CNBC's Harwood: "Bush On His Heels" For State Of Union

President Bush will give the State of The Union speech next Tuesday night to both Houses of Congress--and the American people--and he does at at time when he has one of the lowest approval ratings of his presidency. So--what can he say at such a time? CNBC's John Harwood appeared on "Squawk Box" to give his preview of the speech--and he was joined in commentary with former GE CEO Jack Welch (Welch was a guest host on "Squawk"--and GE is the parent company of CNBC).

Harwood says that the speech won't be the usual laundry list of pet projects president's traditionally give in a state of the union speech. The reason? The Democrats are now in control of Congress and Bush is forced to reach out to them. In fact, Harwood says Bush is "back on his heels" when it comes to the political culture right now. Harwood says Bush will more than likely talk about immigration reform, social security, health care and climate change--issues on the front burner for most Democrats.

When it comes to health care--Harwood said Bush will probably offer tax credits to help businesses cope with the rising costs. And for social security-reports today say that Bush will delay his efforts to privatize social security--in order to balance the federal budget in five years.

With climate change--Harwood says Bush will probably speak about a "cap and trade" regulation that will give tax credits to businesses for NOT emitting greenhouse gases and allow them to pay fines if they do. Jack Welch jumped in to say that when it comes to climate change--businesses would be smart to bet that the issue is here to stay and should design products that take into account climate change. He said "let the experts debate the issue--businesses should plan for it."

Harwood says that of course, Bush will likely talk about the Iraq war in his Tuesday speech and will continue to make his case for pursuing the war. Harwood highlighted one major change--that the Bush administration will stop submitting supplemental budget requests for the war--and now include the costs of the war in the regular U.S. budget. The war is costing the U.S. some $8 billion a month. As CNN reports--Democrats have long said Bush and his budget team fudge budget numbers by making unrealistic assumptions about spending curbs and for failing to account for the long-term costs of the Iraq war. Republicans say the Iraq war aside-- the deficit is improving (going down) from increased tax revenues.