Monday’s Headlines: Obama to Submit $3.83 Trillion Budget

BY Tom LeGro  February 1, 2010 at 8:48 AM EDT

President Barack Obama plans to send Congress a $3.83 trillion budget that calls for more money to fight high unemployment and cuts in spending for government programs to reduce a projected record deficit this year.

President Obama’s plan would raise taxes on the nation’s largest banks, energy producers and families making more than $250,000. In addition, the president proposes a three-year budget freeze on a variety of programs outside of the military and homeland security.

The Obama administration’s budget request, set for release Monday morning, was previewed for reporters late Sunday.

The Obama administration expects the deficit for this year to rise to a record-breaking $1.56 trillion, topping last year’s $1.41 trillion gap, which was also a record high. The deficit is expected to fall to $706 billion in 2014 before beginning to rise again, hitting $1.003 trillion in fiscal 2020, the Wall Street Journal reports. Over the next 10 years the deficit would total $8.532 trillion.

Echoing his pledge in the State of the Union address, the president proposes a $100 billion jobs measure that would provide tax breaks to encourage businesses to boost hiring. He would also increase government spending on infrastructure and energy projects.

“This is a budget that makes tough choices while investing in initiatives to create jobs and help reduce the economic pressures facing the middle class,” White House spokesman Dan Pfeiffer said in a briefing for reporters.

In addition to new spending on the economy, the plan calls for $250 million to be set aside for the purchase of an Illinois prison that had been identified as a possible home for detainees from Guantanamo Bay, the Washington Post reports. The budget also calls for an additional $33 billion in war funding this year and a total budget of $160 billion for the wars in Iraq and Afghanistan next year.

“I think the president’s proposal on freezing non-security domestic spending is a good first step,” House Republican leader John Boehner of Ohio said Sunday on NBC’s “Meet the Press.” “But it’s only $15 billion for each of the next three years. I think we can do much better than that. I don’t think any agency of the federal government should be exempt from rooting out wasteful spending or unnecessary spending.”

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