FACT CHECK: Obama claims credit for an incomplete recovery
By CHRISTOPHER S. RUGABER and
CALVIN WOODWARD
Associated Press
Editor's note: An occasional look at political claims that take shortcuts with the facts or don't tell the full story
WASHINGTON — The U.S. may not have "risen from recession" quite as rousingly as President Barack Obama suggested in his State of the Union speech Tuesday night. Seven years after that severe downturn began, household income hasn't recovered and healthy job growth is complicated by the poor quality, and pay, of many of those jobs.
It's always problematic when a president takes credit for an improving economy, just as it is when he's blamed for things going bad. A leader can only do so much, for better or worse, and there are two sides to every economy. But after an election in which Obama largely held off on chest-beating, he claimed credit in bold terms for what is going right.
Also in his speech, Obama skimmed over the cost to taxpayers of free community college tuition and invited closer scrutiny with his claims about U.S. support for Syrian moderates and about his record of public-lands preservation.
A look at some of his claims, and the facts and the political climate behind them, in his speech:
OBAMA: "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."
THE FACTS: By many measures, the economy is still recovering from the deep scars left by the Great Recession.
Job growth has been healthy, but fueled in part by lower-paying jobs in areas such as retail and restaurants, which have replaced many higher-paying positions in manufacturing and construction. Part-time jobs also remain elevated: There are still 1.7 million fewer workers with full-time jobs than when the recession began in December 2007.
And the faster hiring hasn't pushed up wages much. They have been growing at a tepid pace of about 2 percent a year since the recession ended 5 1/2 years ago. That's barely ahead of inflation and below the annual pace of about 3.5 percent to 4 percent that is typical of a fully healthy economy.
That has left the income of the typical household below its pre-recession level. Inflation-adjusted median household income reached $53,880 in November 2014, according to an analysis of government data by Sentier Research. That is about 4 percent higher than when it bottomed out in 2011. But it is still 4.5 percent lower than the $56,447 median income in December 2007, the month the recession began.
Booming energy production is indeed a reality, but that's a phenomenon many years in the making, with the development of cost-effective extraction from fracking and other means playing into the rise of the U.S. as an energy production giant.
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OBAMA: "I am sending this Congress a bold new plan to lower the cost of community college — to zero."
THE FACTS: Zero for qualifying students; an estimated $60 billion over 10 years to the treasury.
Obama confronts a Republican-controlled Congress that can be expected to be wary of a new program costing that much. Moreover, the proposal requires states to contribute about a quarter of the money, and getting them to go along is bound to be tough. Many states refused to expand Medicaid under the health care law, for example, even though Washington is picking up the entire cost in the first years.
On the other hand, community college is an issue close to home for state government, perhaps more appealing than partnering with Washington on the health law, so the idea could have a fighting chance if it can get through Congress. Educators are divided on its merits, with some worrying that aid for a community college education could divert students and scholarships away from four-year schools.
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OBAMA: "We've set aside more public lands and waters than any administration in history."
THE FACTS: "Waters" is the key word here. Before expanding the Pacific Remote Islands National Monument last year from almost 87,000 square miles to more than 490,000 square miles, Obama had protected far fewer acres than his four predecessors, including President George W. Bush.
Expansion of the massive Pacific islands monument puts Obama on top. It's nearly all water, however, and the move has limited practical implications. While it bans commercial fishing, deep-sea mining and other extraction of underwater resources, little fishing or drilling occur in the mid-ocean region now.
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OBAMA: "Thanks to a growing economy, the recovery is touching more and more lives. Wages are finally starting to rise again. We know that more small-business owners plan to raise their employees' pay than at any time since 2007."
THE FACTS: A survey of small businesses by the National Federation of Independent Business does show that a rising proportion plans to raise wages. But plans to raise pay aren't the same as actually raising them.
Average hourly earnings rose just 1.7 percent in December from 12 months earlier, according to the Labor Department. That's about half the rate that is typical of a healthy economy and actually lower than the previous month. Economists generally expect wage gains to accelerate this year, as unemployment continues to fall and businesses are forced to offer higher pay to attract workers. But there is scant evidence that it is happening yet.
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OBAMA: "In Iraq and Syria, American leadership — including our military power — is stopping ISIL's advance. Instead of getting dragged into another ground war in the Middle East, we are leading a broad coalition, including Arab nations, to degrade and ultimately destroy this terrorist group. We're also supporting a moderate opposition in Syria that can help us in this effort."
THE FACTS: The U.S. also has been slow to set up long-promised training for the moderate Syrian opposition, and has yet to begin the actual vetting of the rebels. Also, despite persistent pleas from the rebels, the U.S. hasn't sent the more-lethal weapons they want. U.S. officials have expressed concerns that the weapons could end up in the hands of insurgents.
