The following editorial appears on Bloomberg View:
President Barack Obama’s annual State of the Union addresses have been more fanciful than most. Not because he has championed colonizing distant galaxies or dispensing free ice cream, but because for the last four years half of Congress – this year, all of it – has been controlled by a party that has starkly different ideas about the role and purpose of government.
Last night’s address has to be viewed in this context. The two parties in Washington are more polarized than at any time in recent history. A series of elections over the course of a decade has produced herky-jerky results with no clear resolution about the nation’s ideological direction.
Consequently, it’s easy to dismiss the president’s State of the Union speech as mere words. As for its content, the White House announced many of the proposals ahead of time. And it’s certainly true that the audacity of a president’s proposals tends to be inversely proportional to his capacity to enact them.
Still, the speech is not quite beside the point – not yet, anyway. Nor is Obama himself, with a rising approval rating that compares favorably with his predecessor’s at this point in his term.
One measure of the speech’s success is how much (or whether) it reframes the debate. By that standard, Republicans’ reaction to [the] speech – they disliked it even before they heard it – is encouraging.
They have reserved particular ire for Obama’s tax proposals. In short, Obama has proposed raising the top tax rate for capital gains and dividends from 23.5 percent to 28 percent for couples making more than $500,000 a year. He would also raise taxes on inheritance steeply among the very wealthy. And he would impose a new fee on what a White House fact sheet calls “large, highly-leveraged financial institutions to discourage excessive borrowing.” Obama would use the $300 billion or so in revenue from these changes to finance a range of tax breaks targeted at middle-class families.
The merits of these proposals – none of which is likely to become law any time soon – are less important right now than their source. This is not yet another report from a Washington think tank or interest group: This is the president of the United States using the biggest bully pulpit he has. And Obama is addressing a genuine problem: stagnating and declining wages among middle- and working-class Americans amid soaring incomes and wealth at the very top. Recognizing a trend that poses long- term risks to the social fabric, some Republicans have started trying to grapple with these forces, too.
There are no better grounds for political debate in 2015 and 2016. Of all the challenges facing the U.S., the most pressing is how best to increase the wages and improve the living standards of a shrinking middle class without huge deficit spending. It’s an effort that will require sustained and concerted action, by one party or two, in both the White House and Congress. It won’t happen through words alone. But the words come first.