In State of the Union, Biden will encourage the economy and contrast with Trump

President Biden begins his State of the Union address Thursday with an economic record that has defied forecasters’ bleak expectations, avoiding a recession while delivering stronger growth and lower unemployment than predicted.

But polls show voters know relatively little about the legislation Biden signed into law that aims to stimulate the economy through spending and tax breaks on infrastructure, clean energy, semiconductors and more.

They remain frustrated about high prices, especially for groceries and housing, even as the rapid inflation that characterized the early years of Biden’s term has cooled. Mr. Biden has consistently followed his predecessor and likely November opponent, former President Donald J. Trump, on economic issues.

His speech on Thursday will attempt to make the case for the success of ‘Bidenomics’. Mr. Biden will begin hinting at what his agenda could deliver in a second term, including efforts to raise corporate taxes and lower housing costs, one of the most tangible examples of what Mr. Biden calls his efforts to build the economy. that gives priority to the workers and the middle class.

Mr. Biden’s State of the Union address will “discuss the historic achievements he has made for the American people and lay out his vision for the future,” Lael Brainard, chairman of the President’s National Economic Council, told reporters ahead of the speech to reporters. She highlighted recent wage increases, low unemployment and the construction of new factories, which she said were linked to Mr. Biden’s agenda.

Ms. Brainard and other administration officials said the president would seek to draw sharp contrasts with Mr. Trump on economic issues during his annual address, including on tax policy and cutting consumer costs. Mr. Biden’s aim is to portray Mr. Trump and his Republican Party as allies of the wealthy and big corporations, rather than Americans struggling with rising costs.

These contrasts include policy deviations from Mr. Trump’s legacy. Mr. Biden will propose raising the corporate tax rate to 28 percent, up from the 21 percent rate that Mr. Trump signed into law in 2017. He will also call for an increase in a new minimum tax on big companies, which Mr. Biden signed. converted into law in 2022, from 15 percent to 21 percent.

Mr. Biden will also propose ending companies’ ability to deduct compensation costs for any employee who receives more than $1 million a year.

The president’s allies in Washington differ on which economic issues he should focus on in this week’s speech. But they roundly agree that he should take credit for measures of economic strength under his watch, while promising to fight more to tame prices.

“He has economic growth, he has wage growth, inflation is coming down,” said Ellen Hughes-Cromwick, a former chief economist at the Ford Motor Company and now a senior fellow at the centrist Democratic think tank Third Way.

Mr. Biden should emphasize these trends, she said, along with the manufacturing investments spurred by his agenda. Her advice to the president is to “keep repeating” those victories.

Third Way’s latest poll in February illustrates Mr. Biden’s struggle to sell voters on his economic record. In some respects, the president’s management of the economy is as strong as — or better than — Trump’s. But these views are dogged by voters’ frustration with inflation. That poll shows respondents trust Mr. Trump over Mr. Biden by a nearly 20-point margin on the economy — and on related issues such as supporting manufacturing and lowering the cost of oil and gas.

A new group funded by Democratic donors released a poll on Wednesday suggesting that Mr Trump is vulnerable to attacks on tax policies that favor the wealthy. Blueprint’s poll found that two of voters’ top five concerns about the former president were the possibility that he would let wealthy tax cheats “off the hook” and cut taxes for wealthy but not working-class families. Trump’s 2017 tax cuts delivered much of the gain to corporations and high earners, but also cut taxes for ordinary workers.

In a memo released Thursday morning, Blueprint said its polling showed that three in five voters “say lower prices for the cost of goods and services is the aspect they would most like to see improved in the economy” – but fewer than a quarter see it as Mr. Biden’s top economic priority.

Progressive groups are also calling on Mr. Biden to aggressively target costs, blaming corporate greed, among other things, for some rising prices. They also want him to vigorously defend the power of government spending to stimulate the economy, including in crucial areas like affordable housing.

The Center for Popular Democracy, a progressive advocacy group, released a memo on Wednesday asking Mr. Biden to call for $1 trillion in new government funding to create 12 million “high-quality, permanent and deeply affordable, green homes owned by government or under democratic community control.” White House aides have not reviewed any new proposals along those lines.

Republicans have largely refuted Biden’s message, accusing him of unleashing high inflation with the spending measures he signed into law. They prepared similar attacks ahead of the State of the Union address.

“President Biden’s reckless spending agenda is a threat to our national security and the American way of life,” Republicans on the House Budget Committee said in a press release on Wednesday. “It threatens to destabilize today’s economy and deprive future generations of Americans of the blessings of freedom that make our nation exceptional.”