Vowing to cut $4 trillion in federal spending over 12 years, President Barack Obama outlined his plan to reduce the country's debt that pairs cost-cutting measures with tax increases for the wealthy.A summary of the proposal reins in entitlement program spending, cuts the defense budget, raises $1 trillion by closing loopholes in the tax code and assumes the Bush tax cuts for income over $250,000 will end. The president vowed to not extend those tax cuts again, despite compromising with congressional Republicans on the issue in December."We cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in our society," he said. "And I refuse t0 renew them again."That part of the plan has receive the most criticism, and is expected to ignite fierce fight in Washington. GOP leaders have already rejected any plan that includes tax hikes for wealthier Americans.From The National Journal:“We don’t believe a lack of revenue is part of the problem,” Senate Minority Leader Mitch McConnell, R-Ky., said after leaving a White House meeting.
From USA Today:"You can't tax the very people we expect to reinvest in our economy and create jobs," said House Speaker John Boehner, R-Ohio. "Washington has a spending problem, not a revenue problem."
Mr. Obama also slammed the proposal forwarded by Budget Chairman Paul Ryan, R-Wis., that will be taken up by the House later this week, saying it painted a pessimistic picture of America.“There’s nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires,” Mr. Obama said. “There’s nothing courageous about asking for sacrifice from those who can least afford it and don’t have any clout on Capitol Hill. And this is not a vision of the America I know."Supporters of the Ryan plan contend his critics have ballooned distortions and that it doesn't go after Medicare, as some have charged.One interesting part of the plan says there would be $3 in spending cuts and interest savings for every $1 that comes from increased tax revenue.