Congress urged to pass fiscal package
US president Barack Obama has urged the US Congress to pass a package of spending cuts and tax changes to delay automatic reductions in domestic and military expenditure and avert the next fiscal deadline on March 1st.
Calling on Congress to adopt measures to postpone the automatic spending cut known as the “sequester” at the start of next month, Mr Obama did not offer specific solutions to the latest fiscal crisis facing the US. But he said a delay for several months would allow time for a full-year budget to be agreed to resolve the issue permanently.
“They should at least pass a smaller package of spending cuts and tax reforms that would delay the economically damaging effects of the sequester for a few more months until Congress finds a way to replace these cuts with a smarter solution,” the president told reporters at the White House.
Mr Obama said there was no reason to put thousands of US jobs at risk “just because folks in Washington couldn’t come together to eliminate a few special-interest tax loopholes or government programmes”.
Congress must agree to reduce borrowing by tens of billions of dollars through spending cuts or tax increases to delay the sequestration deadline of March 1st.
Republicans are demanding deep spending cuts rather than raising taxes.
The president spoke as new figures from the congressional budget office showed that the deficit for the fiscal year to the end of September 2012 was $845 billion (€624 billion) after four years of deficits running at more than $1 trillion. The gap between tax income and government spending is 5.3 per cent of US GDP, which is still considered too high.