'Obamacare,'" she said. "It's a mindset that gave us political talking points, not serious solutions."

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