WEST MIFFLIN, Pa. - President Barack Obama on Wednesday signed an order to create starter retirement accounts that could be opened with as little as $25, but he acknowledged there’s a limit to the help he can give low-wage workers without congressional action.
Obama followed up Tuesday night’s State of the Union address by traveling to two workplaces to drive home the message from a pair of proposals aimed at boosting the personal finances of working-class Americans.
Obama visited a Costco food warehouse in suburban Lanham, Md., where entry-level employees start at $11.50 an hour, to tout his call for a $10.10 minimum wage.
At a U.S. Steel Corp. plant outside Pittsburgh, he signed a presidential memorandum to create the “myRA” program, which he told employees would go toward “making sure that after a lifetime of hard work you can retire with some dignity.”
“I could do more with Congress, but I’m not going to not do anything without Congress, not when it’s about the basic security and dignity of American workers,” Obama said.
The president then sat a wooden desk set up in the cavernous factory and signed the memorandum. He next took it off stage and handed it to Treasury Secretary Jack Lew, whose initial task is to set up a pilot program with accounts available through some employers by the end of the year.
The program will operate like a Roth IRA, so contributions of as little as $5 per paycheck can be made with after-tax dollars. That means account holders can withdraw the funds at any time without paying additional taxes. The funds will be backed by U.S. government debt, similar to a savings option available to federal employees, and investors can keep the accounts if they switch jobs or convert them into private accounts.
Another step Obama is making without Congress is to raise the minimum wage for new federal contracts to $10.10 an hour. But he needs lawmakers to pass legislation to give all workers the same increase from the $7.25 current minimum wage.
“If you work hard, you should be able to pay your rent, buy your groceries, look after your kids,” Obama said at Costco.
The president praised Democratic Maryland Gov. Martin O’Malley for pushing to raise the state’s minimum wage to $10.10. “Ultimately Congress does have to do its part to catch up to the rest of the country on this,” Obama said.
Democrats intend to make the minimum wage increase a potent issue in a number of states with competitive governor’s races this fall. One of the biggest fights could come in Pennsylvania, where GOP Gov. Tom Corbett is among the most vulnerable governors facing re-election and has signaled that he won’t support raising the state’s $7.25-an-hour minimum wage. Democrats are expected to make a similar push in states with incumbent Republicans like Florida, Michigan and Wisconsin.
It’s a tradition for presidents to travel after delivering their annual address to Congress, pitching grand legislative goals for the year ahead.
Today, Obama will visit a General Electric gas engines facility in Waukesha, Wis., not far from Milwaukee. He’ll also speak at a high school in Nashville, Tenn.
Vice President Joe Biden amplified Obama’s message Wednesday with a round of television interviews and a speech at a community college in New York state.
Promoting the proposals put forth in Obama’s speech Tuesday, Biden said the president was not giving up on getting bills through Congress despite stiff Republican opposition.
“I think you’re going to see much more cooperation with Congress this year than in the past five years,” he said on NBC.
Also on the Today show, Biden said he still had “plenty of time” to decide whether to run for president in 2016.
“In my heart I’m confident that I could make a good president,” he said. “I’ve not made a decision to run, I’ve not made a decision not to run. In the meantime, I’ve got a job.”
On CBS, Biden said that before the speech, he and House Speaker John Boehner, R-Ohio, discussed the prospects of the Republican-controlled House passing immigration legislation this year. Boehner has urged fellow Republicans to consider a package of overhaul,although he has said they will not consider the bill passed with bipartisan support in the Senate last June.
“Last year, the president asked for a move on immigration and in fact everybody said no, it’s dead on arrival. This year it looks like we may get something done,” Biden said.
However, Republican Sen. Marco Rubio of Florida, a major player on immigration policy, said Wednesday that there was no chance now of passing a broad overhaul because Republicans have lost trust in Obama.
Rubio said the Obama administration has lost credibility as a result of how it handled the 2012 attack against a U.S. outpost in Libya and accusations that the Internal Revenue Service targeted conservative groups.
Rubio said Republicans told him they feared a repeat of President Ronald Reagan’s immigration overhaul that gave about 3 million aliens legal immigration status without following through with corresponding security improvements.
Information for this article was contributed by Darlene Superville, Nedra Pickler, Philip Elliott and Ken Thomas of The Associated Press, and by Michael A. Memoli of the Tribune Washington Bureau.
Front Section, Pages 4 on 01/30/2014