Obama calls for 90-day moratorium on foreclosures

By CHRISTOPHER WILLS, Associated Press Writer Mon Oct 13, 6:06 PM ET

TOLEDO, Ohio - Democrat Barack Obama proposed more immediate steps Monday to heal the nation's ailing economy including a 90-day moratorium on home foreclosures at some banks and a two-year tax break for businesses that create new jobs.

With the economic turmoil weighing down his Republican presidential rival, Obama also proposed allowing people to withdraw up to $10,000 from their retirement accounts without any penalty this year and next.

The Democratic presidential candidate said his proposals, with a price tag of $60 billion over two years, can be enacted quickly, either through the government's regulatory powers or legislation that Congress could pass in a special session after the election.

"I'm proposing a number of steps that we should take immediately to stabilize our financial system, provide relief to families and communities and help struggling homeowners," Obama told a crowd of 3,000. "It's a plan that begins with one word that's on everyone's mind, and it's spelled J-O-B-S."

Obama delivered his economic message in Toledo, a struggling blue-collar city in a state that could be critical to Obama's presidential hopes. Polls show a close race between Obama and Republican John McCain in Ohio, which decided the 2004 presidential election. At stake are 20 electoral votes.

His call for action comes just two days before the final debate of the presidential race and at a time when McCain is sending mixed signals about how he'll address the economy.

Sen. Lindsey Graham, a key McCain adviser, said Sunday the Republican candidate was considering a proposal to reduce taxes on investment, including a possible cut in capital gains taxes, but McCain offered no new economic proposals when he gave a new stump speech Monday morning promising a change in direction from the economic policies of President Bush.

McCain spokesman Tucker Bounds accused Obama of planning to raise taxes if elected, something that would "have a devastating effect" on the already-troubled economy.

Obama's plan calls for raising taxes only on the 5 percent of people who make more than $250,000 a year. The nonpartisan Tax Policy Center found that under Obama's approach the wealthiest 1 percent of taxpayers would see their taxes go up on average by $93,709 in 2009, For McCain, those same wealthy taxpayers would see an average reduction of $48,860.

Obama is proposing tax cuts for those making less than $200,000 a year.

Obama's latest proposals are in addition to other policies the Illinois senator has already offered as the stock market struggles, financial institutions wobble and tight credit chokes the economy.

Obama supported the $700 billion Wall Street bailout plan and endorsed the latest twist on it: the government buying ownership in major banks and partially nationalizing them to keep them afloat. He also calls for tax breaks for most families, cutting capital gains taxes for investment in small business and extending unemployment benefits.

Obama proposed Monday that banks participating in the federal bailout should temporarily postpone foreclosures for families making good-faith efforts to pay their mortgage.

"We need to give people the breathing room they need to get back on their feet," he said, adding that families living beyond their means share some of the responsibility.

"Part of the reason this crisis occurred, if we're honest with ourselves, is that everyone was living beyond their means — from Wall Street to Washington to even some on Main Street," Obama said.

He also called for a $3,000 tax credit for each additional full-time job a business creates. That means a business that adds five jobs would get a $15,000 break. That would end after 2010 and would cost $40 billion, the campaign estimates.

Obama proposes letting people withdraw up to 15 percent of their retirement funds, to a maximum of $10,000, without the penalty that now applies to early or excess withdrawals. The change would apply retroactively to all of 2008, as well as 2009. People would still have to pay normal taxes on the money. He said letting people dip into their IRAs and 401(k)s would help them get through tough times when money is tight.

State and local governments face a money crunch, too, and Obama called for new federal short-term loans to help them through the crisis. He called it a "funding backstop" to ensure that states and cities can meet payroll or keep projects moving.

He ended the speech with a call for people to unite and make sacrifices, as America did during the Great Depression, until the economy is back on track.

"Together, we cannot fail. Not now. Not when we have a crisis to solve and an economy to save. Not when there are so many Americans without jobs and without homes," Obama said. "We can do this because we've done it before."

Read that also. Think the plan makes sense.

If a boat is sinking don't come up with plans for a new boat that won't leak. Plug ALL the holes that are sinking the boat. It would not only stop the boat from sinking but put more hands on the oars.

