State of the Union: ALEC Experts Respond

Updated January 21, 2015

Jon Russell, director of the American City County Exchange (ACCE): 

 One of the most pressing issues facing local governments across the country is the need for local police agencies to have access to body cameras to provide adequate protections for officers and the public. In his State of the Union address, President Obama did not address pressing issues facing local law enforcement. Given many high profile cases of officer-related deaths, the president has made statements in the past on the subject, but has not delivered any action. Currently the federal government is providing grant money for some large municipalities to have body cameras, but there needs to be a broader discussion of block grants to the states to provide body cameras for their local subdivisions. These block grants can be paid for by increasing the amount of money states receive from the seizure of property through criminal forfeiture by federal law enforcement agencies.

Amy Kjose Anderson, director of the Task Force on Civil Justice: 

President Obama talked about making our economy competitive and our nation a place where businesses want to locate and hire. This is key to economic prosperity, and a central point of ALEC policy, but he failed to mention that our economy cannot be competitive when our legal system costs about twice that of fellow developed countries. When businesses have to spend more money and more time here being sued for providing products and services, they’re less likely to want to do business here and those here have fewer resources to devote to hiring and research.

Fortunately, the states are working to pass meaningful lawsuit reforms to reign in litigation and to create the proper incentives for businesses to breed a prosperous economy. In 2015, nearly 20 states have already introduced lawsuit reforms that would instill fairness and predictability in state legal systems.

Cara Sullivan, director of the Task Force on Commerce, Insurance and Economic Development: 

The President emphasized his belief that America does best when everyone gets a fair shot to succeed. He is right. Every American deserves a chance to earn a living and provide for their families. However, the President’s calls for increasing the minimum wage will do just the opposite. Entry-level jobs provide inexperienced, undereducated individuals an opportunity to climb the first rungs of the career ladder that is the American dream by gaining skills such as responsibility, work ethic and punctuality. The future of America depends on the success of our next generation, but a mandated wage hike will jeopardize opportunities for those that need them most. Instead, policymakers should focus on solutions that expand an individual’s opportunity to thrive, such as lowering the barriers to entry that occupational licenses pose and expanding access to capital for start-ups through equity crowdfunding.

President Obama called for increased investment in our nation’s infrastructure. A functional and safe transportation system is vital to any economy, but President Obama failed to outline a sustainable financing solution. Congress will be forced to tackle the challenge of funding our nation’s transportation infrastructure as the temporary fix to the Highway Trust Fund’s revenue problem that was passed by Congress last year will end in May 2015. Options that leverage private investment dollars, such as public-private partnerships, should be the primary consideration as policymakers examine how to pay for our nation’s infrastructure.

Bartlett Cleland, director of the Task Force on Communications and Technology:

Privacy and Cybersecurity

The Internet is insecure because of its very design — a system of system, a network of networks, originally a system for experimentation and research, not a lockbox for safe commerce or communication. On the Internet change is the norm, static the enemy of innovation. Online privacy suffers since personal information became currency on the Web, as people trade away privacy for ease of online check out or digital trinkets. Barely understood, even today, is how little information it takes for a person to be identified. Taken together, addressing security and privacy is not simple, and passing it off to the American people as simple is malpractice.

POTUS could do much better by the American people by explaining the dangers clearly, leading a national dialogue about solutions, and suggesting a productive policy framework that does not merely swap privacy for greater government control. Long term success rather than a quick political hit is what is necessary.

The debate is an old one; that of a citizen’s rights versus security. That is, how many of our constitutionally guaranteed rights protecting us from government would be eroded to grow government to a size to try to add some additional security? James Madison reminds us, “The means of defence [sic] against foreign danger, have been always the instruments of tyranny at home.”

However, achieving greater cybersecurity is a very real challenge as the private sector owns more than 80 percent of the U.S. critical infrastructure. Only a strong partnership with the private sector, rather than an over regulatory new construct of bureaucracies and mandates, will be effective. If innovation and the ability to act and react are restricted, then our security will remain suspect, and our privacy unprotected.

ALEC has addressed the need with a clear statement of principles for cybersecurity, which can be found here.

Increase internet access/municipal broadband

The goal of increased access to broadband is a good one, but how we reach that goal is equally important. Safeguards and limits on local government-owned networks being vitiated by the federal government is an unacceptable “solution.”

