2016 State of the Union Analysis

LSA Analysis of President Obama's 2016 State of the Union Address

HEALTH | ECONOMIC SECURITY | REFUGEES AND IMMIGRATION | CRIMINAL JUSTICE | EDUCATION

On January 12, President Obama delivered his last State of the Union (SOTU) address to Congress.  Though Presidents often use the annual address as an opportunity to highlight their Administration’s policy goals for the coming  year, President Obama’s eighth and final SOTU served less as a ‘laundry list’ of plans and more as his vision for the future.  

However, there were clear policy ideas embedded in the speech, some of which are likely to be reflected in the Administration’s Fiscal Year 2017 Budget Request to Congress, as well as the White House’s 2016 legislative agenda.  To provide both a preview of and context for the Administration's fiscal and policy priorities in 2016, LSA has prepared a summary of the SOTU, with an emphasis on the provisions that intersect with our members, their priorities, and those they serve.

Below, please find our analysis, which focuses on the speech language and underlying Administration policies in the following areas: Health, Economic Security, Refugees and Immigration, Criminal Justice, and Education.

The archived speech is available here, and the full text as prepared is available here.

HEALTH

Cancer ‘Moonshot’

Last year, Vice President Biden said that with a new moonshot, America can cure cancer. Last month, he worked with this Congress to give scientists at the National Institutes of Health the strongest resources that they’ve had in over a decade. So tonight, I’m announcing a new national effort to get it done. And because he’s gone to the mat for all of us on so many issues over the past 40 years, I’m putting Joe in charge of Mission Control. For the loved ones we’ve all lost, for the families that we can still save, let’s make America the country that cures cancer once and for all. - President Obama, 2016 State of the Union

The idea to make curing cancer America’s next "moonshot" first came from Vice President Biden, who envisioned it in a speech announcing he would not run for president one last time. Vice President Biden, who suffered the untimely death of his son Beau to brain cancer, personally lobbied for the biggest increase in cancer research funding in a decade in the budget deal struck in December — $264 million for the national Cancer Institute.

The goal of the effort President Obama proposed is 'to double the rate of progress.  To make a decade worth of advances in five years.' This effort, to be led by the Vice President, has two main pieces. The first will be to speed up the pace of research by increasing funds and coordinating the work done across institutions. The second will be a coordinated effort to communicate findings at a quicker pace to oncologists and patients across the country. That will involve a call on data and technology companies to make data easier to access.

Medicaid Expansion

That…is what the Affordable Care Act is all about. It’s about filling the gaps in employer-based care so that when you lose a job, or you go back to school, or you strike out and launch that new business, you’ll still have coverage. Nearly 18 million people have gained coverage so far. - President Obama, 2016 State of the Union

In his final SOTU, President Obama focused on America’s future and discussed the building blocks necessary to give everyone a fair shot at opportunity and security. In a fact sheet released by the White House following the speech, the Administration linked these goals to the Affordable Care Act (ACA), stating that ‘to build on our progress in the coming year and beyond, we need to finish the job of making sure all Americans have affordable health coverage and health care.’

Specifically, the White House is referncing the ACA's Medicaid expansion.  The  health care law includes a provision that gives states the option to extend Medicaid coverage to all non-elderly adults with income below 133 percent of the federal poverty level (currently $32,253 for a family of four). At the end of 2015, 30 states and the District of Columbia had expanded their Medicaid programs. Notably, with expansion comes sustained federal support - the federal government covers 100 percent of the costs of newly eligible individuals’ coverage through calendar year 2016.  The federal share then gradually phases down to 90 percent in 2020 and beyond.

To encourage the 19 states who have not yet expanded their Medicaid programs to do so, President Obama is proposing an extra incentive in his Fiscal Year 2017 (FY17) Budget. His fiscal blueprint, set to be released on February 9, will include a legislative proposal to provide any state that has not yet taken up the Medicaid expansion the same three years of full federal support and gradual phase down that those states expanding in 2014 received.

