Asia-Pacific
Obama unveils new initiatives for middle class
(Agencies)
Updated: 2010-01-26 03:25
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 US President Barack Obama speaks at the meeting of the White House Task Force on Middle Class Families in the Eisenhower Executive Office Building on the White House complex in Washington, January 25, 2010. [Agencies] |
WASHINGTON: US President Barack Obama on Monday proposed a package of measures to help middle class families, emphasizing ordinary Americans as he is expected to do later this week in his State of the Union speech.
"Creating good sustainable jobs is the single most important thing that we can do to rebuild the middle class," Obama said after his administration unveiled proposals to expand a child-care tax credit and encourage savings.
The moves reflect a decisively more populist stance by Obama, who has stressed his determination to fight for the middle class and take a tough line toward Wall Street after suffering a serious setback last week in an election for a US Senate seat.
The child-care credit and other measures will be discussed in his first State of the Union speech at 9:00 pm on Wednesday (0200 GMT on Thursday), where he will lay out the challenges and set the tone for his administration in 2010.
A White House official said the State of the Union speech's themes would include "creating good jobs, addressing the deficit, changing Washington, and fighting for middle class families."
Frustration with the 10 percent unemployment rate and wariness toward Obama's plans to change the healthcare system helped set the stage for a shocking loss by Democrats last week in a Massachusetts Senate race.
Obama is expected to tap into that frustration as he addresses the nation on Wednesday.
"We ... need to reverse the overall erosion in middle class security so that when this economy does come back, working Americans are free to pursue their dreams again.
"There are a variety of immediate steps we can take to do just that - steps we're poised to begin taking in the budget that I'll put forward next week," Obama said. He will unveil his proposed federal budget for fiscal 2011 on Feb. 1.
The initiatives were developed by the White House Task Force on Middle Class Families, led by Vice President Joe Biden. The proposals would:
* Require companies that do not offer retirement plans to enroll their employees in direct-deposit retirement accounts unless the workers opt out.
* Increase the "Savers Credit," a tax credit for retirement savings, for families making up to $85,000.
* Change some of the rules for 401K employer-sponsored savings accounts to make them more transparent.
* Increase the child tax credit rate to 35 percent of qualifying expenses from the current 20 percent for families making under $85,000 a year. Families making up to $115,000 would be eligible for some increase in the tax credit.
* Increase child care funding by $1.6 billion in 2011 to serve an additional 235,000 children.
* Boost government spending by $102.5 million for programs aimed at helping families who provide home care for an aging relative.
* Ease the burden for student loans by limiting a borrower's payments to 10 percent of his or her income above a basic living allowance.
