Tuesday, January 27, 2009
Friday, January 9, 2009
ISM Non-Manufacturing Employment vs NFPs: Updated post Number
Directionally correct /better than whispered:
Tuesday, January 6, 2009
The Obama-Biden Plan
Our country faces its most serious economic crisis since the great depression. Working families, who saw their
incomes decline by $2,000 in the economic "expansion" from 2000 to 2007, now face even deeper income
losses. Retirement savings accounts have lost $2 trillion. Markets have fallen 40% in less than a year. Millions
of homeowners who played by the rules can't meet their mortgage payments and face foreclosure as the value
of their homes have plummeted. With credit markets nearly frozen, businesses large and small cannot access
the credit they need to meet payroll and create jobs.
Barack Obama and Joe Biden have a plan to revitalize the economy.
1. Immediate Action to Create Good Jobs in America
2. Immediate Relief for Struggling Families
3. Direct, Immediate Assistance for Homeowners, Not a Bailout for Irresponsible Mortgage Lenders
4. A Rapid, Aggressive Response to Our Financial Crisis, Using All the Tools We Have
1. IMMEDIATE ACTIO TO CREATE GOOD JOBS I AMERICA
The economy has lost 760,000 jobs this year -- and some forecasters expect the unemployment rate to exceed 8
percent by the end of next year. Addressing the financial crisis will help prevent the most severe loss of jobs
from the crisis. But taking direct steps to create jobs will also strengthen the economy and help with the
financial crisis. Barack Obama and Joe Biden's overall economic agenda is pro-jobs, including their plans to
eliminate America's dependence on foreign oil and bring down healthcare costs. But Obama and Biden believe
we must take additional aggressive steps to jump-start job creation right now:
• A ew American Jobs Tax Credit: Obama and Biden will provide a new temporary tax credit to
companies that add jobs here in the United States. During 2009 and 2010, existing businesses will
receive a $3,000 refundable tax credit for each additional full-time employee hired. For example,
if a company that currently has 10 U.S. employees increases its domestic full time employment to
20 employees, this company would get a $30,000 tax credit -- enough to offset the entire added
payroll tax costs to the company for the first $50,000 of income for the new employees. The tax
credit will benefit all companies creating net new jobs, even those struggling to make a profit.
• Raise the small business investment expensing limit to $250,000 through the end of 2009:
Obama and Biden will give small businesses an additional incentive to make investments and start
creating jobs again by providing temporary business tax incentives through 2009. The February
2008 stimulus bill increased maximum Section 179 expenses to $250,000 but this expires in
December 2008. This provision will encourage all firms to pursue investment in the coming
months, but will particularly benefit small firms which generally have smaller amounts of annual
property purchases and so choose to expense the cost of their acquired property.
• Zero capital gains rate for investment in small businesses: Barack Obama and Joe Biden believe
that we need to encourage investment in small businesses to help create jobs and turn our
economy around. That's why they will eliminate all capital gains taxes on investments made in
small and start-up businesses. They also want to cut taxes for the small businesses that create jobs
but are struggling with restricted access to credit on top of skyrocketing health care and energy
costs.
• Save one million jobs through immediate investments to rebuild America's roads and bridges
and repair our schools: The Obama-Biden emergency plan would make $25 billion immediately
available in a Jobs and Growth Fund to help ensure that in-progress and fast-tracked infrastructure
projects are not sidelined, and to ensure that schools can meet their energy costs and undertake
key repairs starting this fall. This increased investment is necessary to stem growing budget
pressures on infrastructure projects. In addition, in an environment where we may face elevated
unemployment levels well into 2009, making an aggressive investment in urgent, high-priority
infrastructure will serve as a triple win: generating capital deployment and job creation to boost
our economy in the near-term, enhancing U.S. competitiveness in the longer term, and improving
the environment by adopting energy efficient school and infrastructure repairs. In total, Obama
and Biden's $25 billion investment will result in 1 million jobs created or saved, while helping to
turn our economy around.
• Partner with America's automakers to help save jobs and ensure that the next generation of
clean vehicles is built in the United States: Senator Obama pushed for $50 billion in loan
guarantees to help the auto industry retool, develop new battery technologies and produce the next
generation of fuel efficient cars here in America. Congress passed only half of this amount -- it is
critical that the administration speeds up the implementation of the first half and that Congress
move quickly to enact the second half. In addition, Obama and Biden believe that with the
tremendous uncertainty facing the auto industry, and the small and medium business suppliers
who depend on them, it is critical that we keep all options on the table for helping them weather
the financial crisis.
2. IMMEDIATE RELIEF FOR STRUGGLIG FAMILIES
Even when the overall economy was growing, most American families were not sharing in this growth. The
typical non-elderly household saw its income decline by more than $2,000 from 2000 to 2007 as expenses
skyrocketed. Weekly wages, adjusted for inflation, are now lower than they were a decade ago. Barack Obama
and Joe Biden's overall economic plan will relieve the squeeze on families and foster bottom-up growth. But
they are proposing that we implement several measures immediately:
• A tax cut for 95 percent of workers and their families -- plus seniors: Barack Obama and Joe
Biden propose a permanent tax cut of $500 for workers and $1,000 for families. A first round of
these tax credits could be mailed out quickly by the IRS based on tax returns already filed for tax
year 2007. In addition, Obama and Biden would extend these expedited tax credits to senior
citizens who are retired as a down payment on his plan to eliminate taxes for all seniors making
up to $50,000.
• Extend unemployment insurance benefits and temporarily suspend taxes on these benefits:
Millions of Americans are looking for work but unable to find it in the weak economy. Today,
more than one in five unemployed workers has been out of work for more than half a year -- the
highest level since early 2005. Obama supported extending unemployment insurance this summer,
but already 800,000 jobless workers have exhausted those benefits and are being left without any
unemployment compensation. Obama and Biden believe Congress should immediately extend
unemployment insurance for an additional 13 weeks to help families that are being hit hardest by
this downturn. In addition, they believe we should temporarily suspend taxes on unemployment
insurance benefits as a way of giving more relief to families.
• Penalty-free hardship withdrawals from IRAs and 401(k)s in 2008 and 2009: Many families are
going to be facing unique economic hardship over the coming year. To help these families pay
their bills and their mortgages and make it through these tough times, Obama and Biden are
calling for legislation that would allow withdrawals of 15% up to $10,000 from retirement
accounts without penalty (although subject to the normal taxes). This would apply to withdrawals
in 2008 (including retroactively) and 2009.
