By Anne E. Kornblut and William Branigin
Washington Post Staff Writer
Monday, January 25, 2010; 2:58 PM
Promising repeatedly to "keep fighting" for average Americans, President Obama rolled out new proposals Monday to help struggling middle-class families, setting the stage for his first State of the Union address Wednesday night.
"Unfortunately, the middle class has been under assault for a long time," Obama told a gathering of his Task Force on Middle Class Families at the Eisenhower Executive Office Building adjacent to the White House. "Too many Americans have known their own painful recessions long before any economist declared that there was a recession."
Previewing key themes of his upcoming address to the nation, Obama unveiled initiatives to help the middle class by making it easier for people to care for dependents, repay student loans and save for retirement.
The proposals are part of broader themes that the White House said Obama would tie together in his State of the Union speech, including the importance of job creation, the need to reduce the deficit and, as ever, the urgency of changing the way Washington works.
But his focus on the middle class will be critical as Obama tries to regain momentum after a series of political setbacks. To that end, he announced several concrete proposals, including:
-- nearly doubling the child and dependent care tax credit for families making under $85,000 a year;
-- limiting a student's federal loan payments to 10 percent of income above basic living allowance;
-- creating a new system of automatic workplace retirement savings accounts;
-- expanding tax credits to match retirement savings; and
-- expanding elder care help for the "sandwich generation" of baby boomers caring for parents and children.
In his remarks to the task force, which is chaired by Vice President Biden, Obama touted successes so far in creating jobs but made clear that the efforts have fallen far short of what is needed.
"These steps have saved or created about 2 million jobs so far," he said, "but more than 7 million have been lost as a consequence of this recession."
Obama praised the work of the task force, and he promised -- four times in less than five minutes -- to "fight for the middle class."
"So we're going to keep fighting to rebuild our economy so that hard work is once again rewarded, wages and incomes are once again rising, and the middle class is once again growing," Obama said. "And above all, we're going to keep fighting to renew the American Dream and keep it alive -- not just in our time, but for all time."
The brief speech -- employing new, populist language that Obama began using last week -- heralded a tone that the president appears likely to sound in Wednesday night's address to Congress and the nation.
In comments before Obama spoke, Biden said the measures announced Monday would help nearly 200,000 people balance work and their need to care for elderly family members, in part by providing 3 million hours of respite care.
He said the initiative to limit federal student loan repayments would help graduates who enter the work force these days with an average debt of $23,000.
To assist the 78 million Americans who do not have employer-based retirement plans, Biden said, the proposals would prod employers to enroll their workers in direct-deposit IRAs and would simplify and expand a "saver's credit" that helps working families save for retirement by providing a 50 percent federal match on the first $1,000 of retirement savings.
He said this incentive would save the government a lot more than the cost of the $500 matches in the long run by helping people build a nest egg for retirement so that they can care for themselves without having to "look to the government to provide some basic needs."
The new initiatives were announced at the 12th meeting of Biden's task force. The goal, Biden said, is to help people achieve the "old-fashioned notion of the American dream."
"It sounds corny, but that's literally what it is," said Biden, who had to stall for nearly half an hour while Obama was delayed in arriving at the event.
The task force, created shortly after Obama took office a year ago, is charged with developing policies aimed at raising the living standards of the middle class. Its members include the secretaries of labor, education, energy, Treasury, commerce, transportation, agriculture, health and human services and housing and urban development. Also participating are the administrator of the Environmental Protection Agency, the chairman of the Council of Economic Advisers and the directors of the National Economic Council, the Office of Management and Budget and the Domestic Policy Council.