Obama to propose $3 trillion in deficit cuts

WASHINGTON - US President Barack Obama will release a plan on Monday calling for more than $3 trillion in deficit cuts over 10 years, with about half of the savings coming from higher taxes on the wealthy and big corporations.

In remarks in the White House Rose Garden at 10:30 am (1430 GMT), Obama will also seek to energize his Democratic supporters with a vow to shield middle-class social insurance programs from large-scale cuts.

"The president will make clear he is not going to support any plan that asks everything of some Americans, nothing of others," said an official who previewed the plan for reporters.

"He'll say that he'll veto any bill that takes one dime from the Medicare benefits seniors rely on without asking the wealthiest Americans and biggest corporations to pay their fair share."

Protesters blocked in bid to 'occupy' Wall Street

Protesters demonstrate in a park near Wall Street against banks and corporations in New York on Saturday. 

NEW YORK - Hundreds of people marched on Saturday near Wall Street in New York in a failed attempt to occupy the heart of global finance to protest greed, corruption and budget cuts.

Plans by protesters to turn Lower Manhattan into an "American Tahrir Square" was thwarted when police blocked all the streets near the New York Stock Exchange and Federal Hall in Lower Manhattan.

The demonstrators had planned to stake out Wall Street until their anger over a financial system they say favors the rich and powerful was heard.

"The one thing we all have in common is that we are the 99 percent that will no longer tolerate the greed and corruption of the one percent," said a statement on the website Occupy Wall Street.

By noon, about 700 people, many carrying backpacks and sleeping bags, had gathered near Wall Street to search for a place to camp amid a heavy police presence.

That was far less than the 20,000 people that the online magazine Adbusters, which launched the movement in July, had hoped to see "flood" the neighborhood for a months-long occupation.

The protesters who did arrive were full of zeal and righteous indignation.

"This is a protest against corporate greed and we come to Wall Street because Wall Street is the Ground Zero for corporate greed," said Julia River Hitt, a 22-year-old philosophy student.

"We are here just to say we are fed up, we are not gonna take it anymore."

The protesters gathered in Trinity Place, some 300 meters from Wall Street, which they hope to turn into the US version of the famous square in Cairo that became the focal point of protests that led to the ouster of Hosni Mubarak in February.

"No more corruption," read one sign a demonstrator brandished. "Wall St Greed, New Yorkers Say Enough," read another.

"I will sleep here. A lot of us we will sleep here," said Steven Taylor, 24 a protester who arrived equipped with a backpack and a sleeping bag.

Youths shared food and discussed the economic crisis in groups of 15 and 20. Others marched around the square.

Among the group was Javier Dorado, a law professor from Spain who compared the protesters with the mass "indignant" demonstrations in his country against high unemployment, welfare cuts and corruption.

Obama to propose 'Buffett Tax' on US millionaires

WASHINGTON - US President Barack Obama, in a populist step designed to appeal to voters, will propose a "Buffett Tax" on people making more than $1 million a year as part of his deficit recommendations to Congress on Monday.

Such a proposal, among suggestions to a congressional supercommittee expected to seek up to $3 trillion in deficit savings over 10 years, would appeal to his Democratic base ahead of the 2012 election but may not raise much in revenues.

White House Communications Director Dan Pfeiffer said on Saturday the tax would act as "a kind of AMT" (Alternative Minimum Tax) aimed at ensuring millionaires pay a minimum rate of tax that at least matches that of middle-class families.

The "Buffett Tax" refers to billionaire US investor Warren Buffett, who wrote earlier this year that rich people like him often pay less in tax than those who work for them due to loopholes in the tax code, and can afford to pay more.

Obama is scheduled to lay out his recommendations in White House Rose Garden remarks on Monday and is expected to urge steps to raise tax revenue as well as cuts in government spending.

Those could include reforms of the Medicare and Medicaid government healthcare programs for elderly and poorer Americans. The White House has already said Obama will not recommend any changes to the popular Social Security federal retirement plan.

Obama, who has been hammered in opinion polls over his handling of the faltering economy, wants to use his plan to counter Republican claims he is a "tax-and-spend" liberal as he campaigns for re-election next year.

Congress is at liberty to ignore his suggestions and Republicans, who control the US House of Representatives, have said that they will not agree to tax hikes.

