Obama Proposes FDIC Hike

By Jennifer Parker

Sep 30, 2008 6:55am

ABC News’ John Berman reports: Barack Obama issued a new proposal his campaign hopes will help jump start the financial bailout negotiations and perhaps attract some new voters. 

He proposed lifting the current limit on federal deposit insurance from its current limit of $100,000 to $250,000.  In a statement, the Obama campaign said it’s a "step that would boost small businesses, make our banking system more secure, and help restore public confidence in our financial system."

As it stands, FDIC insurance guarantees deposits in banks of up to $100,000, meaning if the bank goes down, the federal government guarantees your first $100,000 are safe.

In the e-mail statement this morning, Obama says, ‘“While that guarantee is more than adequate for most families, it is insufficient for many small businesses that maintain bank accounts to meet their payroll, buy their supplies, and invest in expanding and creating jobs.  The current insurance limit of $100,000 was set 28 years ago and has not been adjusted for inflation."

The campaign said Obama would make the suggestion to congressional leaders later this morning.
Obama has come under criticism from his presidential rival John McCain for not taking a more active role in the negotiations.

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