ECONOMIC SECURITY

Worker Protections

Say a hardworking American loses his job — we shouldn’t just make sure he can get unemployment insurance; we should make sure that program encourages him to retrain for a business that’s ready to hire him. If that new job doesn’t pay as much, there should be a system of wage insurance in place so that he can still pay his bills. - President Obama, 2016 State of the Union

Building on his SOTU remarks, President Obama used his January 16 Weekly Address to announce new proposals to provide workers with wage insurance, Unemployment Insurance protections, and support for retraining to get the next job.  Part of the Administration’s broader push to modernize the country’s Unemployment Insurance system, the President’s proposal contains three core elements:

  • Protecting Workers with Wage Insurance: The President’s plan would ensure workers have access to wage insurance that would replace half of lost wages, up to $10,000 over two years. Displaced workers making less than $50,000 who were with their prior employer for at least three years would be able to leverage these resources to help them get back on their feet and on the way to a new career.

  • Strengthening Unemployment Insurance (UI): The President’s plan would address holes in the country's UI system – in part by expanding coverage to part-time, many low-income, and intermittent workers, as well as to workers who leave work for compelling family reasons. It would also ensure that states provide at minimum 26 weeks of UI coverage. 

  • Making it Easier for Workers to Retool and Retrain: The President’s plan would seek to make it easier for companies to avoid lay-offs through work-sharing, while also incentivizing states to offer retraining for workers on UI and provide relocation vouchers or subsidized employment. In addition, it would expand intensive career counseling to the long-term unemployed, discouraged, and part-time workers.

Opportunity and Mobility

All these trends have squeezed workers…It’s made it harder for a hardworking family to pull itself out of poverty, harder for young people to start their careers, tougher for workers to retire when they want to. And although none of these trends are unique to America, they do offend our uniquely American belief that everybody who works hard should get a fair shot. For the past seven years, our goal has been a growing economy that works also better for everybody. We’ve made progress. But we need to make more. - President Obama, 2016 State of the Union

The day after the SOTU, the White House expanded on the President’s vision that there is more work to be done to give all Americans a fair shot at opportunity and security, announcing that the President’s FY17 Budget will include new investments and initiatives designed to expand economic opportunity, increase mobility, and revitalize communities. These proposals include investments that would:

  • Increase Access to Neighborhoods of High Opportunity: The President’s FY17 Budget will recommend a $15 million mobility counseling pilot to help families that receive housing assistance through the Department of Housing and Urban Development move to, and stay in, safer neighborhoods with stronger schools and better access to jobs. These investments would be distributed to about 10 regional housing program sites with participating Public Housing Authorities and/or private non-profits over a three-year period. A portion of the funding would also support an evaluation to measure the impact of the counseling pilot to inform future policymaking and program design. 

  • Helping Families in Crisis Gain Stability and Move to Self Sufficiency: To help stabilize families in crisis and position them to move towards self-sufficiency, the Budget will propose Emergency Aid and Service Connection Grants, a new $2 billion initiative to test innovative State and local approaches to aid families facing financial crisis. This includes financially stressed families who have been brought to the brink of crisis, and it includes families living in extreme poverty. The funding would be targeted to provide families the emergency help they need to avert or reverse a downward spiral, and if needed, to connect them with the longer-term supports, such as income assistance, job training, child care, and mental health and substance abuse treatment.

  • Advancing Proven Community-based Initiatives to Improve Educational and Employment Outcomes: The President’s FY17 Budget will also invest $128 million in the Department of Education’s Promise Neighborhoods program and $200 million in the Department of Housing and Urban Development’s Choice Neighborhoods program to help improve the educational and life outcomes of residents of distressed communities. This FY17 funding would support approximately 15 new Promise Neighborhoods and six new Choice Neighborhoods implementation grants, and numerous other planning grants for communities to engage with stakeholders to create plans for future revitalization.

