|Barack Obama greeted supporters yesterday at the Pentecostal Temple Church of God in Christ in Las Vegas. (ethan miller/Getty Images)|
LAS VEGAS - Barack Obama yesterday unveiled an economic stimulus package costing up to $120 billion that his campaign said would put money in the hands of workers and seniors, stem the foreclosure crisis, and cover state budget shortfalls.
The Illinois senator is proposing that the plan be implemented before a new president takes office.
"We need that middle-class tax cut now more than ever - not five months from now or five weeks from now, but now," Obama said in a statement. "I'm announcing a plan to jump-start the economy by putting money in the pockets of those who need it most and will spend it quickly."
The plan would have to be approved by Congress and President Bush to go forward, which is not likely.
But Obama's campaign said it represented the kind of relief he would pursue if he were president now.
The Democrat from Illinois called on the government to make available a $250 tax credit to 150 million workers to offset the payroll tax paid on the first $8,100 of earnings. He urged a further $250 tax credit per worker if employment declines three months in a row.
He also would give a one-time, $250 payment to Social Security recipients who would not benefit from the tax credit, followed by another $250 payment if employment declines three months straight.
The immediate relief would cost $45 billion, plus another $45 billion if the economy weakened.
Obama also pledged $10 billion to increase pre-foreclosure counseling and help "responsible homeowners" refinance their mortgages or sell their homes.
The plan also calls for $10 billion to help states and local governments facing budget problems as a result of the housing crisis, caused by falling property values and sales tax revenue.
Obama also wants $10 billion to extend unemployment insurance while loosening the eligibility criteria to include many part-time and nontraditional workers.
Austan Goolsbee, a senior economic policy adviser to Obama, said the plan was slightly larger than the $110 billion package presented Friday by Obama's chief rival, Senator Hillary Clinton.
Goolsbee said Obama's plan would have a more immediate impact because checks for tax credits and Social Security payments could be issued right away, while Clinton's plan to subsidize such things as higher heating bills would require an application process.
"Those are things that would take many months if not a year or more before the money would get out the door," Goolsbee said.