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Obama Administration Rolls Out $3.5 Trillion Budget Plan

President Obama's $3.5 trillion federal budget plan for the fiscal year includes both record spending and deficits for a wide range of programs, including health care, education and bank rescues. Kwame Holman reports.

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  • JUDY WOODRUFF:

    President Obama laid out the highlights of his first budget proposal today for Congress and the nation. It was a plan replete with record spending and deficits and huge numbers for everything from health care to bank rescues.

    Kwame Holman has our lead story report.

  • KWAME HOLMAN:

    Budget Director Peter Orszag personally delivered the 134-page outline to Congress's budget chairmen this morning on the Capitol Plaza.

    SEN. KENT CONRAD (D), North Dakota: This is it.

  • KWAME HOLMAN:

    "It" was a $3.5 trillion blueprint for government spending, the largest ever. And it projected by far the largest deficit ever, at $1.75 trillion, more than four times the red ink for this year.

    President Obama acknowledged the grim numbers in his rollout announcement.

    BARACK OBAMA, President of the United States: In keeping with my commitment to make our government more open and transparent, this budget is an honest accounting of where we are and where we intend to go.

  • KWAME HOLMAN:

    As a result, the deficit would top 12 percent of the nation's gross domestic product. It's the largest, in terms of GDP, since World War II, driven by the costs of the financial rescue package and the economic stimulus plan.

    Another major chunk of the spending — $634 billion — would go for a down payment on universal health care.

  • BARACK OBAMA:

    Because of crushing health care costs and the fact that they drag down our economy, bankrupt our families, and represent the fastest-growing part of our budget, we must make it a priority to give every single American quality, affordable health care.