Family Policies

And I’ll keep pushing for progress on the work that I believe still needs to be done…Equal pay for equal work, paid leave, raising the minimum wage. All these things still matter to hardworking families; they are still the right thing to do, and I will not let up until they get done. - President Obama, 2016 State of the Union

Equal pay, paid family and medical leave, and raising the minimum wage each got its own extended treatment in last year’s State of the Union address. By again referencing them in his final SOTU, President Obama is signaling his ongoing prioritization of these policies.  In part, the Administration continues to push for these changes on a variety of fronts, including:

  • Equal Pay: President Obama wants Congress to pass the Paycheck Fairness Act, which would ban employers from retaliating against workers who talk to each other about how much they earn and make it harder to justify unequal pay along gender lines.

  • Paid Leave: The White House also supports the FAMILY Act, which would create a social insurance program and provide 12 weeks of paid family and medical leave for everyone.

  • Minimum Wage: President Obama has consistently backed efforts to raise the minimum wage at the federal and state levels.

Tax Credits for Childless Adults 

Speaker Ryan has talked about his interest in tackling poverty. America is about giving everybody willing to work a hand up, and I’d welcome a serious discussion about strategies we can all support, like expanding tax cuts for low-income workers without kids. - President Obama, 2016 State of the Union

With this statement, President Obama is specifically referencing proposals both he and Speaker Paul Ryan (R-Wisc.) have put forward to expand the Earned Income Tax Credit (EITC), the biggest federal program supporting the working poor. 

The EITC has long enjoyed bipartisan support because it encourages and rewards the work of low- and moderate-income people. In fact, policymakers found common ground last year to make permanent critical improvements to the EITC and low-income part of the Child Tax Credit that were scheduled to expire in 2017.  This was a major legislative accomplishment – and top LSA priority - that President Obama celebrated at the top of his SOTU address, saying ‘Mr. Speaker I appreciate the constructive approach you and the other leaders took at the end of last year to…make tax cuts permanent for working families.’ 

Yet, even with these improvements in place, the credit largely excludes workers who aren’t raising children and completely excludes them if they’re under age 25.  Both President Obama and Speaker Ryan propose to change that — in almost exactly the same way.  They would phase in the credit more quickly as a worker’s earnings rise, raise the maximum credit to about $1,000, and lower the eligibility age from 25 to 21.  However, they completely disagree about how to pay for it, dimming the prospects for Congressional action.

REFUGEES AND IMMIGRATION

Refugees

Instability will continue for decades in many parts of the world — in the Middle East, in Afghanistan and Pakistan, in parts of Central America, Africa, and Asia. Some of these places may become safe havens for new terrorist networks; others will fall victim to ethnic conflict, or famine, feeding the next wave of refugees. The world will look to us to help solve these problems... - President Obama, 2016 State of the Union

President Obama touched on refugee policy in his final SOTU, echoing his Administration’s arguments in support of accepting refugees; the White House has firmly opposed proposals to restrict or freeze Syrian and Iraqi refugees from coming into the country.  However, analysts noted the President's decision to include "parts of Central America" in this statement, as the Administration is currently being criticized by Democrats in both chambers of Congress who believe these immigrants should be treated as refugees. 

Immigration

And I’ll keep pushing for progress on the work that I believe still needs to be done: fixing a broken immigration system. - President Obama, 2016 State of the Union

President Obama has consistently said that the only permanent way to address immigration reform is for Congress to pass a comprehensive bill that would improve border security, change the laws for admitting new immigrants in the future, and create a path to citizenship for unauthorized immigrants already here. But the Republican-led Congress has little intention of cooperating – and the White House knows that.  