I like that analogy, Redshirt.

Welcome

I hate to be the constant cynic, but I wouldn't get your hopes up. It's election time so both the candidates are going to promise the world. Their follow through once they actually get into office is debatable. And don't forget, neither can do a single thing without Congress backing it.

I'm fully aware that what Obama is suggesting may not pass.

But..I like that he has a plan and it's a good one too.

I don't see McCain doing that.

first - give people a 3 month break and they will NOT PAY THEIR BILLS for three months. Face it folks, one of the reasons we are in this mess is cause of people that haven't been paying their bills and living beyond their means...

Tax breaks and such --- Lets see: I own a small business (file under individual but make $250,000 or more a year) my tax goes up $93,709. Obuthead gives me a $3,000 credit (which I have to file for-costing me manhours). How many employees do I have to hire to make up the difference between what he giveth and what he taketh away. I am really begining to believe yall deserve another theif running the government.

Some of you must think he is Robin Hood. Take from the rich and give to the poor. Problem with this theory is he aint giving to the working class poor. He's giving to the poor that AIN'T WORKED NOR WILL THEY EVER WORK...

worse... He be givin away YOUR hard earned money.

Excuse me...his tax plan would benefit every teacher in the country along with many others. Any time you want to take over my classroom and see the WORK I do everyday you are more than welcome.

Only problem with that analogy...

Ya can't plug leaks with paper... and lets face it square... Paper is all they are throwing at this thing.

Best bet when a boat is sinking with THIS many leaks is PUT ON A LIFE VEST... and hope the water ain't to cold.

Obama proposed, "a 90-day moratorium on home foreclosures at some banks."

Somehow you came up with, "they will NOT PAY THEIR BILLS for three months." WT?

These are not non-paying bills people. These are people struggling to make ends meet. People that have had medical emergencies. People that have lost their jobs. Even women whose husbands died or left them. Elderly people.

Unemployed people don't get home loans.

You said, "He's giving to the poor that AIN'T WORKED NOR WILL THEY EVER WORK... "

That's a bunch of bull!

First of all,the sinking boat you keep talking about should be called the Bush Titanic! It began sinking 8 years ago a couple of months before you voted the worst president in history back into office for four more years of damage.Bush and the repugs in congress voted to deregulate the evil bankers and gave them the right to rewrite the laws and rules so they can legally do any damn thing they want to do and then pretend it's the not their responsibilly and it was the consumers irresponsibilly.These are professional Vanpires who are very rich because they stay up late thinking of ways to screw the working class.So for anyone to believe the propaganda they hear is just outrages.Do you really believe that the WallStreet boys don't know what their doing and this was all a big misunderstanding,WRONG!This was all planned,just like the bail out was planned,Bush is giving the boys his last pay off before he leaves office,remember how he wanted to rush this thru before anyone had a chance to think about it!If you are paying more for your Meds,your insurance,your interest,your gas,and you think it's because the Democrats finally got a couple of seats ahead two years ago,then you need to turn off the fox and start thinking about how and why things are the way they are for yourself.Remember that being patriotic is being able to desent and supporting the Troops would mean bringing them home,McCain doesn't support them,he has voted against funding for their care several times,he doesn't want them home,so a vote for McCain is not supporting the troops,Also McCain was on the committee years ago and voted to no longer look for the MIA's and POW's in Vietnam,I wonder why?Anyway,yes it's true that all thru history cannidates promise things that they know they can't deliver,but at least with Obama,he hasn't voted for all the Bs,that McCain has 90% of the time with Bush and McCain has no plans of trying to end our occupation of the middle east that they call a war,he promised a 100 more years,now if people weren't dying and losing their limbs and coming home and committing suicide,then I guess we could laugh,but it's not funny,it's ignorant and America has no more room for ignorance!A vote for McCain will put blood on your hands and is this the way you want to be when Jesus comes back,lol..

prevent the banks from recouping their money???

......that sounds like a great plan....

Let's protect 3% of home owners and further cripple the banks

nice!!

Its not the %3 that crippled the banks..Do you hear yourself???