The annual State of the Union address is the president’s laundry list for Congress: what he wants to see them do in the next year. Except, of course, in a campaign year, when the State of the Union address is the president’s kick-off speech for his campaign. Given that this is an election year, and given that Congress was paralyzed by partisan squabbling last year, Obama’s State of the Union speech was unusually larded with admonitions for Congress to pass bills for the president to sign. This has been the modus operandi of the Obama administration: Congress is in charge, they’re responsible for this mess, it’s out of my hands.

Take, for instance, the lead issue in the State of the Union speech: jobs. After admonishing US corporations to bring jobs back to the US, Obama offers up a host of tax credit sweeteners, as if the federal government is wallowing in money right now. Commentators pointed out immediately that taxes are not the main reason for offshoring. Cheap labor, lack of labor laws and safety regulations, and closer proximity to commodities and parts are the main reasons corporations send jobs overseas. Obama didn’t say, “We’re ready to repeal labor laws; Congress, send me a bill and I will sign it!” Although that’s what it would take to move these jobs back here.

In fact, the Obama administration doesn’t need to do this on a federal level, because similar actions are occurring at the state level. Last week, Indiana became the 23rd state in the union to pass a “right-to-work” law that undermines labor unions, and a number of other states are considering doing the same. The Obama administration has chosen to remain silent on the “right-to-work” movement, which amounts to a strategic decision to passively support corporations’ efforts to create a Third-World underclass here in the US.

Likewise, his job training initiatives will help employers at the expense of students. A proposal to create a public-private partnership between corporations and community colleges begs the question: while students are learning how to measure, calculate, cut, solder, clean, and assemble, will they be learning civics, reading comprehension, history, or critical thinking? These latter skills are essential for an informed populace in a democratic society, as many Middle Eastern nations are learning today. Will we lose an important edge in our capacity for freedom and democracy in order to gain a competitive edge in the international job markets?

Many listeners celebrated Obama’s call to free K-12 students from standardized testing, expand work-study opportunities for college students, allocate more pay for teachers, extend the tuition tax credit, and lower college tuition rates. He didn’t say, however, where the money would come from for all of these expensive proposals.

No, instead he changed the subject to immigration reform, sending a deeply contradictory message: yes, we should pass laws allowing immigrant students to become naturalized citizens. But then he beat his chest about how he’s closed the borders by putting more “boots on the ground” than any previous president. These two statements don’t constitute an effective immigration reform policy, and certainly don’t fulfill the promise he made in his campaign three years ago to reform our broken immigration system. Under his presidency, that system has become more militarized—an overzealous arm of the anti-terrorism campaign—and has torn many families and communities apart.

Much has been written since the State of Union speech about Obama’s new taskforce to crack down on banks and mortgage lenders who engaged in shady lending practices in the past decade. It’s three years too late and millions of dollars short. The SEC and the Department of Justice have already covered this ground, suing big banks and their former CEO’s and extracting insufficient settlement payments—most of which were paid by shareholders of those companies, not the executives responsible for the misdeeds. The banks will argue strenuously and with great success that this is double jeopardy: they can’t be sued twice for the same crimes. Proponents’ arguments that the taskforce will uncover new crimes are not persuasive, given that that the taskforce will be staffed with many of the same lawyers from the SEC and the DOJ who pursued the earlier cases.

The clearest example of the Obama administration’s approach to governance can be seen in its energy and environmental policies. In his speech Obama said, “Tonight I’m directing my administration to open more than 75% of our potential offshore oil and gas resources.” So much for cracking down on oil company polluters in the wake of the Deepwater Horizon spill in the Gulf. He went on to say that hydraulic fracturing (“fracking”) is okay, as long as companies tell us which chemicals they’re pouring into the ground. No mention was made of how those chemicals often migrate into groundwater and drinking water supplies, harming human, plant, and animal life. No mention was made of recent studies of earthquake activity near the deep-well disposal sites for contaminated fluids used in fracking.

Boasting that we have 100 years of natural gas reserves in the US, Obama ignored recent estimates by his own Energy Information Administration that show those reserves to be much lower—more than 40% lower, in fact, than earlier estimates. In addition, the US is set to become a net exporter of liquefied natural gas by 2016, belying Obama’s assumption that that our natural gas supply is for domestic use only.

