UPDATE 5-Obama to address voter fears in State of Union

* Topics to include economy, jobs, deficit, healthcare

* Follows erosion of middle-class support, election loss

* Obama outlines child-care credit, other aid measures

(Recasts with Gibbs press briefing)

By Alister Bull and Caren Bohan

WASHINGTON, Jan 25 (BestGrowthStock) – President Barack Obama,
concerned by voter anxiety over high unemployment, will use his
State of the Union speech on Wednesday to reassure Americans
worried about jobs and the economy, aides said.

White House spokesman Robert Gibbs said on Monday that
Obama would talk about how to get the economy back onto a
firmer footing, boost hiring, tackle the deficit and deliver
financial regulation and healthcare reform.

“I think all of that goes to the type of economic anxiety
that people felt in this country last week,” Gibbs told
reporters. “Feeling like their jobs weren’t secure … feeling
like they were working longer and harder for less money.”

Obama’s first State of the Union speech at 9 p.m. EST on
Wednesday (0200 GMT on Thursday) will give him a chance to set
the tone and priorities for his second year in office.

His rhetoric has already taken a populist turn after the
White House suffered a serious setback in an election for a
U.S. Senate seat last Tuesday.

“Creating good sustainable jobs is the single most
important thing that we can do to rebuild the middle class,”
Obama said earlier in unveiling proposals to expand a
child-care tax credit and encourage savings to demonstrate his
concern for middle-class families.

A year into his presidency, Obama and his Democratic Party
have witnessed an erosion of support among middle-class
Americans who swept him into office. He has responded with a
tougher line against Wall Street and excessive executive
bonuses.

Frustration with the 10 percent unemployment rate and
wariness toward Obama’s plans to change the healthcare system
helped set the stage for a shocking loss by Democrats last week
in a Massachusetts Senate race.

TAPPING INTO FRUSTRATION

Obama will seek to tap into that frustration as he
addresses the nation on Wednesday.

“We … need to reverse the overall erosion in middle-class
security so that when this economy does come back, working
Americans are free to pursue their dreams again,” Obama said.

“There are a variety of immediate steps we can take to do
just that — steps we’re poised to begin taking in the budget
that I’ll put forward next week,” he said. Obama will unveil
his proposed federal budget for fiscal 2011 on Feb. 1.

The initiatives were developed by the White House Task
Force on Middle Class Families, led by Vice President Joe
Biden. The proposals would:

* Require companies that do not offer retirement plans to
enroll their employees in direct-deposit retirement accounts
unless the workers opt out.

* Increase the “Savers Credit,” a tax credit for retirement
savings, for families making up to $85,000.

* Change some of the rules for 401(k) employer-sponsored
retirement savings accounts to make them more transparent.

* Increase the child tax credit rate to 35 percent of
qualifying expenses from the current 20 percent for families
making under $85,000 a year. Families making up to $115,000
would be eligible for some increase in the tax credit.

* Increase child care funding by $1.6 billion in 2011 to
serve an additional 235,000 children.

* Boost government spending by $102.5 million for programs
aimed at helping families who provide home care for an aging
relative.

* Ease the burden for student loans by limiting a
borrower’s payments to 10 percent of his or her income above a
basic living allowance.
Stock Market Research Tools

(Editing by Eric Walsh)

UPDATE 5-Obama to address voter fears in State of Union