Washington: The United States President Barack Obama has announced that its long-term debt plan, setting a goal to cut 4 trillion US dollars over the next 12 years.
While addressing a speech at George Washington University on Wednesday Obama said that the deficit reduction is a balanced approach to maintaining economic recovery.
He said four steps would be taken to achieve debt balance, including savings on the defense budget, elimination of waste in healthcare spending, control of domestic expenditures and reform of the federal tax system.
The White House projected that Obama’s framework would reduce deficits as a share of US economy to about 2.5 percent of GDP in 2015, and put deficits on a declining path toward close to 2.0 percent of GDP toward the end of the decade.
Obama said that tackling the US budget deficit would require broad sacrifice. “We all have to make sacrifice but we do not have to sacrifice Americans.”
Meanwhile, Obama said he would refuse to renew Bush-era tax breaks for wealthier Americans. “it is unfair to ask the elderly to pay more for health care while cutting taxes on the richest.”
Obama’s plan falls well short of the more than 5 trillion US dollars in cuts over a decade proposed by House of Republicans, and fired by Democrats as draconian.
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