The Good, The Bad, And The Ugly From The State Of The Union Address

The State of the Union address is usually a President’s laundry list of policy ideas. Some get enacted, while others get ignored. This one was no different.

Here are some takeaways from President Obama’s 2015 address.

Let’s start with the good.

The President hoped to be productive with Republicans who now control both houses of Congress. “I will seek to work with you to make this country stronger.”

There are two areas where that can happen.

Trade

President Obama wants to have the same authority for negotiating trade deals that every President since Franklin Roosevelt has had. “I’m asking both parties to give me trade promotion authority to protect American workers, with strong new trade deals from Asia to Europe that aren’t just free, but fair,” he said.

In order to get TPA, the President will have to convince Congress, especially members of his own party, that TPA is essential. The business community will stand with him, because it knows that greater access to global markets will mean American economic growth.

Infrastructure

President Obama urged Congress to invest in infrastructure:

21st century businesses need 21st century infrastructure – modern ports, stronger bridges, faster trains and the fastest internet.  Democrats and Republicans used to agree on this…. Let’s pass a bipartisan infrastructure plan.

Such an investment would pay off for the economy. A 2014 study for the National Association of Manufacturers found that a “targeted and long-term increase in public infrastructure investments from all public and private sources over the next 15 years would increase jobs by almost 1.3 million at the onset of an initial boost, and grow real GDP 1.3% by 2020 and 2.9% by 2030.”

Now the bad.

Energy

President Obama took credit for America’s energy boom saying:

We believed we could reduce our dependence on foreign oil and protect our planet.  And today, America is number one in oil and gas…. And thanks to lower gas prices and higher fuel standards, the typical family this year should save $750 at the pump.

A brief look at the facts and you’ll find that the oil and natural gas boom has occurred despite actions by the Obama administration.

Between 2009 and 2013, oil production on private and state lands increased by 61% but decreased by 6% on federal lands. As for natural gas, production on private and state lands increased by 33% but decreased by 28% on federal lands.

In addition, the Interior Department and other federal agencies are working on duplicative regulations on hydraulic fracturing, the technology that’s given us the shale energy boom.

Keystone XL Pipeline

The President downplayed the Keystone XL pipeline, calling it a “single oil pipeline.”

But it’s a project the President’s own State Department finds will create 42,000 jobs, generate $3.4 billion in economic activity, and produce $55.6 million in local property taxes annually when it’s up and running, with little environmental impact.

Then there’s the ugly.

Carbon Regulations

The President stood firm on federal carbon regulations, saying:

I am determined to make sure American leadership drives international action.  In Beijing, we made an historic announcement – the United States will double the pace at which we cut carbon pollution, and China committed, for the first time, to limiting their emissions.

First, the U.S.-China agreement the President mentioned is unenforceable. Second, India, another major carbon emitter, won’t give up coal as it grows its economy. Third, by driving coal-fired power plants into oblivion, EPA’s carbon regulations will make power outages more likely.

Bonus: Regulatory Reform Was Missing

The President didn’t mention fixing the broken federal regulatory system. As I noted yesterday, federal regulations are a high barrier for businesses. Reform should make the regulatory process be more accountable, more transparent, include more meaningful public input, and guarantee a swift permitting process.

The main problem is the President didn’t lay out enough ideas on how to grow the economy. As U.S. Chamber President and CEO Tom Donohue said in a statement:

The president appears to want to divvy up the existing economic pie instead of pursuing policies that will grow it to support more jobs, spur growth, and lift incomes. This approach will consign the nation to weak growth and fewer opportunities for our workers.

For further analysis on the State of the Union Address, read J.D. Foster’s post on President Obama’s “masterstroke in chutzpah.” 

This story originally published by the U.S. Chamber of Commerce and was written by Sean Hackbarth