The Issue of Inequality: Obama’s State of the Union Address

The speech symbolized the beginning of the 2012 presidential election. In his State of the Union address on January 24, President Obama made his stance against the Republican Party clear. The speech was an appeal to the American people for his reelection in November.

The president, who is focused on the middle class and workers, outlined his domestic agenda. Stating, “We can restore an economy where everyone gets a fair shot, everyone does their fair share and everyone plays by the same set of rules,” he laid out plans to expand tax cuts for workers and help households suffering under bad mortgages from the aftermath of the housing bubble.

One of the major points of contention is the taxation system.

A hopeful Republican presidential candidate, former Massachusetts governor Mitt Romney, recently disclosed his tax return. While his income from investment last year exceeded $20 million before taxes, the tax rate applied to him was just 13.9 percent. Had his income been employment-based, he would have had 35 percent appropriated in taxes.

In the country where adoration for success stories and favorable treatment of the wealthy is approved because it is seen to motivate others, President Obama asked “Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else — like education and medical research; a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.” His statements reflected the superrich investor Warren Buffett’s remark: “It is unfair that my tax rate is lower than my secretary’s.”*

How much inequality should be allowed? This is a major question driving the election.

The GOP, with its focus on making a “small government,” claims that further deregulation — including tax cuts for the rich — is necessary, while contending that Obama’s economic stimulus package “expanded deficits with unnecessary spending.”*

The rise of economic nationalism is what is concerning. In his speech, Mr. Obama repeated the theme of “bring[ing] jobs back home” and outlined plans to give preferential treatment to corporations that create jobs domestically.

President Obama also criticized China, where “unfair trading practices” such as music and film piracy occur, and announced the establishment of an organization that would investigate such injustices.

To suppress foreign investment by adopting such policies may distort the very trade that contributes to global development. Because labeling “unfair trading” could encourage economic friction, the decision to use such a label should have been more carefully considered.

There were few words on the international front.

Mr. Obama refused to accept Iran’s development of nuclear weapons, stating, “I will take no options off the table to achieve that goal.” In response to Republicans who call for an attack on Iran, the president showed a strong, uncompromising stance.

Political positions tend to be extreme in election years. Protectionism and hard-line foreign policy approaches give a candidate’s popularity a boost. These positions, however, can compromise long-established international cooperation and cause America to stumble. Focused and productive discussions are to be looked forward to.

*Editor’s Note: These quotations, accurately translated, could not be verified.