President Barack Obama is proposing a $3.77 trillion U.S. government budget for 2014 that would change taxes for the wealthy and adjust how Social Security benefits are calculated, a plan that fails to satisfy members of both parties.
The proposal intends to reduce the deficit by nearly $2 trillion during the next decade, through a combination of new revenues and budget cuts. It includes a minimum 30 percent tax on people making $1 million or more a year.
Obama is pushing for a compromise between Republicans who refuse to raise taxes and Democrats who are seeking to protect popular programs that provide pensions and health care to the elderly and poor.
President Obama's Proposed 2014 Budget
Source: White House
Includes $1.8 trillion of additional budget deficit reduction over 10 years
Closes tax loopholes and reduces tax benefits for the wealthiest
Includes $400 billion in health savings
Includes $1 billion investment to launch manufacturing innovation institutes
Provides $50 billion for infrastructure investment
The president says his proposed budget is not his ideal plan to cut the deficit, but an effort at compromise to end what he says has been a cycle of short-term, crisis-driven decision-making.
Competing budget plans have already been passed by the Republican-controlled House of Representatives and the Democratic-controlled Senate, setting the stage for contentious negotiations.
Republicans are opposed to raising more government revenue, after a deal with Democrats earlier this year that increased income-tax rates on wealthy Americans. And lawmakers in the president's Democratic Party are angry over his suggestion to switch to a modified formula to measure inflation, which will lower annual cost-of-living increases for Social Security recipients.
Obama will host a group of 12 Republican lawmakers at a private dinner at the White House Wednesday night to discuss his budget proposals.
Some information for this report was provided by AP and Reuters.