Economy: Obama Unveils Deficit Plan



Obama-Deficit-Plan-1

Obama-Deficit-Plan-1

On Monday US President Barack Obama unveiled a $3.6 trillion plan to cut the budget deficit. Part of the plan included raising taxes on the rich, and Republicans have rejected it as a grab for political attention.

It is clear that Obama’s proposal has only a small chance to become law, as the tug-of-war between the Republicans’ spending-cuts-only approach to balancing the budget continues to clash with the Democratic president’s vetoes.

Obama for raising taxes

In response to the concerns raised about raising taxes, Obama has said, “I will not support any plan that puts all the burden of closing our deficit on ordinary Americans.

“We are not going to have a one-sided deal that hurts the folks who are most vulnerable.”

In his speech on Monday, Obama made an intentional move to a more staunchly Democratic ideology, as he his approval ratings have reached new lows after two heated lock-ups with Republicans over the deficit this summer. His speech calling for all Americans to pay their “fair share” of taxes is a move to distinguish himself among Democrats who feel the president has thus far failed to stick with liberal principles during budget rows with Republicans.

Republican response

Republicans, however, have consistently been uncompromising about raising taxes, as they believe it will hurt the economy to place more burdens on businesses.

Republican Senate leader Mitch McConnell stuck to this ideology after Obama’s speech on Monday, saying in response, “Veto threats, a massive tax hike, phantom savings, and punting on entitlement reform is not a recipe for economic or job growth.”

Speaker of the House of Representatives John Boehner made a speech in Ohio, accusing Obama’s plans for tax hikes on the rich as “class warfare.” In his speech he spoke against government growth and displayed a classic Republican sentiment for a smaller government, saying, “Giving the federal government more money would be like giving a cocaine addict more cocaine.”

Obama’s plan, which proposes saving $3.6 trillion over 10 years, will be sent to the “super committee” of six Democrats and six Republicans that are tasked with deficit reduction.

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