“"...at the dawn of the 21st century we also have a collective responsibility to recommit ourselves to the dream; to strengthen that safety net, put the rungs back on that ladder to the middle-class, and give every family the chance that so many of our parents and grandparents had. This responsibility is one that's been missing from
— Barack Obama,
Over the last few decades, too many American families have worked hard their whole lives only to find that sometimes the game is rigged against them. Too many rungs have been removed from the ladder to middle-class security, and the safety net that's supposed to break any falls has grown badly frayed. Many families face increased anxiety when it comes to paying medical bills or balancing their home and work life or finding ways to send their children to college. At the same time, others have tumbled into poverty, watching jobs disappear, and the chances for their children's success slip further and further away.
Providing these families with the same chances that previous generations have had is a daunting challenge, but it is certainly one we can meet. Barack Obama will bring the much needed leadership and vision to
Barack Obama's Plan
Provide a "Making Work Pay" Tax Cut for
Raise the Minimum Wage to $9.50 an Hour by 2011: Barack Obama believes that people who work full time should not live in poverty. Before the Democrats took back Congress, the minimum wage had not changed in 10 years. Even though the minimum wage will rise to $9.50 an hour by 2011, the minimum wage's real purchasing power will still be below what it was in 1968. As president, Obama will further raise the minimum wage, index it to inflation and increase the Earned Income Tax Credit to make sure that full-time workers can earn a living wage that allows them to raise their families and pay for basic needs such as food, transportation, and housing -- things so many people take for granted.
Expand the Earned Income Tax Credit: In both the Illinois State Senate and the U.S. Senate, Obama has championed efforts to expand the EITC, which is one of the most successful anti-poverty programs to date. As president, Obama will reward work by increasing the number of working parents eligible for EITC benefits, increasing the benefit available to parents who support their children through child support payments, and reducing the EITC marriage penalty which hurts low-income families. Under the Obama plan, full-time workers making minimum wage would get an EITC benefit up to $555, more than three times greater than the $175 benefit they get today. If the workers are responsibly supporting their children on child support, the Obama plan would give those workers a benefit of $1,110.
Expand Paid Sick Days: Half of all private sector workers have no paid sick days and the problem is worse for employees in low-paying jobs, where less than a quarter receive any paid sick days. Barack Obama will require that employers provide seven paid sick days per year.
Expand the Family and Medical Leave Act (FMLA): The FMLA covers only certain employees of employers with 50 or more employees. Barack Obama will expand the FMLA to cover businesses with 25 or more employees. Barack Obama will expand the FMLA to cover more purposes as well, including allowing workers to take leave for elder care needs; allowing parents up to 24 hours of leave each year to participate in their children's academic activities at school; allowing leave to be taken for purposes of caring for individuals who reside in their home for 6 months or more; and expanding FMLA to cover leave for employees to address domestic violence and sexual assault.
Encourage States to Adopt Paid Leave: As president, Barack Obama will initiate a 50 state strategy to encourage all of the states to adopt paid-leave systems. Obama will provide a $1.5 billion fund to assist states with start-up costs and to help states offset the costs for employees and employers.
Expand the Child and Dependent Care Tax Credit: The Child and Dependent Care Tax Credit provides too little relief to families that struggle to afford child care expenses. Barack Obama will reform the Child and Dependent Care Tax Credit by making it refundable and allowing low-income families to receive up to a 50 percent credit for their child care expenses.
Protect Against Caregiver Discrimination: Workers with family obligations often are discriminated against in the workplace. Barack Obama will commit the government to enforcing recently-enacted Equal Employment Opportunity Commission guidelines on caregiver discrimination.
Expand Flexible Work Arrangements: Barack Obama will address this concern by creating a program to inform businesses about the benefits of flexible work schedules for productivity and establishing positive workplaces; helping businesses create flexible work opportunities; and increasing federal incentives for telecommuting. Obama will also make the federal government a model employer in terms of adopting flexible work schedules and permitting employees to petition to request flexible arrangements.
For more information about Barack Obama's plan to help more Americans succeed in the workforce, please visit the Economic Policy page.
