Obama sets up panel to tackle U.S. debt

09:44, February 19, 2010      

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U.S. President Barack Obama on Thursday issued an executive order to establish a bipartisan commission after Congress rejected a similar body to find ways to reduce the huge budget deficit.

"These are tough times, and we can't keep spending like they're not," Obama said, before signing the executive order at the White House.

Obama said that unless lawmakers put aside partisan differences, the continuing red-ink trend could "hobble our economy."

"It will cloud our future and it will saddle every child in America with an intolerable burden," he said.

The federal deficit hit a record 1.41 trillion dollars in fiscal year 2009.

In the 2011 fiscal year budget proposal sent to the Congress earlier this month, President Obama said that the budget deficit will swell to a record 1.56 trillion dollars in the 2010 fiscal year ending September.

Last year's deficit equaled 9.9 percent of GDP, the highest point since World War II, and is projected to climb to 10.6 percent of GDP this year. Officials say a sustainable deficit-GDP ratio is about three percent.

Obama once wanted to push a Congress approved commission to tackle the debt issue. But it was rejected by lawmakers in the Senate -- by Republicans who had previously backed the idea as a way of trimming huge U.S. deficits.

Though Obama's commission will lack any requirement for Congress to act on its advice, it could provide the president some political cover with an electorate that is increasingly concerned about the massive deficit.

Source: Xinhua
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