The American political system is at near deadlock with President Obama’s Democratic Party in control of the senate whilst the opposition Republican Party has a majority in the House of Representatives. For bills to become law, they require the approval of both houses, so any politically contentious measures (read: just about anything) face a nearly impossible challenge. Consequently, it is highly unlikely that the $3.77 trillion budget proposal that the President has presented will make it into law in any recognisable form.
The Obama budget does offer compromises which could tempt some wavering Republicans, but the majority will follow Party guidance and reject them. The proposals include cuts to pension and health care programmes but require some $700 billion to be raised in new taxes which will largely hit richer Americans. Republicans are vehemently opposed to raising new taxes, arguing that they have already agreed to all the new taxes they are going to whilst negotiating a solution to the “Fiscal Cliff” crisis at the end of last year. The President’s offer to curb some spending on social security payments has proved unpopular with some in his own Party, but some form of compromise must be achieved if the nation is to move forward.
The budget aims to claw $1.8 trillion from the US deficit over the next decade which would bring potential savings up to $4.3 trillion with other measures. It calls for savings of $400 billion from government spending and tweaks to social security programmes designed to save a further $130 billion, but protections were in place to shield the elderly and poorest members of society from the impact of the reforms.
Alteration to tax brackets would net a further $100 billion over 10 years and a similar sum would be saved from military and domestic spending cuts, reduction of farm subsidies and cuts to federal employee pension schemes. Tax advantages for the wealthiest 2% of Americans would be curtailed with the aim that those with household incomes over the $1million mark should pay 30% tax – a move certain to be blocked by Republicans.
Obama’s Budget Pipe Dream
Dr. Mike Campbell is a British scientist and freelance writer. Mike got his doctorate in Ghent, Belgium and has worked in Belgium, France, Monaco and Austria since leaving the UK. As a writer, he specialises in business, science, medicine and environmental subjects.