Expand Early Childhood Education: Obama has been a champion of early childhood education since his years in the
Improve Public Schools: From the moment our children step into a classroom, the single most important factor in determining their achievement is their teacher. Barack Obama values teachers and the central role that they play in education. He will work to ensure competent, effective teachers in schools that are organized for success. Obama's K-12 plan will expand service scholarships to recruit and prepare teachers who commit to working in underserved districts. To support teachers, Obama will foster ongoing improvements in teacher education, provide mentoring for beginning teachers, create incentives for shared planning and learning time for teachers. To retain teachers, Obama will support career pathways that provide ongoing professional development and reward accomplished teachers for their expertise. This Career Ladder initiative will help eliminate teacher shortages in hard-to-staff areas and subjects, improve teacher retention rates, strengthen teacher preparation programs, improve professional development, and better utilize and reward accomplished teachers.
Reform and Fund No Child Left Behind: The goal of the No Child Left Behind Act is the right one - ensuring that all children can meet high standards - but the law has significant flaws that need to be addressed. Barack Obama believes it was wrong to force teachers, principals and schools to accomplish the goals of No Child Left Behind without the necessary resources. We have failed to provide high-quality teachers in every classroom and failed to support and pay for those teachers. Obama understands that NCLB has demoralized our educators, broken its promise to our children and must be changed in a fundamental way. Obama will work with mayors and state leaders to ensure that NCLB reform addresses the need for a broader and better range of assessments and an accountability system that focuses on improving schools, rather than punishing them.
Make College More Affordable: Barack Obama will make college affordable for all Americans by creating a new American Opportunity Tax Credit. This universal and fully refundable credit will ensure that the first $4,000 of a college education is completely free for most Americans, and will cover two-thirds the cost of tuition at the average public college or university. Recipients of this credit will be required to conduct 100 hours of public service a year.
For more information on Barack Obama's education plan, please visit the Education Policy page
Provide Universal Health Care and Lower Health Costs: Barack Obama is committed to signing universal health legislation by the end of his first term in office that ensures all Americans have high-quality, affordable health care coverage. His plan will save a typical American family up to $2,500 every year on medical expenditures by providing affordable, comprehensive and portable health coverage for every American; modernizing the U.S. health care system to contain spiraling health care costs and improve the quality of patient care; and promoting prevention and strengthening public health to prevent disease and protect against natural and man-made disasters.
For more information on Barack Obama's health care plan, please visit the Health Care Policy page
Create a Universal Mortgage Credit: The current mortgage interest deduction excludes nearly two-thirds of Americans who do not itemize their taxes. Barack Obama will ensure that anyone with a mortgage, not just the well-off, can take advantage of this tax incentive for homeownership by creating a universal mortgage credit. This 10 percent credit will benefit an additional 10 million homeowners, the majority of whom earn less than $50,000 per year. Non-itemizers will be eligible for this refundable credit, which will provide the average recipient with approximately $500 per year in tax savings.
Combat Mortgage Fraud and Subprime Loans: Barack Obama believes we must establish stiff penalties to deter fraud and protect consumers against abusive lending practices. Obama introduced the STOP FRAUD Act, which would increase funding for federal law enforcement programs, create new criminal penalties for mortgage professionals found guilty of fraud, and require industry insiders to report suspicious activity. In March 2007, Obama urged Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson to bring together lenders, consumer advocates, federal regulators and housing agencies for a summit meeting on preserving home ownership. The bill also provides counseling to homeowners and tenants to avoid foreclosures. As president, Obama will continue to fight to ensure more Americans can achieve and protect the dream of home ownership.
Mandate Accurate Loan Disclosure: Today's subprime mortgage problem stems in large part from the lack of easy-to-understand information that borrowers receive from mortgage brokers. As president, Barack Obama will enact laws to ensure that all prospective homebuyers have access to accurate and complete information about their mortgage options. Obama will create a Homeowner Obligation Made Explicit (HOME) score, which will provide potential borrowers with a simplified, standardized borrower metric (similar to APR) for home mortgages. The HOME score will allow individuals to easily compare various mortgage products and understand the full cost of the loan. The HOME score would also help borrowers understand their long-term obligations and would be required to include mandatory taxes and insurance.
