The State of the Union
Last night, President Joe Biden gave his second State of the Union (SOTU) address — and his first to a divided Congress. (Policy wonks will note that a president’s first address to a joint session of Congress – in Biden’s case, in 2021 -- isn’t technically a SOTU address.) The speech clocked in at 73 minutes, a full 10 minutes longer than last year’s SOTU, and touched on a number of topics, including Medicare and Social Security.
The president’s discussion of these entitlement programs spurred a heated exchange with some Republicans after the president accused them of wanting to eliminate the two programs. That exchange, which was largely ad-libbed by the president, ended in lawmakers from both parties rising to their feet when President Biden asked Congress to “stand up for seniors.”
That moment was one of the few points at which Republicans and Democrats stood in applause together. In fact, by most accounts the speech marked the unofficial launch of what will be a raucous and contentious 2024 presidential election.
So what will the president focus on over the next 21 months as voters decide whether he should occupy the White House for a second term? We will take a look this week, but first let’s examine the general mood of the country going into last night’s speech — and going into the Biden reelection campaign.
Do Americans Feel the State of the Union Is Strong?
Last night, President Biden declared the state of the U.S. economy is strong, but urged Congress to do more when it comes to rebuilding the economy after COVID-19, reducing prescription drug costs, and addressing income inequality. In fact, President Biden used the phrase “finish the job” eight times in his speech last night.
If public polling is to be believed, most Americans agree that there is still a lot to be done when it comes to the economy and other issues.
Not only does the president’s current approval rating stand at just 42 percent, an ABC/Washington Post poll released this week found only 36 percent of U.S. adults believe President Biden has accomplished a “great deal” or “a good amount” since he took office in January 2021. Nearly two-thirds (62 percent) said President Biden had accomplished “not very much” or “little to nothing.” While Republicans were more likely than Democrats to say the president had done little, there are a lot of Democratic voters who don’t seem impressed with the White House’s record thus far.
Additionally, a recent Monmouth survey found only 39 percent of Americans believe the state of the union is “somewhat strong” and an Associated Press survey found even Democrats are not sure if the president should run for reelection. In fact, only 37 percent of Democratic voters said he should. Younger Democrats were even more likely to oppose a second Biden term. Only 23 percent of the party’s youngest voters want President Biden to be their standard bearer in 2024.
Voters are also pessimistic about the future. According to a survey by Pew Research Center, 40 percent of Americans think the economy will be in a worse spot a year from now. More than half of Republicans (56 percent) feel that way, but so do one-quarter of Democrats. Pew also found the vast majority of Americans (both Republicans and Democrats) are still very worried about the rising price of food, energy, and housing. (One bright spot: Pew found only 36 percent of Americans are worried about the availability of consumer goods. Maybe that is why the term “supply chain” was only uttered twice in last night speech.)
Despite Americans’ pessimistic views of the president’s performance, President Biden attempted to strike a positive tone last night. He focused on a so-called “unity agenda,” or a series of four issues areas where he believes the two parties can come together. They were:
Ending cancer as we know it today;
Supporting U.S. armed forces veterans, their families, caregivers, and survivors;
Ending the opioid epidemic and address Americans’ mental health challenges; and
Police accountability, crime prevention, and criminal justice reform.
Other important issues also came up, of course.
What the President Said About Taxes and the Budget Deficit
President Biden did not say much about the elephant in the room — the looming debt ceiling crisis — and argued that, when it comes to addressing the national debt, Congress could tackle the problem by raising taxes on high-earning Americans.
Specifically, President Biden asked lawmakers to impose a minimum tax on American billionaires and to set a minimum tax for corporations. The commander in chief also asked the House and Senate to quadruple the tax on corporate stock buybacks, which a White House fact sheet said allows “corporations to funnel tax-advantaged payouts to wealthy and foreign investors, instead of paying dividends that shareholders are required to pay taxes on.” As Bloomberg reminded readers, a one percent stock buyback tax was part of the Inflation Reduction Act, but that levy is considered by many analysts to be too low of a rate to successfully deter companies from buying back their own shares.
None of these tax proposals are likely to gain traction in the Republican-controlled House, of course, but voters certainly do want Washington policymakers to deal with the budget deficit.
According to pollsters at the Pew Research Center, reducing the budget deficit (the annual gap between what the federal government takes in as far a revenue and what it spends that, cumulatively, adds to the national debt) is a higher priority for the public than in recent years. Indeed, 57 percent of Americans currently see addressing the budget deficit as a top priority for the president and Congress in the year ahead. That number compares with 45 percent who said the same a year ago. While Republicans are much more likely to emphasize deficit reduction, 44 percent of Democrats say reducing the budget deficit is a major priority.
Republicans, of course, prefer to address the national debt and annual budget deficit by reducing spending.
What the President Said About Financial Services and Technology
While financial services, fintech, and technology policy comprised only a small section of President Biden’s speech, what he said was notable.
It is clear the president will use the full weight of the executive branch agencies to regulate financial services, technology, and fintech. Indeed, President Biden cited efforts to improve the landscape for consumers through initiatives like the Consumer Financial Protection Bureau’s proposed rule to lower or eliminate so-called “junk” banking and credit card fees. The president also called on Congress to pass the Junk Fees Prevention Act, which would ban vacation resort and family seating fees, would eliminate unnecessary early termination fees for internet and phone services, and would crack down on excessive fees and other practices that drive up airline ticket prices.
As we wrote last week, technology policy is one area where federal lawmakers may be able to come together in the 118th Congress. Last night, President Biden urged Congress to “pass bipartisan legislation to strengthen antitrust enforcement and prevent big online platforms from giving their own products an unfair advantage.”
Would Americans support these measures? According to Pew Research Center, the answer is not clear. Its polling found Americans divided in their views about whether technology companies are having a positive effect on the country or not, with Republicans’ views growing more negative in recent years. Today, only 49 percent believe tech companies are a net benefit to society. (To be sure, that number is better than Americans’ estimation of financial firms. Just 40 percent of Americans think banks and financial institutions have a positive impact on consumers and the U.S. economy.) And in a survey released last spring, just 44 percent of Americans said they favored greater regulation of tech companies.
As NextGov explained, President Biden also wants Congress to take action on data privacy, especially when it comes to social media companies. Specifically, the president called for cooperation on legislation that would bar online targeted advertising for children and teenagers and to put together strong privacy, data, health and online safety protections. “We must finally hold social media companies accountable for the experiment they are running on our children for profit,” Biden said. More generally, President Biden also asked lawmakers to impose stricter limits on the companies’ use of personal data.
What Will Get Done?
For all the pomp and pageantry that a State of the Union brings to primetime television, the speech is hardly an action forcing event.
This week, Politico examined some of the major promises President Biden made in his 2022 SOTU. A year ago, for example, the president also pledged address inflation and the budget deficit. While those numbers have improved, the Washington-D.C.-based newspaper concluded that outcome is not necessarily due to the president’s policies. Other initiatives that President Biden discussed last year, such as paid family leave, implementing a Paycheck Fairness Act, and renewing the child tax credit at its pandemic levels, went nowhere in 2022.
Politico noted the president also focused on policing in last year’s SOTU, but “police reform talks never restarted last year after crumbling in 2021.” (As noted above, this issue is part of President Biden’s four-point “unity agenda.”)
Finally, last night President Biden stated his goal is to cut the cancer death rate by at least 50 percent over the next 25 years. Readers might also recall that the “Cancer Moonshot” was part of President Barack Obama’s final SOTU in 2016. In other words: when it comes to the annual SOTU, what is old is new all over again.