Wednesday, April 13, 2011

Obama unveils $4 trillion plan to cut deficit and avoid "financial armageddon"

Barack Obama, the US president, has unveiled a $4 trillion deficit-reduction programme, and slammed Republican plans for sweeping spending cuts as an attempt to fracture America's social compact.

The US has a projected annual deficit of $1.6 trillion this year and a cumulative public debt of $14.27 trillion.

In a speech designed to address the issue ahead of his 2012 re-election battle, the president said he wanted to achieve the reduction over 12 years or less.

"The debate about budgets and deficits is about more than just numbers on a page, more than just cutting and spending," he said.

"It's about the kind of future we want, it's about the kind of country we believe in."

Speaking at George Washington University in Washington on Wednesday, he said he was borrowing recommendations from a bipartisan fiscal commission which reported last year.

Obama said he would seek to reduce the deficit by keeping domestic spending low, finding savings in the defence budget, reducing excess health care costs and reforming the tax system.

Despite calling on Democrats and Republicans to come together to secure a prosperous future for their country, he also savaged a rival budget and deficit reduction plan put forward by Republican congressman Paul Ryan which aimed to cut $4.4 trillion from the deficit over a decade. (read more)