I found President Biden’s State of the Union Address last night (February 7, 2023) 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:
For decades, the middle class was hollowed out.
Too many good-paying manufacturing jobs moved overseas. Factories at home closed down.
Once-thriving cities and towns became shadows of what they used to be.
And along the way, something else was lost.
Pride. That sense of self-worth.
I ran for President to fundamentally change things, to make sure the economy works for everyone so we can all feel pride in what we do.
To build an economy from the bottom up and the middle out, not from the top down. Because when the middle class does well, the poor have a ladder up and the wealthy still do very well. We all do well.
As my Dad used to say, a job is about a lot more than a paycheck. It’s about your dignity. It’s about respect. It’s about being able to look your kid in the eye and say, “Honey –it’s going to be OK,” and mean it.
So, let’s look at the results. Unemployment rate at 3.4%, a 50-year low. Near record low unemployment for Black and Hispanic workers.
We’ve already created 800,000 good-paying manufacturing jobs, the fastest growth in 40 years.
Where is it written that America can’t lead the world in manufacturing again?
For too many decades, we imported products and exported jobs.
Now, thanks to all we’ve done, we’re exporting American products and creating American jobs.
Inflation has been a global problem because of the pandemic that disrupted supply chains and Putin’s war that disrupted energy and food supplies.
But we’re better positioned than any country on Earth.
We have more to do, but here at home, inflation is coming down.
Here at home, gas prices are down $1.50 a gallon since their peak.
Food inflation is coming down.
Inflation has fallen every month for the last six months while take home pay has gone up.
Additionally, over the last two years, a record 10 million Americans applied to start a new small business.
Every time somebody starts a small business, it’s an act of hope.
And the Vice President will continue her work to ensure more small businesses can access capital and the historic laws we enacted.
Standing here last year, I shared with you a story of American genius and possibility.
Semiconductors, the small computer chips the size of your fingertip that power everything from cellphones to automobiles, and so much more. These chips were invented right here in America.
America used to make nearly 40% of the world’s chips.
But in the last few decades, we lost our edge and we’re down to producing only 10%. We all saw what happened during the pandemic when chip factories overseas shut down.
Today’s automobiles need up to 3,000 chips each, but American automakers couldn’t make enough cars because there weren’t enough chips.
Car prices went up. So did everything from refrigerators to cellphones.
We can never let that happen again.
That’s why we came together to pass the bipartisan CHIPS and Science Act.
We’re making sure the supply chain for America begins in America.
We’ve already created 800,000 manufacturing jobs even without this law.
With this new law, we will create hundreds of thousands of new jobs across the country.
That’s going to come from companies that have announced more than $300 billion in investments in American manufacturing in the last two years.
Outside of Columbus, Ohio, Intel is building semiconductor factories on a thousand acres – a literal field of dreams.
That’ll create 10,000 jobs. 7,000 construction jobs. 3,000 jobs once the factories are finished.
Jobs paying $130,000 a year, and many don’t require a college degree.
Jobs where people don’t have to leave home in search of opportunity.
And it’s just getting started.
Think about the new homes, new small businesses, and so much more that will come to life.
And when we do these projects, we’re going to Buy American.
Buy American has been the law of the land since 1933. But for too long, past administrations have found ways to get around it.
Tonight, I’m also announcing new standards to require all construction materials used in federal infrastructure projects to be made in America.
American-made lumber, glass, drywall, fiber optic cables.
And on my watch, American roads, American bridges, and American highways will be made with American products.
My economic plan is about investing in places and people that have been forgotten. Amid the economic upheaval of the past four decades, too many people have been left behind or treated like they’re invisible.
Maybe that’s you, watching at home.
You remember the jobs that went away. And you wonder whether a path even exists anymore for you and your children to get ahead without moving away.
I get it.
That’s why we’re building an economy where no one is left behind.
Jobs are coming back, pride is coming back, because of the choices we made in the last two years. This is a blue-collar blueprint to rebuild America and make a real difference in your lives.
For example, too many of you lay in bed at night staring at the ceiling, wondering what will happen if your spouse gets cancer, your child gets sick, or if something happens to you.
Will you have the money to pay your medical bills? Will you have to sell the house?
I get it. With the Inflation Reduction Act that I signed into law, we’re taking on powerful interests to bring your health care costs down so you can sleep better at night.
You may have noticed that Big Oil just reported record profits.
Last year, they made $200 billion in the midst of a global energy crisis.
They invested too little of that profit to increase domestic production and keep gas prices down.
Instead, they used those record profits to buy back their own stock, rewarding their CEOs and shareholders.
Corporations ought to do the right thing.
That’s why I propose that we quadruple the tax on corporate stock buybacks to encourage long term investments instead.
They will still make a considerable profit.
Let’s finish the job and close the loopholes that allow the very wealthy to avoid paying their taxes.
Instead of cutting the number of audits of wealthy tax payers, I signed a law that will reduce the deficit by $114 billion by cracking down on wealthy tax cheats.
That’s being fiscally responsible.
In the last two years, my administration cut the deficit by more than $1.7 trillion – the largest deficit reduction in American history.
Under the previous administration, America’s deficit went up four years in a row.
Because of those record deficits, no president added more to the national debt in any four years than my predecessor.
Nearly 25% of the entire national debt, a debt that took 200 years to accumulate, was added by that administration alone.
The Special Note summarizes my overall thoughts about our economic situation
SPX at 4152.99 as this post is written