US Republicans Accuse President Obama of Class Warfare

World | September 20, 2011, Tuesday // 13:18|  views

US House of Representatives Speaker, John Boehner, accuses President Obama of lack of leadership. Photo by BGNES

US Republican Paul Ryan, Chairman of the House Budget Committee, known as a supporter of deep cuts and no tax rises, is accusing President, Barack Obama, in flaring up "class warfare" in the country.

"Pitting one group of Americans against another is not leadership," the US House of Representatives Speaker, John Boehner, is further quoted saying.

The Republicans' words came as response to Obama's proposal for a "Buffett rule", which would see Americans who earn more than USD 1 M pay the same rate of tax as those who earn less.

The proposal refers to billionaire financier Warren Buffett, who has complained that he and his wealthy peers pay relatively less tax than the people who work for them.

Obama insists the wealthy and corporations should pay their "fair share" to cut the deficit.

"It's not class warfare, it's math," he countered, pointing out "middle-class families shouldn't pay higher taxes than millionaires and billionaires."

On Monday, the President announced a new plan to save more than USD 3 TN over a decade that would pay for his plan to boost jobs, with roughly half coming from tax increases.

CNN reported that the President's plan includes USD 1.5 TN in new revenue generated largely by higher taxes on the wealthiest Americans, a proposal strongly opposed by GOP leaders who insist that any tax increase will undermine an already shaky economy.

In terms of spending, Obama's plan incorporates USD 580 B in mandatory cuts, including USD 248 B from the Medicare program. Roughly 90% of those savings will come from reducing overpayments in the system, according to a senior administration official, who explained that any changes to Medicare benefits won't kick in before 2017.

An additional USD 72 B will come from Medicaid and other health programs.

The President's plan does not include any Social Security reform proposals or changes to the Medicare eligibility age, reforms that have reportedly been put on the table by the administration in the past but are strongly opposed by a number of progressive Democrats.

Another USD 1.1 TN in savings would be generated by winding down the wars in Iraq and Afghanistan. The administration also estimates interest savings of approximately USD 430 B, a result of less borrowing and smaller annual budget shortfalls.

Roughly USD 450 B in the plan would be used to pay for the American Jobs Act, the economic stimulus measure proposed by Obama last week.

"We are not going to have a one-sided deal that hurts the folks that are most vulnerable. Spending cuts alone will not solve our fiscal problems. We can't just cut our way out of this hole," he added. "It's going to take a balanced approach. If we're going to make spending cuts -- many of which we wouldn't make if we weren't facing such large budget deficits -- then it's only right that we ask everyone to pay their fair share," Obama stated.

The President explicitly promised to veto any debt-reduction legislation that cuts benefits while failing to include higher taxes on the wealthy.

"This administration's insistence on raising taxes on job creators and its reluctance to take the steps necessary to strengthen our entitlement programs are the reasons the President and I were not able to reach an agreement previously, and it is evident today that these barriers remain," Boehner insists.

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Tags: US, House of Representatives Speaker, John Boehner, president, Barack Obama, class warfare, Buffet rule, plan, spending, tax, cuts, budget

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