April 14 (Bloomberg)--President Barack Obama adopted proposals by the leadership of its commission on debt reduction while turning the Republicans privatize Medicare plan and opens a debate on an overhaul of the tax and spending cuts.
The proposal to reduce the deficit Obama yesterday presented is similar to all of the spending cuts and tax increases offered year last by the Presidents of its bipartisan fiscal commission. It contrasts with a Republican plan, announced earlier this month by House Budget Committee Chairman Paul Ryan, which would reduce the $ 6 billion of programs, including Medicaid, Medicare, food stamps and education while reducing tax rates on high income of the page.The President in February 2012 budget proposal did not approve the proposal of 1 December by the Presidents of the debt-panel, former Senator of Wyoming Alan Simpson, a Republican, and Erskine Bowles, a former Chief of staff of the speech of the President Bill Clinton.While Obama had no details for the redesign of droitIl programs can resume the negotiations on How to reduce the nation's long-term debt, said Jason Peuquet, policy analyst for the Committee to a Federal Budget, a bipartisan group of Washington to examine tax issues. "" This is a big step forward ", said Peuquet.Stan Collender, Director General of Qorvis Communications and an aide to the former congressional budget, called Obama proposal"a policy game-changer."Plan of Obama aims to reduce the deficit by $ 4 trillion, more than 12 years while the leaders of its debt-Panel cut 3.8 billion in nine years. Ryan budget cut 6.2 billion over the next decade, although it would not balance the budget until 2040 reason to compensate for the reduction of taxation. "Poisoning Wells'House Republicans were instantly critical of the plan of Obama. Leader of the majority Eric Cantor of Virginia said the Obama only concrete proposal to increase taxes. Ryan, Wisconsin, said he was "very disappointed" in the proposal of the President and that "instead of bridges, it is poisoning the wells."The Obama fiscal Commission has provided a detailed plan to strengthen social security, including the reduction of future benefits and raising the retirement age, something neither the President nor approached Ryan.The President said yesterday that both parties should work together to strengthen the programme without benefits "hit stick" for future generations. "It can be done" Obama said. "All we have is it not what it wants to do,"Ryan told journalists after the speech of the Obama." Earlier in the day, he said in an interview that "social security is the only area that I think has the best chance to work with them on".Yesterday, three Senate Republicans presented a Bill to gradually increase the age of retirement at 70 in 2032, social security and benefits future peg to income levels. The three are Lindsey Graham of South Carolina and two new students elected with the support of Tea Party, Mike Lee of the proposals of the Utah and Paul Rand of OverhaulThe of Kentucky.Tax by the President and Ryan may open a debate on an overhaul of the tax that would be a rate while reducing or putting end to many of the credits and deductions.Obama provided no detail on taxes beyond the cancellation of cuts for the wealthiest Americans adopted for the first time under President George w. Bush. The leaders of the debt Panel also would leave these tax cuts expire for people earning over $250,000. Ryan proposes to reduce the tax rate on higher revenue for taxes of individuals and of societies of 35 percent to 25 p. 100.Focus of Ryan on the privatization of Medicare and shrinking Medicaid by converting it to a block controlled by States grant program sparked a reaction of Democratswho say that it seeks to balance the budget on the backs of the elderly and the poor.Private InsurersRyan would be slow Medicare spending of 40 billion dollars more than a decade and deliver the program to private insurers, from people turning 65 in 2022, by providing subsidies to purchase private coverage.Obama said yesterday that Ryan plan "end Medicare as we know it" and would have the effect of 50 million Americans lose health insurance.The Chairman proposed to limit the growth of Medicare living expenses 0.5% of gross domestic product and strengthen a Commission created by the health care Act, which aims to recommend insurance, reduced spending.The debt commission proposal would limit the growth of overall health spending to 1% of GDP. He identified specific areas in order to achieve its objective, including the sharing of the costs of health care and restrictions on certain Medigap supplemental insurance coverage.Republicans are attacking Obama for failing to achieve budgetary savings, even the leaders of his commission proposed for the next 10 years. "Is not yet come close '"It comes even close to meet the benchmarks set by the Republicans in the House,"said representative Scott Garrett of New Jersey, vice President of the appeal of Budget Committee.Obama of Ryan of $ 400 billion in cuts in defence by 2023 is smaller than the commission proposalwhich recommends cutting on twice more than many a defence together 1.7 trillion dollars in discretionary savings. Plan of Ryan offer a reduction in the defence of $ 78 billion.David Walker, a former U.S. general controller, said the differences between Obama and Ryan plans to make "unrealistic to strike a large market at the end of June," when Congress must vote to increase the ceiling of the debt of the 14 countries trillions of dollars.He said, that the two parties may be able to agree on a security social review, the outlines of a budget for 2012 and proposes a so-called trigger mechanism "automatic" to control spending similar to what the President Obama.Plan would require a reduction in spending and higher taxes if domestic product gross debt of the nation is not stabilized in 2014. Walker, said that this type of enforcement mechanism might be adopted with a vote on the debt ceiling.-With the help of James Rowley and Laura Litvan in Washington. Editors: Laurie Asseo, Leslie Hoffecker.
To contact the reporters on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net. Brian Faler in Washington to bfaler@bloomberg.net
To contact the editor responsible for this story: Mark Silva in msilva34@bloomberg.net
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