WASHINGTON -- President Barack Obama urged Congress yesterday to pass a package of modest cuts and tax changes as a way to delay drastic, across-the-board federal spending reductions that could harm the economy.
But Obama's proposal would postpone the $85 billion in automatic cuts scheduled to take effect March 1 by only a few months until a larger deal could be reached.
"Deep, indiscriminate cuts to things like education and training, energy and national security will cost us jobs, and it will slow down our recovery," Obama said in a seven-minute statement to reporters at the White House. "It's not the right thing to do for the economy. It's not the right thing for folks who are out there still looking for work."
Obama's remarks came as the nonpartisan Congressional Budget Office released its forecast for the next decade. The CBO projects, absent changes in spending and/or taxes, that federal debt held by the public will reach levels akin to 76 percent of the total economy, the largest percentage since 1950. It would tick up to 77 percent by the end of the decade and rise even further in subsequent years.
Obama did not offer a specific proposal or release any new plans Tuesday. But he said Congress should approve additional revenue by eliminating tax loopholes and deductions benefiting certain industries or the wealthy, as well as spending reductions.
He also said Congress should rely on a proposal he made in mid-December to House Speaker John Boehner (R-Ohio). That includes, among other changes, a less-generous measure of inflation to adjust benefits for Social Security and other programs and cuts to health care.
On Capitol Hill, Republicans dismissed Obama's comments as more partisan rhetoric and the same mix of tax increases and military spending cuts he advocated in the past. Senate Minority Leader Mitch McConnell (R-Ky.) said the president had an "unserious attitude."
The automatic cuts, known as sequestration, are the result of a bipartisan deal struck in 2011 to raise the nation's debt ceiling. Congress agreed that if a 12-member committee failed to reduce the deficit by $1.2 trillion over the next decade, the cuts would come from government spending.
The first round of $109 billion in cuts was set to start in January. But the White House and Congress agreed to delay that until March 1 as part of a New Year's deal that raised taxes on the richest 1 percent of Americans.