State of the Union Summary: 2016 and Past SOTUs

President Obama's 2016 SOTU

Obama SOTU
President Barack Obama delivers his State of the Union address before a joint session of Congress on Capitol Hill January 12, 2016 in Washington, D.C.. Photo: Getty Images

President Obama presented his eighth and final annual State of the Union address (SOTU) on January 12, 2016, at 9 p.m. EST. The SOTU usually outlines the President's priorities for the fiscal year, including the current Federal budget. Since this was Obama's final SOTU, he summarized  his economic accomplishmentsnts and vision for the future. 

2016 SOTU Summary

President Obama focused on four areas and presented the following solutions.

Equal Opportunity to Achieve Economic Success: Obama's priorities are consistent with his definition of the American Dream, which he described as..."This country does best when everyone gets their fair shot." To do this, he wants everyone get the education they need to prosper. Offer pre-kindergarten for all. Offer every student computer science and math classes.Make college affordable by providing free community college to every responsible student.

Strengthen Social Security and Medicare. Expand tax cuts to low-income workers  Retrain workers, don't just give them unemployment insurance.If new job doesn't pay as much, offer wage insurance. Showcase employers who exhibit best practices.

Use Technology to Solve Problems: Reignite spirit of innovation to solve climate change. Higher taxes and fewer subsidies on fossil fuels. Put Joe Biden at the head of a new cure cancer initiative. 

Keep America Safe:  Asked Congress to authorize military force against ISIL.

Even without that, the military will continue to work with local forces in Syria and other failing states. He wants to avoid getting stuck in a ground war like in Iraq and Vietnam.

Obama asked Congress to approve the Trans-Pacific Partnership to offset China's power in the region. 

Better Political System: End gerrymandering.

Find a solution to campaign finance reform. Make it easier to vote.

Obama also said he would like to accomplish the following things, but wouldn't go into detail. He said he would still work for programs that advance judicial reform, fight prescription drug abuse, help students write computer code, fix a broken immigration system, provide equal pay for equal work, and raise the minimum wage.

He ended the speech with a callback to his 2008 campaign: "I believe in change because I believe in you. That's why I stand here confident that the State of our Union is strong." 

Economic Impact

If adopted, Obama's proposals would stimulate growth and job creation by boosting demand. They are opposed by Republicans who support Reaganomics, and hold a majority in Congress. Instead, he's using this speech to frame the discussion, and challenge them to come up with their own proactive proposals. 

The Transatlantic Trade and Investment Partnership and the Trans-Pacific Partnership, on the other hand, are blocked by Democrats, who are worried they promote job outsourcing.

Combined, these agreements would add $14 billion a year in exports. Article updated January 12, 2016..

Past SOTUs and Their Records

Obama's priorities have been very consistent since his 2004 Democratic Convention speech, and his 2008 campaign. His SOTUs are, therefore, very similar.

2015 SOTU

President Obama's 2015 SOTU focused on eight priority areas:

1. Tax Reform: Obama wanted to raise $320 billion in ten years by increasing the top capital-gains tax rate from 23.8% to 28%. This rate applies to the highest 1% of earners, such as married couples making more than $500,000. He also wanted to extend the capital-gains tax on inherited assets, and increase taxes on banks that use a lot of debt and derivatives for trading.

That would pay for $235 billion in tax cuts for the middle-class over the next ten years. This includes a $500 tax credit for moderate-income households with two earners, tripling the child-care tax credit to $3,000 a year, and permanently extending the earned-income credit.

Finally, he wanted to close corporate tax loopholes to fund $150 billion for infrastructure spending. He also advocates lower rates for businesses that create U.S. jobs, and raise them for those that create jobs overseas.(Source: White House Tax Reform Fact SheetObama Plan Reignites Tax FightWSJ, January 20, 2015; Will There Be Any SurprisesPolitico, January 20, 2015)

2. Middle-Class Economics:  He revised last year's focus on reversing income inequality to the term "Middle-Class Economics." He asked Congress to pass the Women's Paycheck Fairness Act. Since women hold many entry-level jobs, he again asked to raise the U.S. minimum wage to a living wage

Help states require 7 days of paid sick leave for all workers. Make tax-advantaged retirement savings plans automatic (opt-out rather than opt-in). Fund more infrastructure projects, including faster internet, to support a 21st century economy and job creation. He would reject any proposal to approve the Keystone Pipeline unless it was part of a larger infrastructure plan.

3. Precision Medicine Initiative: This furthers the computerized medical records begun in the ARRA and the ACA. It provides data needed to cure diseases and give patients electronic access to their own medical records.

4. Attack Climate Change: Agreement with China on climate control. More stringent methane emissions standards.

5. Immigration Reform: Obama passed an Executive Order that prioritized the deportation of illegal immigrants who had committed felons. He has deported 400,000 each year.Others, who have lived in the United States for five years or more, and have children who are citizens or legal residents, can apply for three years of deportation protection. They would have to register, pass criminal background checks, and pay taxes. He further challenges Congress to reform the U.S. immigration process.

