Obama Speech Details Leaked: Promises To Cut $4 Trillion In Deficit Over Next 12 Years (Or Less)

Tyler Durden's picture

In about an hour, the Teleprompter in Chief will once again address a nation on the topic of the exploding US deficit, which he can only hope has the attention span of an HFT algorithm, and has forgotten his proclamations on the same issue from early 2009. Among the things Obama will discuss:

  • Sets a goal of reducing US deficit by $4 trilllion in 12 years or less, according to a congressional source
  • Implements a deficit plan would curb deficits to 2.5% of GDP in 2015, 2% toward end of decade according to a congressional source
  • Wants US debt on "declining path", enforced by "debt failsafe" trigger of broad cuts, according to a congressional source
  • Seeks $770 billion in savings by 2023 in cuts to non-security discretionary spending according to a congressional source

Good luck with that. In the meantime... a clip from Obama circa February 2009 on where Obama saw the budget by the end of 2012. That did not...quite... work... out.

More details on the upcoming speech from Reuters:

According to congressional sources, Obama will propose:

  • Reducing the deficit by $4 trillion in 12 years or less
  • Curbing deficits to 2.5 percent of GDP in 2015, 2 percent toward the end of the decade
  • Ending Bush-era tax rates for the wealthiest Americans
  • Seeking $770 billion in savings by 2023 in cuts to non-security discretionary spending
  • Saving $480 billion in Medicare and Medicaid by 2023 and at least $1 trillion more by 2033.

Obama will use the speech to try to regain control of the spending
debate by drawing a contrast with a Republican plan to combine an
overhaul of the Medicare health program with lower taxes to reduce the
deficit by $4.4 trillion in 10 years.

Obama was expected to
point to recommendations made last year by his debt commission,
co-chaired by Republican Alan Simpson and Democrat Erskine Bowles, as a
starting point for discussion.

He has so far declined to endorse
their report but in a sign he was moving closer toward their findings,
the panel co-chairmen were expected to attend the speech.

The
deficit issue has become entangled with a vote Congress will consider in
the next few weeks on raising the nation's borrowing limit. Republicans
say they will not vote to lift the debt limit without commitments to
rein in long-term deficits.

The debt is expected to hit the $14.3 trillion ceiling as early as
mid-May and a failure to lift it could raise the specter of default and
ripple through financial markets.