• Instruct the Treasury to allow seniors to delay required withdrawals from 401(k)s and IRAs:
Currently seniors are required to start withdrawing from their 401(k)s and IRAs at age 70 1/2 and
every year thereafter over their lifetime. But the explicit requirement that withdrawals continue on
an annual basis -- and the related requirement that the amount withdrawn be based on currently
much higher year-end 2007 asset values -- is based on Treasury regulations, not the statute, which
has a less specific mandate. That means the Secretary of the Treasury has authority to change its
regulations to protect seniors from being forced, at this critical time, to sell their investments and
"lock in" their losses just after market values have plummeted in an almost unprecedented
fashion. Obama and Biden are calling on Treasury to temporarily suspend the required
withdrawals for retirees over age 70 1/2. Because retirees often make these required withdrawals
late in the year, there is still time to help millions of affected seniors -- but only if done promptly.
In addition, because lower-income seniors may have no choice but to take withdrawals this year
and in 2008, Obama and Biden will exempt any withdrawals made up to the required minimum
amount from taxation. This will give seniors the flexibility they deserve -- to forgo withdrawals if
they choose or to take those withdrawals tax free if they need those resources to pay their bills.
• Funds to counteract high heating costs this winter: Obama and Biden are calling for
supplementing the recently passed LIHEAP funding to ensure that cold-weather states can
cushion the impact of high energy prices for their residents this winter. The Energy Information
Administration said that consumers will pay a projected $1,137 to heat their homes from Oct. 1 to
March 31 -- 15 percent more than last year's heating outlay during this time. Homeowners that use
heating oil rather than natural gas could see increases of 23 percent compared to last year. As part
of his $25 billion state fiscal relief package, Obama's plan will supplement existing LIHEAP
funding to help state programs expand to cover more residents while continuing to provide a
meaningful benefit.
3. DIRECT, IMMEDIATE ASSISTACE FOR HOMEOWERS, OT A BAILOUT FOR
IRRESPOSIBLE MORTGAGE LEDERS
Over the past two years, Americans have lost 20 percent of the value of their homes. In some parts of the
country home values have fallen by twice that amount. In combination with a rapidly deteriorating economy,
that means more and more families are having a hard time meeting their monthly mortgage payments. At the
same time, many states are considering property tax hikes that will burden homeowners still further. And
millions of families who have seen the value of their homes fall below the cost of their mortgages need
assistance in restructuring their mortgages to stay in their homes.
Barack Obama and Joe Biden's plan provides direct relief to help America's homeowners pay their mortgages,
stay in their homes, and avoid painful tax increases while protecting taxpayers and not rewarding the bad
behavior and bad actors who got us into this mess:
• Instruct the Secretaries of the Treasury and Housing and Urban Development (HUD) to use
their existing authority to more aggressively modify the terms of mortgages: Barack Obama
was an early champion of the HOPE for Homeowners Act that passed over the summer. In
addition, Obama insisted that the financial rescue plan Congress recently passed include authority
for the Secretary to work with servicers to modify the terms of mortgages for homeowners who
played by the rules. Obama and Biden believe that both of these plans should be implemented
aggressively and comprehensively. In addition, Obama and Biden are calling on Treasury and
HUD to develop a plan to work with state housing agencies to coordinate broad mortgage
restructurings. The Dodd-Frank legislation gives states broader authority to help struggling
homeowners, and coordination is essential to ensure that state and national efforts are working in
concert to help as many homeowners as possible at the minimum cost to taxpayers.
• Reform the bankruptcy code to assist homeowners and remove legal impediments to
encouraging broader mortgage restructuring: Obama and Biden are also calling for legislation
to close the loophole in our bankruptcy code that allows bankruptcy judges to modify the terms of
mortgages on investment properties and vacation homes but not on primary residences. He also
believes we should clarify the legal liability of mortgage servicers so that servicers who work with
struggling homeowners to modify their mortgages will receive legal protections. And we should
remove any tax- or legal-related impediments to encouraging shared-equity mortgages within the
HOPE for Homeownership process.
• Enact a 90-day foreclosure moratorium for homeowners who are acting in good faith:
Financial institutions that participate in the financial rescue plan should be required to adhere to a
homeowner's code of conduct, including a 90-day foreclosure moratorium for any homeowners
living in their homes who are making good faith efforts to pay their mortgages. This will help
create stability until the more far-reaching solutions are implemented and give both sides a chance
to work out an agreement.
• Provide $25 Billion in state fiscal relief to help avoid painful property tax increases: Budget
crunches across the nation are putting our local governments in the untenable position of having
to choose between raising property taxes and cutting vital services. Obama has proposed $25
billion in state fiscal relief that, coupled with the new emergency facility to address the state credit
crunch, will help states and localities continue to provide essential services like health care,
police, fire and education without raising taxes or fees.
• Create a universal mortgage tax credit for homeowners: Barack Obama believes we should
immediately enact a 10 percent refundable tax credit on the mortgage interest paid by
hardworking American families who do not itemize their taxes. This credit will help offset the
cost of mortgage payments for at least 10 million middle-class homeowners.
4. A RAPID, AGGRESSIVE RESPOSE TO THE FIACIAL CRISIS -- USIG ALL THE
TOOLS WE HAVE
Barack Obama and Joe Biden believe that our deep systemic financial market crisis requires a systemic
response. They fought to ensure that the recently-passed financial rescue package gave the Treasury the tools
to stabilize the financial system, while protecting taxpayers and ensuring CEOs would not get rich in the
process. However, this stabilization will only occur if the Treasury, Federal Reserve, FDIC, and other
government entities use their authority and move quickly and aggressively to address the financial crisis.
It is now clear that our financial markets will not restart until financial institutions are lending again. Because
of the extensive losses many of these institutions have suffered, they need more capital so that they will have
the money to lend to families and businesses. Obama and Biden recognized this early, and were heartened by
the Treasury's stated intention to use its recently granted authority to inject capital into our financial
institutions. However, Secretary Paulson must turn this intention into action quickly and aggressively, in a
manner that strengthens confidence in our banks, protects taxpayers, does not reward CEOs, and is strictly
temporary.
In addition, our financial authorities must stand ready to take additional, complementary actions -- consistent
with the systemic nature of this crisis -- to ensure this Treasury initiative is successful:
• Be prepared, if necessary, for broader assurances for credit to banks: First, we must be
prepared to provide additional, temporary assurances to achieve the effective functioning of
financial markets. Depending on developing circumstances, these steps could include additional
measures by the Federal Reserve, extending insurance to all deposits, or guaranteeing a broader
range of liabilities of the banking system including overnight loans. Any such steps should be
coordinated internationally where appropriate and feasible. They should be accompanied by
additional oversight to ensure appropriate use of guaranteed funds and by the expectation that
financial institutions taking advantage of these guarantees will raise more capital.
• Extend asset purchases to unfreeze other critical sectors: Second, the Treasury should not limit
itself to purchasing mortgage-backed securities under the financial rescue plan recently passed by
Congress. The Treasury should use the authority it has under the new law to help unfreeze
markets for individual mortgages, student loans, car loans, loans for multi-family dwellings, and
credit card loans.
