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Congressional Reaction Mixed To Obama's Budget

STEVE INSKEEP, host:

It's MORNING EDITION from NPR News. Good morning. I'm Steve Inskeep.

RENEE MONTAGNE, host:

And I'm Renee Montagne.

The budget President Obama proposed yesterday is preliminary, really just an outline. But the 10-year plan drew a big response on Capitol Hill. Democrats praised the president's commitment to expanding health care coverage, education funding and clean energy. Republicans were skeptical, especially about plans to raise taxes on businesses and the affluent.

NPR's David Welna has the story.

DAVID WELNA: Minority Leader Mitch McConnell was among the first to pan President Obama's budget. In his statement, McConnell took aim at what he called that plan's unprecedented spending increases. While the American people are tightening their belts, he added, Washington seems to be taking its belt off.

And Mr. Obama's plan to let tax cuts expire at the end of next year for those making more than a quarter-million dollars a year prompted this from House Minority Leader John Boehner.

Representative JOHN BOEHNER (Republican, Ohio): The administration's plan I think is a job killer, plain and simple. And it raises taxes on all Americans while we're in the middle of a recession.

WELNA: House Speaker Nancy Pelosi, on the other hand, defended the tax hikes on the wealthiest. In fact, the top Congressional Democrat said she would have had them take effect even sooner than the year after next, as called for in the president's plan.

Representative NANCY PELOSI (Democrat, California, Speaker of the House): It's not about raising taxes; it's about ending a tax cut that should not have been there in the first place that contributed enormously to our deficit, which has not contributed very much to the growth of our economy. Do you need any more evidence of that?

WELNA: Another Democrat, Senator Budget Committee Chairman Kent Conrad, said Republicans seem to overlook the fact that the Obama budget makes the Bush tax cuts of 2001 and 2003 permanent for everyone but those in the top tax bracket.

Senator KENT CONRAD (Democrat, North Dakota): They talk about massive tax increases. If you look at the scoring of this budget that would be done by the Congressional Budget Office, the non-partisan Congressional Budget Office, what you see is on a net basis there are substantial tax reductions here.

Senator CHARLES SCHUMER (Democrat, New York): This budget is aimed at the middle class like a laser.

WELNA: That's New York Democratic Senator Charles Schumer. He praised President Obama for making permanent the two-year college tuition tax credit that Schumer managed to include in the big stimulus package.

Sen. SCHUMER: And this a real shot in the arm because it's a credit - $2500 in effect off on your tuition 'cause you get to deduct that full amount from your taxes. And I want to thank and salute the president for putting that in. It's another example of focusing tax cuts not on the wealthy, as was done in the past, but on the middle class.

WELNA: In his budget proposal, President Obama promised that by the end of his fourth year in office he will have cut the more than trillion dollar budget deficit he inherited in half. That deficit reduction target did not impress Judd Gregg, the top Republican on the Senate Budget Committee, who briefly agreed to be the president's Commerce secretary before backing out.

Senator JUDD GREGG (Republican, New Hampshire): That number, that 500 billion, is very, very large, obviously. But more disturbing about it is the fact that it goes on forever. Once they hit that, they plateau at that number. And why is that? Well, it's because there is no fiscal restraint in this budget. There is no attempt to address the spending side of the ledger in any aggressive way.

WELNA: And Paul Ryan, who's the ranking Republican on the House budget panel, accused the president of using slight of hand to claim he's included $2 trillion in deficit reductions in his budget.

Representative PAUL RYAN (Republican, Wisconsin): They're taking the highest level of spending in the war - that 2008 level - and they're inflating it into the baseline. And then the inevitable drawdown accrues $1.6 trillion in savings that then they take credit for to spend and grow government. That's not real good budgeting. That's not honest budgeting.

WELNA: A more complete budget proposal is being promised for April. Then Congress has to act. Over the past few years, Congress has tried and failed to approve a budget, but that did not seem to faze President Obama yesterday.

President BARACK OBAMA: I am absolutely confident that as messy as this process can sometimes be, that we are going to be able to produce a budget that delivers for the American people.

WELNA: And he'll be counting on his big democratic majorities in both chambers to approve that budget.

David Welna, NPR News, the Capitol.

MONTAGNE: And if you want to know more about the President's budget, you'll find a breakdown of the spending at npr.org. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

David Welna is NPR's national security correspondent.

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