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Jamie Dupree's Washington Insider

Posted: 6:06 a.m. Tuesday, Jan. 26, 2010

Obama Budget Freeze 

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By Jamie Dupree

About the last thing many voters would expect is for President Obama to unveil a budget freeze on most areas of domestic spending, especially after watching the Stimulus, Omnibus and more go through Congress.  But that's where he's headed, and it won't be pretty.

Back during the 2008 campaign, Candidate Obama compared a budget freeze to a hatchet, saying he would use a scalpel to cut spending.

But now things are different, eh?

Senior Administration officials said the plan for a three-year freeze will be included in the President's budget, which goes to the Congress on Monday, all an effort to clamp down on the exploding deficit.

The reason for it is simple - the budget is screwed up.

Now, this freeze would not hit all parts of the budget.  Entitlements like Medicare and Social Security would not be hit.

The Pentagon and homeland security items would be spared, as would veterans spending.

So, the freeze would hit most of the "domestic discretionary" budget that Congress deals with, saving $250 billion over ten years according to the White House.

While that is a lot of money, remember - last year's budget deficit was $1.42 trillion.  This year's deficit is heading even higher.

So it's just a drop in the bucket.

Watch the reaction from true-blue Democrats on this in the Congress, because most are unlikely to support the idea.  There have already been rumblings that key lawmakers told the White House they weren't interested.

The other thing to watch - not tomorrow in the State of the Union, but next week in the agate type of the budget - is how much in tax revenue he plans to raise.

So while Republicans might carry the water on a budget freeeze for the President, they won't be ready to back him on tax increases.

The details will be the most important part.  Stay tuned.

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