The major focus of Barack Obamas state of the union address was economic equality and

middle class prosperity. The policies for the promotion and expansion of opportunities for
economic growth were the major focus of the Address. The president showed concern over a
range of policy initiatives for the provision of security to working families. The major measures
include lowering the taxes for working class, increased employment and education opportunities,
development of training programs for workers and increased investment in infrastructure and
energy sectors to create more job opportunities.
President emphasized the need to increase the capital gain and dividend tax rate for the
redistribution purpose. In current American economic scenario the earned income is being taxed
at a higher rate than investment income. In economic terms this is the major reason of inequality.
In his State of Union address, President Obama touched the same reality and was rightly of the
opinion that without dealing with the root cause of the problem of redistribution, economic
recovery cannot contribute to engine of growth.
He said in his State of the Union address we need a tax code that truly helps working Americans
trying to get a leg up in the new economy, and we can achieve that together.
He proposed higher minimum wage, called business units to come forward with more
apprenticeship opportunities for workers and offered new retirement plans.
This is very right approach if we look at the facts about the American middle income families.
Autor, Katz and Kearney (2008) observe that, the lower middle class comprises low skilled

workers with stagnant wages. Almost half of these families rely on two earners to survive. And
one of the challenges that they face is low return because of current tax structure and transfer
programs.
Economists are of the view that human capital and skills are most important factors of growth.
For proper utilization of human potential, it is evident that a person from low and middle income
families should be provided the opportunities to match with suitable occupation.
President rightly focused on middle class as his focal point in the wake of growth in last year that
failed to improve living standards in USA.
He focused middle class in his State of the Union address when stated: The verdict is clear.
Middle class economics works.
The words echoed the resolution that the need of the moment is the restoration of the relation
between hard work and opportunities for all Americans, especially low and middle income
families.
He stressed, Thats what middle-class economics is the idea that this country does best when
everyone gets their fair shot, everyone does their fair share, and everyone plays by the same set
of rules. (Obama, Jaunary 20, 2015)

References
Autor, D. H., Katz, L. F., & Kearney, M. S. (2008). Trends in US wage inequality: Revising the
revisionists. The Review of Economics and Statistics,90(2), 300-323.