Obama to present first budget to Congress
President Barack Obama will on Thursday ask Congress for 634 billion dollars to fund healthcare reform in his 2010 budget, which must reconcile a costly agenda with a vow to slash a gaping deficit.world Updated: Feb 26, 2009 14:59 IST
President Barack Obama will on Thursday ask Congress for 634 billion dollars to fund healthcare reform in his 2010 budget, which must reconcile a costly agenda with a vow to slash a gaping deficit.
The document will formally set down a long list of campaign promises and will be the best evidence yet of Obama's argument that times of dark economic crisis can be a catalyst for sweeping political reform.
The president is expected to ask Congress to finance education, energy and environmental reforms, setting up a new battle with opposition Republicans in Congress after fierce clashes over the recently approved stimulus plan, supported by only three Republican senators.
Obama is also expected to fulfill a campaign pledge to raise taxes on Americans earning more than 250,000 dollars a year from 35 per cent to just under 40 per cent, yielding some 2 trillion dollars over ten years.
The president also reportedly plans to raise money through a mandatory cap on greenhouse emissions.
According to the Washington Post, Obama's budget director Peter Orszag earlier estimated that a cap-and-trade scheme could generate 112 billion dollars by 2012, and up to 300 billion dollars a year by 2020.
The budget will represent Obama's latest attempt to take on the multi-fronted economic meltdown, which he says will balloon the deficit in the short-term but insists must end debt-fueled government spending.
An Obama administration official, speaking on condition of anonymity, said the massive healthcare fund would be financed by raising taxes on highest earning Americans and by savings made in existing healthcare programs.
"So often, we've come to view these documents as simply numbers on a page or a laundry list of programs," Obama told lawmakers in his debut address to a joint session of Congress on Tuesday.
"I see this document differently, I see it as a vision for America -- as a blueprint for our future."
The size of the figure was the latest indication of the new president's intent to push for healthcare reform, a polarizing political issue which has bedeviled Democratic presidents for decades.
Another expensive priority is the president's intention to provide each US child with a "complete and competitive education," and to broaden access to expensive higher learning institutions.
The budget, the 2009 version of which topped 3.5 trillion dollars, will also include the first in-depth details of Obama administration tax policy and defense and social spending.
Despite an aggressive political agenda, Obama is also promising to trim unnecessary spending and to seek efficiencies as part of a new attempt to keep government living within its means.
"My budget does not attempt to solve every problem or address every issue. It reflects the stark reality of what we've inherited -- a trillion-dollar deficit, a financial crisis, and a costly recession," he said on Tuesday.
White House press secretary Robert Gibbs on Wednesday hinted that the budget would also include a request for more money to save the US finance industry.
Congress has already approved a 700 billion dollar, two-stage rescue plan, which has so far done little to repair the foundations under the crippled sector, which is stuck with huge stocks of bad loans.
The success or failure of White House number crunchers in keeping the budget lean will play a vital role in Obama's campaign to cut the deficit, currently forecast to hit 1.3 trillion dollars, in half by 2013.
Obama's promise could prove a political liability if his targets are missed when he seeks reelection in 2012.
Obama has also included the costs of the wars in Afghanistan and Iraq in the main budget. The previous administration funded the conflicts with regular emergency budgets.
The president has promised to recruit more soldiers and marines, but warned in his Tuesday speech that he would end spending on Cold War weapons systems that do not work.