Read all posts from February 2010
February 19, 2010
06:59 PM EDT
During his visit to a town hall in Henderson Nevada, President Obama announced new efforts to stabilize the housing market by buying vacant homes and converting them into affordable housing that will create jobs, help the housing crisis, and allow the local economy to grow. He also announced a $1.5 billion fund for housing finance agencies in Nevada and other hard-hit states to help unemployed homeowners avoid foreclosures. The fund will also help struggling homeowners find a way to pay their mortgages and modify their loans.
He recalled the steps the government has already taken to stem the housing crisis, by providing tax credits to 1.4 million Americans buying their first homes, as well as a loan modification initiative to lower monthly payments for struggling homeowners.
He went on to discuss another issue on everyone’s minds: jobs. He highlighted the steps the government has taken to preserve jobs, and will continue taking to create them. He mentioned how the Recovery Act has helped to save jobs that would have otherwise been lost, expanded unemployment insurance, and cut taxes for the American people.
The President discussed the escalating need for health care reform to increase coverage while lowering overall health care costs, especially when people are seeing rapidly rising premiums and risk losing their coverage.
What we're proposing has nothing to do with a government takeover of a health care. Most of you would have the exact same health care that you've got right now, but you'd be more protected and more secure. And if you don't have health care, you'd have a chance of getting health care. And, by the way, it would actually save us money in the long term, because all those wasteful dollars that we're spending right now, the experts estimate we'd actually save a trillion dollars by passing it.
During the discussion with the audience he also made a forceful case for handling climate change by capping carbon and the benefits of a clean energy economy. He pointed out that other countries are already moving in that direction, and America shouldn't be left behind, using the issue as a prime example of what American leadership can really mean.
What does it mean to lead? It means countries that out-educate us today are going to out-compete us tomorrow. And that means America has to lead in education. That's why we're working with educators to transform our schools, and make college more affordable, and prepare our kids for science and engineering and technical degrees -- because those are going to be the jobs of the future.
And because the future belongs to countries that create the jobs of tomorrow, we've got to lead in energy. That's why we're investing in companies right here in Nevada and across this nation that produce solar power and wind power and the smart, energy-efficient electric grids the investments that are giving rise to a clean energy economy. It's vital that we do that.
Shaun DonovanFebruary 19, 2010
04:52 PM EDT
Yesterday, I had the opportunity to travel to Cincinnati, Ohio for the one year anniversary of the American Recovery and Reinvestment Act of 2009. While in Cincinnati, I visited the Forest Square development, which is a low-income housing development under construction using $1 million in Recovery Act Tax Credit Assistance (TCAP) funds. When complete, this project will consist of 21 affordable apartments for Cincinnati’s elderly residents.
In early 2009, when the project owner was unable to secure financing, the owner applied to the Ohio Housing Finance Agency (OHFA) for TCAP and Treasury Tax Credit Exchange (TCE) funds, both provided through the Recovery Act, to fill funding gaps. After OHFA awarded the project $1 million in TCAP funds and a TCE grant of $248,566, the project owner was able to close the financing and begin construction. Without the Recovery Act, the project owner may not have been able to move forward with the completion of the project. A total of 70 jobs are currently being created as a result of the project.
But most importantly, I was able to see firsthand how the Recovery Act has directly impacted many American families. I had the incredible opportunity to meet a construction worker named Will Straw while touring the project. Will was hired 5 months ago by the project developer, the Model Group, specifically for the Forest Square project. With 30 years of construction experience, Will had been unemployed a year and a half before joining the Model Group. He expressed to me how he, his wife and 3 sons are incredibly gratefully that the Recovery Act has enabled him to find work again.