• Make credit available to small businesses and state or local governments: Third, we should take
immediate steps to support non-financial institutions including small businesses and states and
municipalities. The Federal Reserve and Treasury have acted to preserve the availability of
liquidity for financial institutions and, more recently, have created a program to purchase
commercial paper directly from the large corporate issuers. Small businesses and state and local
governments, however, are having serious difficulty obtaining necessary financing from debt
markets.
• Address the credit crisis facing our states and localities: Barack Obama and Joe
Biden propose that the Federal Reserve and the Treasury work together to design a
facility to provide a funding backstop to the state and municipal government debt
market similar to the recently announced program for the commercial paper market.
The Federal Reserve should determine whether it has sufficient legal authority to
establish such a facility on its own -- if not, it should work with Treasury and the
Congress to achieve this goal. This new facility should be designed to protect
taxpayer resources while ensuring that state and local governments can continue to
provide vital services to their residents.
• Address the credit crisis facing our small businesses: To address the massive
credit crunch that is threatening America's small businesses, Barack Obama and Joe
Biden are proposing two immediate steps: (1) a nationwide emergency lending
facility for small businesses that could be run through the SBA's Disaster Loan
Program, which helped thousands of businesses in the wake of 9/11; and (2)
temporarily eliminating fees on the SBA's 7(a) and 504 loan guarantee programs for
small businesses, to help increase private lending for small businesses.
Trade
Barack Obama and Joe Biden believe that trade with foreign nations should strengthen the American economy
and create more American jobs. They will stand firm against agreements that undermine our economic
security.
• Fight for Fair Trade: Obama and Biden will fight for a trade policy that opens up foreign markets
to support good American jobs. They will use trade agreements to spread good labor and
environmental standards around the world and stand firm against agreements like the Central
American Free Trade Agreement that fail to live up to those important benchmarks. Obama and
Biden will also pressure the World Trade Organization to enforce trade agreements and stop
countries from continuing unfair government subsidies to foreign exporters and nontariff barriers
on U.S. exports.
• Amend the orth American Free Trade Agreement: Obama and Biden believe that NAFTA and
its potential were oversold to the American people. They will work with the leaders of Canada
and Mexico to fix NAFTA so that it works for American workers.
• Improve transition assistance: To help all workers adapt to a rapidly changing economy, Obama
and Biden will update the existing system of Trade Adjustment Assistance by extending it to
service industries, creating flexible education accounts to help workers retrain, and providing
retraining assistance for workers in sectors of the economy vulnerable to dislocation before they
lose their jobs.
• End tax breaks for companies that send jobs overseas: Barack Obama and Joe Biden believe that
companies should not get billions of dollars in tax deductions for moving their operations
overseas. They will fight to ensure that public contracts are awarded to companies that are
committed to American workers.
• Reward companies that support American workers: Barack Obama introduced the Patriot
Employer Act of 2007 with Senators Richard Durbin (D-Ill) and Sherrod Brown (D-Oh) to reward
companies that create good jobs with good benefits for American workers. The legislation would
provide a tax credit to companies that maintain or increase the number of full-time workers in
America relative to those outside the U.S.; maintain their corporate headquarters in America if it
has ever been in America; pay decent wages; prepare workers for retirement; provide health
insurance; and support employees who serve in the military.
Manufacturing and Green Jobs
• Invest in our next generation innovators and job creators: Obama and Biden will create an
Advanced Manufacturing Fund to identify and invest in the most compelling advanced
manufacturing strategies. The Fund will have a peer-review selection and award process based on
the Michigan 21st Century Jobs Fund, a state-level initiative that has awarded over $125 million
to Michigan businesses with the most innovative proposals to create new products and new jobs in
the state.
• Double funding for the manufacturing extension partnership: The Manufacturing Extension
Partnership (MEP) works with manufacturers across the country to improve efficiency, implement
new technology and strengthen company growth. This highly-successful program has engaged in
more than 350,000 projects across the country and in 2006 alone, helped create and protect over
50,000 jobs. But despite this success, funding for MEP has been slashed by the Bush
administration. Barack Obama and Joe Biden will double funding for the MEP so its training
centers can continue to bolster the competitiveness of U.S. manufacturers.
• Invest in a clean energy economy and create 5 million new green jobs: Obama and Biden will
invest $150 billion over 10 years to advance the next generation of biofuels and fuel
infrastructure, accelerate the commercialization of plug-in hybrids, promote development of
commercial scale renewable energy, invest in low emissions coal plants, and begin transition to a
new digital electricity grid. The plan will also invest in America's highly-skilled manufacturing
workforce and manufacturing centers to ensure that American workers have the skills and tools
they need to pioneer the first wave of green technologies that will be in high demand throughout
the world.
• Create new job training programs for clean technologies: The Obama-Biden plan will increase
funding for federal workforce training programs and direct these programs to incorporate green
technologies training, such as advanced manufacturing and weatherization training, into their
efforts to help Americans find and retain stable, high-paying jobs. Obama and Biden will also
create an energy-focused youth jobs program to invest in disconnected and disadvantaged youth.
• Boost the renewable energy sector and create new jobs: The Obama-Biden plan will create new
federal policies, and expand existing ones, that have been proven to create new American jobs.
Obama and Biden will create a federal Renewable Portfolio Standard (RPS) that will require 25
percent of American electricity be derived from renewable sources by 2025, which has the
potential to create hundreds of thousands of new jobs. They will also extend the Production Tax
Credit, a credit used successfully by American farmers and investors to increase renewable energy
production and create new local jobs.
ational Infrastructure Investment
Barack Obama and Joe Biden believe that it is critically important for the United States to rebuild its national
transportation infrastructure -- its highways, bridges, roads, ports, air, and train systems -- to strengthen user
safety, bolster our long-term competitiveness and ensure our economy continues to grow.
• Create a ational Infrastructure Reinvestment Bank: Barack Obama and Joe Biden will address
the infrastructure challenge by creating a National Infrastructure Reinvestment Bank to expand
and enhance, not supplant, existing federal transportation investments. This independent entity
will be directed to invest in our nation's most challenging transportation infrastructure needs. The
Bank will receive an infusion of federal money, $60 billion over 10 years, to provide financing to
transportation infrastructure projects across the nation. These projects will directly and indirectly
create up to two million new jobs and stimulate approximately $35 billion per year in new
economic activity.
Technology, Innovation and Creating Jobs
Barack Obama and Joe Biden will increase federal support for research, technology and innovation for
companies and universities so that American families can lead the world in creating new advanced jobs and
products.
• Invest in the sciences: Obama and Biden support doubling federal funding for basic research and
changing the posture of our federal government from being one of the most anti-science
administrations in American history to one that embraces science and technology. This will foster
home-grown innovation, help ensure the competitiveness of U.S. technology-based businesses,
and ensure that 21st century jobs can and will grow in America.
• Make the Research and Development Tax Credit permanent: Barack Obama and Joe Biden
want investments in a skilled research and development workforce and technology infrastructure
to be supported here in America so that American workers and communities will benefit. Obama
and Biden want to make the Research and Development tax credit permanent so that firms can
rely on it when making decisions to invest in domestic R&D over multi-year timeframes.