The president then tossed a bone to environmentalists by calling for the opening of public lands to clean energy projects. Unfortunately, this shows the Democratic Party’s vast ignorance of the debate raging in environmental circles about such projects. Many enviros condemn the effort to place, for example, solar panels in a pristine and fragile semi-desert environment, when there are many private lands that could be used for clean energy development. The difference: energy companies would have to pay private landowners, when they could get access to public lands much more cheaply. Again, financial incentives to corporations trump environmental policy.

Most important are the elements missing from an Obama administration energy and environmental policy, primarily energy conservation plans and any effort to require power plants to clean up their carbon emissions. Corporations and the Republican Party have called these “job-killing” initiatives, and the Democratic Party has swallowed it hook, line, and sinker.

Aside from the tax credits for businesses to bring jobs home, the expensive educational initiatives, and the call to fund clean energy projects, the centerpiece of Obama’s State of the Union address, the words that everyone was waiting to hear were: “Here’s how we’re going to pay for all this.”

Again, Obama disappointed us. He made two, brief statements about funding for his proposals. First, he claimed that the federal government will get a peace dividend from ending the war in Iraq, which Congress should spend to pay down the deficit and fund infrastructure projects.

The peace dividend is a mirage. The US is still pouring billions of dollars into the War on Terror. Sure, not as much of it is going to Iraq, although we still have the largest US embassy in the world in Baghdad, and we’re still funding Iraqi infrastructure and security forces training there. But we’re pouring increasing amounts of money into secret and undeclared wars all across the Middle East and Africa, from Pakistan to Yemen, to Somalia. And let’s not forget Afghanistan, where the US military estimates we’ll be involved for at least the next decade or longer.

Secondly, Obama embraced Warren Buffet’s proposal to raise taxes on people who make more than a million dollars per year. This does not constitute a comprehensive, detailed tax plan. He didn’t say a single word about letting the Bush tax cuts expire, he didn’t mention raising taxes on carried interest (wages earned by hedge fund managers that are taxed at only 15%), or raising capital gains tax rates. He didn’t mention revising the alternative minimum tax to capture more wealthy taxpayers instead of middle-class taxpayers. He didn’t mention a special tax on investment transactions, nor did he make a case for the estate tax or closing loopholes that allow the wealthy to transfer their assets tax-free to their children and grandchildren. He didn’t discuss how many businesses in the US paid little or no tax on their profits last year. In short, he presented no plan to deal with the federal government’s fiscal woes. And that’s a massive failure of governance.

Congress bears some responsibility for not passing a comprehensive budget, but that doesn’t let the president off the hook for proposing a solution to the most important problem in the national political arena. Obama failed to do that, and in doing so, proved himself as much removed from reality and divorced from the concerns of average Americans as George W. Bush ever was.

Obama’s State of the Union speech can be viewed as a campaign speech, but it should also be viewed as a gauge for the state of his presidency. In spite of rhetoric meant to appeal to middle class Americans, his administration has done everything it can to help the wealthy maintain their privileges, and to help corporations erode democracy, workers’ rights, and the environment in pursuit of more profits for their shareholders. None of the Republican candidates for president would be better, but they also wouldn’t be much worse, and that makes me shudder for the future of democracy in America.

The mainstream media has been full of news reporting on Republican Presidential candidate Mitt Romney’s finances. First, let’s thank the Occupy Wall Street movement, because without them, this would never have become a campaign issue. And even as Mitt Romney tries desperately to keep his finances a secret, bits of information keep leaking to the press.

First, there’s Romney’s own, casual admission that he paid “about 15%” in income taxes last year, but of course he won’t know for sure until his accountant finishes his tax return (sometime in April, after most of the early primaries are over). He could release his 2010 tax return, however, as other candidates have, but he won’t, which says lot about the amount of government secrecy we can expect from a Romney administration.

About that 15%: it’s less than half of what his wealthy father paid in taxes during his time as an American millionaire, which was 37%. Ah, those good old days. And I’m not even talking about a time that was in the distant past. Ten years ago, Mitt Romney would have paid about 25% in taxes, and 15 years ago, in the mid-1990’s, he would have paid 29%. That was during the booming years of Bill Clinton’s first term, when the economy gained around 11.5 million jobs (which puts the entire Bush Jr. presidency to shame) and the federal government ran a surplus, not a deficit.

