President Barack Obama speaking during the 2012 State of the Union. Photo by the PBS NewsHour.
President Obama put forth a set of liberal policy items focused on economic innovation and restoring the American economy in his 2012 State of the Union speech, ushering in an election year when economic health seemed preeminent in the minds of voters.
He championed the concept of the American Dream, supporting tax credits and education investments he said would keep that dream a reality, while pushing for investigations into banks’ risky lending practices. Ahead of the long campaign — and the even longer “fiscal cliff” debates — he sought to appeal to the interests of the middle class, invoking concerns about outsourcing, job creation and college affordability.
But with an election year came increased challenges to seeing these proposals come to fruition, especially with members of Congress wary of any votes that could come back to haunt them in November. So which of these economic proposals were enacted, which died along the way and which were never heard of again?
Curb the Outsourcing of American Jobs
“If you’re a business that wants to outsource jobs, you shouldn’t get a tax deduction for doing it…. No American company should be able to avoid paying its fair share of taxes by moving jobs and profits overseas.”
Not Achieved: Sen. Debbie Stabenow, D-Mich., introduced the Bring Jobs Home Act, or the “insourcing” bill, which offered tax credits to businesses bringing outsourced jobs back to the States and stripped tax credits from companies spending money to ship jobs overseas. But Senate Republicans blocked the bill in July.
Investigate Unfair Trade Practices
“Tonight I’m announcing the creation of a Trade Enforcement Unit that will be charged with investigating unfair trading practices in countries like China.”
Achieved: In February 2012, the president created the Interagency Trade Enforcement Center by executive order. As China’s economic threat emerged as an issue in the election, the administration brought a trade case against China, asking the World Trade Organization to talk with Beijing about easing Chinese restrictions on exports on rare-earth elements.
Increase Job Training Opportunities
“Join me in a national commitment to train two million Americans with skills that will lead directly to a job.”
Not Achieved: At Northern Virginia Community College in February, President Obama proposed an $8 billion “Community College to Career Fund” to subsidize job training programs for two million workers. No congressional action has been taken on the fund.
Extend Interest Rate Freeze on Student Loans
“At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July.”
Achieved: In late June, Congress passed a $127 billion transportation measure and student loan extension bill, extending the 3.4 percent interest rate on Stafford loans for one year, just ahead of the July deadline.
Extend Tuition Tax Credit
“Extend the tuition tax credit we started, that saves millions of middle-class families thousands of dollars. And give more young people the chance to earn their way through college by doubling the number of work-study jobs in the next five years.”
Achieved: The fiscal cliff deal extended the American Opportunity Tax Credit through 2017, allowing families to take a tax credit up to $2,500. The Tuition and Fees Deduction was also extended through 2013.
Support Small Businesses and Startups
“After all, innovation is what America has always been about. Most new jobs are created in startups and small businesses. So let’s pass an agenda that helps them succeed. Tear down regulations that prevent aspiring entrepreneurs from getting the financing to grow. Expand tax relief to small businesses that are raising wages and creating good jobs. Both parties agree on these ideas. So put them in a bill and get it on my desk this year.”
Achieved: President Obama signed into law the Jumpstart Our Business Startups (JOBS) Act in April. The law eases funding restrictions for small businesses.
Mortgage Relief for Homeowners
“I’m sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage by refinancing at historically low interest rates. No more red tape; no more runaround from the banks. A small fee on the largest financial institutions will ensure that it won’t add to the deficit and will give banks that were rescued by taxpayers a chance to repay a deficit of trust.”
Investigate Risky Mortgages That Led to Housing Crisis
“And tonight I’m asking my attorney general to create a special unit of federal prosecutors and leading state attorney general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. This new unit will hold accountable those who broke the law, speed assistance to homeowners and help turn the page on an era of recklessness that hurt so many Americans.”
Achieved: President Obama appointed N.Y. Attorney General Eric Schneiderman to oversee the Justice Department’s federal mortgage task force, officially known as the Residential Mortgage-Backed Securities Working Group. The task force filed suit against two major banks, first Bear Stearns and Company — now part of JPMorgan — and Credit Suisse for misleading investors.
Payroll Tax Cut
“Right now our most immediate priority is stopping a tax hike on 160 million working Americans while the recovery is still fragile. People cannot afford losing $40 out of each paycheck this year…. No side issues. No drama. Pass the payroll tax cut without delay.”
Achieved: Congress passed an extension of the payroll tax cut in February. The tax cut lapsed at the end of 2012 since the extension was not renewed as part of the “fiscal cliff” deal.
Minimum Tax Rate for Millionaires
“Tax reform should follow the Buffett rule: If you make more than a million dollars a year, you should not pay less than 30 percent in taxes. And my Republican friend Tom Coburn is right: Washington should stop subsidizing millionaires. In fact, if you’re earning a million dollars a year, you shouldn’t get special tax subsidies or deductions. On the other hand, if you make under $250,000 a year, like 98 percent of American families, your taxes shouldn’t go up. You’re the ones struggling with rising costs and stagnant wages. You’re the ones who need relief.”
Not Achieved: The Senate defeated the minimum tax on the wealthy, otherwise known as the Buffett Rule. In the fiscal cliff negotiations, Obama was forced to adjust upward his initial $250,000 threshold for Bush tax cut extensions to $400,000 for individuals and $450,000 for couples.
Ban Insider Trading for Congress Members
“Send me a bill that bans insider trading by members of Congress; I will sign it tomorrow.”
Achieved: President Obama signed the STOCK Act in April, banning members of Congress and their staff from trading non-public information to enrich their portfolios.
Stop Subsidies for Oil Companies
“We’ve subsidized oil companies for a century. That’s long enough. It’s time to end the taxpayer giveaways to an industry that rarely has been more profitable, and double down on a clean energy industry that never has been more promising. Pass clean energy tax credits; create these jobs.”
Not Achieved: President Obama and Congressional Democrats didn’t get enough procedural votes in the Senate for their bill to cut oil subsidies to survive. The fiscal cliff deal extended tax credits for wind energy.
Create a Veterans Job Corps
“And tonight I’m proposing a Veterans Job Corps that will help our communities hire veterans as cops and firefighters, so that America is as strong as those who defend her.”
Not Achieved: Republicans opposed the costs associated with Obama’s Veterans Job Corps bill, which failed to receive the 60 votes in the Senate it needed to move forward.
Sandi Fox and James Hercher contributed to this report.