Amid growing worries about a worsening of the U.S. economy, Democratic presidential candidate Barack Obama proposed a $75 billion economic stimulus plan on Sunday that includes worker tax credits, a one-time pension supplement and help to homeowners facing foreclosure.
The plan would include an immediate $250 tax credit for workers, which could double if the economy worsens, a one-time $250 supplement to Social Security payments, a $10 billion fund to help homeowners facing foreclosure and a $10 billion fund to assist states facing budget shortfalls amid lower tax revenues.
"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."
If he won his party's nomination and then the November election, Obama would take office in January 2009.
The Illinois senator's office unveiled the proposals at the start of a day of campaigning in Nevada, which holds the next contested Democratic primary on Saturday.
The "goal would be to help the U.S. economy from going into recession," his economic advisor Austan Goolsbee told reporters.
Obama's leading rival, New York Sen. Hillary Clinton, on Friday unveiled an economic stimulus package she said would be worth $70 billion. Her plan placed more of an emphasis on helping families unable to make mortgage payments -- a major issue in Nevada where "for sale" signs are common on homes around heavily populated Las Vegas.
"There are some similarities," Goolsbee said of the two plans. The biggest difference with Obama's plan is that "the absolutely most imperative thing is to get the money into the people's hands immediately so they can spent it."
"The stimulus does increase the deficit in the immediate term," the economic adviser said, adding that preventing a recession could have "profound" budget implications.
The Obama plan also includes a $10 billion extension of unemployment insurance to help those who have been unable to find a job for more than six months.
The foreclosure help plan would be aimed at "responsible homeowners" who live in their primary residences, Goolsbee said. Las Vegas has been hit hard by the subprime loan crisis, but many of those suffering bought additional houses hoping that fast rising prices amid a prosperous local economy would lead to easy money.
Last year, Obama proposed tax credits of up to $500 for 150 million workers. His revised economic plan calls for $250 of that to come in an immediate credit, and the rest as soon as three months later if the nation's unemployment rate worsens.