• Deploy next-generation broadband: Barack Obama and Joe Biden believe we can get broadband
to every community in America through a combination of reform of the Universal Service Fund,
better use of the nation's wireless spectrum, promotion of next-generation facilities, technologies
and applications, and new tax and loan incentives.
Small Business
• Provide tax relief for small businesses and start-up companies: Obama and Biden will eliminate
all capital gains taxes on start-up and small businesses to encourage innovation and job creation.
Obama and Biden will also support small business owners by providing a $500 "Making Work
Pay" tax credit to almost every worker in America. Self-employed small business owners pay both
the employee and the employer side of the payroll tax, and this measure will reduce the burdens
of this double taxation.
• Create a national network of public-private business incubators: Obama and Biden will support
entrepreneurship and spur job growth by creating a national network of public-private business
incubators. Business incubators facilitate the critical work of entrepreneurs in creating start-up
companies. Obama and Biden will invest $250 million per year to increase the number and size of
incubators in disadvantaged communities throughout the country.
Labor
Obama and Biden will strengthen the ability of workers to organize unions. He will fight for passage of the
Employee Free Choice Act. Obama and Biden will ensure that his labor appointees support workers' rights and
will work to ban the permanent replacement of striking workers. Obama and Biden will also increase the
minimum wage and index it to inflation to ensure it rises every year.
• Ensure freedom to unionize: Obama and Biden believe that workers should have the freedom to
choose whether to join a union without harassment or intimidation from their employers. Obama
cosponsored and is a strong advocate for the Employee Free Choice Act (EFCA), a bipartisan
effort that makes sure workers can exercise their right to organize. They will continue to fight for
EFCA's passage and Obama will sign it into law.
• Fight attacks on workers' right to organize: Obama has fought the Bush National Labor
Relations Board (NLRB) efforts to strip workers of their right to organize. He is a cosponsor of
legislation to overturn the NLRB's "Kentucky River" decisions classifying hundreds of thousands
of nurses, construction workers, and professional workers as "supervisors" who are not protected
by federal labor laws.
• Protect striking workers: Obama and Biden support the right of workers to bargain collectively
and strike if necessary. They will work to ban the permanent replacement of striking workers, so
workers can stand up for themselves without worrying about losing their livelihoods.
• Raise the minimum wage: Barack Obama and Joe Biden will raise the minimum wage, index it to
inflation and increase the Earned Income Tax Credit to make sure that full-time workers earn a
living wage that allows them to raise their families and pay for basic needs.
Mortgages, Homeownership, and Bankruptcy
Obama and Biden will crack down on fraudulent brokers and lenders. They will also make sure homebuyers
have honest and complete information about their mortgage options, they'll give a tax credit to all middle-class
homeowners, and they'll reform our bankruptcy laws to protect working people.
• Create a universal mortgage credit: Obama and Biden will create a 10 percent universal mortgage
credit to provide tax relief to homeowners who do not itemize. This credit will provide an average
of $500 to 10 million homeowners, the majority of whom earn less than $50,000 per year.
• Ensure more accountability in the subprime mortgage industry: Obama has been closely
monitoring the subprime mortgage situation for years, and introduced comprehensive legislation
over a year ago to fight mortgage fraud and protect consumers against abusive lending practices.
Obama's STOP FRAUD Act provides the first federal definition of mortgage fraud, increases
funding for federal and state law enforcement programs, creates new criminal penalties for
mortgage professionals found guilty of fraud, and requires industry insiders to report suspicious
activity.
• Mandate accurate loan disclosure: Obama and Biden 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.
• Close bankruptcy loophole for mortgage companies: Obama and Biden will work to eliminate
the provision that prevents bankruptcy courts from modifying an individual's mortgage payments.
They believe that the subprime mortgage industry, which has engaged in dangerous and
sometimes unscrupulous business practices, should not be shielded by outdated federal law.
Credit Cards and Lending
Obama and Biden will establish a five-star rating system so that every consumer knows the risk involved in
every credit card. They also will establish a Credit Card Bill of Rights to stop credit card companies from
exploiting consumers with unfair practices.
• Create a credit card rating system to improve disclosure: Obama and Biden will create a credit
card rating system, modeled on five-star systems used for other consumer products, to provide
consumers an easily identifiable ranking of credit cards, based on the card's features. Credit card
companies will be required to display the rating on all application and contract materials, enabling
consumers to quickly understand all of the major provisions of a credit card without having to rely
exclusively on fine print in lengthy documents.
• Establish a Credit Card Bill of Rights to protect consumers: Obama and Biden will create a
Credit Card Bill of Rights to protect consumers. The Obama-Biden plan will:
• Ban Unilateral Changes
• Apply Interest Rate Increases Only to Future Debt
• Prohibit Interest on Fees
• Prohibit "Universal Defaults"
• Require Prompt and Fair Crediting of Cardholder Payments
Cap outlandish interest rates on payday loans and improve disclosure: Obama and
Biden will extend a 36 percent interest cap to all Americans. They will require lenders to provide
clear and simplified information about loan fees, payments and penalties, which is why they'll
require lenders to provide this information during the application process.
Encourage responsible lending institutions to make small consumer loans: Obama and
Biden will encourage banks, credit unions and Community Development Financial Institutions to
provide affordable short-term and small-dollar loans and to drive unscrupulous lenders out of
business.
Reform bankruptcy laws to protect families facing a medical crisis: Obama and Biden
will create an exemption in bankruptcy law for individuals who can prove they filed for
bankruptcy because of medical expenses. This exemption will create a process that forgives the
debt and lets the individuals get back on their feet.
Work-Family Balance
Obama and Biden will double funding for after-school programs, expand the Family Medical Leave Act,
provide low-income families with a refundable tax credit to help with their child-care expenses, and encourage
flexible work schedules.
• Expand the Family and Medical Leave Act: The FMLA covers only certain employees of
employers with 50 or more employees. Obama and Biden will expand it to cover businesses with
25 or more employees. They 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; and expanding FMLA to cover leave for
employees to address domestic violence.
• Encourage states to adopt paid leave: As president, Obama will initiate a strategy to encourage all
50 states to adopt paid-leave systems. Obama and Biden 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 high-quality afterschool opportunities: Obama and Biden will double funding for the
main federal support for afterschool programs, the 21st Century Learning Centers program, to
serve a million more children. Obama and Biden will include measures to maximize performance
and effectiveness across grantees nationwide.
• 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. Obama and Biden
will reform the Child and Dependent Care Tax Credit by making it refundable and allowing lowincome
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. Obama and Biden will enforce the recently-enacted Equal Employment
Opportunity Commission guidelines on caregiver discrimination.