So whenever you hear right-wing pundits complain that raising taxes on the rich will hurt the economy, you should know better. The rich have paid much higher tax rates during some of the best years of the U.S. economy.

Let’s remember that the federal deficit wasn’t a side effect of the George W. Bush years; it was the whole point. Bush was heavily supported by Wall Street, the oil industry, and defense contractors because he was willing to spend taxpayer money (and borrow even more) on two wasteful wars in the Middle East, which turned out to be very profitable for them. And of course Bush pushed through two major tax cuts for the wealthy that were very dear to the hearts of his wealthy constituents.

Now comes Romney, who is the very embodiment of everything that is Wall Street. His fortune, estimated to be around $250 million, puts him in the upper ranks of the 1%. His tax rate of 15% means that he earns no wages or salary; he makes all of his money through his investments. His work history, as former CEO of Bain Capital, means he has yet to learn what an honest day’s work in the real economy—the one that manufactures real goods and provides services to average Americans—really means.

Bain Capital is a private equity firm. Private equity firms engage in leveraged buyouts. They collect a big pool of cash from wealthy investors and use that pool of cash to buy a distressed company. They “turn that company around” by cutting what they determine to be excess: they sell off some of the assets and lay off a lot of people. Once they’ve turned the company into a money making enterprise, they use that company as collateral for big loans, which are then used to buy more distressed companies, and so on. And the amount of profit that private equity firms demand from the companies they buy is very high, because they have a whole bunch of wealthy investors who want a big, exciting rate of return.

Romney is no longer CEO of Bain Capital, but a large portion of his fortune is invested in Bain Capital’s various investment funds. And at least $25 million of his fortune is invested in offshore funds that Bain set up in the Cayman Islands.

Romney and his financial advisors have all denied that he invested in those funds to avoid paying U.S. taxes. They all say something like: “he chose those funds because of the assets they invested in, not for tax reasons.” That’s disingenuous, to say the least. Every investor looks at the total rate of return of the investment he’s considering. The “total rate of return” is what the fund pays the investor less any costs to the investor, including fees paid to the fund managers and income taxes. There would be no other reason for Bain to set up a fund in the Cayman Islands except to help the investors avoid paying U.S. income taxes. Bain has a total of 138 offshore investment funds in the Cayman Islands.

Now, many politicians—both Republicans and Democrats—have railed against companies and individuals who use offshore banks and other foreign institutions to avoid paying U.S. taxes. The U.S. Treasury has been cracking down on taxpayers who don’t declare their foreign earnings, because the Treasury has a vested interest in knowing the extent of the problem, and for good reason. Offshore investments suck an estimated $100 billion dollars in tax revenue out of the U.S. Treasury.

But the problem could be worse than that. Funds that are organized in a foreign country but purchase and trade mostly U.S. assets allow foreigners to invest in the U.S. without having to pay U.S. taxes on that income, as they would otherwise be required to do if they bought and sold those assets directly. And U.S. assets, particularly real estate, are looking like a very good deal to foreign investors these days. The U.S. Treasury needs that tax revenue now more than ever, but can’t collect it from funds organized as offshore tax havens. Don’t expect Mitt Romney to change that law.

Nor can we expect Mitt Romney to advocate for a repeal of the Bush-era tax cuts for the wealthy, as Barack Obama has done. Those tax cuts have rewarded Romney, and his Wall Street cohorts, beyond their wildest dreams.

In the past year the press was full of stories speculating over whether the economic recovery was well under way or beginning to falter. But most stories were economic happy talk, glowing reports of record corporate earnings without any mention of how the companies were using their windfalls of cash. The disconnect between what ordinary Americans see inside their own checkbooks and what they read or watch in the news reports is getting bigger every day. So here is our list of the most important and neglected economic stories of the year.

1. The European Debt Crisis was manufactured by big, institutional investors to punish the European Union for not fully bailing out Greece the way the US government bailed out big banks in 2008 and 2009.