6. Help Improve Workers' Skills: Make two years of community college free. Make two years of community college free.  Support more programs to train and hire veterans. Streamline the education tax credit to give more college students $2,500 each year for five years.

7. Defense: Ask Congress to pass a resolution for the use of force against ISIS. Work with allies to address the resurgence of ISIS and other terrorist groups. Focus on cyber-terrorism at home. Use economic sanctions, like the ones that worked against Russia. He will veto any Congressional trade sanction against Iran, which could disrupt ongoing negotiations. Asked Congress to pass legislation needed to fight cyberthreats.

8. Trade: Ask Congress to pass the Trade Promotion Authority. End the embargo against Cuba, extending Obama's easing of trade relations. Close the Guantanamo prison.

2014 Summary and Record

Tax Code Overhaul: Lower taxes on companies that create U.S. jobs, higher taxes on ones that outsource. No action. Instead, Obama created a new savings bond called "MyRA," to help workers without pensions or 401(k)s save for retirement. Workers would sign up to have part of their paycheck automatically deducted, and put into Treasury bonds. The account would have the same tax break as IRAs, and gives Americans the same right for automatic savings at work that Congress has. 

Create Jobs - Pass the rest of the American Jobs Act, fund more infrastructure, and raise minimum wage to $10.10/hour. Obama passed an Executive Order that requires businesses that have government contracts to raise the minimum wage to $10.10 an hour by 2015. That level is enough to keep families above the poverty level, and keeps up with the cost of living.

  • Pass transportation and waterways bills to protect 3 million jobs. Waterways bill passed, only a stop-gap transportation funding bill was passed. 
  • Undo budget cuts to federally-funded R&D. Funding remained below pre-sequestration levels, except for research on Alzheimer's, pediatrics, and Ebola. 
  • Launch six more technology hubs like the ones created in Raleigh, NC and Youngston, OH. Included in 2015 budget.
  • Streamline permitting process for construction projects. Done by executive order.
  • Create new public-private partnerships for manufacturing innovation and technology.
  • Hire the long-term unemployed and people looking for their first job. Streamlined federal job training programs.

Attack Global Warming - Switch more cars to natural gas by adding fueling stations. Not funded.

  • Stop giving $4 billion in subsidies to oil companies, and give them to renewable fuels companies. No action.
  • Protect more federal lands through executive orders.  He designated four national monuments.
  • Set carbon standards for existing power plants, like it already did for new coal- and gas-fired plants.  The EPA required plants to lower emissions by 30% by 2030.
  • Obama hiked fuel-economy standards for cars and light trucks to 54.5 miles per gallon by 2025. He did the same for heavy-duty trucks. They must improve their fuel efficiency 20% by 2018. (Source: Washington Post, Here are 7 policies Obama said he would do without Congress, January 29, 2014)

Immigration Reform - Pass the Senate's Comprehensive Immigration Reform Bill, which  allows immigrants to become citizens if they learn English, pass a criminal background check, and pay any back taxes. They'd also pay a citizenship fee, and wait in line behind legal immigrants. It also doubles the number of border security agents, cracks down on businesses that hire illegal workers and increases the number of guest worker visas. 

Instead, the House proposed a bill that would require Homeland Security to report how it will control U.S. borders in two years. Mandate all businesses use the federal E-Verify employment database system. Give more green cards to foreign-born graduates who majored in math and science at U.S. universities. Create a  program for farm workers. Allow states to enforce federal immigration laws. Grant legal status to 11.5 illegal immigrants, with an opportunity to get a green card. Open a similar pathway to children brought to the United States. (Source: AZCentral, Immigration Reform Still Hinges on Boehner, January 2, 2013)

Education - The President promoted education as a way out of poverty. This includes Federal programs that work with states to make preschool available to every child in America, because every dollar invested saves $7 later on. Thirty states have already done so, and Obama said he will put together a coalition to make the "Race to the Top" program for preschoolers.

The FCC, Apple and the major internet providers are installing broadband in high schools. Establish more partnerships with companies to provide math, science and high tech training to high school students.

Limit loan repayments to 10% of income. Obama ordered the Department of Education to do so.

Defense and Trade - End the War in Afghanistan. Done, with 9,800 troops to train Afghanis.  Keep domestic defense strong, but move off a permanent war footing. Reduce use of drones. Reform surveillance programs to protect domestic privacy. Close Guantanamo Bay because it's unconstitutional. Rely on diplomacy as well as military might. Keep Iran from obtaining a nuclear weapon. Obama promised to provide more healthcare, including mental healthcare, for returning veterans. He also promised more job training and support for families.

