Obama calls for $3 trillion in deficit cuts

WASHINGTON – President Barack Obama will Monday call for new deficit cuts of $3.0 trillion but warn Republicans he will veto any bill that trims healthcare for the elderly without hiking taxes on the rich.

Obama will lay out a series of proposals that include a broad overhaul of the tax code designed to raise $1.5 trillion dollars, mostly by letting previous tax cuts for the wealthy expire and by closing corporate loopholes.

Officials said the plan would ensure America’s long term fiscal future at a time of deep economic gloom, and permit continued investment in education, new generation energy and job creation.

Specifically, Obama will lay out a plan for tax revenue raises and spending cuts which he will suggest a congressional supercommittee charged with coming up with up to $1.5 trillion dollars in spending cuts should adopt.

Obama’s proposals will bring total deficit cutting plans over the next decade to $4.4 trillion, officials said.

That topline figure includes $1.2 trillion in cuts in federal discretionary spending already agreed by Obama in August as part of a compromise which ended a standoff with Republicans over raising the federal debt ceiling.

It includes 580 billion in spending cuts across all mandatory spending programs and $1.1 trillion of savings realized from drawing down US troop numbers in Afghanistan and Iraq.

Tax reform would result in 1.5 trillion dollars in savings, and a further 430 billion dollars will be found in additional interest savings elsewhere.