Obama’s big budget draws battle lines

PRESIDENT Barack Obama has proposed a $3.99 trillion (NZ$5.3t) budget that drew scorn from Republicans and set up battles over tax reform, infrastructure spending, and the quest to prove which party best represents the middle class.

In his fiscal year 2016 budget blueprint, a political document that must be approved by Congress to take effect, Obama proposed a series of programmes to help middle-income Americans that he would pay for with higher taxes on corporations and wealthy individuals.

He also sought to show that the United States could increase spending in a fiscally responsible way. The budget foresees a $474 billion deficit, which is 2.5 per cent of US gross domestic product.

Obama’s budget fleshes out proposals from his State of the Union address last month and helps highlight Democratic priorities for the last two years of his presidency and the beginning of the 2016 presidential campaign.

‘‘I know there are Republicans who disagree with my approach. And I’ve said this before: If they have other ideas for how we can keep America safe, grow our economy, while helping middle-class families feel some sense of economic security, I welcome their ideas,’’ Obama said.

‘‘But their numbers have to add up. And what we can’t do is play politics with folks’ economic security, or with our national security.’’

Obama spoke from the headquarters of the Department of Homeland Security, a site the White House chose to emphasise its insistence that Republicans fund the agency charged with implementing his controversial executive actions on immigration.

The president said the opposing party would put the nation at risk if it did not fully fund the department. Republicans have threatened to curtail department spending to block Obama’s executive orders on immigration.

They have said they see room for compromise in areas such as tax reform and infrastructure, but many of Obama’s programmes, which were rolled out in the weeks before the budget’s release, have landed with a thud.

‘‘Today, President Obama laid out a plan for more taxes, more spending, and more of the Washington gridlock that has failed middle-class families,’’ said John Boehner, Republican speaker of the House of Representatives.

‘‘It may be Groundhog Day, but the American people can’t afford a repeat of the same old top-down policies of the past.’’

Democrats, however, viewed the budget as a statement of their priorities and a chance to demonstrate they represent the party that champions middle-income Americans.

‘‘(It) affords him an opportunity to contrast his vision of helping the middle class with the Republican Congress’ approach of exacerbating inequality, ignoring the middle class and making the burdens of those who want to enter it even greater,’’ said Neera Tanden, president of the Center for American Progress, which has close ties to the Obama White House.

The budget achieves $1.8 trillion in deficit reduction over the next 10 years, officials said, through healthcare, tax and immigration reform, but the forecast assumes Republican support for Obama’s programmes, which is unlikely.

Republicans have blocked immigration reform legislation in the House, for example, and Obama’s budget assumes passage of such a bill.

The administration foresees a continuation of the decline in unemployment, forecasting a rate of 5.4 per cent in 2015. It stands at 5.6 per cent. It also proposes a new infrastructure bank, a 6 per cent increase in research and development, and a controversial consolidation of US government agencies. Obama has previously proposed combining trade agencies, but the proposal fizzled.

The budget sets aside $14 billion to strengthen US cybersecurity defences after a spate of high-profile hackings. It calls for a one-time, 14 per cent tax on an estimated $2.1 trillion in profits piled up abroad by companies such as General Electric and Microsoft, while imposing a 19 per cent tax on US companies’ future foreign earnings.

It proposes a 7 per cent rise in US domestic and military spending, ending ‘‘sequester’’ caps with reforms to crop insurance programmes and closing tax loopholes such as one on ‘‘carried interest.’’ UNIDENTIFIED attackers threw petrol bombs on a packed passenger bus, leaving at least seven people dead and 16 others injured yesterday amid a nationwide general strike enforced by an opposition alliance calling for new elections in Bangladesh.

Local police chief Uttam Chakrabarty said the pre-dawn attack took place in the eastern district of Comilla when passengers were asleep on a trip to Dhaka from the southern coastal district of Cox’s Bazar. The area is about 90 kilometers east of the capital.

The injured have been admitted to hospital mostly for burns.

It is the latest in a series of arson attacks allegedly carried out by opposition activists that have killed at least 53 people have died since January 5 as the opposition alliance led by former Prime Minister Khaleda Zia enforces a nationwide transportation blockade called to force Prime Minister Sheikh Hasina to step down.

The January 5 was the one-year anniversary of Hasina’s return to power. Zia had planned an antigovernment rally in Dhaka on that day, but police refused to allow it due to violence worries. Zia then announced a nonstop transportation blockade until Hasina resigns.

But many buses, often escorted by police and para-military border guards, have been running, sparking attacks around the country. Authorities blame opposition activists and hired goons for the attacks. Zia and her aides say the opposition is not involved.

Tuesday was also the last day of a 72-hour nationwide general strike enforced by the opposition.

Zia’s party and its partners – who had demanded that a neutral administration oversee the election – boycotted the last vote in 2014, allowing Hasina to win a five-year term. Hasina says new elections will not be held until her term ends in 2019, saying the nation cannot suffer because of a ‘‘wrong political decision.’’

The new phase of violence ended a year of relative calm as political violence left nearly 300 people dead in 2013.

Zia was prime minister from 2001 to 2006, but failed to hand over power peacefully. A militarybacked caretaker government then ruled the country for two years before Hasina came to power with a landslide election win in 2008.