While many profess from middle class America to have felt neglected by the Obama administration it is important to highlight some of the key items that have affected the middle class the past 2 years. With very high unemployment and elections coming up in November perhaps it would be an opportunity to be reminded what actually Obama and congress has done.
- He has ended combat operations in Iraq. (50,000 remain).
What this means is at May 28, 2010, there were 4,404 dead from the US armed forces.
According to a Congressional Budget Office (CBO) report published in October 2007 that approximately $1.9 trillion would be spent on Iraq by 2017 including indirect costs.
A recent study indicated that the long term health care costs for wounded Iraq war veterans could range from $350 billion to $700 billion.
Although the above details are grim, it is an achievement to be getting out of a war that has cost so many middle class Americans their lives and has plunged the US into deeper debt.
- Signed into law American Recovery and Reinvestment Act of 2009
$116 billion: New payroll tax credit of $400 per worker and $800 per couple in 2009 and 2010.
$70 billion: Alternative minimum tax: a one year increase in AMT floor to $70,950 for joint filers for 2009.
$86.8 billion for Medicaid
$40 billion to provide extended unemployment benefits through Dec. 31, and increase them by $25 a week
$19.9 billion for the Food Stamp Program
Although it may be surprising to some but much of the stimulus was actually spent on the citizens themselves and though many may feel that citizens could have better spent the stimulus funds, they themselves were in charge of a lot of it which went to their bank accounts.
- Signed into law the Health Care and Education Reconciliation Act of 2010
Effective in 2014 - Households with incomes from 150% to 400% of the federal poverty level ($88,200 for a family of four) would pay on a sliding scale from 4% to 9.8% of their income on premiums, rest will be covered by government advanceable, refundable tax credit
Would extend the ban on lifetime limits and rescission of coverage to all existing health plans within six months after signing into Law
Effective September 23, 2010- Dependents (children) will be permitted to remain on their parents' insurance plan until their 26th birthday
Effective in 2014 - insurers are prohibited from discriminating against or charging higher rates for any individuals based on pre-existing medical conditions and Insurers are prohibited from establishing annual spending caps.
While certainly not the most ideal reform that many would have hoped for, many middle class americans would be covered by the subsidies.
- Signed into Financial Reform Act 2010
Consumer protection reforms including a new consumer protection agency and uniform standards for "plain vanilla" products as well as strengthened investor protection;
Mortgage Reform and Anti-Predatory Lending eg loan originator shall make a reasonable and good faith effort based on verified and documented information that “at the time the loan is consummated, the consumer has a reasonable ability to repay the loan, according to the terms, and all applicable taxes, insurance (including mortgage guarantee insurance), and other assessments.
The consumer protection agency will assist the middle class in future decision making on financial products.
So while it may seem that the Obama administration has not necessarily provided what both democrats and republicans would have wanted it is ignorant to say nothing useful has been done for the past year.
It seems the middle class claim nothing was done to help businesses, should consider $51 billion given as tax credits for companies from the stimulus separate to the funds given to infrastructure.
So while job losses and housing foreclosures continue to be a problem, perhaps if the stimulus was provided to more projects, eg infrastructure was given 105.3 Billion vs 237 Billion given to individuals for tax cuts it would have had an even bigger effect on job creation.
I may disagree with the various approaches on legislation(i would have gone for a much bigger stimulus) i cannot agree that nothing has been done for the middle class.
The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com