Republican lawmakers are already signaling they will do what they can to block President Barack Obama's pitch for tax increases on the wealthiest Americans.
Obama is making that pitch to a huge television audience in hopes of putting the new Republican Congress in the position of defending top income earners over the middle class.
In excerpts released ahead of the address, the president trumpets the nation's move beyond the recession, but says more needs to be done.
“At this moment – with a growing economy, shrinking deficits, bustling industry, and booming energy production – we have risen from recession freer to write our own future than any other nation on Earth. It’s now up to us to choose who we want to be over the next fifteen years, and for decades to come.
"Will we accept an economy where only a few of us do spectacularly well? Or will we commit ourselves to an economy that generates rising incomes and chances for everyone who makes the effort?”
As Obama continues to signal what he will propose during Tuesday's State of the Union address, senior administration officials said during the weekend that he will call for raising the capital gains rate on top income earners and eliminating a tax break on inheritances. The revenue generated by those changes would fund new tax credits and other cost-saving measures for middle-class taxpayers, officials said.
Tax increases are rarely welcomed by congressional Republicans, who now hold majorities in the House and the Senate for the first time in Obama's presidency. His tax proposals will probably be dismissed, if not outright ignored, by lawmakers outside the Democratic Party's liberal base.
Rep. Adam Kinzinger, R-Ill., said that he had heard all five of Obama's State of the Union addresses, which he said are filled with proposals both good and bad. But he said on ABC's "This Week" that the president has fallen short by failing to establish close ties to Congress.
Key Republicans in both chambers indicated they would oppose the plan
"Slapping American small businesses, savers and investors with more tax hikes only negates the benefits of the tax policies that have been successful in helping to expand the economy, promote savings and create jobs," Sen. Orrin Hatch, R-Utah, chairman of the Finance Committee, said in a weekend statement.
"More Washington tax hikes and spending is the same, old top-down approach we've come to expect from President Obama that hasn't worked," said Michael Steel, a spokesman for House Speaker John Boehner.
Obama aides were not surprised.
Said White House senior adviser Dan Pfeiffer: "Are they going to agree on everything? Absolutely not. I think we should have a debate in this country between middle-class economics and trickle-down economics and see if we can come to an agreement on the things we do agree on." He spoke on CBS's "Face the Nation
Administration officials disclosed details of the tax proposals on the condition of anonymity because they were not authorized to discuss the proposals by name before the president's speech.
The centerpiece of the president's tax proposal is an increase in the capital gains rate on couples making more than $500,000 per year to 28 percent, the same level as under President Ronald Reagan. The top capital gains rate has already been raised from 15 percent to 23.8 percent during Obama's presidency.
Obama also wants to close what the administration is calling the "trust fund loophole," a change that would require estates to pay capital gains taxes on securities at the time they're inherited. Officials said the overwhelming impact of the change would be on the top 1 percent of income earners.
Administration officials pointed to a third proposal from the president as one they hope Republicans would support: a fee on the roughly 100 U.S. financial firms with assets of more than $50 billion.
Raising the capital gains rate, ending the inheritance loophole and tacking a fee on financial firms would generate $320 billion in revenue over a decade, according to administration estimates. Obama wants to put the bulk of that money into a series of measures aimed at helping middle-class Americans.
____________________________________________
Q&A about the State of the Union
Anyone who has closely followed President Barack Obama since 2015 opened might wonder what he has left to say Tuesday night when he delivers the annual State of the Union address.
In a bid to generate excitement for the agenda-setting speech, Obama broke with tradition this month and began unveiling proposals from the address before he formally announces them to a joint session of Congress and a nationally televised audience. Those details usually remain closely held until the day of the speech.
Viewers may already have heard about his proposals to boost homeownership, pay for two years of community college and increase taxes on the wealthiest Americans.
This year is also the first time Obama will give the speech before a Congress that's completely controlled by Republicans.
Some questions and answers about the State of the Union:
Q: Why is the president giving the speech?
A: The Constitution requires that the president "from time to time give the Congress information on the State of the Union, and recommend to their consideration such measures as he shall judge necessary and expedient."
Q: Who delivered the first address?
A: George Washington on Jan. 8, 1790 in New York.
Q: Must it be a speech?
A: No. Thomas Jefferson changed the custom with his first annual message on Dec. 8, 1801, by sending written copies to both houses of Congress to be read by clerks of each chamber. Jefferson wanted to simplify what he believed to be an aristocratic imitation of the British monarch's speech from the throne, which he thought was unsuitable to a republic. The practice of sending Congress written copies of the speech continued for more than a century.
Q: Who resumed delivering the annual message in person?
A: Woodrow Wilson, on April 8, 1913. Wilson also is widely credited with transforming the speech from a report on the activities of the executive branch into a blueprint for the president's legislative program for the coming congressional session and year.
Q: When did the annual message become known as the "State of the Union" address?
A: Franklin D. Roosevelt applied the constitutional phrase "State of the Union" to both the message and the event. It became the popular terminology from then on.
Q: How has the speech been affected by advances in communications technology?
A: Calvin Coolidge delivered the first speech broadcast on radio in 1923. Harry Truman's address in 1947 was the first broadcast on television. George W. Bush's 2002 speech was the first made available as a live webcast on the White House website. Lyndon B. Johnson recognized the importance of having a national audience when, in 1965, he moved the speech from midafternoon to 9 p.m. to attract the largest number of TV viewers.
Obama used social media to help power his two presidential campaigns, and he has done the same to promote his State of the Union addresses. Besides tweets on Twitter, photos on Instagram and video releases on Facebook and Upworthy, Obama devotes an entire page on the White House website to the State of the Union. People can also watch an "enhanced" broadcast of the speech on the website, complete with data, graphs and charts explaining the policies Obama will talk about.
Q: Has the speech ever been postponed?
A: Ronald Reagan's 1986 address was postponed after the Challenger space shuttle exploded in flight on Jan. 28 of that year.
Q: Is there a State of the Union speech every year?
A: No. Each of the past five presidents Reagan in 1981, George H.W. Bush in 1989, Bill Clinton in 1993, George W. Bush in 2001 and Obama in 2009 chose not to give an official State of the Union address their first year in office. That speech would have followed shortly after their inaugural addresses.
Q: Has the speech always been delivered in person since Wilson resumed the practice?
A: Since World War II, some presidents have skipped the in-person appearance. Truman sent his final message in print, a practice followed by Dwight D. Eisenhower in 1961 and Jimmy Carter in 1981. As Eisenhower recovered from a heart attack in 1956, he prepared a seven-minute, filmed summary of the message from his retreat in Key West, Florida, that was broadcast nationwide. Richard Nixon sent a printed message to Congress in 1973; his staff said an oral message would have come too soon after his second inaugural address.
Q: Have any presidents not delivered any State of the Union message?
A: Two. William Henry Harrison, who died 32 days after his inauguration in 1841, and James A. Garfield, who was assassinated in 1881 after 199 days in office.
Q: Who are the people who sit with the first lady?
A: The White House invites them because their personal stories help highlight a particular issue or public policy. Reagan was the first to invite special guests in 1982 and recognize them during the speech. Every president since has continued the tradition.
Obama's guests this year include Alan Gross, the Maryland man who recently returned to the U.S. after five years imprisoned in Cuba. Gross was freed last month as part of Obama's historic announcement that the U.S. would end 50 years of hostility toward Cuba by restoring diplomatic relations. The guest list also includes eight people who wrote letters to Obama about their personal hardship and how Obama's policies helped them. Obama says he reads 10 letters each night out of the thousands sent to him daily.
_
Source: Congressional Research Service.