Obama spells out austerity agenda for second term
By Andre Damon
10 November 2012
In his first public statement since election night, President Barack Obama
said Friday that his main priority in the coming months will be to slash the
federal budget deficit, primarily through major cuts in health care and
other social programs.
Speaking from the White House, Obama announced plans to hold discussions
next week with congressional leaders of both parties and business executives
to work out a bipartisan agreement on budget cutting. In addition to
austerity measures, the Democrats and Republicans are agreed on implementing
a comprehensive tax reform that will benefit corporations and the wealthy
at the expense of the majority of the population.
In the course of his brief remarks, Obama boasted of spending cuts
implemented during his first term in office and pledged, in the name of
strengthening Medicare and Medicaid, to cut even more from these programs.
Last year, I worked with Democrats and Republicans to cut a trillion
dollars worth of spending, Obama said. I intend to work with both parties
to do more, and that includes making reforms that will bring down the cost
of health care, so we can strengthen programs like Medicaid and Medicare for
the long haul.
To justify these measures, Obama cited the so-called fiscal cliffa series
of spending cuts and tax increases put in place by the administration and
Congress last year and slated to take effect on January 1 unless a new plan
to slash the deficit is enacted before then. The media and the political
establishment are seeking to foster a crisis atmosphere over this
manufactured deadline in order to push through deeply unpopular measures as
quickly as possible, now that the elections are out of the way.
Under current law, on January 1 there will be a simultaneous expiration of
all Bush-era tax cuts and the Obama payroll tax holiday, along with an
automatic sequestration that will begin to cut federal discretionary
spending, military as well as civilian, by hundreds of billions of dollars.
Obama said, At the end of this year we face a series of deadlines that
require us to make major decisions about how to pay our deficit down,
decisions that will have a huge impact on both the economy and the middle
class, both now and in the future.
In his remarks, he insisted as a requirement for any deal with the
Republicans that the wealthiest Americans pay a little more in taxes,
adding that he refused to accept any approach that isnt balanced. The
administration wants some pretense of shared sacrifice to help sell the
package to the American people.
Im not going to ask students and seniors and middle class families to pay
down the entire deficit, Obama said.
However, Obama went out of his way to make clear his intention to strike a
bargain with congressional Republicans over taxes, saying, Im not wedded
to every detail of my plan. Im open to compromise.
Several newspapers, including the Washington Post and the Wall Street
Journal, noted that while calling for the top 2 percent of earners to pay
more in taxes, Obama did not call for an increase in tax rates on incomes
over $250,000, a policy he had campaigned on.
As the Journal put it, That left open the possibility of raising tax
revenue by limiting or eliminating tax deductions or other tax breaks for
families above those thresholds, rather than raising income tax rates.
The New York Times noted that Charles E. Schumer of New York, the
third-ranking Senate Democrat, suggested Thursday that he could accept a
tax plan that leaves the top tax rate at 35 percent, provided that loophole
closings would hit the rich, not the middle class.
Earlier in the day, Republican House Speaker John Boehner reiterated his
opposition to any increase in the top tax rate, but said that he too would
be amenable to raising government revenues by cutting tax loopholes as part
of a plan to slash social entitlement programs.
The conclusions of the Simpson-Bowles commission on deficit reduction,
established by Obama in 2010, give some indication of what is in store. The
commission recommended regressive tax changes that would disproportionately
impact working people, including eliminating the home mortgage interest
deduction and the deduction for employer-provided health care benefits. The
commission also recommended introducing a 15 percent gasoline tax.
Most proposals for taxes from both parties also include a significant cut in
corporate taxes, generally alluded to under the euphemism of pro-growth
tax reform.
In his speech, Obama called on Congress to act immediately to prevent tax
increases on the middle class at the end of the year. For his part,
Boehner made clear that he would be willing to delay a long-term agreement
to cut social spending until next year as long as a framework was
established by the end of this year.
Despite campaigning against the Bush-era tax cuts for the rich in 2008,
Obama signed a two-year renewal of the measure following the 2010 elections,
when Republicans regained control of the House of Representatives.
Whatever the ultimate form of the deal worked out by Obama and the
Republicans, both parties are agreed on implementing trillions of dollars in
cuts to social spending on Medicare, Medicaid, and Social Security, and
reworking the tax code to increase the tax burden on a majority of the
population while lowering it on the very rich.
Thé Mulindwas Communication Group
"With Yoweri Museveni and Dr. Kiiza Besigye Uganda is in anarchy"
Kuungana Mulindwa Mawasiliano Kikundi
"Pamoja na Yoweri Museveni na Dk. Kiiza Besigye Uganda ni katika machafuko"
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