While models of municipality creation vary widely around the world, in the United States how they are created is fairly clear. The U.S. Constitution empowers states as the primary political entity. The federal government itself is also a creation of the states, and of the people, with the Constitution placing restraints on government broadly, at the agreement of the states. States are also empowered to arbitrarily create subdivisions, generically referred to as municipalities. Ultimately then, responsibility for the municipalities generally falls to the states.

POTUS’ suggestion of intervention into this relationship between states and municipalities would have profound negative effects. Complete usurpation of state’s rights, in particular the existing law in 19 states that either prohibit government-owned broadband networks or place some limitation (such as transparency) on municipalities if they provide broadband, is unacceptable. Municipalities, untethered from responsibility to the state, could partake in risky schemes of tax-funded adventurism, placing the entire state and all its citizens at risk.

The ALEC Communications and Technology public sector chairman and vice-chairman, North Dakota Representative Blair Thoreson and California Senator Joel Andersen wrote to the FCC last year and provided their concerns on federal preemption of state-level safeguards. Their letter can be found here.

Network neutrality

The Federal Communications Commission (FCC) has already tried multiple times to regulate the Internet under the guise of “Net Neutrality.” Each time the court has struck down their attempts. Legislation is clearly the only path to rein in the FCC. However, ALEC has been very clear as to what acceptable legislation will include, which is spelled out in the ALEC Resolution on Network Neutrality.

Lindsay Russell Dexter, director of the Task Force on Education:

The word free seems to be a word that jumps out in everyday life. Advertisements and coupons that provide buy-one-get-one-free are automatic head turners. And who doesn’t want something free? In fact, many individuals and families are able to save money and live within a budget by taking advantage of these types of deals. But buying one bar of soap and getting another for free is much different than advertising a free community college education. Yet, President Obama has proposed just that: reducing the cost of community colleges to “zero.” President Obama said, “I want to make it free.”

However, Americans are not banking their futures on a free bar of soap. They are banking their futures on the possibility of a better life through affordable education. The president’s goal to make community college free is exciting and a head-turner, but like the buy-one-get-one free bar of soap, it is only an advertisement. Further, President Obama’s free community college advertisement is really nothing more than political rhetoric and turning education policy into a political gamut is dangerous and not fair to hardworking taxpayers.

Not only is the President spewing off political education proposals, he is disingenuous about the free in the advertisement. The President’s community college proposal is not free. His proposal is estimated to cost $60 billion in new federal money over the next ten years. What is even more concerning is his cost sharing ‘partnership’ with states. At no point did the president vet his free community college proposal through state policymakers. And at no point did he acknowledge that already struggling states may not be able to cushion his cost sharing ‘partnership’ or what is, truly, an unfunded mandate of almost a quarter of the total costs to states.

John Eick, director of the Task Force on Energy, Environment and Agriculture:

Energy – whether directly or indirectly – came up three times during the President’s state of the union address.

As he has in the past, Mr. Obama spoke positively (and seemingly tried to take credit) for the U.S. now producing the most oil and natural gas, combined, than any other global competitor. This is certainly a positive development since, as Mr. Obama said, “we are as free from the grip of foreign oil as we’ve been in almost 30 years.”

However, the vast majority of the increase in oil and gas production Mr. Obama points to has occurred on privately-owned land. As the Institute for Energy Research has written about, fossil fuel production on federal lands is currently at a ten year low. The average number of leases the Bureau of Land Management issues has dropped precipitously since the Reagan administration and the average amount of time needed to obtain a permit to drill on federal lands has doubled since just 2005. So, in many respects, these gains have happened in spite of Mr. Obama’s policies, and to be fair, many of his predecessors.

The Keystone XL pipeline was only briefly alluded to in order for Mr. Obama to make the case for greater funding for infrastructure projects: “let’s set our sights higher than a single oil pipeline. Let’s pass a bipartisan infrastructure plan that could create more than thirty times as many jobs per year, and make this country stronger for decades to come.”

Finally, the president spent most of his time on energy policy speaking about the threats posed by global climate change. He also expressed a commitment to blocking any Congressional action that would thwart his efforts. Of course, here Mr. Obama was referring to his Clean Power Plan which may only have a minimal impact on rising temperatures while presenting a number of problems associated with cost, reliability, and federal overreach.

Sean Riley, director of the Task Force on Health and Human Services:

The president spent just five minutes of last year’s State of the Union addressing health care. With last Friday’s surprise resignation of the administration’s top official overseeing the ACA’s rollout, he spent even less time this year. While the president briefly commented on reductions in the number of uninsured, he made no mention that gains have largely been driven through expansion of Medicaid, a program he once labeled as broken.

