NCPA - National Center for Policy Analysis

OBAMA ON THE ECONOMY

September 8, 2008

How do John McCain and Barack Obama differ on the economy? The National Journal compared and contrasted the two presidential candidates. Below is a summary of Obama's positions on the economy.

Bush tax cuts:

  • Obama wants to make permanent the 2001 and 2003 income-tax cuts for about 94 percent of tax filers -- those making less than $200,000 a year.
  • He will either repeal the Bush cuts for the top one percent of taxpayers, or allow the cuts for those taxpayers to expire in 2010.
  • He will let the tax cuts on income from capital gains and dividends expire in 2010 -- raising the rate from 15 percent to 28 percent.
  • He will restore most of Bush's temporary estate tax cut to a 45 percent rate for estates valued at $3.5 million or more.

New tax cuts:

  • Obama would grant a yearly tax credit of $500 for individuals and $1,000 for married couples that would apply to all workers who pay Social Security.
  • Also, those 65 and older earning less than $50,000 a year would be exempt from income tax.
  • The price tag: $280 million over 10 years.

The budget:

  • Obama has rhetorically committed to "pay-as-you-go."
  • Some revenue -- but not much in the short term -- would come from a proposed 2 percent to 4 percent surcharge on high earners to reduce Social Security's projected shortfall after 2017.

Housing and credit crisis:

  • Obama would empower the Federal Reserve to regulate investment banks and any other institutions to which it lends.
  • His 2007 bill would expand federal regulation of mortgage lending and toughen criminal penalties for fraud.
  • Proposes a $10 billion fund to help homeowners avoid foreclosure and $10 billion to help state and local governments.

Source: "Obama on the Economy," in "Where They Stand," National Journal, August 30, 2008.

 

Browse more articles on Economic Issues