Deadline looming, Obama urging Congress to deal with budget cuts

Federal budget faces severe sequestration cuts

As the clock ticks on the automatic spending cuts set to kick in on March 1, President Obama will hold an event this morning to urge Congress to come up with an alternative plan to avert the cuts.

The White House says Mr. Obama will emphasize the potential negative effects of the so-called sequester - the $1.2 trillion over 10 years in cuts - by standing with first responders, people who the White House says will be directly affected by the cuts.

The president "will be joined at the White House by emergency responders - the kinds of working Americans whose jobs are on the line if Congressional Republicans fail to compromise on a balanced solution," a White House official said in a statement.

"The President will challenge Republicans to make a very simple choice: do they protect investments in education, health care and national defense or do they continue to prioritize and protect tax loopholes that benefit the very few at the expense of middle and working class Americans?" the official continued.

The $1.2 trillion sequester cuts, which were initially set to kick in on Jan. 1, emerged out of Congress' 2011 budget negotiations. Congress agreed that if a congressional "supercommittee" couldn't come up with an acceptable deficit reduction plan, Congress would just slash $1.2 trillion from the budget over 10 years -- half coming from defense spending and half from non-defense. The cuts were designed to be so drastic that Republicans and Democrats would be compelled to craft an alternate, bipartisan agreement on deficit reduction.

Ten days out, however, no single substitute plan exists and lawmakers are on a week's recess until next Monday.

Economists agree the steep, across-the-board cuts would slow the economy. The White Houserecently laid out the ways the sequester would hurt the middle class, from slashing education programs to small business loan guarantees. Taking $1.2 trillion out of the economy would put close to a million jobs at risk, the nonpartisan Congressional Budget Office has estimated.

Obama "doing everything he can" to stop sequester, says McDonough

The president and his chief of staff Denis McDonough have publicly prodded Congress multiple times since Mr. Obama's State of the Union address last Tuesday, emphasizing education, manufacturing, and immigration reform as the keys to growth. In his weekly address over the weekend, Mr. Obama lobbied for his "balanced approach" to deficit reduction that would combine "responsible reforms" on health care spending and taxes to stabilize our finances.

The president contrasted his approach with Republicans, who have proposed "even bigger cuts to things like education and job training, Medicare and Social Security benefits."

"That won't work," Mr. Obama said. "We can't just cut our way to prosperity."

Meantime, McDonough said the president hasn't "given up" on coming up with an alternative to avert the current set of cuts and he's doing "everything he can to not let this happen." In his State of the Union address last week, McDonough said, the president laid out what he's prepared to offer to avoid the cuts.

"We're ready to do another trillion-and-a-half to get to the $4 trillion mark that every economist in the country says we need to do to stabilize the debt problem," McDonough said on "Face the Nation" Sunday.

"Now when we think of the kinds of things that we're going to have to invest in, the president has also been very clear that he's ready to take on, as he laid out in the speech, a question like rising health care costs and Medicare."

Proposals being floated by Mr. Obama, as well as the Democratic-controlled Senate, McDonough argued, are "both very balanced plans that get some savings in this deficit fight from spending cuts, and some savings from increased revenues." Senate Democrats last week suggested a $110 billion measure to again delay the cuts.

What the Republican-controlled House has relayed, he continued, "is that they will not even consider anything that includes increased revenues. Not even closing loopholes for corporate jets, closing loopholes for oil and gas companies. That seems to me to be a position that we ought to have them reexamine and come to the table, and let's have a real discussion about it."

Arguing there are "much better ways to do these budget cuts," Sen. John Barrasso, R-Wyo., on CNN Sunday said further tinkering with the newly minted tax rates is "off the table," and that Democrats' proposal to generate more revenue isn't going to win over the GOP.

"Let me be very clear - and I'd say this to the president as I say it to you - these spending cuts are going to go through," Barrasso said. "The American people need to know tax cuts are off the table and the Republican Party is not in any way going to trade spending cuts for a tax increase."

House Republicans note that they passed legislation last year to address the sequester. But since the Democratic-led Senate never picked them up, they'll now follow the Senate's lead.

"It's time for the Senate to do their work," House Speaker John Boehner, R-Ohio, said last week. "If they're willing to pass a bill, we'll find some way to work with them to address this problem... The sequester -- I don't like it. No one should like it. But the sequester is there because the president insisted that it be there."

Ryan: Obama sees GOP as enemy, not partners

House Budget Committee chairman Rep. Paul Ryan, R-Wis., predicted last week that there would be no deal and that the sequester will kick in on March 1.

Ryan said the sequester is likely, "because the president hasn't put a budget on the table. The Senate hasn't passed a budget in four years ... Don't forget that it's the president who first proposed the sequester and it's the president who designed the sequester as it is now designed."

"We have acted in the House. The president has not. The Senate has not and therefore ... I think it's going to happen."