Close Bankruptcy Loophole for Mortgage Companies: Barack Obama strongly opposed the 2005 bankruptcy bill, which is expected to have serious effects on low and middle-income borrowers of subprime mortgages. As president, Obama will work to eliminate the federal bankruptcy law's Chapter 13 provision that prevents bankruptcy courts from modifying an individual's mortgage payments. This forces individuals who seek bankruptcy protection to continue paying the full amount of their existing mortgage plans. This provision, which provides unique protection to the mortgage industry, places the interests of big lenders over than of low and middle-income Americans. Obama believes that the subprime mortgage industry, which has engaged in dangerous and sometimes unscrupulous business practices, should not be shielded by outdated federal law.
Strengthen Fatherhood and Families: Barack Obama has re-introduced the Responsible Fatherhood and Healthy Families Act to remove some of the government penalties on married families, crack down on men avoiding child support payments, ensure that support payments go to families instead of state bureaucracies, fund support services for fathers and their families, and support domestic violence prevention efforts. As president, Obama will sign this bill into law and continue to implement innovative measures to strengthen families.
Support Parents with Young Children: Barack Obama would expand programs like the successful Nurse-Family Partnership to all low-income, first-time mothers. The Nurse-Family Partnership provides home visits by trained registered nurses to low-income expectant mothers and their families. Researchers at the Federal Reserve Bank of
Eliminate Income Taxes for Seniors Making Less Than $50,000: Obama will eliminate all income taxation of seniors making less than $50,000 per year. This will provide an immediate tax cut averaging $1,400 to 7 million seniors and relieve millions from the burden of filing tax returns.
Create Automatic Workplace Pensions: Obama's retirement security plan will automatically enroll workers in a workplace pension plan. Under his plan, employers who do not currently offer a retirement plan, will be required to enroll their employees in a direct-deposit IRA account that is compatible to existing direct-deposit payroll systems. Employees may opt-out if they choose. Experts estimate that this program will increase the savings participation rate for low and middle-income workers from its current 15 percent level to around 80 percent.
Expand Retirement Savings Incentives for Working Families: Obama will ensure savings incentives are fair to all workers by creating a generous savings match for low and middle-income Americans. His plan will match 50 percent of the first $1,000 of savings for families that earn less than $75,000. The savings match will be automatically deposited into designated personal accounts. Over 80 percent of these savings incentives will go to new savers.
Immediate Relief for American Families
Gas and Food Prices
John McCain will help Americans hurting from high gasoline and food costs. Americans need relief right now from high gas prices. John McCain will act immediately to reduce the pain of high gas prices.
- John McCain believes we should send a strong message to world markets. Under his plan, the
will be telling oil producing countries and oil speculators that our dependence on foreign oil will come to an end - and the impact will be lower prices at the pump. United States
- John McCain's policies will increase the value of the dollar and thus reduce the price of oil. In recent years, the declining value of the dollar has added to the cost of imported oil. This will change. Americans will have a stronger economy, a stronger dollar and greater purchasing power for oil, gas and food.
- John McCain believes we should institute a summer gas tax holiday. Hard-working American families are suffering from higher gasoline prices. John McCain called on Congress to suspend the 18.4 cent federal gas tax and 24.4 cent diesel tax from Memorial Day to Labor Day.
- Reuters: Gas Tax
Holiday"Of Most Immediate Effect To Consumers." "Of most immediate effect to consumers was his appeal to the U.S. Congress to suspend the 18.4 cent federal gas tax and 24.4 cent diesel tax from Memorial Day at the end of May to Labor Day in early September." (Steve Holland, "McCain Proposes Tax Cuts And Lashes Democrats," Reuters, 4/15/08) USAToday: "A TODAY Analysis Showed That McCain's Gas-Tax Proposal Could Save Motorists $6.8 Billion In Taxes During The Summer." (Kathy Kiely, "Gas-Tax Holiday Among McCain's Plans For Economy," USA Today, 4/16/08) USA
- John McCain will repeal the 54 cents per gallon tax on imported sugar-based ethanol, increasing competition, and lowering prices of gasoline at the pump.
- John McCain will roll back corn-based ethanol mandates, which are contributing to the rising cost of food.
John McCain believes there is nothing more important than keeping alive the American dream of owning a home. Priority number one is to keep well-meaning, deserving home owners who are facing foreclosure in their homes.
John McCain's approach to helping sub-prime or other financially strapped mortgage borrowers is built on sound principles:
- No taxpayer money should bail out real estate speculators or financial market participants who failed to perform due diligence in assessing credit risks. Any assistance for borrowers should be focused solely on homeowners and any government assistance to the banking system should be based solely on preventing systemic risk.
