I found President Obama’s State of the Union Address last night (January 12, 2016) to contain some noteworthy comments. While I could comment extensively on many parts of the speech, for now I will indicate excerpts that I found most relevant with regard to the economic situation, and may comment upon them at a future point. I am highlighting these excerpts for many reasons; it should be noted that I do not necessarily agree with any or all of them.
Here are the excerpts I found most relevant, in the order they occurred in the speech:
Let me start with the economy, and a basic fact: the United States of America, right now, has the strongest, most durable economy in the world. We’re in the middle of the longest streak of private-sector job creation in history. More than 14 million new jobs; the strongest two years of job growth since the ‘90s; an unemployment rate cut in half. Our auto industry just had its best year ever. Manufacturing has created nearly 900,000 new jobs in the past six years. And we’ve done all this while cutting our deficits by almost three-quarters.
Anyone claiming that America’s economy is in decline is peddling fiction. What is true – and the reason that a lot of Americans feel anxious – is that the economy has been changing in profound ways, changes that started long before the Great Recession hit and haven’t let up. Today, technology doesn’t just replace jobs on the assembly line, but any job where work can be automated. Companies in a global economy can locate anywhere, and face tougher competition. As a result, workers have less leverage for a raise. Companies have less loyalty to their communities. And more and more wealth and income is concentrated at the very top.
All these trends have squeezed workers, even when they have jobs; even when the economy is growing. It’s made it harder for a hardworking family to pull itself out of poverty, harder for young people to start on their careers, and 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 better for everybody. We’ve made progress. But we need to make more. And despite all the political arguments we’ve had these past few years, there are some areas where Americans broadly agree.
Of course, a great education isn’t all we need in this new economy. We also need benefits and protections that provide a basic measure of security. After all, it’s not much of a stretch to say that some of the only people in America who are going to work the same job, in the same place, with a health and retirement package, for 30 years, are sitting in this chamber. For everyone else, especially folks in their forties and fifties, saving for retirement or bouncing back from job loss has gotten a lot tougher. Americans understand that at some point in their careers, they may have to retool and retrain. But they shouldn’t lose what they’ve already worked so hard to build.
That’s why Social Security and Medicare are more important than ever; we shouldn’t weaken them, we should strengthen them. And for Americans short of retirement, basic benefits should be just as mobile as everything else is today. That’s what the Affordable Care Act is all about. It’s about filling the gaps in employer-based care so that when we lose a job, or go back to school, or start that new business, we’ll still have coverage. Nearly eighteen million have gained coverage so far. Health care inflation has slowed. And our businesses have created jobs every single month since it became law.
Now, I’m guessing we won’t agree on health care anytime soon. But there should be other ways both parties can improve economic security. 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. And even if he’s going from job to job, he should still be able to save for retirement and take his savings with him. That’s the way we make the new economy work better for everyone.
The Special Note summarizes my overall thoughts about our economic situation
SPX at 1943.69 as this post is written