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Posted by on Jan 21, 2015 in 2014 Elections, 2016 Elections, 2016 Presidential Election, Economy, Featured, Politics | 31 comments

Obama: Damn the torpedoes


WASHINGTON — “This is good news, people.”

With those five words, President Obama made clear that he thinks it’s far more important to win a long-term argument with his partisan and ideological opponents than to pretend that they are eager to seize opportunities to work with him. He decided to deal with the Republican Party he has, not the Republican Party he wishes he had.

Those ad-libbed words followed what ranks as one of the more polemical passages ever offered in a State of the Union address. “At every step, we were told our goals were misguided or too ambitious,” he declared, “that we would crush jobs and explode deficits. Instead, we’ve seen the fastest economic growth in over a decade, our deficits cut by two-thirds, a stock market that has doubled, and health care inflation at its lowest rate in 50 years.”

Good news, indeed, and in telling the Republicans that all their predictions turned out to be wrong, he was also reminding his fellow citizens which side, which policies and which president had brought the country back.

His analysis of the nature of his political opposition, in turn, dictated the approach he took in the rest of the speech. There was no point in hedging on his wishes, constraining his hopes, and compromising in advance. Earlier in his administration, he might have begun the negotiations by offering his interlocutors their asking price upfront and then moving backward from there. No more.

Instead, he laid out what he would do if he had a more cooperative Congress. This time around, Obama’s agenda was organized around the interests of middle-class American workers, the group his administration acknowledges has not been dealt into the economic recovery.

Thus did he offer redistributive tax proposals — cuts for the middle class, increases for the very wealthy — and call for guaranteed sick leave for everyone, expanded child care, universal access to two years of community college, and equal pay for equal work.

He even offered encouraging words to organized labor. “We still need laws that strengthen rather than weaken unions,” he said, “and give American workers a voice.” And in defending a free trade agreement likely to be opposed by many in the unions and in his own party, he tried to make his case in the name of worker rights. He is unlikely to persuade them, but it tells us which audience Obama had in mind that he framed his rationale this way.

And he got pretty personal with the honorable members of Congress when he renewed his support for an increase in the minimum wage. “If you truly believe you can work full time and support a family on less than $15,000 a year,” he said, “go try it.”

There is something odd in the notion that Obama is supposed to abandon his convictions because the Republicans won a low-turnout midterm election whose Senate races were fought mostly in territory hostile to Democrats.

Ronald Reagan was never asked to stop being a conservative after Democrats took the Senate in the 1986 elections and emerged in control of both houses of Congress. Republicans praised George W. Bush for his courage in upping his commitment in Iraq through the troop surge even though the Democratic sweep of 2006 was in large part a repudiation of the war on which he doubled down. Are only progressive presidents expected to trim their sails?

There seemed to be a disconnect between Obama’s combative opening and his close defending his signature refrain that “there wasn’t a liberal America or a conservative America.” He acknowledged that many saw it as “ironic” that “our politics seems more divided than ever.”

But notice that he used this passage to suggest how the American debate had to change. He proposed that discussions of abortion focus more on the successes we’ve had in reducing teen pregnancies and abortions themselves. Referring to the recent confrontations in Ferguson and New York, he urged us to consider the fears of African-American young men and police officers alike even as we join in celebrating declining crime and incarceration rates.

Obama clearly still believes that the country is less divided than our politics allows us to be. But he is no longer drawn to the illusion that his adversaries in the other party will beat their swords into ploughshares anytime soon. He is battling not just for a personal legacy, but also on behalf of a perspective that he hopes the country will someday embrace.

E.J. Dionne’s email address is [email protected] Twitter: @EJDionne. (c) 2015, Washington Post Writers Group

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  • Bdavisshorty

    In regards to the free 2 years of college. I read an article by Forbes and they stated obama intends on paying for these 2 year of free college by taxing the 529 plans. How is this going to help the middle class when taxing the 529 plans directly hurt the middle class? He is sneaky.

    • ShannonL

      Sneaky? Interesting word choice.

      Considering that 50% of the 529 plans belong to the the wealthiest 10% of American familes, I dont think giving free 2 year college to everyone by taxing the 529 plans is hurting the middle class.

      What it will do is push more people into 2 year schools instead of much more expensive state and private 4 year schools, which will drastically reduce the cost of a college education.

      • JSpencer

        Thanks for weighing in Shannon. Obama’s proposal is one that has a chance (if congress gets their heads out of you know where) of paying off big. There is nothing wrong with asking that top ten percent to make a meager investment in the country that made it possible for them to do so well.

