Obama thinks he can cut deficit by half

President Barack Obama has committed hundreds of billions of dollars to help revive the economy and is working on a plan to cut the federal deficit in half by the end of his first term.

Obama will touch on his efforts to restore fiscal discipline at a White House fiscal policy summit on Monday and in an address to Congress on Tuesday. On Thursday he plans to send at least a summary of his first budget request to Capitol Hill. The bottom line, said an administration official Saturday, is to halve the federal deficit to $533 billion by the time his first term ends in 2013. He inherited a deficit of about $1.3 trillion from former President George W. Bush.

The official, speaking on condition of anonymity because the president has not yet released his budget for the fiscal year 2010, which begins Oct. 1, said the deficit will be shrunk by scaling back Iraq war spending, ending the temporary tax breaks enacted by the Bush administration for those making $250,000 or more a year, and streamlining government.

"We can’t generate sustained growth without getting our deficits under control," Obama said in his weekly radio and Internet address that seemed to preview his intentions. He said his budget will be "sober in its assessments, honest in its accounting, and lays out in detail my strategy for investing in what we need, cutting what we don’t, and restoring fiscal discipline."

Obama’s budget also is expected to take steps toward his campaign promises of establishing universal health care and lessening the country’s reliance on foreign oil.

Obama has pledged to make deficit reduction a priority both as a candidate and a president. But he also has said economic recovery must come first.

Last week, he signed into law the $787 billion stimulus measure that is meant to create jobs but certainly will add to the nation’s skyrocketing national debt. He also is implementing the $700 billion financial sector rescue passed on Bush’s watch; about $75 billion of which is being used toward Obama’s plan to help homeowners facing foreclosure.

3 Responses to "Obama thinks he can cut deficit by half"

  1. woody188  February 22, 2009 at 2:40 pm

    Sure, if you play with the numbers and don’t include the costs of war in the Middle East then you can get the budget back down to $500 billion just like the previous administration. Too bad it’s still a record number historically speaking, but we shouldn’t think in those terms or else we might need some re-education.

    We should be talking about privatizing the banks losses by forcing the old Wall Street investment banks upper management and board members to personally fund any bail-outs. But I guess instead Obama will be happy to just let them all off the hook and let them walk away with their multi-million dollar bonuses for running their banks into the ground while still leaving them in charge of those same banks so they can continue those same mistakes.

    One never learns from ones actions if one never faces any consequences.

  2. Ardie  February 22, 2009 at 3:40 pm

    I hope President Obama brings back the 90 percent tax bracket for those whom earn more money than he does. Money grabbing is not a virtue — it is a mental and moral disorder which needs to be included in the DSM IV.

  3. griff  February 23, 2009 at 5:54 pm

    According to the Treasury Department, our national debt as of February 19 stands at 10.8 trillion dollars, and change. Public debt is just under 5 trillion and intragovernmental holdings stands at 4.3 trillion. So cutting the deficit by 500 billion would mean that our national debt would only grow by 500 billion this year. Fat chance of that happening, considering our national debt jumped 165 billion in Obama’s first 28 days, and we haven’t even finished divying up the bailout and the stimulus yet. And of course, another bailout is only a matter of time.

    Our total unfunded obligations stand at more than 66 trillion dollars while our national GDP is in the neighborhood of 13 trillion dollars. And of course, Obama will meet with all the people that have created this problem not to fix it, but to figure out how to sell us a new line of bullshit.

    As ususal the ridiculous notion is such that a few million in extra taxes is the answer to this problem. What we need is millions of private sector jobs, massive cuts in federal spending, an end to bailouts and stimulus packages, and an end to NAFTA and GATT. Then maybe some tax breals will do some good.

    I’m all for the rich paying their fair share, but to use this as an argument for a balanced budget is ludicrous. You can be rest assured that any new taxes levied will disappear into the bureaucratis black hole.

    Oh, and a boatload of bureaucrats and bankers in prison jumpsuits.

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