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US 'won't balance budget in next 10 years'

13 March 2013, 13:24

Washington - President Barack Obama warned on Tuesday America will not balance its budget within a decade because Republican plans to do so would entail slashing social programmes many citizens rely on for support.

Even as he set out to woo lawmakers on Capitol Hill, including Republican foes, Obama called for an approach that restores fiscal stability but also protects healthcare for the poor and the elderly and shields the middle class.

"My goal is not to chase a balanced budget just for the sake of balance. My goal is how do we grow the economy, put people back to work, and if we do that we are going to be bringing in more revenue," Obama told ABC News.

Obama said a plan unveiled by Republican congressman Paul Ryan on Tuesday which balances the budget in 10 years was too punitive.

"We're not going balance the budget in 10 years because if you look at what Paul Ryan does to balance the budget, it means that you have to voucherise Medicare, you have to slash deeply into programmes like Medicaid."

"You've essentially got to either tax middle class families a lot higher than you currently are, or you can't lower rates the way he's promised."

Painful cuts

Obama is calling for a deficit cutting solution that raises new revenue by closing loopholes favoured by the rich and corporations.

His Democrats say Ryan's approach would entail painful cuts to Medicaid government health programmes for the poor and Medicare for senior citizens.

Earlier, Obama visited Capitol Hill for lunch with Democratic senators.

But in the next two days, he will enter the lion's den in separate talks with Republicans from both chambers and will also meet minority lawmakers from his own Democratic Party in the House of Representatives.

Obama has often appeared to shun the back-slapping and arm-twisting that greases power between a president and Congress, but has made a new effort in recent days, and dined with a dozen Republican senators last week.

Senate Republican minority leader Mitch McConnell, who has used his mastery of procedure to gum up Obama's legislative programme, complimented the president for his effort, though offered no real signs of a breakthrough.

Optimism on immigration

"With regard to what a lot of you have described as the president's charm offensive, we welcome it," McConnell told reporters.

"The reports I got from the members who went down to dinner with him last week was excellent - that they had a good exchange. I told the president on Friday I hope he'll invite all of our members down for these dinners."

Democrats said the president mostly spoke about deficit cutting and budget issues and also expressed optimism that a bipartisan deal to fix America's broken immigration system could be reached.

"He thinks it's very important that we solve these problems together and he says that working together with Republicans in terms of getting a grand bargain, or a major dent in this issue, is critically important," said Democratic Senator Carl Levin.

But "compromise is essential and he hasn't seen enough of it from [Republicans] yet", Levin said.

Democratic senator Tom Harkin said several senators brought up Republican plans to cut spending on social programmes, adding: "We're cautioning about that, be careful about this grand bargain."

Crushing burden

While atmospherics were improved, there were signs on Tuesday, as Republicans and Democrats unveiled rival budgets, that staunch divisions over basic political philosophy could derail the latest push for compromise.

Ryan, the Republican party's 2012 vice presidential candidate, said his budget would alleviate the "crushing burden" of debt that is threatening America's future and would cut $4.6 trillion in spending.

The plan contains no new tax revenue and demands massive spending cuts, as well as major changes to cherished social programmes like Medicare and Medicaid, in a bid to balance the budget within a decade.

Ryan on Tuesday described his plan as an "invitation to the president of the United States and to Senate Democrats to come together to fix these problems".

"Show us how to balance the budget," he said.

Democrats in Congress are unveiling their own budget plans, which include nearly $1 trillion in new revenues and $1 trillion in cuts.

The White House, under fire from Republicans over delays in its own budget blueprint, predicted Obama's own plan would emerge after 8 April.



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