In his State of the Union address, President Barack Obama proposed using money repaid by financial institutions to the Troubled Asset Relief Program to help small businesses.
So tonight, I'm proposing that we take $30 billion of the money Wall Street banks have repaid and use it to help community banks give small businesses the credit they need to stay afloat, he said. I'm also proposing a new small business tax credit one that will go to over 1 million small businesses who hire new workers or raise wages. While we're at it, let's also eliminate all capital gains taxes on small business investment, and provide a tax incentive for all large businesses and all small businesses to invest in new plants and equipment.
Obama also called for the Senate to pass the financial regulatory reform overhaul approved by the House last year. Now, the House has already passed financial reform with many of these changes, he said. And the lobbyists are trying to kill it. But we cannot let them win this fight. And if the bill that ends up on my desk does not meet the test of real reform, I will send it back until we get it right. We've got to get it right.
Obama also proposed an expansion in education tax credits. To make college more affordable, this bill will finally end the unwarranted taxpayer subsidies that go to banks for student loans, he said. Instead, let's take that money and give families a $10,000 tax credit for four years of college and increase Pell Grants. And let's tell another 1 million students that when they graduate, they will be required to pay only 10 percent of their income on student loans, and all of their debt will be forgiven after 20 years - and forgiven after 10 years if they choose a career in public service, because in the United States of America, no one should go broke because they chose to go to college.
He also referred to an announcement Monday by Vice President Joe Biden about expanding aid to the middle class, including an expansion of the Child and Dependent Care Credit and the Savers Credit, as well as creating a system of automatic workplace IRAs by requiring all employers to provide an option for employees to enroll in a direct-deposit IRA (see Obama Calls for Expanding Middle-Class Tax Benefits).
Now, the price of college tuition is just one of the burdens facing the middle class. That's why last year I asked Vice President Biden to chair a task force on middle-class families, he said. That's why we're nearly doubling the child care tax credit, and making it easier to save for retirement by giving access to every worker a retirement account and expanding the tax credit for those who start a nest egg.
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