State of the Union 2011: Sidestepped Issues

Jan. 26, 2011 — -- President Obama's State of the Union address on Tuesday touched on innovation, education, security and taming the budget deficit through less spending. But there were few details about exactly how he would cut the persistently high national unemployment rate.

Mindful of the long road of negotiations ahead with a Republican-controlled House, the president steered clear of placing a figure on how he'd control military spending, Medicare, Medicaid and Social Security.

"He could have acknowledged the seriousness of the employment situation, including the unemployment rate," said Doug Roberts, chief investment strategist of Channel Capital Research.

Still, observers say the annual address to Congress is more about setting the tone than filling in all the details.

"The speech provides the president an opportunity to set the tone for a less-polarized Washington, one in which there are prospects of Democrats and Republicans working together to address the nation's problems," said Shanto Iyengar, professor of political science at Stanford University.

While the president did not mention new jobs programs, he emphasized the South Korea trade agreement that will lead to jobs and the importance of investing in education. One specific proposal is a tax credit of $10,000 for four years of college.

Roberts pointed out that Obama avoided talking about the nation's mortgage and foreclosure crisis, currency manipulation disputes with China and international banking stability.

"There was minimal focus on deterioration in the economy, trying to give the appearance of a strong recovery," Roberts said.

The "biggest takeaway for investors" from the speech, according to Anthony Valeri, senior vice president of LPL Research, was a possible decrease in the corporate tax rate. Though he said investors will have to wait and see additional details and "concrete action."