2008 Presidential Election: A Look at the Foreclosure Crisis, Taxes & Retirement
We're certainly living in interesting times. Not only are we in the middle of a presidential election that has been touted by many as the "most important election of our lifetimes"; we're also in the midst of a global financial crisis.
Both the presidential nominees, Sen. John McCain (R-AZ) and Barack Obama (D-IL), have evolved their economic plans as the times have changed.
In this article, Total Bankruptcy breaks down where the candidates stand on three of the hottest financial issues: the foreclosure crisis, tax relief and retirement matters.
U.S. Mortgage Foreclosure Crisis
Foreclosure rates have skyrocketed and middle-class foreclosures are becoming more and more common. Many Americans feel as if the American Dream is slipping out of reach. Here's some information on what the candidates plan to do about the foreclosure nightmare:
McCain's Homeowner Plan: Said he wants the government to purchase failing mortgages directly from the lenders and replace that mortgage with a fixed-rate mortgage based on the home's reduced value. The government would then receive part of the equity in the home and people could stay in their homes.
Obama's Homeowner Plan: Said he will enact a 90-day moratorium on foreclosures and require that banks which take government funds agree not to foreclose against homeowners who are trying to make payments (even if the payments aren't the full monthly amount).
Tax Relief
When the economy is bumpy, taxes become an even bigger issue than usual. This has been a hot issue during the election and the candidates have continually fired shots at each other's plans. Here's a quick synopsis of the core of their tax plans:
McCain's Tax Plan. McCain would extend most of the Bush tax cuts that would otherwise expire after 2010 and cut the corporate tax rate. He would further give tax deductions to businesses that invest in certain capital equipment. In addition, he wants to cut by 50 percent the tax rates on long-term capital gains to 7.5 percent in 2009 and 2010. He also will stop taxes on unemployment insurance benefits for this year and 2009. He further wants to allow investors to deduct more in losses and guarantee savings accounts.
Obama's Tax Plan. He immediately wants to establish tax cuts for households making less than $250,000 ($500 for individuals; $1,000 for families). He also wants the same cuts for retired seniors who make less than $50,000. He further wants to extend unemployment insurance benefits for an additional 13 weeks and temporarily suspend taxes on benefits. In addition, he would allow a 10 percent refundable tax credit on mortgage interest to taxpayers who don't itemize. Further, he plans to eliminate capital gains on taxes on small and start-up businesses and allow them to write off investments of up to $250,000 through the end of 2009.
American's Retirement
It's not a new warning-our Social Security program is in danger of collapsing and we've known about this problem for a long time. As our population ages, it's only bound to get worse. Many people are wondering if they'll ever receive the benefits of a system that they've been contributing to for a lifetime.
The media has criticized both candidates for being too vague on how they plan to solve the lack-of-funding issue, but here's a rundown of what they've said on the campaign trail:
McCain's Retirement Plan: Has said that "everything's on the table" when it comes to reforming the Social Security system but has specifically endorsed the idea of younger workers being allowed to divert a portion of their Social Security payroll taxes into private accounts. He said he opposes an increase in payroll taxes, although in an ABC News interview, he said it might be a possibility.
Obama's Retirement Plan: Has endorsed an automatic IRA enrollment proposition that woufld expand retirement savings, especially for those without an employer-sponsored retirement plan. Wants to expand the Saver's Credit for household earning less than $75,000 a year and eliminate all income taxes on seniors who have an income of less than $50,000. Obama recommends a 2 to 4 percent increase in payroll taxes for families that earn more than $250,000 a year.
Note: The above information was gathered from the candidates' official Web sites or from their recent political speeches.
Other Resources
Be an informed voter-be sure to check out the below resources for more information on the candidate's positions:
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