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| Obama warns Congress over spending cuts: 'People will lose their jobs' | Obama warns Congress over spending cuts: 'People will lose their jobs' |
| (8 days later) | |
| Barack Obama warned Tuesday that looming spending cuts are a "meat-cleaver" approach to America's debt woes that will damage the economy and safety of the nation. | Barack Obama warned Tuesday that looming spending cuts are a "meat-cleaver" approach to America's debt woes that will damage the economy and safety of the nation. |
| "This is not an abstraction. People will lose their jobs," Obama said in a tough speech that criticised Republicans who he claimed have blocked efforts to avert roughly $85bn in federal spending cuts scheduled to begin March 1. Analysts believe compromise on the so-called sequestration is becoming less likely each day. | "This is not an abstraction. People will lose their jobs," Obama said in a tough speech that criticised Republicans who he claimed have blocked efforts to avert roughly $85bn in federal spending cuts scheduled to begin March 1. Analysts believe compromise on the so-called sequestration is becoming less likely each day. |
| "Now if Congress allows this meat-cleaver approach to take place, it will jeopardise our military readiness, it will eviscerate jobs and energy and medical research," Obama said at the White House. "It won't consider whether we are cutting some bloated program that has outlived its usefulness or a vital service that Americans depend on every single day." | "Now if Congress allows this meat-cleaver approach to take place, it will jeopardise our military readiness, it will eviscerate jobs and energy and medical research," Obama said at the White House. "It won't consider whether we are cutting some bloated program that has outlived its usefulness or a vital service that Americans depend on every single day." |
| "FBI agents will be furloughed, federal prosecutors will have to close cases and let criminals go, thousands of teachers and educators will be laid off," he said. Obama warned "hundreds of thousands will lose access to primary care". | "FBI agents will be furloughed, federal prosecutors will have to close cases and let criminals go, thousands of teachers and educators will be laid off," he said. Obama warned "hundreds of thousands will lose access to primary care". |
| He said Republicans were refusing to compromise on tax reforms aimed at closing tax loopholes and deductions for the "well-off and well-connected". | He said Republicans were refusing to compromise on tax reforms aimed at closing tax loopholes and deductions for the "well-off and well-connected". |
| "It's wrong to ask the middle class to bear the full burden of deficit reduction," the president said. | "It's wrong to ask the middle class to bear the full burden of deficit reduction," the president said. |
| Republican House speaker John Boehner said the president had offered "no credible plan that can pass Congress – only more calls for higher taxes." | Republican House speaker John Boehner said the president had offered "no credible plan that can pass Congress – only more calls for higher taxes." |
| In a statement, Boehner said: "Just last month, the president got his higher taxes on the wealthy, and he's already back for more. The American people understand that the revenue debate is now closed. We should close loopholes and carve-outs in the tax code, but that revenue should be used to lower rates across the board. | In a statement, Boehner said: "Just last month, the president got his higher taxes on the wealthy, and he's already back for more. The American people understand that the revenue debate is now closed. We should close loopholes and carve-outs in the tax code, but that revenue should be used to lower rates across the board. |
| "Tax reform is a once-in-a generation opportunity to boost job creation in America. It should not be squandered to enable more Washington spending. Spending is the problem, [and] spending must be the focus. | "Tax reform is a once-in-a generation opportunity to boost job creation in America. It should not be squandered to enable more Washington spending. Spending is the problem, [and] spending must be the focus. |
| "Washington Democrats' new-found concern about the president's sequester is appreciated, but words alone won't avert it. Replacing the president's sequester will require a plan to cut spending that will put us on the path to a budget that is balanced in 10 years. To keep these first responders on the job, what other spending is the president willing to cut?" | "Washington Democrats' new-found concern about the president's sequester is appreciated, but words alone won't avert it. Replacing the president's sequester will require a plan to cut spending that will put us on the path to a budget that is balanced in 10 years. To keep these first responders on the job, what other spending is the president willing to cut?" |
| Jay Carney, the White House press secretary, told reporters after the speech: "We should not have our economy held hostage to reckless partisan agendas. The president has made clear his door is open. What we've heard from congressional Republicans is categorical refusal." | Jay Carney, the White House press secretary, told reporters after the speech: "We should not have our economy held hostage to reckless partisan agendas. The president has made clear his door is open. What we've heard from congressional Republicans is categorical refusal." |
| The speech came as Erskine Bowles and Alan Simpson, who chaired a bipartisan debt commission in 2010, expressed their concerns about sequestration. Bowles said sequestration was a "stupid, stupid, stupid" idea. | The speech came as Erskine Bowles and Alan Simpson, who chaired a bipartisan debt commission in 2010, expressed their concerns about sequestration. Bowles said sequestration was a "stupid, stupid, stupid" idea. |
