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Obama: Reining in deficit also a priority this year

WASHINGTON - President Barack Obama renewed his pledge yesterday to make job creation his top priority in 2010 but said it was also critical to rein in a record budget deficit that threatened an economic recovery.

Obama used his weekly radio and Internet address to remind Americans of the various proposals he put forward in the past week to spur job growth and tame a $1.4 trillion deficit. But before the release Monday of his proposed budget for 2011 fiscal year, which begins Oct. 1, he put a clear emphasis on addressing the deficit problem.

"As we work to create jobs, it is critical that we rein in the budget deficits we've been accumulating for far too long - deficits that won't just burden our children and grandchildren, but could damage our markets, drive up our interest rates, and jeopardize our recovery right now," he said.

The White House has said Obama is still committed to a promise he made last year to halve the deficit by the end of his term in 2013. The president did not refer to that pledge in his address. He has said his next budget will include a three-year spending freeze on some domestic programs.

The size of the deficit is a political hot potato in an election year, with Republicans seeking to paint Obama as a big spender and the White House countering that he inherited a $1.3 trillion deficit when he took office. Democrats face a tough time in holding on to their majorities in the Senate and the House in the midterm congressional elections in November. High unemployment, now at 10 percent, and the size of the deficit could hurt them, analysts say.

White House senior adviser David Axelrod said in an interview that the administration also hopes Congress will approve a new stimulus bill in the next couple of weeks. The other most immediate priorities, he said, are votes on a bailout fee on big banks and a financial reform package, including a new consumer finance agency.

Congressional Republicans have opposed these and other proposals, saying Obama wants to slap stifling regulations on the nation's still-struggling financial sector.

With AP

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