Obama proposes $3.6 trillion budget

UPDATED:

The massive budget blueprint that President Obama released Thursday puts his stamp on the entire operation of the federal government - fulfilling campaign promises of redistributing the tax burden and stripping Bush-era policies that the Democrat dubbed irresponsible, while amassing more than $3 trillion in debt over the next two years.

From making permanent a tax cut for workers to ending tax cuts for the better-off, the president signaled his vision for government in a document outlining massive new spending - $3.6 trillion in 2010 alone. The proposal would make a down payment on universal health care and tackle his No. 1 priority of curbing the effects of climate change.

It greatly adds to the national debt, projecting deficits of $1.8 trillion in 2009 and $1.2 trillion in 2010.

It also outlines $2 trillion in “savings,” coming mostly by ending President George W. Bush’s tax cuts for individuals making $200,000 or more and families earning $250,000 per year or more and creating a cap-and-trade system to tax greenhouse gas emissions.

The White House says much of that $1.8 trillion deficit for 2009 reflects Mr. Bush’s plans for a budget year that began in October and the stimulus plan needed to boost the dormant economy. The administration presented its own blueprint - the full, detailed budget will come in April - as the start of a “new era of responsibility,” giving that title to the 134-page document.

The budget introduction asserted that Mr. Obama inherited a “legacy of irresponsibility, and it is our duty to change it.”

Reactions to the budget fell along mostly party lines, with Sen. Edward M. Kennedy, Massachusetts Democrat, saying it sent a strong statement on health care and “restored the American dream” for workers, while Republicans bashed Mr. Obama for a tax increase that they said would hurt the small businesses that create most jobs in the United States.

Sen. John Kerry said the budget “reflects an honest change in Washington that begins to reckon with our biggest challenges,” adding: “This is nothing short of a sober, honest assessment of where our country stands and a tough, realistic plan to get our budget in line with our priorities.”

But Sen. Olympia J. Snowe of Maine, one of just three Republicans who voted for the president’s stimulus, lamented that the budget falls “woefully short” on fiscal responsibility and deficit reduction.

She said the president was wrong to increase non-defense discretionary spending by more than 9 percent after the stimulus.

“Although bold with its intention, this blueprint is scarce on details,” Mrs. Snowe said.

Rep. Jeff Flake, Arizona Republican, called it an unsustainable level of spending, though he added praise for Mr. Obama’s proposal to cut payments to farms with incomes higher than $500,000.

Much of the spending in the budget outline was an expansion of what the administration already has done with its $787 billion economic stimulus plan, building on the transportation, education and infrastructure funding that the president signed into law last week. It details tax credits for college students, job training, public health plans and teenage pregnancy programs that interest groups said had been underfunded for years.

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