April 13 (Bloomberg) -- President Barack Obama, as part of his plan to reduce the nation’s long-term debt, will propose cutting $400 billion from the Pentagon’s budget through the 2023 fiscal year, extending cuts beyond those sought by Defense Secretary Robert Gates, a person familiar with the plan said.
Gates met with Obama and Vice President Joe Biden in the Oval Office yesterday afternoon to discuss the president’s plan. Gates proposed in January cutting $78 billion from defense spending over five years, amid pressure to curb trillion-dollar federal deficits.
Over the next five years, the administration forecasts the government will pile up a cumulative deficit of $3.8 trillion; over the decade, the cumulative deficits would rise to $7.2 trillion. In addition to defense cuts, Obama will propose three other main components to reduce the debt, according to a White House statement: holding down domestic spending, curbing health-care costs and closing tax loopholes. The administration has released no details.
Obama is scheduled to deliver an address this afternoon at George Washington University in the capital as the administration prepares for a fight with congressional Republicans over raising the government’s debt limit and as the president is trying to frame the debate for his 2012 re-election campaign.
The planned $400 billion in cuts would be spread out through fiscal 2023.
Gates said last month the budget discipline he has imposed will leave the Defense Department in a “good place” and he didn’t foresee the need to put “other major programs on the block for the next year or two.”
Democratic and Republican congressional leaders, including House Speaker John Boehner, met with the president this morning at the White House for a preview of the speech.
Obama will outline reductions in entitlement spending and increased taxes on the wealthy while seeking to draw a sharp contrast with Republican proposals, according to another person familiar with the plan. He’ll draw on the findings of the Simpson-Bowles debt commission, including overhauling the tax code to bring in more revenue, and proposals he has already set out in his 2012 budget.
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