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President Barack Obama’s proposed $3.7 trillion federal budget drew mixed reviews from local representatives in the U.S. Congress on Monday.
Obama scored points from members of the local delegation for recognizing the value of infrastructure investments and tax credits for working families.
He also received criticism for proposed cuts in a home-heating assistance program and block grants that have traditionally been used to spur improvements in cities like North Tonawanda.
“I agree with the president that we need to reduce spending and make targeted investments in the future, but many of these cuts I see as inappropriate,” said U.S. Rep. Louise Slaughter, D-Fairport, following the release of Obama’s spending plan. “There’s no need to go after working-class families trying to heat their homes in one of the coldest winters on record. And it’s not necessary to slash funding to programs that allow economic development in our upstate cities. These cuts are unjust and I know they will hurt my constituents.”
Obama said his 10-year blueprint makes “tough choices and sacrifices.” It relies heavily on the recovering economy, tax increases and rosy economic assumptions to estimate that the federal deficit would drop from this year’s record $1.6 trillion — an astronomical figure that requires the government to borrow 43 cents out of every dollar it spends — to about $600 billion after five years.
Obama foresees a deficit of $1.1 trillion for the new budget year, which begins Oct. 1, still very high by historical benchmarks but moving in the right direction.
The president claims $1.1 trillion in deficit savings over the coming decade for his plan, a 12 percent cut from the federal deficits the administration otherwise projects. But that figure includes almost $650 billion in spending cuts and new transportation revenues the administration won’t specify.
Obama would trade cuts to some domestic programs to pay for increases in education, infrastructure and research as necessary investments that he judges to be important to the country's competitiveness in a global economy.
But he also raises taxes by $1.6 trillion over the coming decade, much of it from allowing recently renewed tax cuts for families making more than $250,000 a year to expire in two years — he signed a two-year extension of them into law just two months ago — and from curbing their tax deductions for charitable contributions, mortgage interest and state and local tax payments.
Slaughter took aim at Obama’s decision to either hold the line or reduce spending for some safety-net programs, including the Low Income Home Energy Assistance Program, or HEAP. Slaughter’s office said the proposed budget would trim the program, used by low-income families to offset home-heating costs, by $2.53 billion from fiscal year 2010. Her office estimates that 15,241 households in Western New York benefited from the program in 2009.
She also was critical of the president’s decision to cut funding for the federal Community Development Bloc Grant program by 7.5 percent, or $300 million, arguing that the program has helped low-income homeowners in Western New York perform home improvement projects that have resulted in energy savings and efficiencies.
Slaughter suggested cuts could be made elsewhere, such as spending on wars in Afghanistan and Iraq.
“Right now, we’re spending $2 billion a week on the war in Afghanistan, that’s roughly $8 billion every month and that’s in addition to our ongoing costs in Iraq,” she said. Eliminating our spending on foreign wars alone would go a long way to cutting our deficit in half.”
Slaughter did give Obama credit for following through on promises to continue to support high-speed rail initiatives like those underway in Niagara Falls and for setting aside funds to stop the spread of the Asian Carp into the Great Lakes.
Sen. Charles Schumer, D-New York, welcomed Obama’s decision to make permanent the American Opportunity Tax Credit he helped author. Schumer maintains that the $2,500 college tuition tax credit included in the American Reinvestment and Recovery Act (ARRA) of 2009 will provide help to middle-class families trying to stretch their pay checks during tough economic times. The budget also proposes that both the $2,500 credit amount and the income thresholds be adjusted for inflation starting in 2013.
“As after-shocks from the economic downturn continue to take their toll and tuition costs skyrocket, these savings are needed now more than ever,” Schumer said.
Republicans were far less receptive, assailing Obama’s plan for failing to take the lead on the nation’s daunting fiscal problems. Despite his spending cuts and tax increases, the government's total debt would still mushroom from $14.2 trillion now to almost $21 trillion by 2016.
"People vote for presidents because they want leadership," House Budget Committee Chairman Paul Ryan, R-Wis., said in an interview. "They expect presidents to take on the greatest challenges facing the country. Well, the biggest crisis we have is the debt, and he's doing absolutely nothing to get it under control."
While Obama's budget total of $3.7 trillion would be down slightly from this year's estimated $3.8 trillion, lower war costs and declining stimulus spending alone would account for a $90 billion drop.
A year after appointing a bipartisan commission to recommend ways to deal with the debt, Obama would bypass almost all of its painful prescriptions to cut huge benefit programs like Social Security and Medicare. But the president said he understood more must be done.
“The only way to truly tackle our deficit is to cut excessive spending wherever we find it, in domestic spending, defense spending, health care spending and spending through tax breaks and loopholes,” Obama said at a middle school outside Baltimore. “So what we've done here is make a down payment.”
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