"Pushing for progress," however, doesn’t just refer to legislative requests. At the time of the speech, the Obama administration was pushing for the Supreme Court to take up a case regarding the executive actions the White House announced in 2014, which sought to protect millions of immigrants from deportation and allow them to get work permits. These immigration moves have been on hold for nearly a year due to lower court rulings

The White House was very much hoping the justices would agree to take up the case in 2016, giving President Obama an opportunity to secure his immigration policy legacy while still in office.  On January 19, the Supreme Court announced that it will decide the case this year. The justices are expected to hear arguments in April and hand down a ruling by the end of June. 

CRIMINAL JUSTICE

Sentencing Reform

I hope we can work together this year on bipartisan priorities like criminal justice reform. - President Obama, 2016 State of the Union

President Obama is referring to ongoing criminal justice reform efforts in general, and one legislative vehicle in particular.  Currently, there is a bill working its way through Congress that seeks to address mass incarceration at the federal level - The Sentencing Reform and Correction Act of 2015 (S. 2123).  Among other changes, the legislatioin would mandatory minimum sentences and offer federal prisoners an opportunity to shorten their sentences. 

Lawmakers of both parties have coalesced around this bill. However, bipartisan consensus may not be enough to overcome one major hurdle lawmakers face: the calendar. The 2016 legislative session has been shortened due to the November 2016 elections, with the House in town for 95 days and the Senate in session for 26 weeks.  It is unclear if Congress has the will and support to shepherd these changes through this year.

EDUCATION

K-12 Education

Real opportunity requires every American to get the education and training they need to land a good-paying job. The bipartisan reform of No Child Left Behind was an important start...In the coming years, we should build on that progress, by providing pre-K for all, offering every student the hands-on computer science and math classes that make them job-ready on day one, and we should recruit and support more great teachers for our kids. - President Obama, 2016 State of the Union

President Obama is touting a swath of K-12 education policies the Administration has championed, but not really proposing anything new. He’s praising the Every Student Succeeds Act (114-95), the Congressional overhaul of No Child Left Behind; highlighting his support for STEM; calling back to previous SOTU proposals on Pre-K; as well as his efforts to improve teacher recruitment and retention. 

Higher Education

And we have to make college affordable for every American. Because no hardworking student should be stuck in the red. We’ve already reduced student loan payments to 10 percent of a borrower’s income. Now we’ve actually got to cut the cost of college. Providing two years of community college at no cost for every responsible student is one of the best ways to do that, and I’m going to keep fighting to get that started this year. - President Obama, 2016 State of the Union

In part, this is a callback to last year’s SOTU, in which President Obama called for a federal-state partnership where the federal government would essentially subsidize community college tuition to bring it down to zero. This has been a nonstarter in Congress, but the White House lobbied state and city officials in the past year to put the idea in motion at the local level.

In furtherance of the White House's college affordability goals, following the SOTU, the Administration announced its intention to recommend significant new investments for the federal Pell Grant program in its upcoming FY17 Budget Request to Congress. The two new Pell proposals would help students accelerate progress towards their degrees, increasing their likelihood of on-time completion. The Administration estimates that if implemented, the following two changes would mean an additional $2 billion in Pell Grants for students working toward their degrees in 2017:

  • Pell for Accelerated Completion: This policy change would give full-time students the opportunity to earn a third semester of Pell Grants in an academic year, better meeting the diverse needs of today's students by enabling them to take additional courses year-round and finish more quickly. Currently, many full-time students exhaust their annual Pell eligibility after just two semesters and, as a result, are unable to pay for summer courses and must wait until the beginning of the next academic year to continue their studies. If adopted, this proposal would provide nearly 700,000 students with an additional $1,915 on average to help pay for college and complete their degrees faster.

  • On-Track Pell Bonus: The Administration is also proposing to increase in the maximum Pell Grant award of $300 for those students who take 15 credits per semester in an academic year. This new incentive is designed to encourage students to take the credits needed to finish an associate degree in two years (60 credits) or a bachelor's degree in four years (120 credits). Finishing faster means more students will complete their education at a lower cost and likely with less student debt. This proposal would help an estimated 2.3 million students next year.