• Expand flexible work arrangements: Obama and Biden will create a program to inform
businesses about the benefits of flexible work schedules; help businesses create flexible work
opportunities; and increase federal incentives for telecommuting. Obama and Biden will also
make the federal government a model employer in terms of adopting flexible work schedules and
permitting employees to request flexible arrangements.
incomes decline by $2,000 in the economic "expansion" from 2000 to 2007, now face even deeper income
losses. Retirement savings accounts have lost $2 trillion. Markets have fallen 40% in less than a year. Millions
of homeowners who played by the rules can't meet their mortgage payments and face foreclosure as the value
of their homes have plummeted. With credit markets nearly frozen, businesses large and small cannot access
the credit they need to meet payroll and create jobs.
Barack Obama and Joe Biden have a plan to revitalize the economy.
1. Immediate Action to Create Good Jobs in America
2. Immediate Relief for Struggling Families
3. Direct, Immediate Assistance for Homeowners, Not a Bailout for Irresponsible Mortgage Lenders
4. A Rapid, Aggressive Response to Our Financial Crisis, Using All the Tools We Have
1. IMMEDIATE ACTIO TO CREATE GOOD JOBS I AMERICA
The economy has lost 760,000 jobs this year -- and some forecasters expect the unemployment rate to exceed 8
percent by the end of next year. Addressing the financial crisis will help prevent the most severe loss of jobs
from the crisis. But taking direct steps to create jobs will also strengthen the economy and help with the
financial crisis. Barack Obama and Joe Biden's overall economic agenda is pro-jobs, including their plans to
eliminate America's dependence on foreign oil and bring down healthcare costs. But Obama and Biden believe
we must take additional aggressive steps to jump-start job creation right now:
• A ew American Jobs Tax Credit: Obama and Biden will provide a new temporary tax credit to
companies that add jobs here in the United States. During 2009 and 2010, existing businesses will
receive a $3,000 refundable tax credit for each additional full-time employee hired. For example,
if a company that currently has 10 U.S. employees increases its domestic full time employment to
20 employees, this company would get a $30,000 tax credit -- enough to offset the entire added
payroll tax costs to the company for the first $50,000 of income for the new employees. The tax
credit will benefit all companies creating net new jobs, even those struggling to make a profit.
• Raise the small business investment expensing limit to $250,000 through the end of 2009:
Obama and Biden will give small businesses an additional incentive to make investments and start
creating jobs again by providing temporary business tax incentives through 2009. The February
2008 stimulus bill increased maximum Section 179 expenses to $250,000 but this expires in
December 2008. This provision will encourage all firms to pursue investment in the coming
months, but will particularly benefit small firms which generally have smaller amounts of annual
property purchases and so choose to expense the cost of their acquired property.
• Zero capital gains rate for investment in small businesses: Barack Obama and Joe Biden believe
that we need to encourage investment in small businesses to help create jobs and turn our
economy around. That's why they will eliminate all capital gains taxes on investments made in
small and start-up businesses. They also want to cut taxes for the small businesses that create jobs
but are struggling with restricted access to credit on top of skyrocketing health care and energy
costs.
• Save one million jobs through immediate investments to rebuild America's roads and bridges
and repair our schools: The Obama-Biden emergency plan would make $25 billion immediately
available in a Jobs and Growth Fund to help ensure that in-progress and fast-tracked infrastructure
projects are not sidelined, and to ensure that schools can meet their energy costs and undertake
key repairs starting this fall. This increased investment is necessary to stem growing budget
pressures on infrastructure projects. In addition, in an environment where we may face elevated
unemployment levels well into 2009, making an aggressive investment in urgent, high-priority
infrastructure will serve as a triple win: generating capital deployment and job creation to boost
our economy in the near-term, enhancing U.S. competitiveness in the longer term, and improving
the environment by adopting energy efficient school and infrastructure repairs. In total, Obama
and Biden's $25 billion investment will result in 1 million jobs created or saved, while helping to
turn our economy around.
• Partner with America's automakers to help save jobs and ensure that the next generation of
clean vehicles is built in the United States: Senator Obama pushed for $50 billion in loan
guarantees to help the auto industry retool, develop new battery technologies and produce the next
generation of fuel efficient cars here in America. Congress passed only half of this amount -- it is
critical that the administration speeds up the implementation of the first half and that Congress
move quickly to enact the second half. In addition, Obama and Biden believe that with the
tremendous uncertainty facing the auto industry, and the small and medium business suppliers
who depend on them, it is critical that we keep all options on the table for helping them weather
the financial crisis.
2. IMMEDIATE RELIEF FOR STRUGGLIG FAMILIES
Even when the overall economy was growing, most American families were not sharing in this growth. The
typical non-elderly household saw its income decline by more than $2,000 from 2000 to 2007 as expenses
skyrocketed. Weekly wages, adjusted for inflation, are now lower than they were a decade ago. Barack Obama
and Joe Biden's overall economic plan will relieve the squeeze on families and foster bottom-up growth. But
they are proposing that we implement several measures immediately:
• A tax cut for 95 percent of workers and their families -- plus seniors: Barack Obama and Joe
Biden propose a permanent tax cut of $500 for workers and $1,000 for families. A first round of
these tax credits could be mailed out quickly by the IRS based on tax returns already filed for tax
year 2007. In addition, Obama and Biden would extend these expedited tax credits to senior
citizens who are retired as a down payment on his plan to eliminate taxes for all seniors making
up to $50,000.
• Extend unemployment insurance benefits and temporarily suspend taxes on these benefits:
Millions of Americans are looking for work but unable to find it in the weak economy. Today,
more than one in five unemployed workers has been out of work for more than half a year -- the
highest level since early 2005. Obama supported extending unemployment insurance this summer,
but already 800,000 jobless workers have exhausted those benefits and are being left without any
unemployment compensation. Obama and Biden believe Congress should immediately extend
unemployment insurance for an additional 13 weeks to help families that are being hit hardest by
this downturn. In addition, they believe we should temporarily suspend taxes on unemployment
insurance benefits as a way of giving more relief to families.
• Penalty-free hardship withdrawals from IRAs and 401(k)s in 2008 and 2009: Many families are
going to be facing unique economic hardship over the coming year. To help these families pay
their bills and their mortgages and make it through these tough times, Obama and Biden are
calling for legislation that would allow withdrawals of 15% up to $10,000 from retirement
accounts without penalty (although subject to the normal taxes). This would apply to withdrawals
in 2008 (including retroactively) and 2009.
• Instruct the Treasury to allow seniors to delay required withdrawals from 401(k)s and IRAs:
Currently seniors are required to start withdrawing from their 401(k)s and IRAs at age 70 1/2 and
every year thereafter over their lifetime. But the explicit requirement that withdrawals continue on
an annual basis -- and the related requirement that the amount withdrawn be based on currently
much higher year-end 2007 asset values -- is based on Treasury regulations, not the statute, which
has a less specific mandate. That means the Secretary of the Treasury has authority to change its
regulations to protect seniors from being forced, at this critical time, to sell their investments and
"lock in" their losses just after market values have plummeted in an almost unprecedented
fashion. Obama and Biden are calling on Treasury to temporarily suspend the required
withdrawals for retirees over age 70 1/2. Because retirees often make these required withdrawals
late in the year, there is still time to help millions of affected seniors -- but only if done promptly.
