GOP disses Obama's 2012 budget

By Jennifer Liberto, senior writer


WASHINGTON (CNNMoney.com) -- House Republicans hammered President Obama's 2012 proposed budget on Tuesday, telling Treasury Secretary Tim Geithner that tax increases included in the plan are unacceptable.

"Because they kill jobs, those tax increases are dead on arrival in this House," Rep. Kevin Brady of Texas told Geithner, who was testifying before the Ways and Means Committee.

President Obama, in defending his budget proposal earlier in the day, vowed that his proposal would slash deficits by $1.1 trillion over the next decade. Two-thirds of those deficit cuts would result from spending reductions, while a third would come from an increase in tax revenue, according to the White House.

Republicans aimed most of their criticism at the tax hikes, which would impact the wealthiest Americans, as well as some companies and the oil and gas industries.

Ways and Means Chairman Dave Camp of Michigan and other Republicans said the president's plan to let tax breaks expire for the upper-income Americans would end up hurting small businesses. They say many small business owners pay their business taxes by filing as individuals, putting them in the nation's top tax brackets.

"There's disappointment on our side that the president's budget brings up some of the same tax hikes on America's small business that Congress, even when both chambers were controlled by Democrats, already rejected," Camp said.

Democrats counter that those small businesses impacted by expiring tax breaks tend to be investment and law firms. They also say the changes would return the nation to tax rates that led to surpluses in the 1990s.

"Our challenge is to figure out a way to restore sustainability and strengthen economic growth," Geithner said. "We're not going to be growing in the future unless we make some tough choices to restore fiscal responsibility."

But Republicans, who now control the House and are under pressure to keep taxes low, made it clear that tax hikes are a non-starter.

Earlier in the day, House Speaker John Boehner also criticized the president's budget proposal for not cutting enough.

Boehner pledged that Republicans would address reshaping entitlement programs, such as Medicaid and Social Security, when they release their budget blueprint this spring.

"Republicans will not punt," said Boehner. "Everything's on the table. We will put forward a budget that deals with the big challenges that face our country...I have no doubts that all of these issues [Social Security and Medicare] will be on the table." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play

Search for Jobs

Index Last Change % Change
Dow 18,080.14 21.45 0.12%
Nasdaq 5,092.09 36.02 0.71%
S&P 500 2,117.69 4.76 0.23%
Treasuries 1.92 -0.03 -1.54%
Data as of 5:17am ET
Company Price Change % Change
Microsoft Corp 47.87 4.53 10.45%
Apple Inc 130.28 0.61 0.47%
Comcast Corp 59.64 0.41 0.69%
AT&T Inc 34.01 -0.22 -0.64%
Xerox Corp 11.99 -1.15 -8.75%
Data as of Apr 24
Sponsors

Sections

Shares in Italian bank Intesa Sanpaolo dropped sharply Friday after hoaxers claimed its CEO had quit after faking billions in profits. More

The impact of rising immigration on Britain's economy has become a hot topic in the election campaign. More

Apple is likely to post huge growth in sales and profits thanks to the popularity of the iPhone 6. Here's all the numbers to keep an eye on in the report. More

A Girl Scouts Cookie Oven rolling out to Wal-Mart, Target, Kmart stores this summer will let you bake those iconic thin mints right at home. More