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Official: Budget projects $1.75 trillion deficit
Associated Press
Issue date: 2/26/09 Section: News
WASHINGTON (AP) - President Barack Obama is sending Congress a budget Thursday that projects the government's deficit for this year will soar to $1.75 trillion, reflecting efforts to pull the nation out of a deep recession and a severe financial crisis.
A senior administration official told The Associated Press that Obama's $3 trillion-plus spending blueprint also asks Congress to raise taxes on the wealthy in 2011 and cut Medicare costs to provide health care for the uninsured.
The president's first budget also holds out the possibility of spending $250 billion more for additional financial industry rescue efforts on top of the $700 billion that Congress has already authorized, according to this official, who spoke on condition of anonymity before the formal release of the budget.
The official said the administration felt it would be prudent to ask for additional resources to deal with the financial crisis, the most severe to hit the country in seven decades. He called the request a "placeholder" in advance of a determination by the Treasury Department of what extra resources will actually be needed.
The spending blueprint Obama is sending Congress is a 140-page outline, with the complete details scheduled to come in mid- to late April, when the new administration sends up the massive budget books that will flesh out the plan.
However, the submission of the bare budget outline was certain to set off fierce debate in Congress over Obama's spending and tax priorities. The budget document includes additional requests for the current year and Obama's proposals the 2010 budget year, which begins Oct. 1.
The president wants Congress to extend the $400 annual tax cut due to start showing up in workers' paychecks in April, and it extends the tax cuts passed in 2001 and 2003 for couples earning less than $250,000 per year. Those tax cuts were due to expire at the end of 2010.
To pay for the middle-class tax relief and the effort to increase health coverage, Obama's budget makes significant cuts on the rate of growth in other areas of health care and seeks to trim a variety of other government programs, including subsidies earned by farmers with revenue of more than $500,000 a year.
A senior administration official told The Associated Press that Obama's $3 trillion-plus spending blueprint also asks Congress to raise taxes on the wealthy in 2011 and cut Medicare costs to provide health care for the uninsured.
The president's first budget also holds out the possibility of spending $250 billion more for additional financial industry rescue efforts on top of the $700 billion that Congress has already authorized, according to this official, who spoke on condition of anonymity before the formal release of the budget.
The official said the administration felt it would be prudent to ask for additional resources to deal with the financial crisis, the most severe to hit the country in seven decades. He called the request a "placeholder" in advance of a determination by the Treasury Department of what extra resources will actually be needed.
The spending blueprint Obama is sending Congress is a 140-page outline, with the complete details scheduled to come in mid- to late April, when the new administration sends up the massive budget books that will flesh out the plan.
However, the submission of the bare budget outline was certain to set off fierce debate in Congress over Obama's spending and tax priorities. The budget document includes additional requests for the current year and Obama's proposals the 2010 budget year, which begins Oct. 1.
The president wants Congress to extend the $400 annual tax cut due to start showing up in workers' paychecks in April, and it extends the tax cuts passed in 2001 and 2003 for couples earning less than $250,000 per year. Those tax cuts were due to expire at the end of 2010.
To pay for the middle-class tax relief and the effort to increase health coverage, Obama's budget makes significant cuts on the rate of growth in other areas of health care and seeks to trim a variety of other government programs, including subsidies earned by farmers with revenue of more than $500,000 a year.
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