US House approves spending cuts

2011-04-16 13:15

Washington - The Republican-controlled US House of Representatives has adopted a dramatic 2012 budget plan that would cut the country's debt by revamping the decades-old system that guarantees medical insurance for Americans over 65 and to the poor and disabled.

The plan put forward by Republican Rep. Paul Ryan, the budget committee chairperson, is at odds with a spending vision President Barack Obama outlined earlier this week, which foresees tax increases for high-income Americans while holding the line on those major social contract programmes.

With the 2012 presidential election campaign already under way, Obama and his Democrats are locked in an ideological confrontation with Republicans, especially a nearly 90-strong first-year class in the House of Representatives that is allied with the ultraconservative tea party movement.

Their victory in November, under the flag of cutting government spending and intrusion into the lives of Americans, gave Republicans control of the House. That set in place a divided government that has forced Obama to accept compromises on spending and taxation that have angered the liberal wing of his Democratic Party deeply.

Debt

The US debt, in relation to the size of the American economy, has reached alarming proportions. Republicans in particular are pounding the issue, which they say endangers the country's domestic well-being and its ability to influence world affairs. Most Democrats also accept the need to cut spending but cannot swallow what they see as the draconian Republican approach.

In an Associated Press interview Friday, Obama said the Republican approach would mean "We would have a fundamentally different society than we have now."

Beyond that, Obama said, "Literally, we couldn't afford to fix the roads in the country under their budget."

The House approved the Ryan plan just a day after Congress adopted legislation that cut $38.5bn out of the national budget for the remaining 4 1/2 months of 2011. That money was cut from spending for US government agencies and amounts to only about 12% of total government outlays.

The White House said Friday that Obama had signed the short-term spending extension.

The Republican spending outline for the next fiscal year beginning October 1, calls for cuts of $5.8 trillion over 10 years. It would reduce tax rates for corporations and the wealthy, and eliminate various tax loopholes.

The measure, a nonbinding blueprint that sets a theoretical framework for future legislation, also would dramatically cut Medicaid, the medical insurance programme for the poor and disabled, and transform it into a grant program run by the states. It does not touch Social Security, the national pension system, or immediately cut Medicare.

It does, however, call for transforming Medicare into a system under which the government provides future retirees with vouchers to buy private insurance plans. People now 55 and over would stay in the current system, but younger people would receive the insurance subsidies. Economists say those vouchers would lose value over time because they would not keep pace with fast-rising medical costs.

Obama's plan, outlined earlier this week's calls for cutting the federal deficit by $4 trillion over 12 years by eliminating health care fraud, raising taxes on the wealthy and paring defence spending.

- AP
Read more on:    us
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 

Africa: Land of Billionaires!

Find out who are the richest of the richest in Africa!

 
 

Men24.com

Jurassic World trailer is epic!
Best bro movies 2014
Every man should be able to do these three things
Goalkeeper saves five penalties with his FACE!

Jobs in Cape Town [change area]

Jobs in Western Cape region

Customer Service Advisor

Cape Town
Teleresources Cape Town
R5 000 Per Month

Catering Manager

Cape Town
Origin Foodservice Management
R10 000 - R15 000 Per Month

Accounts Assistant

Cape Town CBD
Express Employment Services - Cape Town
R9 000 - R10 000 Per Month

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

Hot festive offers at kalahari.com!

Hurry! Stocks are limited. Don’t miss out. Shop Now!

Save up to 60% on toys!

Don’t miss out on this hot offer, save up to 60% on toys. While stocks last. Shop now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Seen something you like in our catalogue?

Find the perfect gift and save up to R5000 – As seen on the catalogue. Hurry and shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

You may feel divided. Conflict between mind and emotions can create tension or indecision. This could lead to stressful feelings...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.