Military leaders, however, agree that coalition airstrikes and the military effort in Syria and Iraq have stopped the momentum of the Islamic State group, or ISIL, made it hard for the insurgents to communicate and travel, and hurt their oil revenues.
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Associated Press writers Kimberly Hefling, Dina Cappiello and Lolita C. Baldor contributed to this report.
WASHINGTON — Refusing to bend to the new Republican Congress, President Barack Obama unveiled Tuesday night an ambitious State of the Union agenda steeped in Democratic priorities, including tax increases on the wealthy, education and child care help for the middle class and a torrent of veto threats for the GOP's own plans.
In a shift from tradition, Obama's address to a joint session of Congress was less a laundry list of new proposals and more an attempt to sell a story of national economic revival. He appealed for "better politics" in Washington and pledged to work with Republicans, but he showed few signs of curtailing or tweaking his own plans to meet GOP priorities.
Instead, the president vowed to use his veto pen to strike down the Republican leadership's efforts to dismantle his signature accomplishments, including his health care and financial reform laws.
"We can't put the security of families at risk by taking away their health insurance or unraveling the new rules on Wall Street or refighting past battles on immigration when we've got a system to fix," Obama said. "And if a bill comes to my desk that tries to do any of these things, I will veto it."
The president sought out more common ground on foreign policy, pledging to work with Congress on a new authorization for military action against the Islamic State group in Iraq and Syria, as well as legislation to guard against cyberattacks. In a rare move away from his own party, Obama also renewed his call for fast-tracking free trade agreements with Asia and Europe, generating more applause from pro-trade Republicans than skeptical Democrats.
Obama's address marked the first time in his presidency that he stood before a Republican-controlled Congress. Yet the shift in the political landscape has also been accompanied by a burst of economic growth and hiring, as well as a slight increase in Obama's once sagging approval ratings — leaving the White House to see little incentive in curtailing or even tweaking its agenda in response to the Republicans' midterm election victories.
After ticking through signs of the rising economy, the president turned toward Republicans sitting in the chamber and said with a wink, "This is good news, people."
The centerpiece of Obama's economic proposals marked a shift away from the focus on austerity and deficit reduction that has dominated his fiscal fights with Republicans. In a direct challenge to GOP economic ideology, Obama called for increasing the capital gains rate on couples making more than $500,000 annually, to 28 percent.
The president's tax plan would also require estates to pay capital gains taxes on securities at the time they're inherited and slap a fee on the roughly 100 U.S. financial firms with assets of more than $50 billion.
Much of the $320 billion in new taxes and fees would be used for measures aimed at helping the middle class, including a $500 tax credit for some families with two spouses working, expansion of the child care tax credit and a $60 billion program to make community college free.
"Will we accept an economy where only a few of us do spectacularly well?" Obama asked. "Or will we commit ourselves to an economy that generates rising incomes and chances for everyone who makes the effort?"
Even before the president's address, Republicans were balking at his proposals and painting a far less rosy picture of the economy.
"We see our neighbors agonize over stagnant wages and lost jobs. We see the hurt caused by canceled health care plans and higher monthly insurance bills," said Iowa Sen. Joni Ernst, who delivered the Republican response. "But when we demanded solutions, too often Washington responded with the same stale mindset that led to failed policies like Obamacare. It's a mindset that gave us political talking points, not serious solutions."
With an eye on a swirl of foreign policy challenges, Obama defended his decision to return to military action in Iraq and also authorize airstrikes in Syria. He said Congress could "show the world that we are united in this mission" by passing a new resolution formally authorizing the use of force against the Islamic State group.
As the U.S. eyes a March deadline for a framework agreement with Iran on its disputed nuclear program, the president vowed to veto any effort by Congress to pass new sanctions legislation. Such a step, he said, "will all but guarantee that diplomacy fails — alienating America from its allies and ensuring that Iran starts up its nuclear program again."
The president also heralded his unilateral move last month to normalize diplomatic relations with Cuba after a half-century of animosity, and he urged lawmakers to follow his lead by lifting the economic embargo on the communist island. Yet the guest boxes in the House chamber underscored the sensitive politics that hang over efforts to overhaul the long-standing U.S. policy toward Cuba.
Among the guests sitting with first lady Michelle Obama was Alan Gross, the American man who spent five years in a Cuban prison and was released as part of the deal to end the freeze between Washington and Havana. In a nod to the concerns of Cuban dissidents and pro-democracy advocates, House Speaker John Boehner's guest was Jorge Luis García Pérez, who spent 17 years in a Cuban prison. Florida Republican Sen. Macro Rubio brought Rosa Maria Paya Acevedo, whose father was a well-known Cuban dissident who was killed in a car accident that his family believes was suspicious.