Despite the president’s relative silence, the public will need to wait just over a month before the Affordable Care Act again takes the national spotlight. Although the six Supreme Court justices in attendance had their attention focused on the president, the roles will reverse on March 4 when the Court hears arguments in King v. Burwell regarding the availability of insurance subsidies under the ACA. Though a decision won’t be released until June, the presidents’ silence on the case tonight, and over the past several months, is significant. While the administration continues to hold that the case is without merit, last October language was quietly inserted into contracts between CMS and health insurers offering plans on that would “allow insurers to stop offering their plans should judges rule that the federal government should not be allowed to offer subsidies to people in states without their own exchanges.”

Regardless of the Supreme Court’s decision, the Affordable Care Act will continue to pose significant challenges to the states and to businesses across the country. While bipartisan measures are moving forward to address some of these issues, with more on the horizon, Congress and the president would be wise to empower states and provide the flexibility that has long been sought.

Karla Jones, director of the Task Force on Federalism and International Relations:

Making some of the most robust statements on international trade since launching the National Export Initiative at the 2010 SOTU, it is clear the president sees export promotion as an important part of his legacy. This is excellent news for the country as increasing exports is a sure way to create jobs and promote state and national economic growth, and giving the president Trade Promotion Authority (TPA) and removing outdated regulations – especially those governing energy exports – are the best ways to boost trade. TPA gives Congress the ability to set legislative parameters on agreements negotiated by the president in exchange for a pledge by Congress to vote on the resulting agreement by up or down vote – no additional amendments and is crucial to finalizing the trade frameworks currently being negotiated. Additionally, lifting anachronistic regulations on liquefied natural gas (LNG) and crude oil exports would free the U.S. to capitalize fully on the current domestic energy boon, and now is the perfect time to press forward on these initiatives. No longer burdened with reelection challenges or pressure from fellow Democrats facing tough mid-term elections, the president has the freedom to collaborate with likeminded partners on both sides of the aisle to grow our nation’s exports.

Cara Sullivan, director of the Justice Performance Project:

President Obama highlighted that, for the first time in 40 years, the crime rate and incarceration rate have both declined. Criminal justice reform poses a true opportunity for what the President deems “better politics” and is an issue where there is a real opportunity, and need, to get something done. Policymakers on both sides of the aisle have recognized the need for comprehensive sentencing reform that focuses prison space on high-risk offenders while holding nonviolent offenders accountable in community-based programs that emphasize rehabilitation, personal responsibility and restitution to victims. State legislators across the country have realized that we cannot simply throw more dollars at corrections budgets to keep our communities safe. Instead, our system requires data-driven solutions that are proven to reduce the likelihood that an offender will reoffend. President Obama and Congress should follow the example of the states and best protect our communities by pursuing policies that prioritize supervision of serious offenders, expand opportunities for the 95 percent of incarcerated individuals that will one day be released, and emphasize mental health and addiction treatment for those who need it.

Jonathan Williams, director of the Task Force on Tax and Fiscal Policy:

America’s tax code is overly burdensome, complex, and uncompetitive with the rest of the world. At a top rate of 35 percent, the United States has the highest corporate tax rate in the developed world and the top personal income tax rate is even higher at 39.6 percent. Unfortunately, President Obama has proposed even higher taxes—with a $320 billion tax increase, mostly on capital gains income and a higher death tax, at the center of his economic plan. The goal of increasing wages for middle income earners is an admirable one, but saddling the economy with even more taxes and sharply reducing potential returns for investors will only slow down our fragile economic recovery and handicap economic growth—which helps no one. If the president truly wanted to fix and improve our tax code he should look at years of economic evidence that demonstrate that capital based taxes, such as taxes on capital gains and income, are highly destructive to economic growth and are highly volatile sources of revenue.

This is a lesson states know well, the nine states with no personal income tax routinely outperform the nine states with the highest personal income taxes in nearly every important economic metric from job growth to growth in gross state product. Additionally, the President’s calls for higher taxes, especially increasing the death tax, are out of step with what most Americans want. Last year, 14 states reduced their tax burdens, including many traditionally blue states. Furthermore, in 2014 Minnesota, Maryland, Rhode Island, and New York all reduced their death taxes. These reductions come soon after the complete elimination of the death tax in Indiana, Ohio and North Carolina in recent years. By ignoring the economic evidence and calls for fundamental reform of the United States tax code, the President has demonstrated that he is simply not interested in taking seriously one of the most important topics to the American people.