* Little movement seen toward compromise on halting cuts
* Administration feels it has upper hand in budget debate
* Pentagon to release plan for furloughs this week
* Commission proposes $2.4 trillion in deficit reduction
By Steve Holland and Roberta Rampton
WASHINGTON, Feb 19 President Barack Obama
renewed pressure on congressional Republicans to head off budget
cuts that are due to begin on March 1, staging a White House
appearance with emergency workers to illustrate jobs he said
were at risk.
Obama is trying to get concessions from Congress to stall
the cuts by ending tax breaks enjoyed mainly by wealthy
"My door is open. I put tough cuts and reforms on the table.
I am willing to work with anyone to get this job done," Obama
said at the event. In a symbolic gesture, Obama was flanked by
17 uniformed firefighters and law enforcement officers who would
not necessarily be laid off by the cuts.
Obama plans similar events in the next 10 days. The
administration believes the public will blame job losses on
congressional Republicans, senior administration officials told
Unions are also planning events this week with toddlers in
strollers and seniors in wheelchairs to underscore the impact
the cuts will have on services.
With Congress off this week, it seems unlikely that a
compromise will be reached by the March 1 deadline.
Unless there is a deal, about $85 billion in
across-the-board spending cuts kick in at the beginning of March
and continue through Sept. 30 as part of a decade-long $1.2
trillion budget savings plan.
Private sector companies that have government contracts are
expected to begin issuing more layoff notices as the deadline
draws near, administration officials said.
The Pentagon is expected to notify Congress this week that
it plans to put about 800,000 civilian employees on unpaid leave
for up to 22 days in the coming months, a defense official said
Under the sequestration budget measures, half the cuts would
be shouldered by the Pentagon and the other half scattered among
other government agencies.
"This is not an abstraction. There are people whose
livelihoods are at stake," Obama said, noting the cuts, known as
"sequestration," could hurt the economy.
Even if the cuts happen, Congress is expected to blunt their
effect by negotiating a replacement measure in March while
lawmakers work on a deal to fund government agencies that run
out of money on March 27.
At the same time, the co-chairmen of a former fiscal
commission created by Obama added to the spending debate by
proposing $2.4 trillion in deficit reduction over 10 years.
Senate Republican leader Mitch McConnell criticized Obama
for holding a "campaign-style" event rather than focusing on
cutting government waste or trimming spending on green energy
"President says his door is open, but he's spent more time
in 2013 with Tiger Woods than with all congressional
Republicans," said Doug Heye, a spokesman for House Republican
leader Eric Cantor, on Twitter. He was referring to Obama's
weekend golf outing with Woods in Florida.
White House spokesman Jay Carney would not say whether
officials were holding meetings with Republicans.
"The problem here isn't a lack of meetings around the table
in the Roosevelt Room or the Cabinet room," Carney told
Republican Speaker John Boehner said the House has twice
passed a plan to replace the sequester with "common sense cuts"
and said the president needs to show he was willing to make cuts
to keep emergency workers and others on the job.
"Just last month, the president got his higher taxes on the
wealthy, and he's already back for more," Boehner said in a
Obama has been adamant that any budget agreement to replace
the cuts reflect a balanced approach and include both budget
cuts and tax increases.
To give Congress time to act on a long-term solution, Obama
urged congressional Republicans to accept a smaller $110 billion
package that Democrats proposed last week.
But Republicans believe they have raised taxes enough after
reluctantly agreeing to increase them on the wealthy as part of
a deal that avoided the "fiscal cliff" of higher taxes and
spending cuts that would have kicked in at the end of 2012.
Republicans want deeper spending cuts to reduce the United
States' $1 trillion annual deficits and $16 trillion national
Democrat Erskine Bowles and Republican Alan Simpson, who led
the fiscal commission, proposed cutting spending, overhauling
the tax system and reforming the healthcare system. Under their
plan, about one-fourth of the $2.4 trillion in deficit reduction
would come from healthcare reforms and another fourth from tax
The remaining reduction would come from a combination of
mandatory spending cuts, stronger caps on U.S. discretionary
spending, using the Consumer Price Index for inflation-indexed
provisions in the budget and lower interest payments.
It is unclear how much impact the plan will have because it
contains elements that have been non-starters for each party:
further tax revenue, which has been rejected by Republicans; and
deeper cuts to entitlement programs such as Medicare, a notion
spurned by Democrats.
The $600 billion in proposed savings on federal healthcare
spending reflects the scale of reduction that Republicans have
sought in deficit talks. But the approach is more in line with
Obama's proposals for reducing underlying healthcare costs and
seeking modifications rather than radical changes to programs.
The healthcare target dwarfs both the $400 billion in
savings from Medicare, Medicaid and other healthcare programs
sought by Obama and the $342 billion in savings proposed by the
Simpson-Bowles commission in December 2010. However, the two men
said the new proposal is not based on commission findings but on
ideas discussed in last year's fiscal cliff debate.
"What we tried to do is make enough cuts in healthcare to
slow the rate of growth on a per capita basis to the rate of
growth of the economy. In our opinion, that takes about $600
billion over a 10-year period," Bowles told CNBC.