In his State of the Union address last night, President Obama said that his “top priority remains ensuring middle class Americans feel secure in their jobs, homes and budgets.” The President said he will “work with Congress and act on his own to expand opportunity for all so that every American can get ahead and have a shot at creating a better life for their kids.” The President also pledged to expand the earned-income tax credit, overhaul the tax code to eliminate “wasteful loopholes” and lower tax rates for businesses that create jobs in the United States.
The President said, “Today, after four years of economic growth, corporate profits and stock prices have rarely been higher, and those at the top have never done better. But average wages have barely budged. Inequality has deepened. Upward mobility has stalled. The cold, hard fact is that even in the midst of recovery, too many Americans are working more than ever just to get by; let alone to get ahead. And too many still aren't working at all. So our job is to reverse these trends.” The President continued, “It won't happen right away, and we won't agree on everything. But what I offer tonight is a set of concrete, practical proposals to speed up growth, strengthen the middle class and build new ladders of opportunity into the middle class. Some require congressional action, and I'm eager to work with all of you. But America does not stand still, and neither will I. So wherever and whenever I can take steps without legislation to expand opportunity for more American families, that's what I'm going to do.”
On the issue of taxes, the President said, “The best measure of opportunity is access to a good job. With the economy picking up speed, companies say they intend to hire more people this year. And over half of big manufacturers say they're thinking of insourcing jobs from abroad.” The President continued, “So let's make that decision easier for more companies. Both Democrats and Republicans have argued that our tax code is riddled with wasteful, complicated loopholes that punish businesses investing here, and reward companies that keep profits abroad. Let's flip that equation. Let's work together to close those loopholes, end those incentives to ship jobs overseas, and lower tax rates for businesses that create jobs right here at home. Moreover, we can take the money we save from this transition to tax reform to create jobs rebuilding our roads, upgrading our ports, unclogging our commutes -- because in today's global economy, first- class jobs gravitate to first-class infrastructure. We'll need Congress to protect more than 3 million jobs by finishing transportation and waterways bills this summer. That can happen.”
The President also pledged to strengthen the Earned Income Tax Credit and called on Congress to pass a “significant increase in the EITC for workers without children, including non-custodial parents.” The President also urged Congress to “work with me to fix an upside-down tax code that gives big tax breaks to help the wealthy save, but does little or nothing for middle-class Americans.”
In reaction to the President’s speech, House Ways and Means Chairman Dave Camp said, “We must focus on strengthening the economy. Unfortunately, the President’s address offered little in the way of substantive policies that will lead to the kind of strong job creation you see when employers have the resources to invest, hire and increase wages. Rather than rely on more of the same – more calls for increasing the minimum wage, another round of extended unemployment benefits and more costly regulations that grow government but shrink resources – it would have been encouraging to hear the President offer specific ideas on two policies that can put more money in the hands of hardworking families and create jobs – making the tax code simpler and fairer for all and pursuing ambitious trade policies.” Camp added, “Our current tax code is an anchor dragging down our economy. We must modernize our tax code so businesses can hire new workers and Americans can see more take-home pay. While the President noted the importance of corporate tax reform, we must reform all of the tax code so that hardworking families and businesses on Main Street can have a tax code that works for them – not just big business. Tax reform done right means greater economic growth and more money in the pockets of middle-class families.”