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Obama warns budget cuts will cause job losses | |
(about 1 hour later) | |
US President Barack Obama has warned Congress "people will lose their jobs" if deep budget cuts are allowed to take effect next week. | |
Mr Obama said $85bn (£55bn) in cuts was a harmful, "meat-cleaver approach" to deficit reduction, as he stood with emergency workers at the White House. | |
He also offered targeted spending cuts, supporting a proposal similar to that outlined by Senate Democrats last week. | |
Mr Obama has just returned from a three-day golf trip in Florida. | Mr Obama has just returned from a three-day golf trip in Florida. |
Over the weekend, the president played a round with Tiger Woods. | |
'Blocking tax reform' | 'Blocking tax reform' |
Mr Obama said the deep, across-the-board spending cuts had originally been designed because they were so unattractive and unappealing that they would spur politicians to work together. | |
The president said of the looming cuts: "They are not smart, they are not fair... this is not an abstraction. People will lose their jobs." | |
Mr Obama said that while he was open to cutting back on unsuccessful or unnecessary government programmes, he accused Republicans of "ideological rigidity" for opposing tax increases. | |
He proposed closing some tax loopholes to increase revenue, and backed a budget plan put together by Senate Democrats last week. | |
Congressional Republicans have given a frosty reception to the Senate proposal. | |
They point out that Mr Obama already won a revenue increase in the new year, when Congress allowed taxes to rise on families making more than $450,000 annually. | They point out that Mr Obama already won a revenue increase in the new year, when Congress allowed taxes to rise on families making more than $450,000 annually. |
Democrats have suggested increasing revenues by closing some tax loopholes, including tax breaks for the oil and natural gas industry, for businesses that have outsourced labour and ensuring millionaires pay a tax rate of at least 30%. | Democrats have suggested increasing revenues by closing some tax loopholes, including tax breaks for the oil and natural gas industry, for businesses that have outsourced labour and ensuring millionaires pay a tax rate of at least 30%. |
The Democratic plan does not include any changes to costly federal programmes such as Medicare and Social Security. | The Democratic plan does not include any changes to costly federal programmes such as Medicare and Social Security. |
Many Republicans have supported the idea of closing some loopholes, but they say the changes should be part of a broader overhaul of the tax code, not a way to plug spending gaps. | |
The "sequester" was originally due to take effect on 1 January, along with a series of other measures known as the fiscal cliff. | The "sequester" was originally due to take effect on 1 January, along with a series of other measures known as the fiscal cliff. |
But, amid dire warnings that the package of across-the-board spending cuts and tax increases could tip the US back into recession, lawmakers pushed back the spending cuts by two months, saying it would give them time to shape a larger budget deal. | But, amid dire warnings that the package of across-the-board spending cuts and tax increases could tip the US back into recession, lawmakers pushed back the spending cuts by two months, saying it would give them time to shape a larger budget deal. |
But little progress on such a plan has been seen in recent weeks. | But little progress on such a plan has been seen in recent weeks. |