Investor scrutiny

If the president pushes for tax increases that stand little chance of being passed by a divided Congress, it may help him blame lawmakers for thwarting his plans at a time when the public's opinion of Congress has touched record lows.

But he is also under pressure to show leadership after rating agency Standard and Poor's cut the US AAA credit rating, and as investors scrutinize Washington for evidence it can curb the country's towering deficit and mounting debt.

The supercommittee of six Democratic and six Republican lawmakers must find at least $1.2 trillion in deficit savings before the end of the year to avoid painful automatic cuts, and is mandated to seek savings of up to $1.5 trillion.

Those savings are on top of $917 billion in deficit reduction agreed to in an August deal to raise the US debt limit and Obama wants the supercommittee to go further.

Obama has separately urged the supercommittee to consider $467 billion in tax increases on top of that goal to pay for a jobs bill he unveiled earlier this month.

Top Obama adviser calls for less regulation

Job seekers filling out applications during a recruiting event sponsored by Chicago's Greater West Town Community Development Project at the Mabel Manning public library in Chicago, Illinois, on Aug 31. 

Jeffrey Immelt believes it will spur growth in stagnant labor market

WASHINGTON - The United States government must reduce business regulation to spur job growth, said Jeffrey Immelt, chief executive officer of General Electric Co and head of President Barack Obama's Council on Jobs and Competitiveness.

"The one thing I hope to get done is to create more jobs," Immelt said in an interview on CNN's Fareed Zakaria GPS, broadcast on Sept 19. "There's got to be some simplification of regulations."

Immelt, named to the council in January to build a bridge between the government and the country's employers, said industry-wide jobs proposals will be ready by the end of this year. Americans' pessimism about the economy has deepened, sending Obama's approval ratings to the lowest of his presidency, as the stagnant labor market limits consumer spending and threatens to trigger another recession.

One way to boost confidence among employers is to "try to see through the eyes of small businesses", which face a bigger hurdle than large companies such as GE, International Business Machines Corp and JPMorgan Chase & Co, Immelt said.

"We're big enough companies that we can muscle through regulatory" pressures, he said. "We can comply. We can do the things we need to do."

"If you're a $50 million business, it's just so much harder," he said. Seen from his perspective, small business "has all the problems GE has, only on steroids".

More certainty

More certainty on tax rates and healthcare policy and building a well-trained workforce would also encourage companies to hire and increase investment, Immelt said. At the same time, for companies to say the lack of these incentives is stopping them from investing is "a crutch".

GE expects to add about 15,000 jobs in the US this year and is investing in the country as well as in overseas markets such as China and India, Immelt said. The businessman is also chairman of GE, based in Fairfield, Connecticut. It is the biggest maker of power generation equipment, medical-imaging machines, locomotives and aircraft engines.

Obama's $447 billion plan includes tax cuts and spending proposals to jump-start job creation. Payrolls were little changed in August and the unemployment rate held at 9.1 percent, Labor Department figures showed. On Sept 2 Obama's disapproval rating reached 50 percent for the first time since he became president of the US, according to a New York Times/CBS News poll conducted from Sept 10 to Sept 15.

Debt, government cuts

While the US needs to reduce its debt and the size of the government, Immelt said, it also needs to spend on improving education, infrastructure and research and development to spur innovation and become more competitive.

"There is a role, I think a small role, to be played by the government in risk-taking, in helping to evolve where we go," Immelt said when asked whether the US government should be as active as the Chinese government has been in a push to compete for market share with GE in wind turbines.

For more than 100 years, the US government has been "a catalyst to drive growth", he said. The National Institutes of Health helped to create the world's best healthcare system and "the nuclear industry was built on the back of the Department of Defense", which also "spawned the Internet", Immelt said.

In China, there is a "system where the government fundamentally runs the play", Immelt said. He said he makes GE executives study China's Five-Year Economic Plans to better understand how to compete and win.

"We do have to recognize that competition has changed, that the biggest competitor plays the game in a very state-driven way," Immelt said on CNN.

In the US, businesses work together and the government and private industry team up to find solutions, he said.

The US has thrived on a "sense of partnership that's very much a part of the American culture", Immelt said, adding he is confident that "will ultimately play out" and work in the nation's favor.