Obama Finds Trimming the Deficit More Difficult Than Expected

A deeper recession than the administration initially predicted has made President Obama's goal of trimming the federal deficit in next year's budget much more difficult, the New York Times reports. Obama is preparing the budget he will have to present to Congress in February, and is still promising reductions to the deficit.

But the slow recovery has increased the bill for government stimulus and job-creation programs beyond the $787 billion Congress passed last year, and the savings Obama predicted from winding down the war in Iraq have been offset by a new buildup in Afghanistan. In addition, one of the usual methods of shaving the budget -- reducing Medicare payments -- is already being considered to fund a proposed health care reform.

"The White House faces a tough challenge preparing a budget with very different goals: cutting the deficit while maintaining stimulative policies designed to keep the recovery going," said Thomas S. Kahn, staff director for the House Budget Committee. "There are unfortunately no politically painless ways to cut the deficit. Virtually all the low-hanging fruit has already been picked."

Obama's difficult budget preparations also fall in an election year, when members of his party are especially shy of voting on risky measures to cut government programs or raise taxes. The deficit for the 2009 fiscal year was $1.4 trillion, about 10 percent of the country's gross domestic product.