Will the President's Miraculous Budget Plan Succeed?
by Joe Cooper

President Obama unveiled a $3 trillion-plus budget that he says will halve the federal deficit by the end of his first term.  The 2010 fiscal year budget includes substantial investments in health care reform, renewable energy and education.  The budget also includes big cuts for some programs, setting the stage for major political battles to fight to save budget items in the months ahead.

Congress received a 140-page summary of the budget for the 2010 fiscal year.   The full details are expected in April.  The government's fiscal year runs from October of one year to September of the next.

Peter Orszag, director of the Office of Management and Budget, outlined four ways the administration will reach their goal of reducing the deficit in half by 2013.  First, he predicted the economy would recover because of the Recovery Act and the normal business cycle.  Second, the tax cuts for the wealthy will expire as scheduled at the end of 2010. That will hit families making more than $250,000 a year. The administration is also closing down some corporate tax loopholes.  The administration is "winding down the war," which he predicted would reduce costs over time.  Finally, the administration is "making government more efficient," Orszag said.

The President says his team has already identified $2 trillion in budget savings by scouring the federal budget.

Here's a breakdown of some of the items in the budget:

Defense:  $75.5 billion in spending on Iraq and Afghanistan for the remainder of 2009, $130 billion in spending on Iraq and Afghanistan for fiscal year 2010 and $533.7 billion for Department of Defense.

Education:  $46.7 billion in spending for fiscal year 2010.

Energy:  $26.3 billion in projected spending for the Energy Department in fiscal year 2010.

The budget builds on funds already allotted for programs in the $787 billion stimulus package signed into law earlier this month.  Obama's outline also sets aside an additional $250 billion to stabilize the financial system, on top of the $700 billion already authorized by Congress under the Troubled Asset Relief Program.

Obama is also proposing a $634 billion health care "reserve fund" aimed at reforming the system. In order to fund it, Obama will ask wealthy Americans to accept a tax increase and wealthy seniors to pay higher Medicare premiums. The budget will leave the details of how to reform the system to be worked out by Congress.

Rep. John Boehner, R-Ohio the House minority leader says, "There's been too much spending under the Republicans over the last couple of years, but if you begin to look at what's happen over the last month and what's being proposed in this budget, the president's beginning to make President Bush like a piker when it comes to spending.

"The era of big government is back and Democrats are asking you to pay for it," said Boehner, R-Ohio.

House Speaker Nancy Pelosi, however, praised the budget as "a statement of our national values.  The budget is consistent with the president's message of accountability, fiscal responsibility, transparency from the standpoint of how we approach it. It reflects the values that he conveyed about investing in education and energy and health care; also in how we grow our economy for infrastructure and how we support our troops," said Pelosi, D-California.