President Barack Obama on Tuesday will call for a small package of spending cuts and tax changes to delay $85 billion in automatic spending cuts, known as “the sequester,” from kicking in next month.
“Given that the budget process in Congress won’t likely be completed by March 1st, the President on Tuesday will call on Congress to pass a smaller package of spending cuts and tax reforms to avoid the economically harmful consequences of the sequester for a few months, which will allow Congress more time to reach a solution that permanently avoids the sequester and significantly reduces the deficit in a balanced way,” a White House official told The Washington Post late Tuesday morning.
Obama will deliver a statement outlining his proposals at 1:15 p.m.
The deep spending cuts were established during the August 2011 debt ceiling deal as way to force Congress to come up with a long-term deficit-reduction plan. The deal set up the ill-fated 2011 “supercommittee” that was ultimately unable to agree on spending cuts.
Although $109 billion in cuts were originally scheduled to occur on Jan. 1, Congress approved a last-minute “fiscal cliff” deal in December that delayed the sequester until March 1.
Democrats are discussing implementing a combination of tax increases and spending cuts to replace the sequester, according to The Hill.