      • Bdavisshorty

        Not that interesting. I’m just not that articulate. I use simple words compared to most posters. That’s me and I’m content. Shannon could you please point me to an article that confirms what you noted? If Forbes is wrong I’d really like to read about it. Thanks

        • SteveK

          Bloomberg – Why 97% of People Don’t Use 529 College Savings Plans
          Sep 9, 2014

          Saving for a kid’s college can feel like trying to scale a skyscraper. Unfortunately, the tool most recommended to parents for the challenge is often little better than a step stool — one known to wobble.

          The appeal of 529 college savings plans is that investment returns aren’t taxed as long as the money’s used for education. States set the investment options, and often add on additional tax incentives. Despite these perks, less than 3 percent of American families use the plans. Those who do use them are disproportionately wealthy, with 25 times more assets than those who don’t use the plans, according to the Government Accountability Office (GAO).


        • SteveK

          GAO – A Small Percentage of Families Save in 529 Plans
          GAO-13-64: Published: Dec 12, 2012.
          Publicly Released: Dec 12, 2012.

          A small percentage of U.S. families saved in 529 plans in 2010, and those who did tended to be wealthier than others. According to the Survey of Consumer Finances (SCF), less than 3 percent of families saved in a 529 plan or Coverdell Education Savings Account (Coverdell)–a similar but less often used college savings vehicle also included in the SCF. While the economic downturn may have reduced income available for education savings, even among those families who considered saving for education a priority, fewer than 1 in 10 had a 529 plan (or Coverdell). Families with these accounts had about 25 times the median financial assets of those without. They also had about 3 times the median income and the percentage who had college degrees was about twice as high as for families without 529 plans (or Coverdells).


        • The_Ohioan

          Maybe this 2012 article will help you. The 529’s are really not a middle class option to prepare for college expenses as much as it is an estate planning gift for the wealthy.

          529s are one of the most powerful, lowest cost estate planning vehicles. Contributions made to a 529 are removed from your estate. Unlike most solutions that remove assets from estates and leave little control over investments and beneficiaries, the 529 allows owners to change investments and beneficiaries every year.

          Because 529 owners can name a successor to the account when they pass away, a 529 can be used for multiple generations.

          Just imagine a grandmother and grandfather who strongly believe in education. Each makes $65,000 contributions as follows: four children, 16 grandchildren, 64 great-grandchildren and even their gardener’s three children. In total, they contribute over $5.6 million and instantly remove the same amount from their estate.

          Plus – a more recent article.

          An analysis by the Government Accountability Office found that in 2010 less than 3% of families saved in a 529 plan. The GAO estimated that families who saved in 529s had a “median financial asset value” that was 25 times that of families without a 529.


          • Bdavisshorty


          • Bdavisshorty

            So when the 529 plan dries up which I assume it will due to lack of incentive how is the free 2 years of college going to be funded?

          • The_Ohioan

            By the more taxes all those better educated folks will be paying. 🙂

          • Bdavisshorty

            Or they will go to college for two years then drop out because they can’t afford two more.

          • SteveK

            Or they will go to college for two years then drop out because they can’t afford two more.

            Or… Or maybe on their way to school they’ll get hit by a car or a bus and won’t be able to graduate!

          • The_Ohioan

            But, hopefully, they will be working at higher wages and paying more in taxes. It’s a plan to better educate the population in areas that don’t need a four year degree.

            As far as the other two years of college:

            “President Obama offered a plan Friday to reduce the costs of higher education by increasing the amount of federal grant money available for low-interest loans and tying it directly to colleges’ ability to reduce tuition.”


          • dduck12

            I always advise people to get a well prepared will, health care proxy and living will, as these are top estate planning priorities.
            If people, with discretionary monies, wish to benefit someone with money for a future education (even trade schools are OK) then they should consider 529 plans. Honest financial professionals remind us that the advantageous tax aspect should not be the prime motivator for establishing a 529, but there is nothing wrong with managing ones finances. I have a neighbor that set up 529s for her brother’s orphaned kids. She is far from a 10%er.
            No, I don’t sell any thing listed above, but I fervently believe in them, and just because a product or plan has a low participation rate does not mean they are not good for some folks, it may just mean that most people fail to plan.

          • The_Ohioan

            You are absolutely right. I suspect more people would set up such a plan if they knew about them. I might even consider it for my family.

            Probably, the 97% don’t have a financial advisor (or can’t afford one) so they never knew it was available. I also suspect that if the 97% start setting them up, they will quickly become extinct. That’s the way things seem to happen for the middle class. Just sayin’.

        • ShannonL

          Hi, that data was in the Forbes article.

      • Bdavisshorty

        So who owns the other 50% of the 529 plans?

