Obama set to unveil austerity plan

Obama set to unveil austerity plan

US president to release a tough and tight fiscal budget, but House Republicans want deeper cuts.
Last Modified: 13 Feb 2011 17:07 GMT

Please click here to access the complete version of this article.

Barack Obama, the US president, is set to unveil his fiscal 2012 budget on Monday, an election-year plan forged from conflicting needs to cut spending and stoke the economic recovery.

With vast crisis payments and sharply lower tax revenues making it difficult for the government to balance its books, Obama will set out an austerity plan that will help set the tone for next year's presidential race.

It is expected to address widespread public anger that the government is living beyond its means, detailing sweeping spending cuts while including some investments.

To square the circle, Obama's proposed budget for fiscal 2012 will seek to cut the record federal deficit, slashing energy subsidies for the poor and freeze public workers' pay.

But faced with high unemployment and an economic recovery that is still struggling to escape the orbit of the 2008 economic crisis, Obama will also give states more flexibility to pay for unemployment benefits.

Please click here to access the complete version of this article.

ENDS

© Scoop Media