Five domestic policy ideas in Biden’s State of the Union speech

Biden had already called for raising income taxes on the richest Americans and for much heavier taxation of billionaires. But on Thursday, he also called for barring firms from deducting the costs of paying salaries over $1 million from their federal taxes. The plan would raise $270 billion over 10 years, according to the White House, and aim to reduce inequality in the workforce amid soaring pay for executives.

The White House on Thursday also unveiled two other tax plans: a new minimum tax proposal on corporations, and a new tax on corporate jet travel. The new corporate minimum tax rate would rise to 21 percent. Biden also said he wants to push the regular corporate tax rate from 21 percent to 28 percent. Trump’s 2017 tax law cut it from 35 percent to 21 percent, but Biden’s Inflation Reduction Act nudged it back up in 2022.

Biden unveiled a fresh set of housing initiatives, including tax credits to ease costs for first-time buyers and moves to boost the number of available homes.

The White House’s proposals would provide middle-class first-time buyers with $5,000 per year for two years. That would have the same effect as lowering a buyer’s mortgage rate by more than 1.5 percentage points for two years on the median home, according to the White House.

Biden also wants Congress to provide a one-year credit of up to $10,000 for families who sell their starter homes, so long as their houses are below the median price in their county. The idea is to free up a part of the market that has been effectively frozen, as thousands of homeowners cling to low mortgages of 2 or 3 percent and avoid buying a new home with a much higher rate.

Biden said Medicare should be allowed to negotiate prices for at least 50 drugs per year, up from the target of 20 drugs per year. That change would require congressional action, but White House officials said it could reduce federal spending by tens of billions of dollars annually. Since Medicare sets prices that influence what private insurers charge, it could lead to lower drug prices for Americans who aren’t covered by the program, too.

This is all still theoretical, though: The Biden administration’s drug price negotiations just began this year, targeting an initial slate of 10 drugs; the drug industry has filed multiple lawsuits to try to stop the initiative; and the new prices won’t take effect until 2026 at the earliest.

Before the speech, White House officials also ripped into health insurance plans that they said are “ripping off” average Americans by not covering preexisting conditions, among other loopholes. The administration is close to finalizing its rule that will limit the availability of these health plans, officials said.

Biden’s speech marked the first time a president has uttered “AI” during a State of the Union address, according to an analysis of transcripts from the American Presidency Project. Biden called on Congress to “harness” the power of the rapidly evolving technology while managing its risks.

He also asked lawmakers to take steps to block AI fakes as part of what he called a “Unity Agenda,” weeks after thousands of New Hampshire voters received AI-generated robocalls impersonating his voice.

“Ban AI voice impersonation and more,” he said.

Biden’s call for action from Congress comes months after he signed an ambitious executive order, which placed new safety obligations on AI developers. However, congressional action is needed to fund some initiatives in the order, including a new U.S. AI Safety Institute within the National Institute of Standards and Technology. A Washington Post investigation reported funding challenges at the agency — which have led to decay at its facilities — could jeopardize the White House’s AI plans.

Amid White House frustration that polls show most voters are unaware of the profound impact his signature climate bill, the Inflation Reduction Act, has had in reigniting manufacturing in the United States, the president highlighted in his speech one of many new clean tech plants lured to the country as a result of generous incentives in the bill. In this case, the factory is getting built at an auto plant that was slated to be shuttered in Belvidere, Ill.

Biden called it “a great comeback story … Instead of an auto factory shutting down, an auto factory is reopening and a new state-of-the art battery factory is being built to power those cars.” The billions of dollars of federal clean energy incentives the president championed is leading to a resurgence in manufacturing across the nation, especially in key swing states such as Michigan, Georgia, Arizona and North Carolina. The factories are making components key to the energy transition.

But few voters are aware of the law and how it is driving economic growth. A Post-University of Maryland poll in August found that 71 percent of Americans had heard “little” or “nothing at all” about the package.