President Barack Obama presented his budget plan to Congress today. CNN reports on the Obama budget:
One high-profile proposal involves closing the loophole that has allowed some Wall Street investment managers to pay lower tax rates than their low-paid assistants. Wall Street lobbyists have fought such changes in the past and won, but the current political environment is so sour on financial executives that the proposal could garner more support now.
On agriculture, the Obama administration is aiming to save $9.8 billion over 10 years by phasing out direct payments to farmers with sales revenues of $500,000 or more per year. On education, the administration is considering elimination of the Federal Mentoring Program created by the previous Bush administration to save nearly $50 million. On defense, the administration’s list suggests it will target expensive weapons systems but does not specify which programs will be cut or how much money will be saved.
The list did contend the Pentagon’s new weapons programs are “among the largest, most expensive, and technically difficult that the Department has ever tried to develop. Consequently, they carry a high risk of performance failure, cost increases and schedule delays.”
Obama is also proposing a $634 billion health care “reserve fund” aimed at reforming the system, according to senior administration officials. In order to fund it, Obama will ask wealthy Americans to deal with a tax increase and wealthy seniors to pay higher Medicare premiums.
Obama is pretty much acting as expected here. The only confusing facet is his concurrent plan to halve the deficit by 2013. Why the tight timeline? I’d like to hear an explanation of a) why it’s necessary to act on the deficit so quickly, and b) how, exactly, he plans on reducing it.