SOTU 2014: U.S. President Barack Obama will deliver his fifth State of the Union address tonight, which means tomorrow most media outlets will graph and "wordcloud" his most used buzzwords like "jobs," "invest," and "innovate."
Instead of waiting until after the SOTU, we put together the nine phrases you're likely to hear tonight - as well as why President Obama needs to address them.
Here's your outline of State of the Union 2014:
- "Income inequality"
Income inequality (or income distribution) in the United States - and even the world - is expected to be the single largest theme. This week a report during the Davos Forum revealed that the top 85 richest people in the world had the same amount of wealth as the poorest half of the world (3.5 billion people). Income inequality has been a critical topic for the progressive president... after all, it has accelerated in the last five years.
President Obama will likely note that higher capital gains taxes haven't stopped the markets from soaring, and that while the market hits record highs, the average American is still struggling.
- "The minimum wage"
While the stock market has soared, American wages have stagnated since the onset of the financial crisis. President Obama will again call for an increase in the federal minimum wage. Calls to increase the minimum wage are coming from both sides of the aisle, although doing so has historically done little to increase employment, decrease automation, or spur investment. Expect the figure to be $10.10 as the target rate.
- "The Affordable Healthcare Act"
Although it's clear he'd rather avoid the subject, President Obama must discuss the biggest political football in Washington: The Affordable Healthcare Act, a.k.a. Obamacare.
The rough kickoff to the program, ongoing spiral of problems in the insurance program, and inability to drive young Americans into the healthcare markets have fueled a comical amount of delays, excuses, and embarrassments for the administration. Retiring Rep. Jim Moran (D-VA) recently said the dearth of enrollments from young, healthy Americans will "unravel" the healthcare system.
The president will excuse these problems as "kinks" or "glitches" like those that companies face when introducing something grand to the market. And while this may be half-true, usually someone gets fired or is held accountable, unlike the healthcare rollout.
President Obama will speak to the "official" statistics on signups and likely offer a shout out to one or two Americans suffering from health problems who were able to obtain healthcare thanks to the passage of the law.
- "Executive action... Executive order..."
No topic after the State of the Union will spark more partisan divide than what would come in the event President Obama threatens to go it alone and sign executive orders on any number of stagnating issues in Washington.
Many forget that in 2008, President Obama accused George W. Bush of going around Congress too often. Only recently has President Obama warmed to greater use of executive fiat to push his agenda. Many Democrats argue he should even go further.
Last month, the president famously said that he has a phone and a pen, signaling a demand that he expects Congress to call him, or he'll take action alone. From minimum wage to infrastructure, President Obama has explored ways to go around Congress. The goal is to force Republicans to play along or present them as obstructionists who do not deserve the majority in the House or the Senate in an election year.
- "...Washington dysfunction"
This is a favorite subject of President Obama. He will take a number of backhanded shots at Republicans arguing that the American people are tired of Washington dysfunction and that they must work together. The president will explain that the "American people deserve" a Washington that works and will highlight that it is critical that both Republicans and Democrats work together - or else, he will use executive action.
- "On the day I took office..."
Every year, President Obama notes that on the day he came into office five years ago, the United States lost nearly 4 million jobs (2012's speech)... was engaged in two wars (2010), had an auto industry on the verge of collapse (2010)... and was in the wake of "the worst recession most of us have ever known" (2011).
Should the president tie his first day in office to this speech, he will likely do so over the issue of income inequality, noting that the U.S. stock market has increased dramatically while the average worker hasn't experienced a recovery. Perhaps the camera should cut to Ben Bernanke if the president ponders why this has occurred.
- "We must address climate change..."
President Obama will again speak of a need to tackle climate change, likely pointing to California's crippling drought to justify his agenda, which includes more centralized planning, crony alternative energy spending, and little cost-benefit analysis.
- "Send me comprehensive immigration reform..."
While the Congressional Budget Office noted that passing amnesty to undocumented workers would drive down wages for American workers, calls for amnesty are heating up around the country. Immigration reform is needed in the United States, but concerns about an influx of labor at a time the supply of high-paying jobs is down will loom.
- "We can't wait!"
From climate change to job creation, from infrastructure to immigration reform, President Obama will fuel a sense of urgency for greater top-down government rules, regulations, redistribution, and tax increases.
And that term defines Washington - a bastion of "Pass laws first, think about consequences later."
We'll be back Wednesday to follow-up what State of the Union (SOTU) 2014 means for the economy, and the likelihood the outlined agenda moves forward.
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.