Economic growth and job creation are the primary objectives of the budget proposal U.S. President Barack Obama will unveil Wednesday, the White House said.
"Everything else is a means to achieving that objective," White House spokesman
Jay Carney said ahead of the release of the budget, widely expected to call for
more than $3.5 trillion in government spending but also entitlement cuts
cherished by Democrats.
Obama was to deliver a statement about the budget in the White House Rose Garden
at 11 a.m., the White House said.
He was to follow that at 6:30 p.m. with a White House pizza dinner with a dozen
Republican senators, including Johnny Isakson of Georgia and Orrin Hatch of
Utah, to try to pave the way for new budget negotiations.
Centrist Republicans said the proposals in Obama's budget didn't go far enough
on entitlement cuts, but they credited him with living up to his commitment to
GOP members to deal with entitlements.
"I think it's a start," said Sen. John Hoeven, R-N.D., adding he spoke with
Obama about additional steps that could be taken.
But Republican leaders said they wouldn't accept the proposed new revenue in
Obama's budget that would come largely from limits on tax breaks for
upper-income earners.
Closing tax loopholes and limiting tax breaks for "well-off and well-connected"
Americans would cut the deficit $580 billion and strengthen the economy, Carney
told reporters Tuesday.
The tax reform would be part of a $1.8 trillion package to cut the deficit, he
said.
But Republicans said they wouldn't agree to more tax revenue after the recent
"fiscal cliff" deal that raised tax rates on annual household incomes above
$450,000.
They also said too many parts of Obama's package were simply recycled proposals
that have been floated and ignored for years.
"Apart from reports of a modest entitlement change -- and we'll need to see the
details on that -- it sounds like the White House just tossed last year's budget
in the microwave," Minority Leader Mitch McConnell, R-Ky., said on the Senate
floor Tuesday.
The entitlement change includes pulling back on spending for programs including
Social Security by using a less-generous formula than currently used for
calculating cost-of-living increases.
The formula, known as chained CPI, or a chained consumer price index, is
increasingly being discussed in Washington because many economists say it better
measures inflation than the currently used CPI formula.
It tweaks the inflation formula slightly but results in big savings over the
long run, perhaps more than $100 billion over a decade, The Washington Post
reported. It also reduces the federal deficit through a combination of spending
cuts and increased revenues.
The chained CPI formula would curb annual increases in many government programs.
Obama has said he is open to chained CPI as part of a "grand bargain" that would
include spending cuts as well as new revenue.
He also is proposing $305 billion in Medicare cuts over a decade as part of a
10-year plan to cut the deficit $1.8 trillion -- provided Republicans agree to
higher taxes.
But an advocacy group called the National Committee to Preserve Social Security
and Medicare presented a petition to the White House Tuesday with 2 million
signatures protesting the chained CPI formula.
It said the formula would hurt senior citizens, retired veterans and people with
disabilities.
The advocacy group was joined by liberal Democrats who expressed unhappiness
with what they called Obama's increasingly centrist position to secure
bipartisan support for his proposals.
Carney told reporters the White House budget pairs chained CPI "with a proposal
to protect vulnerable groups of citizens" from any disadvantage stemming from
chained CPI.
The budget proposal also will reverse across-the-board spending cuts, known as
sequestration, that began in March and replace them with changes to Medicaid,
defense programs and farm subsidies.
At the same time, it will propose "ladders of opportunity" expenditures to help
advance "those who are not in the middle class but aspire to be there," Carney
said.
This would help "make sure that the middle class is growing," he said.
Republican National Committee Chairman Reince Priebus said Wednesday night's
pizza dinner at the White House could be a symbolic harbinger.
"If we're lucky, maybe the pizza will serve to illuminate an important economic
point for President Obama," Priebus said in a statement.
"Instead of redistributing the slices, the best way to make everyone happy is to
make the pie bigger," he said. "It's as true for dinner as it is for economic
growth and opportunity."