Gun Control -  Pass any gun control legislation. No action by Congress. New regulations include clarification on who is diagnosed as mentally ill to keep them from buying firearms, reduce barriers to states submitting data to the National Instant Criminal Background Check System, and an FBI rule that allows law enforcement to run a full background check before returning a seized gun. The Justice Department gave $1 million to the National Crime Prevention Council to teach safe firearms storage

Obamacare - Stop voting against the Affordable Care Act. (Source: Obama's 2014 SOTU ProsposalsWashington Post, January 20, 2015)

2013:  Obama mentioned the same 8 main points, with the following differences:

  1. Debt Reduction - Implement existing Obamacare healthcare cost savings and new taxes.
  2. Create Jobs - Same as 2014, except raise minimum wage to $9/hour.
  3. Attack Climate Change - Develop U.S. energy, alternative energy and fund energy efficiency.
  4. Immigration Reform - Stronger border security, a path to citizenship for illegal immigrants, and a guest worker program.
  5. Education - Same as 2014, and reward higher ed for cutting costs.
  6. Gun Control - Strengthen gun control through a Senate bill, (that was defeated)  to strengthen background checks and ban military-style assault rifles and high-capacity magazines.  (Source: Washington Post, Say What!)

  7. Tax Code Overhaul, Defense and Trade and Gun Control - Same as 2014.

Most of Obama's priorities in the 2013 did not make it past a House controlled by Tea Party-Republicans. Instead, he spend his political capital negotiating with Congress to raise the debt ceiling and passing a budget. It ended with a 16-day government shutdown in October. After that, he was busy defending and tweaking Obamacare in response to criticism over delays and technical malfunctions of the web site. Obama kept his promise to lower the U.S. deficit without cutting Social Security and Medicare benefits.

His 2013 executive order to increase information sharing to combat cyber attacks blew up in his face. He was severely criticized for allowing the NSA to snoop into American's online habits and emails. 

2012: Obama presented this Economic Blueprint to address income inequality.

  1. Extend the 2010 tax cuts to everyone except those making $250,000 a year or more.
  2. Approve the American Jobs Act. It would extend the payroll tax cut as well as extended unemployment benefits. He also wants to eliminate tax breaks for companies that move jobs overseas, lower taxes for companies that hire Americans, and give tax breaks for companies that build in distressed areas and train workers.
  3. Strengthen the domestic energy industry by developing natural gas, reduce tax credits for oil exploration, give tax credits for alternative energy development and allow the development of clean energy on enough public land to power three million homes and direct the Navy to purchase enough capacity to power a quarter of a million homes a year.
  4. Defense - The elimination of Osama bin Laden, and the end of the Iraq War meant that defense could sustain $500 billion in cuts in traditional military, while increasing cyber-security. Create a Jobs Corps for Veterans.
  5. Free trade - Signed free trade agreements with Colombia, South Korea and Panama in 2011. Set up a Trade Investigation Unit to enforce trade agreements.
  6. Education, housing and regulations - Train 2 million of the structurally unemployed, extend the tuition tax credit, and double the number of work/study jobs. Giving mortgage holders $3,000 a year with a refinancing program, funded by a small fee on the big banks. Retain the Dodd-Frank Wall Street Reform Act. Ban insider trading among Congressmen.

2011: Obama focused on job creation, but the specifics were weak. He proposed adding 100,000 math and science teachers within 10 years and making the tuition tax credit permanent. He expanded the ARRA stimulus program's expansion of public works projects. His other proposals included: 

  1. Reduce the corporate tax rate, but close loopholes so the net effect on the budget would be zero.
  2. Freeze discretionary spending budget at current levels, which "would reduce the deficit by more than $400 billion over the next decade." 
  3. Let the Bush tax cuts expire for those making over $250,000.
  4. Approve a free-trade agreement (FTA) with South Korea.
  5. Cut oil consumption by 785 million barrels by 2030, boost renewable-energy investment by more than 85%, end the $4 billion-a-year in tax subsidies to oil and gas producers, and add 1 million alternative energy vehicles by 2015.

The immediate impact of Obama's business-friendly speech was the Dow went above 12,000 for the first time since 2008. 

2010: Obama called on Congress to:

  • Pass the Dodd-Frank Wall Street Reform Act. Passed on July 21, 2010.
  • Agree to economic stimulus for small businesses, including $33 billion in tax credits for those that add new workers or give raises beyond a cost-of-living increase. It raised the limit on SBA loan guarantees from $2 million to $5 million, and took $30 billion from TARP for 8,000 community banks, and eliminating capital gains taxes for investors in small businesses.
  • Step up programs to encourage re-financing so that homeowners can move into more affordable and sustainable mortgages. Not much changed.
  • Allow bankruptcy proceedings to renegotiate all debts. This didn't happen. Find out how the 2005 Bankruptcy Act helped cause the recession.
  • Freeze non-security discretionary spending for three years. Create a bipartisan Fiscal Commission.
  • Launch a National Export Initiative to help small businesses. Free trade agreements with South Korea, Panama, and Colombia. Later approved.
  • End tax breaks for companies that outsource jobs. He did include a permanent extension of the Research and Experimentation tax credit in the FY 2012 budget.
  • Pass the Jobs Bill. Passed in February as the small business stimulus package.


Compare the President's Budgets

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