WASHINGTON - President Obama Monday released his fiscal year 2013 budget and it says the president's plan would secure about $3 trillion in deficit reduction over ten years.
"This plan is a balanced one that asks everyone to do their part," Obama says in his budget overview.
The budget projects a $1.33 trillion deficit for FY'12, the current fiscal year. This is slightly above the actual FY'11 deficit of $1.296 trillion. The Congressional Budget Office estimated a few weeks ago that the FY'12 deficit will be $1.08 trillion.
For FY'13, the president's budget would spend about $3.8 trillion and take in about $2.9 trillion of revenues.
The budget argues that if the president's policies are approved, the deficit will fall to $901 billion in FY'13.
Obama's budget calls for $1.5 trillion in additional revenues, with higher taxes proposed on some corporations, upper income earners and hedge funds. Much of this additional revenue will come from allowing many of the Bush era tax cuts to expire at the end of the year for those with annual incomes of more than $250,000.
Obama's budget also proposes a $61 billion "financial crisis responsibility fee" on large corporations that was outlined in his State of the Union speech.
Obama said these tax provisions should be undertaken in the context of "comprehensive tax reform."
The president's fiscal outline calls for about $350 billion in short-term stimulus measures, with about half of this coming from a year-long extension of the payroll tax cut and unemployment insurance benefits.
The plan calls for about $580 billion in entitlement savings from programs such as Medicare, Medicaid, and agriculture subsidies.
Now with the release of Obama's budget, the administration's top fiscal officials will defend the plan on Capitol Hill in a week-long series of congressional hearings.
Treasury Secretary Timothy Geithner is scheduled to testify to the Senate Finance Committee at 10 a.m. Tuesday, the House Ways and Means Committee at 10 a.m. Wednesday, the Senate Budget Committee at 10 a.m. Thursday, and the House Budget Committee at 2 p.m. Thursday.
Jeff Zients, the acting White House budget director, will testify to the Senate Budget Committee at 10 a.m. Tuesday and the House Budget Committee at 10 a.m. Wednesday.
After lawmakers have gone over the president's budget, the House and Senate Budget Committees are charged to draft congressional budget resolutions. These are congressional fiscal blueprints that set spending and revenue goals and make deficit estimates. They will be unveiled in March.
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