Some Clues for the Rest of the Year — Biden Goes Populist, GOP is Still Divided
Author: Greg Valliere
February 8, 2023
PRESIDENTS ARE RARELY HECKLED in a State of the Union address, but at times last night Congress looked like the bellicose British Parliament. Three major themes stood out:
BIDEN THE POPULIST: He can read the polls, which show the public favors higher taxes on the rich, wants no changes to Social Security, and hates the big oil companies. So the president went populist, launching an attack that will be repeated frequently this year. For business, there will be headline risk — but there’s no chance that tax hikes or anti-corporate legislation will pass.
DEBT DEAL ALREADY IS IN TROUBLE: Anyone who hoped for a debt deal by summer got an earful last night — Biden wants to score political points, blasting the reckless threat of a government default, and Republicans want radical spending reform. Both sides are still far apart on the most important domestic issue of 2023; there’s no willingness to compromise on the debt — and there won’t be until mid-summer.
THE DIVIDED REPUBLICANS: What better image of the GOP infighting than the shot of McCarthy trying to shush radical House members — including Marjorie Taylor Greene — who were booing and heckling Biden. But McCarthy couldn’t stop them. It was clear — once again — that he can’t control his radicals, some of whom would actually welcome a default.
THE NEXT MOVE: The Biden budget will be out by early March, highlighting enormous federal deficits — over $1 trillion annually — for years to come. Then there will be pressure on the GOP to produce a budget proposal, which will call for huge — and unpopular — spending cuts.
BOTTOM LINE: Did the address help Biden? As we wrote yesterday, this annual snooze-fest usually raises a president’s favorability rating by two or three points, but most Americans aren’t buying Biden’s argument that the economy is in good shape. The more he makes that assertion, the more voters conclude that he’s out of touch.
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