Obama Drops Stimulus for Benefit Cut to Woo Republicans [View all]

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http://www.bloomberg.com/news/2013-04-08/obama-abandons-stimulus-for-benefit-cut-to-win-over-republicans.html

Less than a week after job-creation figures fell short of expectations and underscored the U.S. economy’s fragility, President Barack Obama will send Congress a budget that doesn’t include the stimulus his allies say is needed and instead embraces cuts in an appeal to Republicans.

“This is not our ideal budget,” Gene Sperling, director of the White House’s National Economic Council, told Bloomberg Television. “This does reflect a compromise offer. There’s measures in here we would prefer not to take.”

Obama’s budget for fiscal 2014, set for release April 10, will propose reducing Social Security recipients’ annual cost- of-living adjustments by changing the inflation calculation, according to an outline released last week. The Medicare insurance program for the elderly would be cut by reducing payments to health-care providers and drug companies and imposing more costs on high-income beneficiaries.

While the White House hasn’t yet released specific dollar figures for the budget, administration officials said the plan puts the country on a path toward lower deficits, cutting the gap by $1.8 trillion over the next 10 years.