Saturday, March 28, 2009
President Obama's first Budget
February 26, 2009-President Obama came up with his first financial budget of around a multi trillion dollar. His very ambitious first budget seems to cut the rate of federal deficit first via few steps like increasing business tax, wealth tax and by diminishing spending after Iraq and Afghanistan war. Here is an overview on his budget plan.
Economy budget started with labour department. Expected budget rise for this is about $600 million which is almost 4.7%. Legislation also proposed that there will be extended benefits given to the unemployed. Retirement security plan has also got a boost as the employers who usually do not offer retirement plan has to enroll themselves in direct deposit IRAs. As a stimulus package helping poor has been approved. Around 13% additional help would be provided to the disadvantaged people which sums up to $79 a month. Budget is also offering an increase of $1 for child nutrition program and $25 increment weekly for unemployment benefit.
Budget calls for a hike of $663.7 billion which comes to 4% from the last year. The expenditure for the wars has been included in calculating the deficit for the first time. Officials are saying that budget is giving a ratio which is definitely contributing in lowering the figure in this changed operation. It is giving a ratio of 20% for war funds and 80% for others.
Obama's perception for higher education was highlighted when he urged all Americans to start some kind of crash courses and keep oneself engaged and prepared for future. He also added "A higher education is no longer just a pathway to opportunity; it's a prerequisite." He wants a dramatically rise in the figure of college graduates by maximum 2020. President wants to do away with the student loan provided by different banks and lenders and replace it with direct student loan program given by the Education department itself. It promises a huge save of about $24 million.
Rate of tax has been increased for families making more than $250,000 annual income where as tax rate has been cut for most of the families who are failing to make so. It is providing a tax credit of $400 for individuals and $800 for couples. Deduction rate has also been checked. Affluent taxpayers would get a 20% tax rate on the total capital gains and dividends.
Proposed transportation spending is around $70.5 billion but an additional $48 billion is also allocated for this need. This budget has proposed a new initiative like having a "National Infrastructure Bank" which can provide financial support for infrastructural projects on national or regional basis. $800 million has been granted for improving air traffic control system. Around $55 million fund to increase commercial air service in rural areas.