Sat, Aug 20, 2011 - Page 7 News List

Obama asks agencies to identify 5% and 10% cuts

Reuters, VINEYARD HAVEN, MASS

US President Barack Obama, who wants the US Congress to boost jobs while also controlling the national deficit, has asked government agencies to identify cuts of 5 percent and 10 percent in their 2013 budget proposals.

White House budget chief Jack Lew, in a blog posted on the White House Web site on Thursday, said he had asked for budget submissions to give Obama options in meeting deficit-cutting targets agreed in a recent deal to lift the US debt limit.

“To meet this goal we asked agencies to provide budgets based on two scenarios: a 5 percent cut and a 10 percent cut,” Lew said.

His request, made on Wednesday, seeks cuts in discretionary spending from the funding levels of last year.

Obama’s reelection hopes next year hang on his success in lowering unemployment, currently stuck above 9 percent, while easing public concerns about the high US deficit and debt.

Spending reductions in social programs that help the poor are likely to be resisted stoutly by Obama’s Democrats, while Republicans traditionally oppose trimming defense spending.

Lew said the instruction did not mean Obama would impose such cuts on an individual agency’s budget, or on all budgets.

“We do not believe in making across-the-board cuts; rather, we believe that we should cut what is wasteful or not essential,” he said.

Congress lifted the US debt limit by US$2.4 trillion earlier this month and agreed to seek spending reductions that would lower the deficit by at least that amount over 10 years.

“We asked agencies to provide these two options so that the president can have the information needed to make the tough choices necessary to meet the hard spending targets,” Lew said.

Obama, who arrived on the Massachusetts island of Martha’s Vineyard on Thursday for a family holiday, will urge Congress next month to take fresh steps to boost hiring.

He will also propose that a special congressional committee, set up to find deficit savings, seek reductions of more than US$1.5 trillion over 10 years in order to permit more government spending to boost growth and jobs now.

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