Since day one, the Recovery Act has been working to address the greatest economic crisis since the Great Depression and lay a new foundation for economic growth. According to the Congressional Budget Office, the Recovery Act is already responsible for a many as 2.4 million jobs at the end of 2009. The Recovery Act funded- TCAP program is just one example of how recovery is already happening in communities across the country. TCAP is restarting stalled construction projects, creating jobs, revitalizing neighborhoods and providing affordable housing for low-income residents throughout the country. What I saw in Cincinnati yesterday is just one example of the economic recovery America is beginning to experience.
Secretary Kathleen SebeliusFebruary 19, 2010
03:17 PM EDT
As families across the country struggle to make ends meet in this troubled economy, many are getting difficult news: their health insurance premiums are rising. Significantly. And a new report today indicates that premiums for seniors in Medicare Advantage plans will continue to rise. This is the continuation of an unfortunate trend. Seniors who remained enrolled in their Medicare Advantage plans between 2009 and 2010 have experienced rapidly increasing premiums, at 32 percent on average, with a steeper 78 percent average increase for enrollees in private fee-for-service plans.
But while seniors are suffering, insurance companies are doing better than ever. Humana earned $452.3 million in the fourth quarter of 2009 from its Medicare Advantage plans, compared with $267.3 million a year earlier, a 70 percent increase. At the same time, these companies are being vastly overpaid by the federal government, making huge profits and sticking seniors with higher bills.
This news comes just one day after we at the Department of Health and Human Services released a report showing how insurance companies are driving up premiums at unnecessary, alarming rates. In California, beneficiaries recently received letters from Anthem Blue Cross announcing their rates would go up as high as 39 percent. Elsewhere, in the last year alone, large insurers have requested premium increases of 56 percent in Michigan, 24 percent in Connecticut, 23 percent in Maine, 20 percent in Oregon and 16 percent in Rhode Island.
What makes this harder to take is that insurance premiums aren’t the only numbers on the rise -- insurance industry profits are also growing by leaps and bounds. The five largest health insurance companies – WellPoint, UnitedHealth Group, Cigna, Aetna, and Humana – earned combined profits of $12.2 billion in 2009, 56 percent more than the previous year. Moreover, the CEOs of these same companies are each taking home up to $24 million per year.
Insurance companies say that if consumers don’t like it, they can shop elsewhere. Yet we all know that finding a policy on the individual market is not as easy as it sounds. In many cases, insurers can slash your coverage when you need it most. If you have a pre-existing condition, they may deny you coverage altogether.
To show how out of touch insurance companies are with middle-class families, a recent study found that nearly 75 percent of consumers looking for coverage on the individual market never bought a plan – and most of them cited cost as their primary reason. Yet insurers are turning a blind eye. As reported in Arkansas, one Blue Cross plan wanted to increase rates by 28 percent, but regulators forced the plan to settle for just 11 percent. In a broken health care system without competition, transparency, or choice there is little stopping insurance companies from jacking up rates, and putting greater costs onto the backs of working Americans.
Our broken system is working for insurance companies, not families. While profits and premiums are going up, coverage is going down. And three of the top five insurers cut the proportion of premiums they spent on customers' medical care last year, committing more to salaries, administrative expenses, and profits.
Without health insurance reform, we will continue to get more of the same. That is unacceptable.
Reform will protect consumers from abusive insurance industry practices. It will encourage competition among insurance companies in order to drive down costs and offer consumers choices to get the coverage that’s right for them. Reform will also bring down premiums and limit out-of-pocket costs that eat into the family budget.
These efforts won’t just help our health care system – they will also help our economy. Lowering health care costs through reform could generate between 250,000 and 400,000 jobs a year.
It's time we put the health of American families back in the hands of consumers – not the insurance industry.
Kathleen Sebelius is Secretary of Health and Human Services
Jesse LeeFebruary 19, 2010
02:58 PM EDT
This Monday your relationship with your credit card is going to change a bit, as the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 goes into full effect. The law bans unfair rate increases, prevents unfair fee traps, requires plain language in plain sight for disclosures, increases accountability all around, and institutes protections for students and young people just for starters.
