Sen. Barack Obama delivered a second economic speech in as many days on Tuesday, announcing $80 billion in proposed tax cuts for working people, homeowners and seniors with the declaration that "the wealth of our nation is rooted in the work of our people."
Obama (D-Ill.) has made confronting special interests and corporate lobbyists a core theme of his campaign, and he elaborated it in his tax cut proposal. Arguing that rich business interests -- rather than market forces -- have conspired to lobby for tax breaks, Obama said it is time to shift the tax burden away from the middle class.
"In our new economy, there is no shortage of new wealth," he told the Tax Policy Center. "But wages are not keeping pace...This isn't the invisible hand of a market at work. It's the successful work of special interests. For decades, we've seen successful strategies to ride anti-tax sentiment in this country towards tax cuts that favor wealth, not work. And for decades, we've seen the gaps in wealth in this country grow wider, while the costs to working people are greater."
Obama proposed eliminating tax returns for some 22 million senior citizens, promising that no retiree making less than $50,000 would pay income tax. He said he would expand tax relief on mortgage interest for homeowners, targeting about 10 million people who own their homes. And he proposed reducing income taxes for 150 million workers, eliminating all income taxes for about 10 million of those.
Invoking the current mortgage crisis, Obama said he would provide some relief in the form of a "universal homeowners' tax credit" that gave people tax credits even if they do not itemize their tax returns.
Obama has said he would pay for his tax cuts by rolling back part of the Bush tax cut, though he has also said that step would help pay for his health care program. Sen. Hillary Rodham Clinton has proposed tax credits to help make health insurance more affordable, as part of her overall health care package. Former Sen. John Edwards mapped out a plan earlier this year to exempt some investment income from capital gains taxes, provide tax-free savings accounts for low income workers and the middle class, and raise capital gains taxes for the wealthiest.
"Our country is divided into two Americas - one for those at the top and one for everyone else," Eric Schultz, a spokesman for Edwards said. "Senator Edwards believes this is an issue of fairness - those at the top should pay their fair share, instead of making hard-working families bear most of the burden. But we also think when it comes to selecting a president, specifics matter, and we look forward to seeing what tax rates Senator Obama proposes."