Obama budget seeks boost for military, domestic programmes

[WASHINGTON] United States President Barack Obama will call for a 7 per cent rise in US domestic and military spending in his budget that would end caps known as 'sequestration,' the White House said on Thursday, setting up a new source of conflict with Republicans in Congress.

Mr Obama intends to announce his budget plans during a meeting with congressional Democrats in Philadelphia later in the day.

The fiscal 2016 budget, which the administration plans to unveil on Monday, would fund a host of programmes that Republicans are unlikely to support.

It is the latest salvo by the Democratic president lobbed at a Congress controlled by the opposition party, and follows a defiant State of the Union address last week that critics said betrayed an unwillingness to seek compromise.

The White House rejects that criticism and hopes Mr Obama can find common ground with lawmakers from both parties to prevent sequester cuts from going back into full force when the next fiscal year begins on Oct 1.

Mr Obama's budget, which is as much a political document as a fiscal road map, would do that by trimming "inefficient spending programmes" and eliminating tax loopholes, a White House official said. It proposes a roughly 7 per cent spending jump over the sequester limits.

That includes US$530 billion (S$717.1 billion) in non-defence discretionary spending, which is US$37 billion above the caps, and US$561 billion in defence outlays, which is US$38 billion above.

"This is the beginning of a negotiation," White House spokesman Josh Earnest told reporters. "We're certainly open to ideas that Republicans have ... What the president (has) put forward is what he believes is the best way for us to move forward, and that's what his budget reflects."

The proposals got an early brush-off from Republican Senate Majority Leader Mitch McConnell's office, which noted the administration tried unsuccessfully to do away with the cuts before.

"This is not a surprise," said Don Stewart, McConnell's deputy chief of staff, in an email. "Previous budgets submitted by the president have purported to reverse the bipartisan spending limits through tax increases that the Congress, even under Democrats, could never accept."

The automatic spending cuts went into effect in 2013, but were lessened in 2014 and 2015 under a bipartisan bill negotiated by Democratic Senator Patty Murray of Washington state and Republican Representative Paul Ryan of Wisconsin.

That compromise bill ends with the current fiscal year on Sept 30.

A spokesman for Republican House of Representatives Speaker John Boehner said Mr Obama's solution of raising taxes for some would not fly.

"Republicans believe there are smarter ways to cut spending than the sequester and have passed legislation to replace it multiple times, only to see the president continue to demand tax hikes," said Cory Fritz. "Until he gets serious about solving our long-term spending problem, it's hard to take him seriously."

Democratic congressional aides said Mr Obama's budget also will include US$1 billion in new aid for Central America.

The money is meant to address conditions that led to an influx into the United States last year of tens of thousands of illegal migrants, including more than 60,000 children traveling without their parents.

The budget will likely propose spending increases to help fund infrastructure projects, as well as research and development initiatives. Following through on Mr Obama's State of the Union address, it will propose raising taxes on the wealthy to cover tax credits and educational programs for the middle class.

That drew praise from Democrats. "The president's plan to replace the sequester with a budget that creates jobs and opportunities for the middle class is just what the American people need," said House Democratic leader Nancy Pelosi.

REUTERS