President Joe Biden delivers his State of the Union address to a joint session of Congress at the U.S. Capitol, Tuesday, Feb. 7, 2023, in Washington, as Vice President Kamala Harris and House Speaker Kevin McCarthy of California applaud.
Pool | Via Reuters
President Joe Biden delivered his second State of the Union address to Congress on Tuesday night, marking the halfway point of his term. It’s an opportunity for him to highlight the administration’s accomplishments so far, as well as set the tone for how to look forward to the next two years, maybe even more.
Biden has been optimistic about economic policy after recent reports showed low unemployment and strong job growth, but his speech showed more ambition to shape the economy into one that grows “from the bottom and the middle, not from the top down.”
Here’s the economic news you missed:
Billionaire tax refunds?
Biden renewed his call to tax billionaires and buy back corporate stock to reduce the federal deficit.
“The tax system is unfair; it’s unfair,” Biden said. “The idea that in 2020, the 55 largest companies in America, from the Fortune 500, generate $40 billion in profits and pay $0 in federal taxes? $0? People, it’s not fair.”
The idea was popularized by progressives like Senator Elizabeth Warren and Bernie Sanders in the 2020 campaign. Biden vowed not to raise taxes on Americans who earn $400,000 a year.
“Now because of the law that I signed, billion dollar companies have to pay a minimum of 15%, God love them,” Biden told Democrats. “15%! That’s less than nurses pay!”
Biden previously proposed a 20% tax on billionaires in March last year as part of the federal budget. In his State of the Union address Tuesday, Biden called on Congress to “finish the job.” The proposal hasn’t gained much traction and is unlikely to go anywhere in the Republican-controlled House.
The fight against ‘waste costs’
Biden continues to fight against unnecessary “junk fees” from banks, airlines, cable companies and other industries that add to it. surprise charges for consumer bills.
“Look, the cost of garbage may not be a problem for the rich, but it’s a problem for most of the rest of us at home as far as I can see,” Biden said. “They add up to hundreds of dollars a month. They make it harder for you to pay your bills.”
The Consumer Financial Protection Bureau proposed new rules to ban excessive credit card late fees last week. Congress banned excessive spending in 2009, but the Board of Governors of the Federal Reserve has issued measures to violate the law.
Biden in his speech called on Congress to pass the Waste Fee Prevention Act that would impose more restrictions on excessive fees on travel and event tickets.
“Airlines can’t treat your child like a piece of cake. The American people are tired of it. They’re tired of being played to suck.”
Antitrust takes center stage
In addition to waste charges, the Biden administration has taken steps to address antitrust issues, a point the president emphasized in his State of the Union address. Biden issued an executive order in October to allow hearing aids to be sold over the counter, making them cheaper for the average consumer.
“Look, capitalism without competition isn’t capitalism, it’s extortion,” Biden said Tuesday night.
The White House repeated that line in November when Ticketmaster’s parent company Live Nation failed to release tickets for Taylor Swift’s Eras Tour, prompting an antitrust investigation. The company was later grilled by members of the Senate Judiciary Committee for its antitrust practices.
“Let’s get the job done, pass bipartisan legislation to strengthen antitrust enforcement to prevent big online platforms from giving an unfair advantage to their own products,” Biden said.
Labor and wages
The president listed several labor-first initiatives as part of a broader effort to build “the economy [that] it’s possible for everyone, so we can all feel proud of what we do.”
He berated companies that make workers sign noncompete agreements, referring to an executive order signed last month that encourages the Federal Trade Commission to ban or limit noncompete agreements. Biden said 30 million Americans should sign non-compete agreements for positions ranging from executives to fast-food cashiers.
Furthermore, Biden called on Congress to pass the Protecting the Right to Organize Act, restoring employees’ right to unionize without retaliation.
“I’ve always gotten a response from my friends on the left, but the right,” Biden said, referring to Republicans. “I am so sick and tired of companies breaking the law by preventing workers from organizing. Pass the PRO Act!”
Biden continues to call for workers to have access to sick days, paid family leave and affordable child care.
Expand the insulin price cap
Drug prices are again important to Biden. The president called for an expansion of the $35 price cap for insulin provided in the Medicare Inflation Reduction Act for privately insured Americans.
“One in ten Americans has diabetes, many people in this room, in the audience,” Biden said. “And every day millions of people need insulin to control their diabetes to survive.”
Biden lashed out at drug companies for raising the price of insulin from about $10 a bottle, to hundreds of dollars a month, “making record profits,” from the drug. He welcomed Congress’s move to cap costs for Medicare recipients, but insisted it needed to be expanded.
“There are millions of other Americans who are not covered by Medicare, including 200,000 young people with Type 1 diabetes who need this insulin to survive,” Biden said. “Let’s finish this project. Let’s cap the cost of insulin for everyone at $35.”
What does this mean?
Many of the ideas proposed by Biden, such as the billionaire tax and the PRO Act, will be a hard sell in the Republican-controlled House and may be dead on arrival.
The White House and House Republicans have been deadlocked on whether Congress will raise the debt ceiling, a routine step that has been taken for decades consistently without conditions. House Republicans have threatened to allow the state to default on its debt obligations if Biden does not agree to spending cuts they believe should be handled separately. A month into the new Congress, the situation is a preview of how the rest of the negotiations will go.