President Joe Biden urged Congress to approve higher taxes on wealthy taxpayers and big corporations during a raucous State of the Union address on Tuesday night marked by frequent outbursts from lawmakers.
Biden seemed to relish the give-and-take, however, getting the members to agree that they won't cut Social Security or Medicare benefits after some Republicans challenged his claims that a few of them wanted to do that. Instead he called on Congress to expand health care coverage and lower insulin costs for all Americans, after last year's Inflation Reduction Act capped insulin costs at $35 for seniors on Medicare. He also touted the tax credits in the Inflation Reduction Act that he said would save families more than $1,000 per year on purchases of electric vehicles and energy-efficient appliances.
"We pay for these investments in our future by finally making the wealthiest and the biggest corporations begin to pay their fair share," said Biden. "I'm a capitalist, but just pay your fair share. And I think a lot of you at home agree with me that our present tax system is simply unfair. The idea that in 2020, 55 of the biggest companies in America made $40 billion in profits and paid zero in federal income taxes? That's simply not fair. But now, because of the law I signed, billion-dollar companies have to pay a minimum of 15%. Just 15%. That's less than a nurse pays."
He insisted that nobody earning less than $400,000 a year would pay another penny in taxes under his plan. "Let's finish the job," he added. "Reward work, not just wealth. Pass my proposal for a billionaire minimum tax because no billionaire should pay a lower tax rate than a school teacher or a firefighter."
Biden also called for higher taxes on petroleum companies and other large corporations, expanding the 1% tax on corporate buybacks included in the Inflation Reduction Act.
"You may have noticed that Big Oil just reported record profits," he said. "Last year, they made $200 billion in the midst of a global energy crisis. It's outrageous. They invested too little of that profit to increase domestic production and keep gas prices down. Instead, they used those record profits to buy back their own stock, rewarding their CEOs and shareholders. Corporations ought to do the right thing. That's why I propose that we quadruple the tax on corporate stock buybacks to encourage long-term investments instead. They will still make a considerable profit."
He defended the Inflation Reduction Act's $80 billion in funding over 10 years for the Internal Revenue Service, much of which will go toward hiring more employees to help with taxpayer service, technology and tax audits. "Let's finish the job and close the loopholes that allow the very wealthy to avoid paying their taxes," said Biden. "Instead of cutting the number of audits of wealthy taxpayers, I signed a law that will reduce the deficit by $114 billion by cracking down on wealthy tax cheats. That's being fiscally responsible."
He also defended his administration's deficit reduction efforts as he faces a fight with Republicans over raising the debt ceiling. That dispute was in evidence during the speech when he was loudly challenged by some GOP members on his claims.
"In the last two years, my administration cut the deficit by more than $1.7 trillion — the largest deficit reduction in American history," said Biden. "Under the previous administration, America's deficit went up four years in a row. Because of those record deficits, no president added more to the national debt in any four years than my predecessor. Nearly 25% of the entire national debt, a debt that took 200 years to accumulate, was added by that administration alone. How did Congress respond to all that debt? They lifted the debt ceiling three times without preconditions or crisis. They paid America's bills to prevent economic disaster for our country. Tonight, I'm asking this Congress to follow suit."
There was also an outcry in the chamber when he claimed Republicans want to cut Social Security and Medicare benefits in exchange for raising the debt ceiling, but Biden responded by getting the lawmakers to all agree they don't plan any such cuts.
"Let us commit here tonight that the full faith and credit of the United States of America will never, ever be questioned," said Biden. "Some of my Republican friends want to take the economy hostage unless I agree to their economic plans. All of you at home should know what their plans are. Instead of making the wealthy pay their fair share, some Republicans want Medicare and Social Security to sunset every five years. That means if Congress doesn't vote to keep them, those programs will go away. Other Republicans say if we don't cut Social Security and Medicare, they'll let America default on its debt for the first time in our history. I won't let that happen."
He said he would offer his fiscal plan next month, claiming it would lower the deficit by $2 trillion, and invited Republicans to submit theirs as well. "We can sit down together and discuss both plans together," said Biden. "My plan will lower the deficit by $2 trillion. I won't cut a single Social Security or Medicare benefit. In fact, I will extend the Medicare Trust Fund by at least two decades. I will not raise taxes on anyone making under $400,000 a year. And I will pay for the ideas I've talked about tonight by making the wealthy and big corporations begin to pay their fair share. Look, here's the deal. Big corporations aren't just taking advantage of the Tax Code. They're taking advantage of you, the American consumer."
In the Republican response, Arkansas Governor Sarah Huckabee Sanders, a former White House press secretary during the Trump administration, blasted Biden and Democrats.
"While you reap the consequences of their failures, the Biden administration seems more interested in woke fantasies than the hard reality Americans face every day," she said. "Most Americans simply want to live their lives in freedom and peace, but we are under attack in a left-wing culture war we didn't start and never wanted to fight."
