President Barack Obama Thursday rolled out an audacious 3.55-trillion-dollar budget bristling with economic reforms and spending on healthcare and climate change but warned that "hard choices" loomed as the deficit piles up. The plan includes more than 600 billion dollars over 10 years for a "down payment" on healthcare reform and a similar annual sum for defense, and encompasses Obama's drive to end the worst economic crisis since the 1930s.
The budget forecasts a 1.750 trillion dollar deficit in fiscal 2009, but foresees that figure falling to 1.171 trillion dollars in 2010.
Likely battles in Congress are looming after the top Republican in the House of Representatives John Boehner declared the budget proved "the era of big government is back" and that Democrats want taxpayers to pay for it. The spending plan would see the deficit soar to the largest percentage of gross domestic product since World War II, but the president touted a string of cost savings designed to lay new foundations for the US economy.
"This budget is an honest accounting of where we are and where we intend to go," Obama said at the White House, in an implied swipe at the financial disclosure methods of the administration of his predecessor, George W. Bush.
"There are some hard choices that lie ahead," the president said, formally unveiling a budget which assumes major cost savings from a planned drawdown of the US garrison in Iraq, which currently costs 170 billion dollars a year.
"We need to be honest with ourselves about what costs are being racked up, because that's how we'll come to grips with the hard choices that lie ahead," Obama said.
The budget also includes an optimistic forecast that the struggling US economy will post robust growth next year, projecting a 1.2 percent contraction in calendar 2009 but an expansion of 3.2 percent in 2010.
Obama's budget chief Peter Orszag dismissed suggestions that the growth forecast was too rosy, saying "We're not raising the price before the sale."
The 2010 spending of 3.552 trillion dollars compares to the current year's total of 3.938 trillion dollars.
The projected spending would include around 200 billion dollars to fight wars in Iraq and Afghanistan over the next 18 months, and a huge 634-billion-dollar, 10-year fund to pay for health care reforms, a key plank of Obama's election campaign, administration officials said.
Overall defense spending for 2010 will reach 663.7 billion dollars and includes the costs of wars in Iraq and Afghanistan, an increase of roughly 1.5 percent.
Obama also used the budget to signal his determination to join global efforts to combat climate change and to pursue alternative energy solutions.
"We'll be working with Congress on legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy," he said.
"To support this effort, we'll invest 15 billion dollars a year for 10 years to develop technologies like wind power and solar power, and to build more efficient cars and trucks right here in America."
Obama has also asked for 250 billion dollars to be set aside for potential additional bailouts of the US financial industry, on top of the 700 billion dollars already committed to that effort.
The Obama administration currently has no plans to use the extra bailout money, but wants the funds included as an "overly conservative" placeholder, a senior administration official said.
The budget is due to set the stage for a fierce battle in Congress, with many Republicans angered by plans to raise taxes on the country's wealthiest individuals. Only three Republican senators rallied behind Obama's 787-billion dollar stimulus plan to revitalize the ailing US economy.
The document formally set down a long list of campaign promises and was the best evidence yet of Obama's argument that times of dark economic crisis can be a catalyst for sweeping political reform.
Obama is to fulfill a campaign pledge to raise taxes on Americans earning more than 250,000 dollars a year from 35 percent to just under 40 percent, yielding some two trillion dollars over ten years.
Orszag earlier estimated that a cap-and-trade scheme to battle climate change could generate 112 billion dollars by 2012, and up to 300 billion dollars a year by 2020.
Obama's request includes 75.5 billion dollars for 2009 to send more US troops to Afghanistan, officials said.
The president will also request 130 billion dollars for Iraq and Afghanistan and set operations in those countries at 50 billion dollars annually in the next several years, they said.
The budget forecasts a 1.750 trillion dollar deficit in fiscal 2009, but foresees that figure falling to 1.171 trillion dollars in 2010.
Likely battles in Congress are looming after the top Republican in the House of Representatives John Boehner declared the budget proved "the era of big government is back" and that Democrats want taxpayers to pay for it. The spending plan would see the deficit soar to the largest percentage of gross domestic product since World War II, but the president touted a string of cost savings designed to lay new foundations for the US economy.
"This budget is an honest accounting of where we are and where we intend to go," Obama said at the White House, in an implied swipe at the financial disclosure methods of the administration of his predecessor, George W. Bush.
"There are some hard choices that lie ahead," the president said, formally unveiling a budget which assumes major cost savings from a planned drawdown of the US garrison in Iraq, which currently costs 170 billion dollars a year.
"We need to be honest with ourselves about what costs are being racked up, because that's how we'll come to grips with the hard choices that lie ahead," Obama said.
The budget also includes an optimistic forecast that the struggling US economy will post robust growth next year, projecting a 1.2 percent contraction in calendar 2009 but an expansion of 3.2 percent in 2010.
Obama's budget chief Peter Orszag dismissed suggestions that the growth forecast was too rosy, saying "We're not raising the price before the sale."
The 2010 spending of 3.552 trillion dollars compares to the current year's total of 3.938 trillion dollars.
The projected spending would include around 200 billion dollars to fight wars in Iraq and Afghanistan over the next 18 months, and a huge 634-billion-dollar, 10-year fund to pay for health care reforms, a key plank of Obama's election campaign, administration officials said.
Overall defense spending for 2010 will reach 663.7 billion dollars and includes the costs of wars in Iraq and Afghanistan, an increase of roughly 1.5 percent.
Obama also used the budget to signal his determination to join global efforts to combat climate change and to pursue alternative energy solutions.
"We'll be working with Congress on legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy," he said.
"To support this effort, we'll invest 15 billion dollars a year for 10 years to develop technologies like wind power and solar power, and to build more efficient cars and trucks right here in America."
Obama has also asked for 250 billion dollars to be set aside for potential additional bailouts of the US financial industry, on top of the 700 billion dollars already committed to that effort.
The Obama administration currently has no plans to use the extra bailout money, but wants the funds included as an "overly conservative" placeholder, a senior administration official said.
The budget is due to set the stage for a fierce battle in Congress, with many Republicans angered by plans to raise taxes on the country's wealthiest individuals. Only three Republican senators rallied behind Obama's 787-billion dollar stimulus plan to revitalize the ailing US economy.
The document formally set down a long list of campaign promises and was the best evidence yet of Obama's argument that times of dark economic crisis can be a catalyst for sweeping political reform.
Obama is to fulfill a campaign pledge to raise taxes on Americans earning more than 250,000 dollars a year from 35 percent to just under 40 percent, yielding some two trillion dollars over ten years.
Orszag earlier estimated that a cap-and-trade scheme to battle climate change could generate 112 billion dollars by 2012, and up to 300 billion dollars a year by 2020.
Obama's request includes 75.5 billion dollars for 2009 to send more US troops to Afghanistan, officials said.
The president will also request 130 billion dollars for Iraq and Afghanistan and set operations in those countries at 50 billion dollars annually in the next several years, they said.
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