- Any policy of financial assistance should be accompanied by reforms that promote greater transparency and accountability to ensure we never face this problem again.
John McCain has proposed a new "HOME Plan" to provide robust, timely and targeted help to those hurt by the housing crisis. Under his HOME Plan, every deserving American family or homeowner will be afforded the opportunity to trade a burdensome mortgage for a manageable loan that reflects their home's market value.
- Eligibility: Holders of a sub-prime mortgage taken after 2005 who live in their home (primary residence only); can prove creditworthiness at the time of the original loan; are either delinquent, in arrears on payments, facing a reset or otherwise demonstrate that they will be unable to continue to meet their mortgage obligations; and can meet the terms of a new 30 year fixed-rate mortgage on the existing home.
- John McCain's HOME Plan Will Keep 200,000 To 400,000 Families From Losing Their Homes. "But at the same time, McCain is calling for aggressive federal action to help keep 200,000 to 400,000 families from losing their homes. That plan has many of the elements of a proposal by Rep. Barney Frank, D-Mass., and Sen. Chris Dodd, D-Conn., requiring participating lenders to forgive part of the loan principal and then write a new loan that would be backed by the federal government through the Federal Housing Administration." (Tom Raum, "Everyone's Invited: McCain Economic Plan Draws From Both Parties," Tucson Citizen, 4/17/08)
- How It Works: Individuals pick up a form at any Post Office or download the form over the Internet and apply for a HOME loan. The FHA HOME Office certifies that the individual is qualified, and contacts the individual's mortgage servicer. The mortgage servicer writes down and retires the existing loan, which is replaced by an FHA guaranteed HOME loan from a lender.
- John McCain will bolster groups like Neighborworks
that provide mortgage assistance to homeowners in their communities. America
Keeping The Credit Crunch From Hurting College Students
John McCain is proposing a student loan continuity plan. Students face the possibility that the credit crunch will disrupt loans for the fall semester. John McCain calls on the federal government and the 50 governors to anticipate loan problems and expand the lender-of-last resort capabilities for each state's guarantee agency.
Workplace Flexibility in a Changing Economy
Workplace Flexibility and Choice
John McCain understands that today’s changing economy is making it harder for parents to balance the demands of family life and their jobs. He believes that strong families require that parents be involved in the lives of their children. Flexible work arrangements can help families strike the right balance.
John McCain was proud to support the Family Medical Leave Act in 1993 that ensured men and women are able to take leave to care for a newborn child, adopt a child or care for an immediate family member with a serious health condition and return to a position that is substantially equal in pay, benefits, and responsibility. This was a needed minimum standard to ensure that parents were not penalized for making the important decision to raise a family.
John McCain co-sponsored the Family Friendly Workplace Act, which sought to allow employers to provide flexible work schedules to help employees balance the demands and needs of work and family, such as allowing employees to take compensatory time-off rather than be paid overtime and to work more than 40 hours in one week and correspondingly less in another week.
John McCain also understands that our changing economy forces many families to deal with the disruptions that come with a job change. He believes that families should be able to hold onto the health and retirement benefits that they have chosen. He also believes that workers should be able to choose new training that fits their personal situation so that they can build new skills as their careers change.
John McCain believes that to keep
John McCain also believes that as our workforce ages, many older Americans want to continue to stay in jobs. These workers have the experience and skills that help keep
John McCain is calling for National Commission on Workplace Flexibility and Choice. This Commission would bring together a bi-partisan set of leaders representing workers, small and large employers, labor, and academics. The Commission would make recommendations to the President on how modernizing our nation’s labor laws and training programs can help workers better balance the demands of their job with family life and to enable workers to more easily transition between jobs.
The Commission would examine the following issues that John McCain believes are important to workplace flexibility and choice:
- Modernizing the nation’s labor laws so that they allow for more flexible scheduling arrangements
- Ensuring that the nation’s labor laws don’t get in the way of working at home
- Promoting telework so that workers can spend less time commuting
- Making health more portable so that workers don’t lose their benefits when they switch jobs
- Ensuring that workers can choose retirement plans that best suit their needs
- Providing workers with more choice in job training assistance so that they can build the skills they need for new and better jobs