DEBT FINANCING. Obama proposes $1.5 trillion in new taxes

U.S. President Barack Obama Monday proposed $1.5 trillion in new taxes — aimed predominantly at the rich — as his proposal for cutting the American public deficit by more than $3 trillion US.
Everybody from America's wealthiest to its largest corporations, "should pay their fair share," Obama said.
Obama's tax plan for slowing the rise of the debt is sure to conflict with congressional Republicans who oppose tax increases.
Just days ago, Republican House Speaker John Boehner ruled out tax increases to lower deficits.
But Obama, speaking at the White House Rose Garden, said spending cuts aren't enough.
"We can't just cut our way out of this hole," he said, a reference to the U.S. debt of more than $14 trillion.
It also came as members of Obama own Democratic Party pressed him to take a tougher stance against Republicans.
The plan stands little chance of passing Congress, but its populist pitch is one that the White House believes the public can support.
The tax increase is called the "Buffett Rule," for billionaire investor Warren Buffett, who has complained that he and other wealthy people have been "coddled long enough" and shouldn't be paying a smaller share of their income in federal taxes than middle-class taxpayers.
It focuses on preventing millionaires from using tax-avoidance schemes to pay lower rates than middle-income taxpayers.
It totals just more than $2 trillion in deficit reduction over 10 years through a combination of new taxes with $580 billion in cuts to mandatory benefit programs, including $248 billion from Medicare.
The administration also counts savings of $1 trillion over 10 years from the withdrawal of troops from Iraq and Afghanistan.
On September 8 Obama unveiled a $447-billion plan in tax cuts and new public works spending proposed as a short-term measure to stimulate a foundering American economy.
He's submitting his deficit fighting plan as a way to pay for that jobs bill while still reducing the American public debt. It will be submitted to a special joint committee of Congress that is charged with recommending deficit reductions of up to $1.5 trillion over 10 years.
In a defiant note, administration officials made clear Sunday that Obama would veto any Medicare benefit cuts that aren't paired with tax increases on upper-income people, those making over $250,000 US a year.
Obama's plan came in sharp contrast with the negotiations he had with Boehner in July as the White House sought a deal with Congress to lift the federal debt ceiling and to avoid a government default.
As a result, it included no changes in Social Security and no increase in the Medicare eligibility age, which the president had been willing to accept this summer.
With files from The Associated Press Accessibility Links

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