Let’s admit the truth here. Sure, Greece was in serious trouble. But Spain? Italy? And now France and Germany? No way. The equation is simple, but the financial press never laid it out for anyone. Instead of bailing out Greece, the EU worked out a deal that forced private investors to take a loss on their Greek bonds, which made big institutional investors (banks and hedge funds) angry; so they dumped any and all European debt in their portfolios. A few weeks later, no European government could get a favorable rate on their short-term debt. And no government in the world can currently get a long-term loan because investors are worried that, once interest rates rise, their money will be locked into long-term bonds whose value will have fallen and whose interest rates will be super low. The European Debt Crisis didn’t ease up until December when the European Central Bank finally announced that it would do what the US Federal Reserve did in 2009: extend no-interest loans to any and all banks that want them. Mission accomplished.

2. Hidden problems in the bond market.

Here’s another simple equation for you: add together panicked investors looking for a safe investment plus a huge number of retiring baby boomers. This leads to a record amount of money poured into the bond markets, because bonds are a safe investment, right? Well, not exactly. With few medium and small businesses able to borrow money, and government debt in disfavor, we should be asking ourselves where all that bond market money is going.

Here’s a way to find out: by looking at the largest bond market index mutual funds, which buy investments to match the composition of the entire US bond market. Here’s what one such fund holds: 70% in US government agency debt, 20.7% in corporate bonds, and the last 9% is made up of municipal bonds, other sovereign debt, cash, and a few risky derivatives (to boost the fund’s rate of return).

Sounds pretty safe, right? But here’s the kicker: of that 70% of US government agency debt, only a little more than half is invested in the safest US Treasuries (US federal government debt, i.e., the much maligned “deficit”). The rest, a full 34.4% of the entire fund, is made up of bonds issued by Fannie Mae and Freddie Mac; in other words, it’s tied up in the still-sinking housing market. Many of these bonds may be worthless, because Fannie and Freddie have been doing the same things that other big US mortgage lenders have been doing: delaying the inevitable write-off for as long as possible.

In addition, of the 20.7% of the fund invested in corporate bonds, more than a third of that (36%) is invested in bonds issued by banks, brokerages, insurance companies, and real estate investments trusts, and other financial industry companies. So the total amount in the fund that’s invested in the housing market and the finance industry is 42%, which shows us exactly how big the housing market bubble still is, and how risky investing in bonds can be.

3. Nearly half of all Americans are poor or low-income.

Last year, as in past years, the US Census Bureau calculated the number of people whose incomes are below the poverty level, defined as $22,314 for a family of four. That number totaled about 49.1 million Americans. But, for the first time, the bureau also calculated the number of people whose incomes were just above the poverty level, but below the “low-income” level, defined as $44,405 for a family of four (about 200% of the poverty level). That total came to 97.3 million additional Americans, which means nearly half of all people in the United States are poor or low-income.

In addition, 1 in 4 Americans needed emergency food assistance in the past year, 57% of all children in this country are in poor or low-income families, and 62% of low income families spent more than one-third of their income on housing. Child care costs take up another 20%, which doesn’t leave much for food, transportation, clothing, school supplies, etc.

With half of our population barely able to afford basic necessities, consumer spending (which accounts for more than 70% of economic activity) will never be able to rescue the US from its economic downturn.

4. The average tax rate paid by large US corporations is really 18.5%.

Whenever anyone mentions raising taxes, a wail goes up in corporate boardrooms all across America: “We pay too much tax!” The aspirational tax rate for US corporations is 35%. Wouldn’t it be nice if the US Treasury actually collected that much? According to a study done by Citizens for Tax Justice, only one-quarter of large US corporations pay more than 30% of their income in tax. Another one-quarter pay less than 10%. Approximately 30 companies in the study paid no tax, despite earning large profits. The most notorious offenders included Boeing, which received enormous tax breaks from the US government because it’s a major defense contractor, and companies like Microsoft who, because they’ve built call centers in other countries, can list most of their profits as foreign earnings not subject to US taxes.

5. Income disparity is at record levels in the US.

The Congressional Budget Office issued a report on income disparity in the US: the richest 1% of Americans saw their income increase by 275% over the past three years, during the worst economic downturn since the 1930’s. The upper 20% of Americans took home 53% of all after-tax income (more than the other 80% of Americans combined). Most shocking was the fact that the poorest 20% of Americans took home only 5% of all after-tax income.

