Open

Coming up

Don't miss

Replay


LATEST SHOWS

AFRICA NEWS

Central African Republic: Brazzaville ceasefire talks delivers fragile deal

Read more

FOCUS

Sluggish tourist season in Crimea

Read more

ENCORE!

Bartabas : Mixing Christ with Spanish music and dancing horses

Read more

IN THE PAPERS

Shifts in the propaganda war waged between Israelis and Palestinians

Read more

IN THE PAPERS

French MPs face quandary in pro-Palestinian rallies

Read more

THE INTERVIEW

Yezid Sayigh, Senior Associate at the Carnegie Middle East Center in Beirut

Read more

#TECH 24

Mind the Gender Gap : getting more women into the tech sector

Read more

INSIDE THE AMERICAS

Bolivian children: heading to work aged 10

Read more

WEB NEWS

Israel and Hamas battle online over public opinion

Read more

  • Live: France says missing Algerian plane 'probably crashed'

    Read more

  • 51 French nationals aboard missing Algerian plane

    Read more

  • Deadly Israeli strike on UN shelter in Gaza Strip

    Read more

  • Iraqi parliament elects moderate Kurd as president

    Read more

  • US, European aviation agencies lift travel restrictions to Tel Aviv

    Read more

  • Sudanese Christian woman sentenced to death arrives in Italy

    Read more

  • No end to fighting until Israel ends Gaza blockade, Hamas says

    Read more

  • Two foreign women shot dead in western Afghanistan

    Read more

  • At least 60 killed in attack on prison convoy near Baghdad

    Read more

  • Cycling is ‘winning the war on doping,’ says expert

    Read more

  • Ceasefire agreed for Central African Republic

    Read more

  • Can Jew-kissing-Arab selfie give peace a viral chance?

    Read more

  • France charges Swiss bank UBS with tax fraud

    Read more

  • Botched Arizona execution takes nearly two hours

    Read more

  • Bomb attacks leave scores dead in north Nigeria

    Read more

Americas

Obama unveils plan to slash deficit and boost growth

Text by News Wires

Latest update : 2011-09-19

US President Barack Obama has called for higher taxes on companies and the wealthy as part of his plan to cut the deficit by some $3 trillion over the next decade, setting the stage for a showdown with Republicans in Congress.

REUTERS - President Barack Obama on Monday laid out a $3 trillion plan to cut U.S. deficits by raising taxes on the rich, but Republicans mocked it as a political stunt, signaling the proposal has little chance of becoming law.

Vowing to veto any cuts to Medicare unless Congress hikes taxes on companies and the wealthy, the Democratic president's recommendations set the stage for an ideological fight with Republicans that will stretch through Election Day 2012.

"I will not support any plan that puts all the burden on closing our deficit on ordinary Americans," Obama said. "We are not going to have a one-sided deal that hurts the folks who are most vulnerable."

With polls showing most Americans unhappy with his economic leadership, Obama's re-election hopes could hinge on his ability to convince voters that Republicans represent the rich, not the middle class. That was the main theme of his remarks on Monday, in which he repeatedly said all Americans must pay their "fair share" of taxes.

Republicans have consistently opposed any measures resembling tax hikes, saying they will hurt the struggling U.S. economy by increasing the burden on job-creating businesses.

"Veto threats, a massive tax hike, phantom savings, and punting on entitlement reform is not a recipe for economic or job growth," said Republican Senate leader Mitch McConnell.

Obama's speech underscored a more aggressive approach to defend Democratic principles after two budget fights earlier this year in which he ended up compromising with Republicans and suffering criticism for doing so from his liberal base.

"This is purely politics, aimed at Obama's demoralized base. It undoubtedly has been poll-tested, so now Obama has a populist campaign issue. There's obviously no chance this could pass (on a vote in Congress)," said Greg Valliere, chief political strategist at consultancy Potomac Research Group.

Super committee

Obama's plan proposes $3 trillion in savings over the next decade with roughly half of those savings coming from higher tax revenues.

His recommendations will go to a congressional "super committee" charged with finding deficit savings of at least $1.2 trillion by Nov. 23. Congress must then vote on the panel's proposal by Dec. 23 or automatic spending cuts will be triggered across government agencies, beginning in 2013.

Investors want evidence that Washington's political leaders are capable of tackling the towering U.S. deficit and the country's mounting debts, after ratings agency Standard & Poor's cut the U.S. AAA rating in August. Agencies have threatened fresh action if Washington fails to produce a credible plan for addressing long-term debt.

Obama's plan does not raise the eligibility age for Medicare recipients, something he proposed during debt ceiling negotiations with House Speaker John Boehner over the summer.

Instead, he is proposing something more palatable to the left -- $248 billion in Medicare savings, the bulk of which will come from reducing overpayments to health care providers.

Medicare and Medicaid are viewed by analysts as the biggest contributors to long-term U.S. deficits, which voters see as a key issue in the election. The U.S. budget deficit in 2011 is expected to be about $1.3 trillion.

 

 

Date created : 2011-09-19

  • USA

    Obama jobs bill set to be next Washington showdown

    Read more

  • FINANCE

    Should governments tax the rich to get out of debt?

    Read more

COMMENT(S)