However, in the eyes of Republicans, Obama’s budget will be dead on arrival in Congress. Republicans argue that his budget is designed to aid his re-election campaign this November, rather than tackle the United States’ twin debt and deficit problem.
According to Obama’s budget chief Jason Lew, the world’s largest economy is not ready for tough austerity measures.
The White House said yesterday that the President is likely to request over $800 billion more for job creation and infrastructure projects. The overall deficit is expected to reach $1.33 trillion this year or 8.5 percent of GDP, and decline to $901 billion or 5.5 percent of GDP in 2013 – the first time since Obama took office that the shortfall falls below $1 trillion.
Eventually, the deficit is expected to fall to as low as $575 billion or 2.7 percent of GDP by 2018.
In addition, Obama is set to reiterate his call for a Buffett tax, raising taxes on those who earn more than $250,000 and for those who earn more than $1 million to pay at least 30 percent in income taxes.
Speaking to reporters, Lew pointed out that Obama’s 2009 budget promise to halve the deficit by 2010 was made before the full extent of economic challenges had manifest.
Lew told ABC News, as reported by Reuters:
A White House factsheet released yesterday said:
However, Businessweek reports that Obama’s budget proposals are not unique. In fact, they have appeared in every budget proposal since Obama took office.