President Barack Obama has sent Monday to Congress his proposed budget for 2012 that aims to reduce the federal deficit of 1 100 billion (about EUR 800 billion) over ten years, but the Republicans deem the decline spending too limited. The White House expects a budget of 3,729 billion dollars with a deficit of 1645 billion for fiscal year 2011 began in early October and 1101 billion for fiscal 2012.
This trend would reduce the deficit to 3.2% of gross domestic product (GDP) in 2015, against 10.9% this year, and also fulfills a commitment by the U.S. president with its partners in the G20. The project anticipates a deficit of around 3% of GDP from 2015 and beyond, slowing growth in U.S.
debt, even if it should rise to 77% of GDP in 2021 against 72% in 2011. "The fiscal realities we face require tough choices, Obama said in a message to lawmakers. Ten years of deficits, compounded by the effects of the recession and the measures we have taken to get out, ( ...) have put us on a path untenable.
That is why my budget charts a course that will repay our debts. " Two thirds of the savings provided by the budget come from reduced spending and lower predictability of debt service as the deficit will be eliminated. The rest came from increased revenues, including the expiration of the tax compromise negotiated in December with the Republicans.
This text extends for two years, tax relief inherited the presidency of George W. Bush and also extends benefits for long-term unemployed. Federal finances should also benefit from increased revenues due to economic recovery and the removal of twelve tax loopholes for companies specializing in oil, gas and coal, which is the aim of providing 46 billion dollars over ten years.
For the rating agency Standard & Poor's, the proposed budget is not a cure for American finances, and there are risks that it is further attenuated as it passes Congress. According to David Wyss, chief economist of the agency, it is a "first step in the right direction" but more must be done before the last baby boomers retire around 2025.
He declined to comment on the triple-A rating from the United States. Months of negotiations have come to expect the members of Congress, among Democrats, the Senate majority, and Republicans, who control the House of Representatives, and Barack Obama on Monday called for the emergence of a bipartisan consensus.
Republicans, who have already unveiled a far more stringent cost-cutting, were very critical vis-à-vis the text. "The president's budget will destroy jobs by spending too much, too taxing and borrowing too much," said Republican Joe Boehner, chairman of the House of Representatives, in a statement.
The draft budget law must allow Barack Obama to fulfill his commitment to the G20 to halve the deficit by the end of his term in January 2013, compared to taking office in 2009. The presentation of the text is timely, while the G20 finance ministers meet Friday and Saturday in Paris. To contribute to this reduction, Bush plans to freeze discretionary spending unsafe for five years, a savings of $ 400 billion over ten years.
This measure involves reducing spending by more than two hundred federal programs and will save 33 billion dollars over fiscal 2012. Defense spending will be reduced by 78 billion over five years, as previously announced, and those health 62 billion over 10 years. 
This trend would reduce the deficit to 3.2% of gross domestic product (GDP) in 2015, against 10.9% this year, and also fulfills a commitment by the U.S. president with its partners in the G20. The project anticipates a deficit of around 3% of GDP from 2015 and beyond, slowing growth in U.S.
debt, even if it should rise to 77% of GDP in 2021 against 72% in 2011. "The fiscal realities we face require tough choices, Obama said in a message to lawmakers. Ten years of deficits, compounded by the effects of the recession and the measures we have taken to get out, ( ...) have put us on a path untenable.
That is why my budget charts a course that will repay our debts. " Two thirds of the savings provided by the budget come from reduced spending and lower predictability of debt service as the deficit will be eliminated. The rest came from increased revenues, including the expiration of the tax compromise negotiated in December with the Republicans.
This text extends for two years, tax relief inherited the presidency of George W. Bush and also extends benefits for long-term unemployed. Federal finances should also benefit from increased revenues due to economic recovery and the removal of twelve tax loopholes for companies specializing in oil, gas and coal, which is the aim of providing 46 billion dollars over ten years.
For the rating agency Standard & Poor's, the proposed budget is not a cure for American finances, and there are risks that it is further attenuated as it passes Congress. According to David Wyss, chief economist of the agency, it is a "first step in the right direction" but more must be done before the last baby boomers retire around 2025.
He declined to comment on the triple-A rating from the United States. Months of negotiations have come to expect the members of Congress, among Democrats, the Senate majority, and Republicans, who control the House of Representatives, and Barack Obama on Monday called for the emergence of a bipartisan consensus.
Republicans, who have already unveiled a far more stringent cost-cutting, were very critical vis-à-vis the text. "The president's budget will destroy jobs by spending too much, too taxing and borrowing too much," said Republican Joe Boehner, chairman of the House of Representatives, in a statement.
The draft budget law must allow Barack Obama to fulfill his commitment to the G20 to halve the deficit by the end of his term in January 2013, compared to taking office in 2009. The presentation of the text is timely, while the G20 finance ministers meet Friday and Saturday in Paris. To contribute to this reduction, Bush plans to freeze discretionary spending unsafe for five years, a savings of $ 400 billion over ten years.
This measure involves reducing spending by more than two hundred federal programs and will save 33 billion dollars over fiscal 2012. Defense spending will be reduced by 78 billion over five years, as previously announced, and those health 62 billion over 10 years.
- Obama to speak on budget shortly (14/02/2011)
- Obama Unveils $3.73 Trillion Budget For 2012 That Includes $367 Billion In Tax Hikes (14/02/2011)
- "Obama's 2012 Budget: $1.65 Trillion Deficit Means More Cuts, Less Stimulus" and related posts (14/02/2011)
- Obama Sends Congress $3.73 Trillion Budget (15/02/2011)
- New Republic: In Obama's Budget, A Hidden Strategy (14/02/2011)
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