Highlights of President Barack Obama’s State of the Union address:
Said the wealthy should pay their fair share in taxes, arguing that anyone who makes more than $1 million should pay a minimum tax rate of at least 30 percent. He also provided more details about the so-called Buffett rule, which sets a goal of a minimum tax rate for those earning $1 million or more a year.
Pushed measures for college affordability, including taking federal aid from colleges that don’t keep net tuition down and provide good value, and urged Congress to make permanent a tuition tax credit worth $10,000 over four years. He also called for a new emphasis on the teaching profession to include better evaluation systems and incentives for teachers and improved teacher education. And he challenged state governments to require students to stay in school until they graduate or turn 18, as 20 states already do.
Proposed a nationwide program to allow homeowners with privately held mortgages to refinance at lower interest rates. It would cover both loans issued by government-controlled mortgage giants Fannie Mae and Freddie Mac and private bank mortgage lenders. Congress would have to approve, a difficult hurdle. Under the plan, any homeowner current on his or her mortgage could take advantage of lending rates now at 4 percent or below. Administration officials offered few details but estimated savings of about $3,000 a year for average borrowers.
IMMIGRATION AND WORKFORCE
Reiterated a call for comprehensive immigration reform, including giving responsible young people a chance to earn their citizenship. He suggested creating a Veterans Job Corps to help communities hire veterans, and he committed to closing the wage gap between men and women.
Called for the creation of a new trade enforcement unit that would go after unfair trade practices around the world, including China. Obama said the U.S. would provide financing to put its companies on even footing when the Chinese or other competitors use unfair export financing to help their businesses. He also called for better inspections to stop counterfeit, pirated or unsafe goods from entering the U.S.
USING WAR SAVINGS FOR INFRASTRUCTURE
Proposed using half the savings achieved by winding down the wars in Iraq and Afghanistan to cover costs of new investments in infrastructure. Obama wants the money to go toward fixing existing roads and building new high-speed rail projects. He also plans to sign an executive order in the coming weeks to clear some of the bureaucratic roadblocks that have slowed work on projects that have already been funded. The White House says the other half of the savings from drawing down the wars would go toward reducing the national debt.
Proposed eliminating tax incentives that make it more attractive for companies to ship jobs overseas. The proposal would require American companies to pay a minimum tax on their overseas profits in order to prevent other countries from attracting U.S. businesses with unusually low tax rates. Obama also wants to eliminate tax deductions companies receive for the cost of shutting down factories and moving production overseas. Instead, Obama wants to create a new tax credit to cover moving expenses for companies that close production overseas and bring jobs back to the U.S. He also wants to reduce tax rates for manufacturers and double the tax deduction for high-tech manufacturers in order to create more manufacturing jobs in the U.S.
Directed his administration to develop a plan for safe extraction of natural gas from shale deposits, which the White House says will support more than 600,000 jobs. The administration is moving forward with what it calls “common-sense” rules to ensure that safe drilling practices are followed and the types of chemicals used in the so-called fracking method are disclosed for operations on public lands. Obama said he would offer incentives to manufacturers to boost the energy efficiency of the industrial sector by upgrading equipment and eliminating wasted energy in their facilities. The White House estimates those incentives and efforts to reduce regulatory barriers could save $100 billion from the nation’s energy bills and cut energy imports. Obama also said he will direct the Defense Department to make the largest renewable energy purchase in history — 1 gigawatt, or 1 billion watts. Obama plans to direct his administration to establish solar energy zones and wind energy areas on public lands to power 3 million homes by the end of 2012.