Overview of President Barack Obama’s plan to avert sequestration
On Feb. 6th, President Barack Obama presented a plan to Congress to avert the $1.2 trillion sequestration – or across-the-board cuts to both defense and non-defense discretionary spending mandated by the Budget Control Act of 2011 – scheduled to take effect on March 1st.
“While it’s critical for us to cut wasteful spending, we can’t just cut our way to prosperity. Deep, indiscriminate cuts to things like education and training, energy and national security will cost us jobs, and it will slow down our economic recovery,” Obama said.
Balancing between mitigating the harmful economic effects of sequestration while reducing the federal deficit by $1.2 trillion, Obama’s plan would scale back the sequester cuts by 50% and offset the remaining 50% with additional taxes.
The President proposed to:
- reduce defense discretionary spending by approximately $300 billion over 10 years, amounting to 25% of the total sequester cuts;
- reduce non-defense discretionary spending by approximately $300 billion over 10 years, amounting to 25% of the sequester cuts;
- and raise $600 billion in new tax revenue (by closing tax loopholes and eliminate certain deductions) to cover the remaining 50% of the sequester cuts.
“I think this balanced mix of spending cuts and tax reform is the best way to finish the job of deficit reduction,” Obama said.
- WhatTheFolly.com: Transcript: President Barack Obama’s remarks on sequestration
- WhatTheFolly.com: Analysis: Impact of sequestration on non-defense discretionary spending
- WhatTheFolly.com: 5 key facts about sequestration
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