US President defends budget

US President Barack Obama defended his budget plans yesterday, insisting that he remained committed to halving the deficit within four years despite new data showing it was bigger than expected.

"In total, our budget would bring discretionary spending for domestic programmes as a share of the economy to its lowest level in nearly half a century," Obama said in his weekly radio address.

"And we will continue making these tough choices in the months and years ahead so that as our economy recovers, we do what we must to bring this deficit down."

The president said his administration was scouring every corner of the budget to produce $2 trillion in deficit reductions over the next decade.

The comments came as Congress was poised to launch debate this week on the $3.55-trillion multiyear budget unveiled by Obama's administration last month.

But the non-partisan Congressional Budget Office (CBO) forecast on Friday the deficit could hit $1.845 trillion this year under the Obama proposal, quadrupling the 2008 record shortfall.

The CBO said its latest budget deficit estimate for fiscal 2009, which ends on September 30, would amount to 13.1 per cent of the country's total economic output.

Since its early January estimate of a $1.2-trillion gap, the CBO said the enactment of the $787-billion stimulus plan, other measures to revive the economy and additional factors had hiked deficit projections for 2009 and 2010 by over $400 billion.

Republicans immediately seized on the report to blast Obama's economic policies. "It's worse than even the most pessimistic predictions for this budget," said Senate Republican Leader Mitch McConnell.

But Obama moved swiftly to rebut his critics point by point, arguing that his economic proposals offered a long-term solution to US structural problems and not "a wishlist of priorities that I picked out of thin air.

"They are a central part of a comprehensive strategy to grow this economy by attacking the very problems that have dragged it down for too long: the high cost of health care and our dependence on foreign oil; our education deficit and our fiscal deficit," the president noted.

According to Obama, the nation also must renew its commitment to complete and competitive education for every child.