Obama unveils US budget cut plans

Mr Obama says the budget will ask Washington to live within its means

US President Barack Obama will unveil a 2012 budget plan later, which is expected to cut domestic spending.

Cuts are expected to hit home heating, community development and education, as Washington aims to cut $1.1tn (£690bn) from the US deficit over a decade.

White House budget director Jack Lew told CNN that there were “scores of programmes” that were being reduced.

Republicans, who control the House of Representatives, do not think the cuts go far enough in tackling the deficit.

House of Representatives Speaker, Republican John Boehner, told NBC the proposed budget would “continue to destroy jobs by spending too much, borrowing too much and taxing too much”.

The budget deficit is predicted to reach $1.48tn this financial year, or close to 10% of GDP.

The two parties disagree over the level of spending cuts needed to cut the deficit and boost economic recovery.

Bringing them together will be a long process that takes most of the year before the required congressional approval of the budget.

The proposed $1.1tn budget reductions are much more than the $400bn of cuts in non-essential programmes the president unveiled in his State of the Union address last month.

Mr Obama is also believed to be about to give states more flexibility to pay for unemployment benefits.

And he will propose an $18bn plan to improve high-speed internet access, and a further $8bn for high-speed railways.

In his weekly message to the nation on Saturday, Mr Obama said the government would have to tighten its belt.

“This budget asks Washington to live within its means, while at the same time investing in our future,” he said.

“It cuts what we can’t afford, to pay for what we cannot do without.

“That’s what families do in hard times. And that’s what our country has to do too.”

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