In addition, because lower-income seniors may have no choice but to take withdrawals this year
and in 2008, Obama and Biden will exempt any withdrawals made up to the required minimum
amount from taxation. This will give seniors the flexibility they deserve -- to forgo withdrawals if
they choose or to take those withdrawals tax free if they need those resources to pay their bills.
• Funds to counteract high heating costs this winter: Obama and Biden are calling for
supplementing the recently passed LIHEAP funding to ensure that cold-weather states can
cushion the impact of high energy prices for their residents this winter. The Energy Information
Administration said that consumers will pay a projected $1,137 to heat their homes from Oct. 1 to
March 31 -- 15 percent more than last year's heating outlay during this time. Homeowners that use
heating oil rather than natural gas could see increases of 23 percent compared to last year. As part
of his $25 billion state fiscal relief package, Obama's plan will supplement existing LIHEAP
funding to help state programs expand to cover more residents while continuing to provide a
meaningful benefit.
3. DIRECT, IMMEDIATE ASSISTACE FOR HOMEOWERS, OT A BAILOUT FOR
IRRESPOSIBLE MORTGAGE LEDERS
Over the past two years, Americans have lost 20 percent of the value of their homes. In some parts of the
country home values have fallen by twice that amount. In combination with a rapidly deteriorating economy,
that means more and more families are having a hard time meeting their monthly mortgage payments. At the
same time, many states are considering property tax hikes that will burden homeowners still further. And
millions of families who have seen the value of their homes fall below the cost of their mortgages need
assistance in restructuring their mortgages to stay in their homes.
Barack Obama and Joe Biden's plan provides direct relief to help America's homeowners pay their mortgages,
stay in their homes, and avoid painful tax increases while protecting taxpayers and not rewarding the bad
behavior and bad actors who got us into this mess:
• Instruct the Secretaries of the Treasury and Housing and Urban Development (HUD) to use
their existing authority to more aggressively modify the terms of mortgages: Barack Obama
was an early champion of the HOPE for Homeowners Act that passed over the summer. In
addition, Obama insisted that the financial rescue plan Congress recently passed include authority
for the Secretary to work with servicers to modify the terms of mortgages for homeowners who
played by the rules. Obama and Biden believe that both of these plans should be implemented
aggressively and comprehensively. In addition, Obama and Biden are calling on Treasury and
HUD to develop a plan to work with state housing agencies to coordinate broad mortgage
restructurings. The Dodd-Frank legislation gives states broader authority to help struggling
homeowners, and coordination is essential to ensure that state and national efforts are working in
concert to help as many homeowners as possible at the minimum cost to taxpayers.
• Reform the bankruptcy code to assist homeowners and remove legal impediments to
encouraging broader mortgage restructuring: Obama and Biden are also calling for legislation
to close the loophole in our bankruptcy code that allows bankruptcy judges to modify the terms of
mortgages on investment properties and vacation homes but not on primary residences. He also
believes we should clarify the legal liability of mortgage servicers so that servicers who work with
struggling homeowners to modify their mortgages will receive legal protections. And we should
remove any tax- or legal-related impediments to encouraging shared-equity mortgages within the
HOPE for Homeownership process.
• Enact a 90-day foreclosure moratorium for homeowners who are acting in good faith:
Financial institutions that participate in the financial rescue plan should be required to adhere to a
homeowner's code of conduct, including a 90-day foreclosure moratorium for any homeowners
living in their homes who are making good faith efforts to pay their mortgages. This will help
create stability until the more far-reaching solutions are implemented and give both sides a chance
to work out an agreement.
• Provide $25 Billion in state fiscal relief to help avoid painful property tax increases: Budget
crunches across the nation are putting our local governments in the untenable position of having
to choose between raising property taxes and cutting vital services. Obama has proposed $25
billion in state fiscal relief that, coupled with the new emergency facility to address the state credit
crunch, will help states and localities continue to provide essential services like health care,
police, fire and education without raising taxes or fees.
• Create a universal mortgage tax credit for homeowners: Barack Obama believes we should
immediately enact a 10 percent refundable tax credit on the mortgage interest paid by
hardworking American families who do not itemize their taxes. This credit will help offset the
cost of mortgage payments for at least 10 million middle-class homeowners.
4. A RAPID, AGGRESSIVE RESPOSE TO THE FIACIAL CRISIS -- USIG ALL THE
TOOLS WE HAVE
Barack Obama and Joe Biden believe that our deep systemic financial market crisis requires a systemic
response. They fought to ensure that the recently-passed financial rescue package gave the Treasury the tools
to stabilize the financial system, while protecting taxpayers and ensuring CEOs would not get rich in the
process. However, this stabilization will only occur if the Treasury, Federal Reserve, FDIC, and other
government entities use their authority and move quickly and aggressively to address the financial crisis.
It is now clear that our financial markets will not restart until financial institutions are lending again. Because
of the extensive losses many of these institutions have suffered, they need more capital so that they will have
the money to lend to families and businesses. Obama and Biden recognized this early, and were heartened by
the Treasury's stated intention to use its recently granted authority to inject capital into our financial
institutions. However, Secretary Paulson must turn this intention into action quickly and aggressively, in a
manner that strengthens confidence in our banks, protects taxpayers, does not reward CEOs, and is strictly
temporary.
In addition, our financial authorities must stand ready to take additional, complementary actions -- consistent
with the systemic nature of this crisis -- to ensure this Treasury initiative is successful:
• Be prepared, if necessary, for broader assurances for credit to banks: First, we must be
prepared to provide additional, temporary assurances to achieve the effective functioning of
financial markets. Depending on developing circumstances, these steps could include additional
measures by the Federal Reserve, extending insurance to all deposits, or guaranteeing a broader
range of liabilities of the banking system including overnight loans. Any such steps should be
coordinated internationally where appropriate and feasible. They should be accompanied by
additional oversight to ensure appropriate use of guaranteed funds and by the expectation that
financial institutions taking advantage of these guarantees will raise more capital.
• Extend asset purchases to unfreeze other critical sectors: Second, the Treasury should not limit
itself to purchasing mortgage-backed securities under the financial rescue plan recently passed by
Congress. The Treasury should use the authority it has under the new law to help unfreeze
markets for individual mortgages, student loans, car loans, loans for multi-family dwellings, and
credit card loans.
• Make credit available to small businesses and state or local governments: Third, we should take
immediate steps to support non-financial institutions including small businesses and states and
municipalities. The Federal Reserve and Treasury have acted to preserve the availability of
liquidity for financial institutions and, more recently, have created a program to purchase
commercial paper directly from the large corporate issuers. Small businesses and state and local
governments, however, are having serious difficulty obtaining necessary financing from debt
markets.