| Bowles and Simpson's original plan to cut debt has been praised by both Republicans and Democrats but failed to stop debt talks collapsing. The two unveiled a new plan Tuesday that they said would cut the budget deficit by $2.4tn over 10 years. The pair said they were hoping to increase pressure on politicians to agree a compromise but the idea of a "grand bargain" over debt reduction "is at best on life support", said Bowles. | Bowles and Simpson's original plan to cut debt has been praised by both Republicans and Democrats but failed to stop debt talks collapsing. The two unveiled a new plan Tuesday that they said would cut the budget deficit by $2.4tn over 10 years. The pair said they were hoping to increase pressure on politicians to agree a compromise but the idea of a "grand bargain" over debt reduction "is at best on life support", said Bowles. |
| "These guys here aren't interested in winning – they're interested in making the other side lose … and rubbing the other side's nose in it," Simpson told reporters at a briefing held by Politico. | "These guys here aren't interested in winning – they're interested in making the other side lose … and rubbing the other side's nose in it," Simpson told reporters at a briefing held by Politico. |
| "When you guys have to go out here to Reagan airport and wait three hours to get through security, you're going to be pissed, and so is everybody else," he said. "When that happens, they're going to go back to Congress and say: 'We're sick of the intransigence. It's time to get something done and fix this debt.'" | "When you guys have to go out here to Reagan airport and wait three hours to get through security, you're going to be pissed, and so is everybody else," he said. "When that happens, they're going to go back to Congress and say: 'We're sick of the intransigence. It's time to get something done and fix this debt.'" |
| The new proposal from Bowles, a former chief of staff to Bill Clinton, and Simpson, a former Republican senator from Wyoming, seeks compromise between Republican spending cuts and Democratic plans for tax hikes. | The new proposal from Bowles, a former chief of staff to Bill Clinton, and Simpson, a former Republican senator from Wyoming, seeks compromise between Republican spending cuts and Democratic plans for tax hikes. |
| "The mindless, across-the-board cuts from sequestration would reduce the deficit, but represent the wrong approach to budgeting," Simpson and Bowles wrote in an outline of their proposal. | "The mindless, across-the-board cuts from sequestration would reduce the deficit, but represent the wrong approach to budgeting," Simpson and Bowles wrote in an outline of their proposal. |
| "There is no perfect solution to our fiscal problems. However, we believe strongly and sincerely that an agreement on a comprehensive plan to bring our debt under control is possible if both sides are able to put their sacred cows on the table in the spirit of principled compromised." | "There is no perfect solution to our fiscal problems. However, we believe strongly and sincerely that an agreement on a comprehensive plan to bring our debt under control is possible if both sides are able to put their sacred cows on the table in the spirit of principled compromised." |
| The $2.4tn reduction over the next decade is lower than the Republican target of $4tn but higher than the White House's $1.5tn goal. Among their proposals are: | The $2.4tn reduction over the next decade is lower than the Republican target of $4tn but higher than the White House's $1.5tn goal. Among their proposals are: |
| • A drop in the sequester and phase in deficit reduction gradually. | • A drop in the sequester and phase in deficit reduction gradually. |
| • $600bn from healthcare reforms to Medicare and Medicaid (the White House has put forward a $400bn saving); | • $600bn from healthcare reforms to Medicare and Medicaid (the White House has put forward a $400bn saving); |
| • Another $600bn from new tax revenue from ending or curbing deductions and breaks (Republicans have blocked tax increases); | • Another $600bn from new tax revenue from ending or curbing deductions and breaks (Republicans have blocked tax increases); |
| • $1.2tn from a combination of mandatory spending cuts, stronger discretionary caps, the adoption of new, less generous inflation-indexed provisions in the budget for benefits, and lower interest payments. | • $1.2tn from a combination of mandatory spending cuts, stronger discretionary caps, the adoption of new, less generous inflation-indexed provisions in the budget for benefits, and lower interest payments. |
| Maya MacGuineas, president of Committee for a Responsible Federal Budget, a nonpartisan group, welcomed the report. "Our political leaders seem alarmingly content to lurch from one near-crisis to the next, and it is our hope that this new framework helps encourage policymakers to meet their fiduciary responsibilities and come up with a bipartisan plan to fix the debt," she said. | Maya MacGuineas, president of Committee for a Responsible Federal Budget, a nonpartisan group, welcomed the report. "Our political leaders seem alarmingly content to lurch from one near-crisis to the next, and it is our hope that this new framework helps encourage policymakers to meet their fiduciary responsibilities and come up with a bipartisan plan to fix the debt," she said. |
| "While the Campaign to Fix the Debt does not endorse specific proposals, we hope policymakers will turn their attention to coming up with a plan that meets the principles laid out by the campaign in order to put the nation on a firmer fiscal footing." | "While the Campaign to Fix the Debt does not endorse specific proposals, we hope policymakers will turn their attention to coming up with a plan that meets the principles laid out by the campaign in order to put the nation on a firmer fiscal footing." |
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