  • Bdavisshorty

    Obama just signed in the Achieving a Better Life Experience (ABLE) just before Christmas which is a 529 plan. Forbes wrote, “An ABLE account will be about saving for kids who will likely never get a “normal” college experience, or anything close to it. Qualified expenses include things like disability education, housing, transportation, employment support, health and wellness, financial/administrative/legal costs, and even funeral fees”.

    His proposal would kill ABLE before it even took a foot hold. He had to know this. He is not a dumb man. It makes no sense to sign in a program to help disabled children then crush it a month later.

    • The_Ohioan

      ??? The ABLE is for persons disabled before age 26. How would this America College plan “kill” it? Isn’t it like being able to walk and chew gum at the same time?

      I’m wondering where you get your information?

      • Bdavisshorty

        I got this information from a Forbes article. Wonder no more.

        • The_Ohioan

          Well, there are more than one Forbes articles on this subject and it pays to read more than one. First, it is NOT certain the ABLE 529’s will be included. Since they are for disability expenses, it would make sense for the education portion only to be affected in the ABLE accounts.

          The [federal] taxes will be on the FUTURE 529 amounts when they are withdrawn to be used for education. All current 529’s are exempt from even that. It will be like saving in a 401K for retirement. You get a [federal] tax break now and pay later.

          If you want to save for your children’s education, it’s one way to do it. There are other considerations, if you are using other [federal] tax credits for education, that will affect the withdrawals from a 529 account, though.

      • Bdavisshorty

        Which state is that? There are no age requirements written into the law. However individual states may impose age requirements. You are correct that it is just speculation that the ABLE will be affected. It is a fair speculation since the ABLE is a 529 plan.

        • The_Ohioan

          I could be wrong, but I think the “age of onset” of the disability must be 26 or younger. And since it is not primarily for education, but for expenses of disabled children who outlive their parents, I would hope it would be excepted, though the education portion might not be.

          (Washington, D.C. – Dec. 17, 2014) – Last night, the U.S. Senate overwhelmingly passed the Achieving a Better Life Experience (ABLE) Act of 2014 by a vote of 76 to 16. First introduced in 2006, and subsequent sessions of Congress, the ABLE Act will allow people with disabilities (with an age of onset up to 26 years old) and their families the opportunity to create a tax-exempt savings account that can be used for maintaining health, independence and quality of life.

          • dduck12
          • The_Ohioan
          • SteveK

            Good link ‘The Ohioan, I think the smoke and mirrors we’re seeing in this thread from the right is primarily intended to distract from what the Congressional Republicans are trying to do NOW (not 3 years ago)… And who what they’re trying to do will hurt. The GOP doesn’t this to reach main-stream American.

          • The_Ohioan

            dd has done what we’ve been asking – using a reputable source that addresses the problems in this thread. Isn’t it a little unfair to chastise him for doing so, now?

            bdavisshorty is guilty only of reading what he wants to read and not looking for an opposite opinion. We all fall into this error sometimes.

            Thinking is hard, it’s hard. 🙂

          • SteveK

            Sorry The Ohioan, I don’t agree. Did you read the article he linked to?

            If you followed dducks link to a three year old article it’s not about trouble for the disabled it’s about the right blaming left (and vice-versa) about not agreeing on how to fix potential future problems with social security and medicare… And imo it’s no different than what dbavisshory is doing.

            Near the end of dducks article he thinks shows ‘More problems for the disabled’ it says:

            Representative Pete Stark of California, the senior Democrat on the panel’s health subcommittee, said, “Today’s report continues to show Medicare on a sound financial footing,” mainly because of the 2010 health care law. Still, Mr. Stark said, Republicans keep trying to “end Medicare as we know it, not because the program is unsustainable, but because they want government out of the business of guaranteeing health care.”

            This has nothing to do with the topic of this thread and is just more distraction and obstruction.

          • The_Ohioan

            Yes, I read the NYT article. It includes this paragraph:

            “Social Security Commissioner Michael J. Astrue, a trustee of the two programs, said Social Security’s disability insurance program faced the most immediate threat, with its trust fund expected to run out of money in 2016, two years sooner than predicted last year.”

            which is pertinent to this thread.

            It is also pertinent to the problems with SS and Medicare which have not been addressed by either Democrats or Republicans since 1983.

            But we can agree to disagree as we often do. 🙂

          • SteveK

            More problems for the disabled

            Curious as to what an almost three year old article about a failed Republican attempt to dismantle Medicare and Social Security has to do with problems for the disabled OR Obama’s proposed ‘free’ Junior College.

            All these ‘problems’ could be easily handled and will be when ‘adults’ retake Congress… 2016 looks like a good time for this to start happening… Because America IS waking up. Thanks in large part to the President talking over the noise machine… Replacing GOP spin with facts.

  • dduck12

    Whoops, forgot to check with Nancy Pelosi. Oh.

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