6. Economically, we don’t live in a post-racist America.

More figures from the Census Bureau show us the racial composition of poverty in the US. The poverty rate is the highest for African Americans at 27%. For Hispanics it’s 26%. And for white Americans it’s 9.9%. Clearly, we don’t live in a post-racist America.

The statistics on race and poverty also held one startling fact: the median annual income for a male, full-time worker (of any race) in 2010 was $47,715. In 1973, the median income for the same worker was $49,065. This erosion of earnings has benefited corporate America immensely, while creating a lost generation for American workers.

7. Mortgage fraud is still going strong.

In August, the FBI released their annual report on mortgage fraud, showing that it’s still a widespread problem in the US. An estimated $10 billion in fraudulent loans were issued in 2010. The most common problems include falsifying documents so people could qualify for loans they couldn’t afford, inflating appraisals of houses so people had to take out larger mortgage loans, and pushing people to buy investment or rental properties that they couldn’t afford—all the same practices that led to the subprime mortgage collapse.

In addition, the Associated Press reported that mortgage-style robo-signing has become a common practice on the sale documents for properties. In 2010, banks were caught rubber-stamping mortgage loan documents and, after paying a nominal fine, they agreed to clean up their act. But now the AP has discovered that the actual sale documents for houses are being processed in the same way, potentially calling into question the ownership of millions of properties that have changed hands in the past decade.

8. Take-home pay in 2010.

Who took home the biggest slice of the pie in 2010? Was it corporations, small business, workers, or investors? Of national income in 2010, 14% was claimed by corporations, the highest rate in history. Small businesses, which are often lauded as the driving engine of employment in our economy, took home only 8.3%, the lowest rate ever. Workers took home 49.9%, the first time ever that employees took home less than 50% of total national income. And the remaining slice of the pie, a full 28.4%, went to investors, most of whom don’t work for a living, and who pay only a 15% tax rate on their income.

9. Failure of the Chrysler bailout.

A couple of years ago, when the US government stepped in to bail out Chrysler, we were told that taxpayers had to pony up to save a US automaker, which would also save US jobs. In addition, this was supposed to be an investment for US taxpayers, who could earn a healthy profit on the deal.

Well, those were lies. The US Treasury sold the last of its Chrysler stock in July, and the total loss shouldered by US taxpayers was $1.3 billion. And Chrysler is no longer a US automaker; Fiat (an Italian company) stepped in to buy up most of its stock, announcing that it would lay off a large chunk of Chrysler’s workforce in the coming merger.

We must point out that, without the bailout, Chrysler would have been bought out by Fiat or another foreign automaker anyway, because of its valuable factories and equipment strategically located in one of the most important car-buying markets in the world. The main difference is that, without the bailout, Chrysler shareholders and bondholders would have taken that $1.3 billion loss, instead of US taxpayers. That’s what a bailout is: nationalization of corporate losses so shareholders and bondholders (often big banks and hedge funds) can be rescued from their stupid investment decisions. (This is what economists mean when they talk about “moral hazard”: the more we rescue investors, the stupider and riskier their investment decisions become.)

10. Where did the cash go?

With this year’s economic happy talk centering on record corporate earnings, we might well ask where all that cash is going. It’s not creating jobs, that’s for sure. In June, the New York Times printed an article entitled “Employers Spend On Equipment Rather Than Hiring.” Apparently, equipment and software costs are so cheap (most of it is manufactured abroad, where labor costs are lower) that corporations have been on a shopping spree. Buying newer equipment and software often means more efficient automation, which leads to more layoffs. In addition, while equipment and software costs have increased only 2.4% in the past couple of years, labor costs have increased 6.7%, mostly because of skyrocketing medical insurance premiums. As a consequence, hiring is up only 2% in the past two years, while equipment and software purchases are up 26%.

So that’s where all the money has been going: to buy goods made by other US companies, but not made in the US, where labor costs are still too high, in spite of the erosion of wages for US workers over the past 40 years.

The trend is obvious, if you gather the right information: more of the available resources and money is being seized by big corporations and investors, while less money is available for the rest of us–those of us who do the real work. It’s too bad that the mainstream US media can’t seem to get the message, much less spread the message.