US President Barack Obama vowed Saturday that irresponsible budgets were a thing of the past as he promised bold action to help the United States emerge from the current economic crisis stronger than before. In his weekly radio address, Obama said his administration had inherited a 1.3-trillion-dollar budget deficit - and a budgeting process that he called "irresponsible as it is unsustainable."
He argued that for years Washington as well as Wall Street had used accounting tricks to conceal real costs of programmes. "These kinds of irresponsible budgets - and inexcusable practices - are now in the past," the president said. "For the first time in many years, my administration has produced a budget that represents an honest reckoning of where we are and where we need to go." Last month, the Obama administration rolled out an audacious 3.55-trillion-dollar budget proposal that bristles with economic reforms and spending on healthcare, climate change and education.
The plan includes more than 600 billion dollars over 10 years for a "down payment" on healthcare reform and a similar annual sum for defence. Obama is to fulfill a campaign pledge to raise taxes on Americans earning more than 250,000 dollars a year from 35 percent to just under 40 percent, yielding some two trillion dollars over ten years.
The budget forecasts a 1.750 trillion dollar deficit in fiscal 2009, but foresees that figure falling to 1.171 trillion dollars in 2010. Obama said his proposal "begins to make the hard choices that weve avoided for far too long - a strategy that cuts where we must and invests where we need." He said the blueprint includes two trillion dollars in deficit reduction and reduces discretionary spending for non-defence programmes as a share of the economy by more than 10 percent over the next decade.
Last Wednesday, the president also signed a memorandum that dramatically reforms the way the government awards its contracts, arguing that it will save up to 40 billion dollars each year. In his address, Obama warned that solving the current economic crisis would not be easy, and the country will continue to face difficult days in the months ahead.
"But I also believe that we will get through this - that if we act swiftly and boldly and responsibly, the United States of America will emerge stronger and more prosperous than it was before," the president assured. Obama also noted that it would be impossible to bring the budget deficit down or grow the economy without tackling the skyrocketing cost of health care. On Thursday, the president held a White House summit on healthcare, bringing together doctors, nurses, lawmakers and business groups to launch the politically perilous process of driving a reform bill through Congress. More than half of all Americans are covered by health insurance provided by employers, but it is not compulsory and nearly 46 million others have no coverage at all. Under the White House healthcare plan, Americans who have health insurance and want to keep it can do so, though the administration says costs will lower.
A new range of "affordable" health insurance options is envisaged under the Obama plan, which will make insurance firms cover pre-existing conditions and include tax credits to help small businesses provide healthcare to workers.
The initiative would seek to lower the cost of prescription drugs, partly through relaxing rules on the import of medicines from other developed nations, and stop pharmaceutical giants blocking production of generic treatments. "Our ideas and opinions about how to achieve this reform will vary, but our goal must be the same: quality, affordable healthcare for every American that no longer overwhelms the budgets of families, businesses, and our government," Obama pointed out.