But of course any time a relationship changes, it's natural to have questions about it. So we invite you to join us for a live video chat with Austan Goolsbee of the Council of Economic Advisers on Monday at 2:00PM EST. We'll be going through CreditCards.com to take questions live on video, and you can even get a head start submitting your questions over there now.
February 19, 2010
12:05 PM EDT
At the beginning of the school year, the President encouraged students to take responsibility for their education, study hard and graduate from high school. That’s why the President and I are proud to announce the Race to the Top High School Commencement challenge. The challenge encourages schools to show how they are making great strides on personal responsibility, academic excellence and college readiness. In your application, tell us why your school is special and why it should be a model for other schools around the country.
Following the application deadline, six finalists will be selected by the White House and Department of Education. These schools will then be featured on the White House website and the public will have an opportunity to vote for the three schools they think best meet the President’s goal. The President will select a national winner from these three finalists and visit the winning high school to deliver the commencement address to the class of 2010.
Applications must be submitted no later than Monday, March 15th at 11:59 pm EST. Learn more about the challenge at www.WhiteHouse.gov/Commencement. You can also check out our facebook page at Facebook.com/racetothetop.
Arne Duncan is Secretary of Education
February 19, 2010
10:25 AM EDT
Today, President Obama is announcing $1.5 billion in funding for innovative measures to help families in the states that have been hit the hardest by housing market stress and unemployment. States where house prices have fallen more than 20% from their peak will be eligible for this funding. Such price declines, coupled with the effects of high unemployment, means that many working and middle-class families in these areas are facing serious challenges. The effort we are announcing today will provide support for state housing finance agencies (HFAs) to design programs tailored to the urgent needs of particular communities.
Eligible HFA programs will aim to help homeowners in areas hardest hit by unemployment and home price declines, helping responsible but struggling homeowners stay in their homes.
The $1.5 billion fund will be available for State Housing Finance Agencies and similar organizations to develop innovative programs help address the problems facing their communities. Housing markets vary considerably from state to state, and often within a single state. Housing Finance Agencies are very familiar with their local housing markets, and will take the lead role in determining what sorts of programs are most appropriate to local conditions. The types of programs that may be funded include: measures for unemployed homeowners, programs to assist borrowers owing more than their home is now worth, programs that help address challenges arising from second mortgages,; or other programs encouraging sustainable and affordable homeownership.
There will be a formula for allocating funding among eligible states that will be based on home price declines and unemployment. Eligible HFAs that would like to participate must submit a program design to Treasury. Program designs must meet funding requirements under the Emergency Economic Stabilization Act of 2008 (EESA). The Department of the Treasury will announce maximum state level allocations in the next two weeks, along with rules governing the submission of program designs by HFAs, and provide a period thereafter for HFAs to submit their program designs in order to receive funding.
The state specific nature of the fund will allow HFAs to design programs focused on the priorities in their local markets. The program will be under strict transparency and accountability rules. All program designs and measures of program effectiveness will be posted online, creating a public web forum for interchange of innovative ideas developed through the program.
This new funding for increased HFA initiatives will support families in the hardest hit markets markets, combining with the numerous other steps the Administration has taken to help support US homeowners and housing markets.
Sarah Apsel is a Policy Advisor at the Treasury Department
February 19, 2010
10:23 AM EDT
On Thursday morning, The First Lady hosted ten students from schools across the London borough of Islington in the Old Family Dining Room. The students were winners of the Islington Black History Month essay competition, and rewarded with a trip to the White House sponsored by the U.S. Embassy in London.
The First Lady congratulated the kids and told them that if they continue to work hard, the opportunities are endless. “President Obama didn't wake up to become who he is. It was a lot of practice early on, of getting things done. You're going to slip and fall and trip along the way. He certainly did,” she said. “I did a little less than he did,” she laughed.
She talked about the importance of young people exchanging ideas and influencing other people’s lives. “Think about who you're going to help along, and never stop doing that.”
The students read excerpts from their winning essays and toured the White House.