• Address the credit crisis facing our states and localities: Barack Obama and Joe
Biden propose that the Federal Reserve and the Treasury work together to design a
facility to provide a funding backstop to the state and municipal government debt
market similar to the recently announced program for the commercial paper market.
The Federal Reserve should determine whether it has sufficient legal authority to
establish such a facility on its own -- if not, it should work with Treasury and the
Congress to achieve this goal. This new facility should be designed to protect
taxpayer resources while ensuring that state and local governments can continue to
provide vital services to their residents.
• Address the credit crisis facing our small businesses: To address the massive
credit crunch that is threatening America's small businesses, Barack Obama and Joe
Biden are proposing two immediate steps: (1) a nationwide emergency lending
facility for small businesses that could be run through the SBA's Disaster Loan
Program, which helped thousands of businesses in the wake of 9/11; and (2)
temporarily eliminating fees on the SBA's 7(a) and 504 loan guarantee programs for
small businesses, to help increase private lending for small businesses.
Trade
Barack Obama and Joe Biden believe that trade with foreign nations should strengthen the American economy
and create more American jobs. They will stand firm against agreements that undermine our economic
security.
• Fight for Fair Trade: Obama and Biden will fight for a trade policy that opens up foreign markets
to support good American jobs. They will use trade agreements to spread good labor and
environmental standards around the world and stand firm against agreements like the Central
American Free Trade Agreement that fail to live up to those important benchmarks. Obama and
Biden will also pressure the World Trade Organization to enforce trade agreements and stop
countries from continuing unfair government subsidies to foreign exporters and nontariff barriers
on U.S. exports.
• Amend the orth American Free Trade Agreement: Obama and Biden believe that NAFTA and
its potential were oversold to the American people. They will work with the leaders of Canada
and Mexico to fix NAFTA so that it works for American workers.
• Improve transition assistance: To help all workers adapt to a rapidly changing economy, Obama
and Biden will update the existing system of Trade Adjustment Assistance by extending it to
service industries, creating flexible education accounts to help workers retrain, and providing
retraining assistance for workers in sectors of the economy vulnerable to dislocation before they
lose their jobs.
• End tax breaks for companies that send jobs overseas: Barack Obama and Joe Biden believe that
companies should not get billions of dollars in tax deductions for moving their operations
overseas. They will fight to ensure that public contracts are awarded to companies that are
committed to American workers.
• Reward companies that support American workers: Barack Obama introduced the Patriot
Employer Act of 2007 with Senators Richard Durbin (D-Ill) and Sherrod Brown (D-Oh) to reward
companies that create good jobs with good benefits for American workers. The legislation would
provide a tax credit to companies that maintain or increase the number of full-time workers in
America relative to those outside the U.S.; maintain their corporate headquarters in America if it
has ever been in America; pay decent wages; prepare workers for retirement; provide health
insurance; and support employees who serve in the military.
Manufacturing and Green Jobs
• Invest in our next generation innovators and job creators: Obama and Biden will create an
Advanced Manufacturing Fund to identify and invest in the most compelling advanced
manufacturing strategies. The Fund will have a peer-review selection and award process based on
the Michigan 21st Century Jobs Fund, a state-level initiative that has awarded over $125 million
to Michigan businesses with the most innovative proposals to create new products and new jobs in
the state.
• Double funding for the manufacturing extension partnership: The Manufacturing Extension
Partnership (MEP) works with manufacturers across the country to improve efficiency, implement
new technology and strengthen company growth. This highly-successful program has engaged in
more than 350,000 projects across the country and in 2006 alone, helped create and protect over
50,000 jobs. But despite this success, funding for MEP has been slashed by the Bush
administration. Barack Obama and Joe Biden will double funding for the MEP so its training
centers can continue to bolster the competitiveness of U.S. manufacturers.
• Invest in a clean energy economy and create 5 million new green jobs: Obama and Biden will
invest $150 billion over 10 years to advance the next generation of biofuels and fuel
infrastructure, accelerate the commercialization of plug-in hybrids, promote development of
commercial scale renewable energy, invest in low emissions coal plants, and begin transition to a
new digital electricity grid. The plan will also invest in America's highly-skilled manufacturing
workforce and manufacturing centers to ensure that American workers have the skills and tools
they need to pioneer the first wave of green technologies that will be in high demand throughout
the world.
• Create new job training programs for clean technologies: The Obama-Biden plan will increase
funding for federal workforce training programs and direct these programs to incorporate green
technologies training, such as advanced manufacturing and weatherization training, into their
efforts to help Americans find and retain stable, high-paying jobs. Obama and Biden will also
create an energy-focused youth jobs program to invest in disconnected and disadvantaged youth.
• Boost the renewable energy sector and create new jobs: The Obama-Biden plan will create new
federal policies, and expand existing ones, that have been proven to create new American jobs.
Obama and Biden will create a federal Renewable Portfolio Standard (RPS) that will require 25
percent of American electricity be derived from renewable sources by 2025, which has the
potential to create hundreds of thousands of new jobs. They will also extend the Production Tax
Credit, a credit used successfully by American farmers and investors to increase renewable energy
production and create new local jobs.
ational Infrastructure Investment
Barack Obama and Joe Biden believe that it is critically important for the United States to rebuild its national
transportation infrastructure -- its highways, bridges, roads, ports, air, and train systems -- to strengthen user
safety, bolster our long-term competitiveness and ensure our economy continues to grow.
• Create a ational Infrastructure Reinvestment Bank: Barack Obama and Joe Biden will address
the infrastructure challenge by creating a National Infrastructure Reinvestment Bank to expand
and enhance, not supplant, existing federal transportation investments. This independent entity
will be directed to invest in our nation's most challenging transportation infrastructure needs. The
Bank will receive an infusion of federal money, $60 billion over 10 years, to provide financing to
transportation infrastructure projects across the nation. These projects will directly and indirectly
create up to two million new jobs and stimulate approximately $35 billion per year in new
economic activity.
Technology, Innovation and Creating Jobs
Barack Obama and Joe Biden will increase federal support for research, technology and innovation for
companies and universities so that American families can lead the world in creating new advanced jobs and
products.
• Invest in the sciences: Obama and Biden support doubling federal funding for basic research and
changing the posture of our federal government from being one of the most anti-science
administrations in American history to one that embraces science and technology. This will foster
home-grown innovation, help ensure the competitiveness of U.S. technology-based businesses,
and ensure that 21st century jobs can and will grow in America.
• Make the Research and Development Tax Credit permanent: Barack Obama and Joe Biden
want investments in a skilled research and development workforce and technology infrastructure
to be supported here in America so that American workers and communities will benefit. Obama
and Biden want to make the Research and Development tax credit permanent so that firms can
rely on it when making decisions to invest in domestic R&D over multi-year timeframes.
