Combative Obama Braces for Fight on Budget

Record shortfall in current fiscal year would shrink to $1.3T in 2011

(AP) - President Obama's proposed budget predicts the national deficit will crest at a record-breaking $1.6 trillion in the current fiscal year, then start to recede in 2011 to $1.3 trillion, a congressional official said today. The new budget, out tomorrow, says deficits over the next decade will average 4.5% of the size of the economy, a level economists say is dangerously high if not addressed, said the official, who was not authorized to discuss the budget before its public release. More»

Aims to recoup bailout losses, avoid passing along to customers

(NEWSER) - The Obama administration will likely include a provision in next month’s budget that imposes fees on banks in an effort to make back some of the taxpayer money lost on the bailout and close the record deficit. Politico has it that a transaction tax is not on the table; while the Wall Street Journal notes that such a tax would require international cooperation. A tax on compensation is considered too easy to skirt. The goal is to structure a fee that newly flush banks can't pass on to still-struggling consumers. More»

(NEWSER) - President Obama said today proposed budget cuts are “not a criticism of” federal workers. Still, they take a toll, from defense to education. The Washington Post takes a look at what’s being trimmed:

• Anthrax vaccine research: The administration says the goals of the program have been met, and its cancellation will save $8 million.
• Cotton storage: The government will save $570 million in payments to growers waiting for higher prices.

(AP) - President Obama appealed to federal workers today to propose ways to make their agencies' and departments' budgets more efficient. The president said employees' ideas would be key as his Cabinet officials cut millions from the federal budget and trim the deficit. "After all, Americans across the country know that the best ideas often come from workers, not just management," Obama said in his weekly radio and Internet address. More»

Move comes amid pressure to slice deficit

(NEWSER) - Facing pressure over spending, President Obama will unite his Cabinet today for the first time and ask members to find $100 million worth of potential budget cuts over the next 90 days, the Washington Post reports. Though it’s a tiny sum compared to a $3.5 trillion budget outline, the move is meant to signal Obama’s commitment to reform, says a top administration official. More»