Obama to seek to bust spending limits by $74 billion

WASHINGTON (AP) -- President Barack Obama will ask Congress to boost government spending by roughly 7 percent above current limits, the White House said Thursday, setting up a certain clash with Republicans who insist that federal spending must be held in check.

Obama's budget, to be formally released Monday, will call for $74 billion more than the levels frozen in place by across-the-board cuts agreed to by both Democrats and Republicans and signed by Obama into law. The White House said his new budget proposals will "fully reverse" the so-called sequestration on the domestic side, while raising military spending.

Under Obama's proposal, national security programs would see an increase of $38 billion over current spending limits, raising the defense budget to $561 billion. On the domestic side, Obama is calling for $530 billion in spending -- an increase of $37 billion.

"If Congress rejects my plan and refuses to undo these arbitrary cuts, it will threaten our economy and our military," Obama warned in an op-ed article Thursday in The Huffington Post.

The proposal from the president, two months after voters booted his party from control of the Senate, reflects the White House's newfound confidence in the economy. Obama's aides believe that improving conditions give Obama credibility to push his spending priorities unabashedly -- despite the fact that Republicans still believe government spends far too much.

Federal deficits, gas prices and unemployment are all falling, while Obama's poll numbers have crept upward. The president has been newly combative as he argues it's time to ease the harsh measures that were taken to help pull the economy out of recession.

Obama was to promote his proposed spending levels to House Democrats at their annual retreat in Philadelphia on Thursday evening. The White House said his budget will be "fully paid for with cuts to inefficient spending programs and closing tax loopholes," but taxpayers will have to wait until the budget is made public to find out exactly how.

While the proposal to spend more on things like education, sick leave and health care was sure to delight many members of Obama's own party, the Republicans now fully control Congress.

"This is not a surprise," said Don Stewart, Senate Majority Leader Mitch McConnell's deputy chief of staff. "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."

Yet Obama's move also puts Republicans in a precarious position.

Many in the GOP want to spend more on defense, especially in light of threats from terrorism and extremist groups. But Republicans are divided about how to pay. While some have argued for ignoring the spending limits, others want to offset the hikes with cuts to either domestic programs or so-called mandatory programs like Social Security and Medicare.

By proposing to raise defense spending by about the same amount as domestic programs, Obama is putting the GOP on notice that he won't accept cuts to his own priorities just to make way for more spending on national security programs that both parties are in the mood to support.

The Pentagon's base budget is currently $496 billion, plus another $64 billion for overseas missions. Obama's increases would allow for next-generation F-35 fighter jets, for ships and submarines and for long-range Air Force tankers. Military leaders have also said the earlier cuts forced reductions in pilots' flying hours, training and equipment maintenance.

On the domestic side, Obama has proposed two free years of community college and creating new or expanded tax credits for child care and spouses who both work. He's called for raising the top capital gains rate on some wealthy couples and consolidating education tax breaks, although some of those ideas have already faced intense opposition.

"Until he gets serious about solving our long-term spending problem, it's hard to take him seriously," said Cory Fritz, a spokesman for House Speaker John Boehner.

The president's budget proposal is just that -- a proposal-- and will not become law.

The budget frames Obama's opening offer as Democrats and Republicans head toward an inevitable clash. It's an agenda that Obama started selling in the run-up to his State of the Union address this month, and that House Democrats have sought to echo as they regroup after losing more members in the midterms.

In his meeting Thursday with House Democrats, Obama was also to insist that House Republicans not use a funding bill for the Homeland Security Department to try to quash the executive actions he took late last year on immigration and deportations. The White House called that a "dangerous view" by the GOP that would risk the country's national security.

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