• Deploy next-generation broadband: Barack Obama and Joe Biden believe we can get broadband
to every community in America through a combination of reform of the Universal Service Fund,
better use of the nation's wireless spectrum, promotion of next-generation facilities, technologies
and applications, and new tax and loan incentives.
Small Business
• Provide tax relief for small businesses and start-up companies: Obama and Biden will eliminate
all capital gains taxes on start-up and small businesses to encourage innovation and job creation.
Obama and Biden will also support small business owners by providing a $500 "Making Work
Pay" tax credit to almost every worker in America. Self-employed small business owners pay both
the employee and the employer side of the payroll tax, and this measure will reduce the burdens
of this double taxation.
• Create a national network of public-private business incubators: Obama and Biden will support
entrepreneurship and spur job growth by creating a national network of public-private business
incubators. Business incubators facilitate the critical work of entrepreneurs in creating start-up
companies. Obama and Biden will invest $250 million per year to increase the number and size of
incubators in disadvantaged communities throughout the country.
Labor
Obama and Biden will strengthen the ability of workers to organize unions. He will fight for passage of the
Employee Free Choice Act. Obama and Biden will ensure that his labor appointees support workers' rights and
will work to ban the permanent replacement of striking workers. Obama and Biden will also increase the
minimum wage and index it to inflation to ensure it rises every year.
• Ensure freedom to unionize: Obama and Biden believe that workers should have the freedom to
choose whether to join a union without harassment or intimidation from their employers. Obama
cosponsored and is a strong advocate for the Employee Free Choice Act (EFCA), a bipartisan
effort that makes sure workers can exercise their right to organize. They will continue to fight for
EFCA's passage and Obama will sign it into law.
• Fight attacks on workers' right to organize: Obama has fought the Bush National Labor
Relations Board (NLRB) efforts to strip workers of their right to organize. He is a cosponsor of
legislation to overturn the NLRB's "Kentucky River" decisions classifying hundreds of thousands
of nurses, construction workers, and professional workers as "supervisors" who are not protected
by federal labor laws.
• Protect striking workers: Obama and Biden support the right of workers to bargain collectively
and strike if necessary. They will work to ban the permanent replacement of striking workers, so
workers can stand up for themselves without worrying about losing their livelihoods.
• Raise the minimum wage: Barack Obama and Joe Biden will raise the minimum wage, index it to
inflation and increase the Earned Income Tax Credit to make sure that full-time workers earn a
living wage that allows them to raise their families and pay for basic needs.
Mortgages, Homeownership, and Bankruptcy
Obama and Biden will crack down on fraudulent brokers and lenders. They will also make sure homebuyers
have honest and complete information about their mortgage options, they'll give a tax credit to all middle-class
homeowners, and they'll reform our bankruptcy laws to protect working people.
• Create a universal mortgage credit: Obama and Biden will create a 10 percent universal mortgage
credit to provide tax relief to homeowners who do not itemize. This credit will provide an average
of $500 to 10 million homeowners, the majority of whom earn less than $50,000 per year.
• Ensure more accountability in the subprime mortgage industry: Obama has been closely
monitoring the subprime mortgage situation for years, and introduced comprehensive legislation
over a year ago to fight mortgage fraud and protect consumers against abusive lending practices.
Obama's STOP FRAUD Act provides the first federal definition of mortgage fraud, increases
funding for federal and state law enforcement programs, creates new criminal penalties for
mortgage professionals found guilty of fraud, and requires industry insiders to report suspicious
activity.
• Mandate accurate loan disclosure: Obama and Biden 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.
• Close bankruptcy loophole for mortgage companies: Obama and Biden will work to eliminate
the provision that prevents bankruptcy courts from modifying an individual's mortgage payments.
They believe that the subprime mortgage industry, which has engaged in dangerous and
sometimes unscrupulous business practices, should not be shielded by outdated federal law.
Credit Cards and Lending
Obama and Biden will establish a five-star rating system so that every consumer knows the risk involved in
every credit card. They also will establish a Credit Card Bill of Rights to stop credit card companies from
exploiting consumers with unfair practices.
• Create a credit card rating system to improve disclosure: Obama and Biden will create a credit
card rating system, modeled on five-star systems used for other consumer products, to provide
consumers an easily identifiable ranking of credit cards, based on the card's features. Credit card
companies will be required to display the rating on all application and contract materials, enabling
consumers to quickly understand all of the major provisions of a credit card without having to rely
exclusively on fine print in lengthy documents.
• Establish a Credit Card Bill of Rights to protect consumers: Obama and Biden will create a
Credit Card Bill of Rights to protect consumers. The Obama-Biden plan will:
• Ban Unilateral Changes
• Apply Interest Rate Increases Only to Future Debt
• Prohibit Interest on Fees
• Prohibit "Universal Defaults"
• Require Prompt and Fair Crediting of Cardholder Payments
Cap outlandish interest rates on payday loans and improve disclosure: Obama and
Biden will extend a 36 percent interest cap to all Americans. They will require lenders to provide
clear and simplified information about loan fees, payments and penalties, which is why they'll
require lenders to provide this information during the application process.
Encourage responsible lending institutions to make small consumer loans: Obama and
Biden will encourage banks, credit unions and Community Development Financial Institutions to
provide affordable short-term and small-dollar loans and to drive unscrupulous lenders out of
business.
Reform bankruptcy laws to protect families facing a medical crisis: Obama and Biden
will create an exemption in bankruptcy law for individuals who can prove they filed for
bankruptcy because of medical expenses. This exemption will create a process that forgives the
debt and lets the individuals get back on their feet.
Work-Family Balance
Obama and Biden will double funding for after-school programs, expand the Family Medical Leave Act,
provide low-income families with a refundable tax credit to help with their child-care expenses, and encourage
flexible work schedules.
• Expand the Family and Medical Leave Act: The FMLA covers only certain employees of
employers with 50 or more employees. Obama and Biden will expand it to cover businesses with
25 or more employees. They 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; and expanding FMLA to cover leave for
employees to address domestic violence.
• Encourage states to adopt paid leave: As president, Obama will initiate a strategy to encourage all
50 states to adopt paid-leave systems. Obama and Biden 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 high-quality afterschool opportunities: Obama and Biden will double funding for the
main federal support for afterschool programs, the 21st Century Learning Centers program, to
serve a million more children. Obama and Biden will include measures to maximize performance
and effectiveness across grantees nationwide.
• 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. Obama and Biden
will reform the Child and Dependent Care Tax Credit by making it refundable and allowing lowincome
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. Obama and Biden will enforce the recently-enacted Equal Employment
Opportunity Commission guidelines on caregiver discrimination.
• Expand flexible work arrangements: Obama and Biden will create a program to inform
businesses about the benefits of flexible work schedules; help businesses create flexible work
opportunities; and increase federal incentives for telecommuting. Obama and Biden will also
make the federal government a model employer in terms of adopting flexible work schedules and
permitting employees to request flexible arrangements.
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