10/13/2008 03:02:24 PM EST

Obama Provides Specific Economic Policy Proposals

posted by gatekeeper50

Right-wing bloviators not withstanding, Barack Obama continues to issue specific economic policy proposals responding to the current downturn:

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Determined to keep the campaign spotlight on the economy, Sen. Barack Obama added $60 billion in new tax breaks and other benefits to his economic stimulus plan, and urged Congress to act quickly after the election to provide middle-class relief.
While his opponent, Sen. John McCain, has reportedly considered (A new plan would be designed to help Senator McCain shore up his economic credentials. Politico, the online political news report, said more than 30 ideas had been put forward but there was no final package, although whatever developed was likely to include at least temporary tax cuts for capital gains and dividends.) but not yet spelled out additional economic recovery steps, the Democratic nominee outlined several costly new proposals at a speech here this afternoon. They include:


  • A temporary tax credit for firms that create jobs in the U.S.

  • Penalty-free 401(k) and IRA withdrawals through 2009, to allow struggling families to withdraw up to 15 percent of their savings, up to $10,000.

  • A 90-day foreclosure moratorium for homeowners making "good-faith efforts" to keep up with their mortgage payments.

  • Creating a new entity to lend to state and local governments, allowing for an effort similar to the liquidity assistance that the Federal Reserve recently extended to commercial banks.

  • The temporary elimination of taxes on unemployment insurance benefits.
    Obama raised the prospect of government aid to the automobile industry and more aggressive federal action to help banks and free up consumer credit. He has already outlined benefits such as a middle-class tax break -- delivered immediately in the form of a check -- and small-business incentives that total about $115 billion over two years.

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    Obama Provides Specific Economic Policy Proposals | 4 comments (4 topical, 0 hidden)
    subject (none / 0)
    I like all of these, except I'm not quite sold on the 401k thing.  That would be like taking Billions of $$$ out of the Stock Market and circulating it in the "regular" economy.  Obviously it would be good in the short term, but has some problems in the long term.

    by qsoundrich on 10/13/2008 03:20:17 PM EST

    There Has Always Beel a Clause (none / 0)

    That allows early withdrawals from 401K in cases of extreme economic hardship - like to prevent foreclosure or bankruptcy.  This would just allow the 401K plan to be a buffer for bad economic times as well as for retirement, which seems fair under the circumstances.

    This plan really ought to be combined with one of McCain's proposals.  That proposal is to allow people to keep their money in their 401K plan rather than require mandatory withdrawals at age 70.5.  This is temporary, and is meant to not force retirees to withdraw money from the stock market while the market is low.  This has an added benefit of keeping more money in the market.

    by rbruck on 10/13/2008 04:40:00 PM EST

    [ Parent ]
    Economic plan (none / 0)
    Not sure about the 70 1/2 thing although I guess for those who don't need the money they can time their withdrawals until stock market recovers.
    Yes, the 401K w/d is for emergency once unemployment runs out. People have been doing this last time we had high unemployment back in 2002 area. (I lost my job then too.) so good that no penalty.
    McCain has a part of his proposal to suspend capital gains taxes for 2 years but I'm fairly well off and so are my working friends but very few have much invested outside their retirement money. Only examples in my life and theirs is when they and my wife inherited some money. I think this is bogus and will only help highest incomes and wealth people as stocks recover over next few years. We will need this 15% tax rate or will never balance the budget and start to cut the deficit. Capital gains on non-homes investments is 90% or more for the wealthy and a non-issue for most of us. It's more of trickle down that has been discredited.  &nb sp; 

    by stanski on 10/13/2008 05:39:04 PM EST

    It is Insanity (none / 0)

    to tax capital gains LESS than earned income.  You are absolutely right that the argument for doing this, which was to incourage investment to increase jobs, has been completely debunked.

    With the exception of certain specific capital gains, like selling your house at retirement time, capital gains should be taxed the same as all other income.  Taxing capital gains less than earned income is just another way of pushing the tax burden down from the wealthy to the middle class.  It isn't fair.

    by rbruck on 10/13/2008 06:22:28 PM EST

    [ Parent ]
    Obama Provides Specific Economic Policy Proposals | 4 comments (4 topical, 0 hidden)
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