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January 28, 2014 at 05:49 PM
(Bloomberg) — President Barack Obama today offered modest steps to chip away at the country’s economic and social challenges in a State of the Union address that reflects the limits of his power to sway Congress.
Using executive authority to enact portions of an agenda that’s been stalled by Republicans, Obama said he will work to create a retirement savings program for workers whose employers don’t offer a 401(k) plan.
Obama said workers would get access to a new type of “MyRA” retirement savings bond “with no risk of losing what you put in.”
Obama also talked about giving “every American access to an automatic IRA on the job.”
Obama appealed for cooperation from the divided Congress on other priorities, including immigration, corporate taxes, an expansion of the earned income tax credit to aid the working poor, and easing income inequality.
“After four years of economic growth, corporate profits and stock prices have rarely been higher, and those at the top have never done better,” Obama said in the text. “But average wages have barely budged.”
Since Obama delivered the State of the Union last year on Feb. 12, the benchmark Standard & Poor’s 500 Index has surged 18 percent, the Bloomberg Dollar Spot Index is up 2.8 percent and the U.S. economic growth rate has accelerated to 4.1 percent in the 3rd quarter from 1.1 percent. Unemployment has dropped to 6.7 percent from 7.7 percent last February. Still, in December, the average weekly earnings of U.S. workers were flat compared to a year earlier when adjusted for inflation. Real median household income of $51,000 is 8 percent lower than in 2007.
Obama said he supports lowering the corporate tax rate and curtailing tax breaks, then using any one-time revenue that change generates to build bridges, transit and other infrastructure. That plan is stalled in Congress, stymied by a partisan dispute over whether wealthy individuals should pay more.
