President Joe Biden took on food companies over pricing and forcefully challenged Republicans and Donald Trump over the border, the economy, China and other issues in the last State of the Union address of his term.
Biden took credit for bringing down inflation, an issue that has dogged his campaign, saying it was “the lowest in the world! And trending lower. The landing is and will be soft.”
But he continued to accuse food companies of gouging consumers through “shrinkflation,” the practice of keeping prices steady while reducing the contents of packages.
“Snack companies think you won’t notice when they charge you just as much for the same size bag but with fewer chips in it. No, I’m not joking. It's called shrinkflation. Pass Bobby Casey’s bill and stop this. I really mean it,” Biden said.
The bill, recently introduced by the Pennsylvania Democratic senator, would require the Federal Trade Commission to issue regulations to make shrinkflation an unfair or deceptive act or practice for manufacturers.
Ahead of the speech, the Senate Agriculture Committee’s Republican staff challenged Biden’s claim that food companies were following the practice to any significant extent.
“As part of the process of collecting accurate data needed to estimate the Consumer Price Index, BLS economists not only monitor product prices, but they monitor product sizes. This allows BLS to ensure that product size changes associated with shrinkflation are accurately reflected in the CPI. The Bureau found the impact of shrinkflation was not significant – on average accounting for less than 2 percentage points of the overall price increases,” the committee staff said.
Food inflation has slowed considerably from the rates seen coming out of the pandemic. USDA is forecasting grocery prices will rise 1.6% this year, well under the 20-year historical rate of 2.7%
Biden made no mention of passing a new farm bill this year. But in a section of the speech on his economic record, Biden took credit for helping farmers financially, not mentioning that net farm income has fallen off sharply over the last couple of years as commodity prices have softened and input costs have remained elevated.
"Because of my investments, family farms – my secretary of agriculture knows more about this than anybody I know – were better able to stay in the family ... and their children and grandchildren won’t have to leave home to make a living. It's transformative," he said, referring to Tom Vilsack.
On China, Biden asserted that "the trade deficit with China is down to the lowest point in over a decade. … We’re standing up against China’s unfair economic practices.”
Biden said that unlike Trump, he had “made sure that the most advanced American technologies can’t be used in China’s weapons,” an apparent reference to the CHIPS and Science Act, which was intended to counter China in technology manufacturing.
“We want competition with China, but not conflict,” Biden said.
On tax policy, Biden proposed a minimum tax of 25% for billionaires and raising the minimum corporate tax from 15% to "at least 21%."
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Tax policy is going to be a major issue in 2025 with the expiration of individual tax provisions in the Tax Cuts and Jobs Act. Unless Congress extends the provisions, individual tax rates will go up, a 20% deduction on small business income will end and the estate tax exemption will be sharply reduced.
Biden directly challenged Republicans at length over the fact that a bipartisan border security bill has been blocked in the GOP-controlled House after passing the Democratic-controlled Senate.
At one point, as he was being heckled by Republican Marjorie Taylor Green, R-Ga., he picked up a white button recognizing Laken Riley, a nursing student who was allegedly killed by a illegal immigrant. Biden referred to her alleged killer as an “illegal.” On Thursday, the House passed the Laken Riley Act, which requires the detention of any migrant who committed burglary or theft. The bill was approved by all GOP members in attendance along with 37 Democrats.
Biden asserted that someone who has to pay a smuggler $8,000 to get into the United States will be far less likely to try if the government slashes the amount of time it takes to adjudicate immigration cases, a key goal of the bipartisan legislation that the House rejected.
Alabama Sen. Katie Britt, who delivered the GOP response to Biden, continued the Republican themes of attacking Biden's capability to manage the presidency and his handling of the economy, border security and crime.
"The free world deserves better than a dithering and diminished leader. America deserves leaders who recognize that secure borders, stable pricing, safe streets and a strong defense are actually the cornerstones of a great nation," Britt said.
Biden also announced the U.S. military will be building a temporary port and a pier to get food and other humanitarian aid into Gaza, as the hunger crisis there worsens. “No U.S. boots will be on the ground," he promised.
The pier will “enable a massive increase in the amount of humanitarian assistance getting into Gaza every day,” he said.
The situation is becoming increasingly dire, Democratic senators said at a hearing of the Senate Foreign Relations Committee on Wednesday.
“Children in Gaza are being starved at the fastest rate that the world has ever seen,” Sen. Chris Van Hollen, D-Md., said, citing United Nations data. “Four out of five of the hungriest people in the world today live in Gaza,” he added.
Twenty-five Democrats wrote to President Joe Biden Feb. 5 urging the opening of more routes for humanitarian aid to enter Gaza, streamlining of the “convoluted aid process,” and other measures. Van Hollen said none of their requests have been implemented.
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