Conrad, D-N.D., who has for decades sought to highlight the dangers of permanent deficits and rising government debt, produced a budget plan bristling with both - even after proposing to require wealthier taxpayers to pay higher rates on income and capital gains.
But Democrats point out that Obama inherited an unprecedented fiscal mess caused by the recession and the taxpayer-financed bailout of Wall Street. Rather than retrenching, however, they still promise to award big budget increases to education and clean energy programs, while assuming Obama's plans to overhaul the U.S. health care system advance.
"The best way to bring our deficit down in the long run is ...
with a budget that leads to broad economic growth by moving from an era of borrow-and-spend to one where we save and invest," Obama said in a Tuesday night news conference.
On the $400-$800 tax credits, White House budget director Peter Orszag noted that it will be in place for two years, giving the administration and Congress time to find ways to extend it.
But it's also becoming clear that Obama's controversial global warming initiative has experienced a setback as neither House nor Senate Democrats are directly incorporating Obama's controversial "cap-and-trade" initiative into their budget plans.
The developments come on the eve of debate in the House and Senate budget committees as they take the first steps to pass Obama's $3.6 trillion budget plan for the fiscal year starting in October.
House Budget Committee Chairman John Spratt Jr., D-S.C., will unveil his companion plan Wednesday.
Obama's budget has ignited a firestorm on Capitol Hill, with Republicans assaulting it over record spending and budget deficits, while many Democrats remain wary of his plans to combat global warming and have sticker shock over his deficit figures.
Obama is coming to appear before Senate Democrats at lunchtime Wednesday to promote his plan.
"It puts us on the path over 10 years for a very different kind of country, one with less freedom, one with more government, one with this extraordinary debt, and one which our children will have a very difficult time affording," said Sen. Lamar Alexander, R-Tenn.
Conrad's plan was released in the wake of new Congressional Budget Office estimates that predicted Obama's plan would produce alarming estimates of red ink - $9.3 trillion over 10 years and a deficit of $749 billion in 2014. Obama's budget promises a $570 billion deficit in that year, and to get below that figure Conrad was forced to make a series of difficult choices.
"When you lose $2.3 trillion, you have to pay for things. You have to cut things," Conrad said.
Conrad said his budget makes room for Obama's hopes to deliver health care to the uninsured. He said the plan would not add to the deficit over the long haul but that early upfront costs would be permitted.
In the House, the health care overhaul could advance under special rules that could effectively cut Republicans out of the debate by preventing the possibility of a Senate filibuster. Conrad and others like Finance Chairman Max Baucus, D-Mont., disagree with the approach, saying that health care is too complicated to pass after just a 20-hour debate in the Senate.
In grappling with the deficit, Conrad would cut Obama's proposed increases for next year for domestic agencies funded by lawmakers to growth of about $27 billion, or 6 percent. Over five years, the savings from Obama's budget would be $160 billion from such appropriated programs.
But Conrad also makes several shaky assumptions, especially that Congress will raise taxes by more about $114 billion over 2013-14 to make sure middle-class taxpayers won't get hit by the alternative minimum tax. He also saves $87 billion by promising Congress will come up with spending cuts or new revenues to avoid cuts in Medicare payments to doctors.
Both problems have been fixed in recent years by using deficit dollars.
Under Congress' arcane procedures, the annual congressional budget resolution is a nonbinding measure that sets the terms for follow-up legislation.
The congressional budget plan also determines how much money to use for defense programs and domestic programs whose budgets are set each year by Congress, and it sets out the fiscal priorities of the governing party in Congress.
Obama's plan to combat global warming would impose higher energy costs on consumers and businesses through a so-called "cap-and-trade" system for auctioning permits to emit greenhouse gases. But so many Democrats have recoiled at the plan - which would sharply raise energy costs for consumers and businesses - that House Speaker Nancy Pelosi of California and other environmentalists were forced to step back.
Neither budget includes Obama's $250 billion set-aside for more bailouts of banks and other firms.
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