Democratic presidential hopeful Sen. Barack Obama D-Ill., speaks at a town hall meeting at Plainfield High School in Plainfield, Ind. Saturday, March 15, 2008.(AP Photo/Alex Brandon)
The True Strength of America…Family
Strengthening Families and Communities
“\”…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 Washington for far too long — a responsibility I intend to take very seriously as President.\””
— Barack Obama, Spartanburg, SC, June 15, 2007
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 Washington to finally restore the promise of the American Dream to all American families.
Barack Obama\’s Plan
Support Working Families
Provide a \”Making Work Pay Tax Cut\” for America\’s Working Families: American people work longer and harder than those in any other wealthy nation in the world. But their hours are getting longer and their wages aren\’t getting any higher. In addition they are being squeezed by rising health care, education and energy costs. Rather than relieving the burden on working families, the current administration has provided tax cut after tax cut to the wealthiest Americans and enacted tax breaks for the most well-connected corporations. Barack Obama will restore fairness to the tax code and provide 150 million workers the tax relief they deserve. Obama will create a new \”Making Work Pay\” tax credit of up to $500 per person, or $1,000 per working family. This refundable income tax credit will provide direct relief to American families who face the regressive payroll tax system. It will offset the payroll tax on the first $8,100 of their earnings while still preserving the important principle of a dedicated revenue source for Social Security. The \”Making Work Pay\” tax credit will completely eliminate income taxes for 10 million Americans. The tax credit will also provide relief to self-employed small business owners who struggle to pay both the employee and employer portion of the payroll tax. The \”Making Work Pay\” tax credit offsets some of this self-employment tax as well.
Provide a Living Wage: 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 $7.25 an hour by 2009, the minimum wage\’s real purchasing power will still be below what it was in 1968. As president, Obama would 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 High-Quality Afterschool Opportunities: Barack Obama will double funding for the main federal support for afterschool programs, the 21st Century Learning Centers program, to serve one million more children. Obama 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. 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.
Strengthen Our Schools
Expand Early Childhood Education: Research shows that half of low-income children start school up to two years behind their peers in preschool skills and that these early achievement gaps continue throughout elementary school. Obama has been a champion of early childhood education since his years in the Illinois legislature, where he led the effort to create the Illinois Early Learning Council. Obama has introduced a comprehensive \”Zero to Five\” plan to provide critical supports to young children and their parents by investing $10 billion per year to create: Early Learning Challenge Grants to stimulate and help fund state \”zero to five\” efforts; quadruple the number of eligible children for Early Head Start and increase Head Start funding and improve quality for both; work to ensure all children have access to pre-school; provide affordable and high-quality child care that will promote child development and ease the burden on working families; and create a Presidential Early Learning Council to increase collaboration and program coordination across federal, state, and local levels.
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. He 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. And by making the tax credit fully refundable, Obama\’s credit will help low-income families that need it the most. Obama will also ensure that the tax credit is available to families at the time of enrollment by using prior year\’s tax data to deliver the credit at the time that tuition is due, rather than a year or more later when tax returns are filed.
For more information on Barack Obama\’s education plan, please visit the Education Policy page
Help American Families Stay Healthy
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: Owning a home is the culmination of the American dream that so many Americans work so hard for. The tax code is supposed to encourage home ownership with a mortgage interest deduction, but it goes only to people who itemize their tax deductions. Like so much in our tax code, this tilts the scales toward the well-off. 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. This tax credit will also help homeowners deal with the uncertain state of the housing market today.
Combat Mortgage Fraud and Subprime Loans: There is a growing epidemic of mortgage fraud crimes in which sophisticated scam artists cheat homeowners out of their mortgages. Some have estimated that more than 2 million homeowners with subprime mortgages are at risk of losing their homes. 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.
Create Fund to Help Homeowners Avoid Foreclosures: In addition to taking important steps to prevent mortgage fraud from occurring in the future, Barack Obama will establish policies to help Americans currently facing foreclosure through no fault of their own. For instance, in communities where there are many foreclosures property values of innocent homeowners are often also negatively impacted, driving them toward foreclosure, too. Obama will create a fund to help people refinance their mortgages and provide comprehensive supports to innocent homeowners. The fund will also assist individuals who purchased homes that are simply too expensive for their income levels by helping to sell their homes. These steps will ensure that individuals who have to sell their homes will be able to quickly regain stable financial footing. The fund will be partially paid for by Obama\’s increased penalties on lend
ers who acted irresponsibly and committed fraud.
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 Families at Home
Strengthen Fatherhood and Families: Since 1960, the number of American children without fathers in their lives has quadrupled, from 6 million to more than 24 million. Children without fathers in their lives are five times more likely to live in poverty and commit crime, nine times more likely to drop out of school, and 20 times more likely to end up in prison. 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 the highly 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. The trained nurses use proven methods to help improve the mental and physical health of the family by providing counseling on substance abuse, creating and achieving personal goals, and effective methods of nurturing children. Proven benefits of these types of programs include improved women\’s prenatal health, a reduction in childhood injuries, fewer unintended pregnancies, increased father involvement and women\’s employment, reduced use of welfare and food stamps, and increased children\’s school readiness. Researchers at the Federal Reserve Bank of Minneapolis concluded that these programs produced an average of five dollars in savings for every dollar invested and produced more than $28,000 in net savings for every high-risk family enrolled in the program. The Obama plan would assist approximately 570,000 first-time mothers each year.
Strengthen Retirement Security
Create Automatic Workplace Pensions: Currently, 75 million working Americans ? roughly half the workforce ? lack employer-based retirement plans. Even when workers are given the option of joining employer-based plans, many do not take up the option because it requires considerable work to research plans and investment portfolios, and enroll in the plan. Barack 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 by signing a written waiver. Even after enrollment, employees will retain the right to change their savings levels, reallocate investment portfolios or end contributions to the account. Obama\’s plan will give options to the self-employed and new small businesses to access new easy-to-enroll savings plans and direct the IRS to deposit tax refunds into those savings plans for people who choose to save some of their refunds. Under the Obama plan when employees change jobs, their savings will be automatically rolled over into the new employer\’s system to ensure continued savings. 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: Barack Obama will ensure savings incentives are fair to all workers by creating a generous savings match for low and middle-income Americans. Obama will expand the existing Savers Credit to match 50 percent of the first $1,000 of savings for families that earn under $75,000, and he will make the tax credit refundable. To help ensure that this proposal actually strengthens retirement investments, the savings match will be automatically deposited into designated personal accounts by using the account information listed on IRS tax filings. Coupled with the automatic workplace pension plan, this proposal will stimulate tens of millions of new Americans to invest for retirement. Over 80 percent of the savings incentives will go to new savers, and 75 percent of people eligible for the incentives who are expected to participate in the new program do not currently save.