Fresh off his State of the Union address, President Obama plans to discuss new ways to build economic security for the middle class and expand opportunity for all so that every American can get ahead.
Having spoken of Americans' "simple, profound belief in the opportunity for all" Tuesday night, the president will spend Wednesday pushing for an increase in the federal minimum wage and the creation of retirement accounts for taxpayers who otherwise couldn't afford them.
Obama will begin his day by visiting a Costco in Lanham, Md., which White House officials said they chose because of the company's move to increase wages for even its lowest-paid employees.
Maryland has been one of the states pushing most aggressively for a raise in the minimum wage: This year Gov. Martin O'Malley (D) has proposed raising the state’s minimum wage to $10.10 an hour. In 2007, Maryland passed a "living wage" law for companies contracting with the state.
On Tuesday, the president announced he will sign an executive order soon to raise the minimum wage to $10.10 for those working on new federal contracts.
After visiting the Costco store, Obama will head to the United States Steel Corp. Irvin Plant in West Mifflin, Pa., to discuss a new proposal, titled “MyRA,” to help Americans save for retirement. The administration, which says that half of all workers don’t have access to employer-sponsored retirement plans, will allow Americans to invest a portion of their salary into government bonds in an account that will be treated like a Roth IRA -- a common type of retirement savings account. Contributions could be withdrawn at anytime tax-free.
The administration says the initial investment could be as low as $25 and further contributions could be as low as $5, made through automatic payroll deductions. Workers would be able to keep the same account when they change jobs or merge it with a private individual retirement account at any time. A White House document says that households earning up to $191,000 will be able to use the account, starting with a pilot program later this year, and they can save up to $15,000 in their accounts before transferring the balance to a private Roth IRA.
(Administration officials late Tuesday night did not specify whether the proceeds or interest payments from the government bonds would be taxable. Nor did they clarify exactly where the account would reside.)
Obama is also pushing -- as he has before -- for companies to automatically enroll employees who do not have access to 401(k)s in individual retirement accounts. Obama also called for limiting retirement tax benefits for the wealthy.