BANGOR – As U.S. Rep. Tom Allen sees it, the Bush administration’s economic policies are to blame for the financial hardships faced by middle-class families, who are being squeezed by the nationwide mortgage crisis, skyrocketing energy and fuel costs and an ailing economy.

Allen, who is challenging incumbent U.S. Senator Susan Collins in the Senate race, came to Bangor on Thursday to unveil his plan to boost the economy by easing the tax burden on middle-class families.

“If our middle class prospers, our state and nation are stronger,” the 1st District congressman said at a news conference at the home of Casey and Sheri Harris.

“The Bush economic polices have given enormous breaks to the superwealthy and big corporations and they have been disastrous for Maine,” he said. “My plan focuses on meaningful tax cuts to help hardworking people like Casey and Sheri Harris raise their children and earn a decent living.”

The Harrises have four children, ages 4 to 20, and are facing financial challenges that make Casey Harris question his family’s middle-class future.

High gas costs recently forced Casey Harris to give up a job in Augusta that provided health insurance and college tuition discounts for his wife and college-age daughter. Harris completed half of his master’s degree program but can’t afford to finish it.

He now works for Manna Ministries, where he runs a 10-bed homeless shelter for men with substance abuse problems. The job, however, offers a modest salary and no health or education benefits. The family relies on MaineCare for health coverage, but with their youngest child about to start school, reduced child care cost could affect their eligibility.

Making matters worse is that the family bought a modest house two years ago with a two-year fixed, then variable, rate mortgage. They have learned their monthly payments will increase so much they no longer will be able to afford them. They are trying to refinance with a fixed rate, but Casey Harris worries that his own $37,000 college debt will prevent them from doing so, which could mean foreclosure.

“It’s a sad reality that my decision to go to college could cause us to literally lose our house,” Harris said.

Allen said his Middle Class Opportunity Act includes means for helping middle class families with young children by raising the child tax credit from $1,000 to $2,000 for the child’s first year, and by expanding the dependent care credit by raising the threshold from $43,000 to $75,000.

The plan also aims to help middle class families afford college tuition by combining three existing incentives, the Hope and Lifetime Learning tax credits and the college tuition tax deduction, into a single, simple tax credit. That credit would amount to up to $2,500 each for up to three students per household and include tuition, fee and book expenses.

For senior citizens, Allen proposes a property tax deduction for those who do not itemize their income tax returns.

Central to Allen’s plan is relief from the Alternative Minimum Tax, or AMT.

The AMT was designed to ensure that households with very high incomes and high deductions pay an appropriate tax. But because the AMT is not indexed for inflation, middle-class Mainers are forced to pick up the slack, he said.

Allen outlined other aspects of his economic plan – “A Modern Maine Economy: Blending Fair Trade, 21st Century Technology and Yankee Ingenuity” – earlier this month in a series of news conferences around the state. Those components included relief for small businesses, rural economic development, infrastructure investments and jobs, trade and manufacturing.

dgagnon@bangordailynews.net

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