Obama unveils 'fair shot' budget
14 February 2012, 09:27
Washington - US President Barack Obama on Monday
unveiled a $3.8 trillion budget packed with tax hikes on the rich and
jobs programmes, fleshing out a populist vision that he hopes to ride to
a second term.
But the blueprint immediately sunk into the toxic
mire of Washington politics, with Republicans branding it an "insult"
to taxpayers, a mere "campaign document" and an example of an America
"drowning in debt".
Obama said his 2013 budget would sustain new
economic growth, create jobs, change an economic system tilted towards
the wealthy and make long-term cuts to deficits now set to top $1
trillion four years in a row.
"We have got to do everything in
our power to keep this recovery on track," Obama said, as he unveiled
the document, the embodiment of his election message of restoring a
"fair shot" for average Americans in a recovering economy.
last thing we need is for Washington to stand in the way of America's
comeback," said Obama, in symbolic territory in swing-state Virginia,
which he hopes to win in November's election.
There is little
chance of much of the document becoming law in a divided Congress in an
election year. But Obama used the budget to set political snares for
Republicans he wants to brand as obstructionist foes of the middle
He called for more than $600bn in construction, research
and development, training and innovation spending designed to create
jobs, and nurture a newly skilled American work force and 21st century
Obama would modernise 35 000 schools, repair
roads, railways and airport runways; pour billions of dollars into
education; and require the Pentagon to reconfigure missions and spend
$487bn less than planned in 10 years.
But the Defence Department's request of $613bn for 2013 still holds military spending steady after a war-torn decade.
into the complex document was a request for $800m to boost political
and other reforms in Arab countries undergoing pro-democracy
The plan projects a $1.3 trillion deficit for the
current fiscal year and sees the shortfall dipping below the $1 trillion
dollar mark in fiscal year 2013 at $901bn. But Republicans charged the
deficit cutting was too slow.
"We've got a choice. We can settle
for a country where a few people do really, really well and everybody
else struggles to get by," Obama said.
"Or we can restore an
economy where everybody gets a fair shot, everybody does their fair
share, everybody plays by the same set of rules, from Washington to Wall
Street to Main Street."
plans to pay for his proposals by repealing tax cuts for those earning
more than $250 000 a year passed by his predecessor George W Bush.
would try again to bring in a Financial Crisis Responsibility Fee on
banks and finance firms to compensate taxpayers for bailouts during the
The proposal calls on Congress to back the
Buffett rule, named after billionaire financier Warren Buffett, designed
to ensure no household earning more than $1m a year pays less than 30%
Officials also put forward a $206bn proposal to tax
dividends of the richest taxpayers at the rate of the top level of
Obama's previous attempts to hike taxes on the
wealthy have foundered on calls of "class warfare" from Republicans who
warn they will slow growth and harm small businesses which are the
engine of job creation.
Mitt Romney, Obama's possible Republican
opponent in November, branded the document "an insult to the American
taxpayer" and said it failed to secure long-term solvency for social
Republican fiscal guru Paul Ryan, who chairs the House Budget Committee, decried "more spending, more borrowing and more debt".
"Instead of an America built to last this is an America drowning in debt," he said.
aides however argued that the budget got the long-term balance between
spending, to secure rebounding economic growth, and austerity needed to
pay down long-term deficits right.
The plan also includes
cost-cutting, including $364bn in health savings, and a $226m chop for
Nasa's Mars robotic exploration programme, likely axing a planned
partnership with Europe.
According to the fiscal 2013 budget's assumptions, unemployment will remain above six percent until 2017.
the jobs forecasts were finalised in November, before a sharp down tick
in the unemployment rate to 8.3% last month, so officials said they
could prove to be too pessimistic.
Get the latest news by following us on Twitter