Obama to lay out deficit-reduction plan later this week

4/10/2011

WASHINGTON — President Obama will lay out new plans this week to reduce the federal deficit in part by seeking cuts to government programs for seniors and the poor, a top political adviser said Sunday, adding that Americans expect both sides to work together.

“You’re going to have to look at Medicare and Medicaid and see what kind of savings you can get,” Obama adviser David Plouffe said on NBC’s “Meet the Press.”

The presidential speech will come during a week in which official Washington pivots from a painful standoff over this year’s budget to next year’s and beyond, focusing on competing plans to shore up the nation’s fiscal health in the long term.

At the top of the week, congressional aides are expected to put to paper the 2011 spending deal struck Friday night, an hour before the government would have begun to shut down. Both houses of Congress were expected to take up that measure at midweek. Next up is the much more complex fight over the election-year budget in 2012. Other, related questions loom, such as whether to raise the nation’s debt ceiling.

It’s all part of a broader debate over how the government provides for the nation’s neediest while strengthening the economy. What’s usually a debate about federal spending had shifted into talks about where to cut, and both parties took aim at the chief federal health programs for the elderly and the poor, Medicare and Medicaid.

Republicans celebrated the thematic win.

“We’ve had to bring this president kicking and screaming to the table to cut spending,” said House Majority Leader Eric Cantor, R-Va., on “Fox News Sunday.”

Plouffe, Obama’s messenger, shuttled around the dial, seeking to link December’s bipartisan deal on tax cuts with Friday night’s nail-biter agreement on this year’s budget as evidence that both parties can govern together when they want to.

“Compromise is not a dirty word,” Plouffe said on ABC’s “This Week.”

The president, Plouffe said, would address ways to reduce the deficit and the long-term, $14 trillion debt. He gave few specifics, but he said the president believes taxes should go up on higher-income Americans and that cuts to Medicare and Medicaid will be necessary.

Obama’s speech will come as the debate shifts to the far more delicate ground of the budget paying for the government next year — when the president and most of Congress are up for re-election.

Republicans said Friday night’s deal in no way means they’re ready to compromise on the fiscal debates ahead, starting with the House Republicans’ $3.5 trillion spending plan for next year.

The GOP blueprint, unveiled last week by Budget Committee Chairman Paul Ryan, R-Wis., would slash federal spending by $5 trillion or more over the coming decade and repeal Obama’s signature health care law. It would leave Social Security untouched but shift more of the risk from rising medical costs from the government to Medicare beneficiaries. It also calls for sharp cuts to Medicaid health care for the poor and disabled and to food aid for the poor.

In events over the next week, Democrats planned to cast the GOP plan as a devastating assault on Americans who need government help the most.