Obama to convene cabinet to cut govt spending

US President Barack Obama, faced with mushrooming budget deficits, announced he will convene his first full cabinet meeting Monday and ask his secretaries for specific plans to cut spending.

US President Barack Obama addresses the Fiscal Responsibility Summit in February 2009. Obama -- faced with mushrooming budget deficits -- has announced he will convene his first full cabinet meeting and ask his secretaries for specific plans to cut spending.

He also added to his administration two new officials, Jeffrey Zients and Aneesh Chopra, whose task will be to streamline processes, cut costs and make the government more efficient.

"And this Monday, at my first, full cabinet meeting, I will ask all of my department and agency heads for specific proposals for cutting their budgets," Obama said in his weekly radio address Saturday.

The announcements came after the non-partisan Congressional Budget Office (CBO) forecast last month the budget deficit could hit 1.845 trillion dollars for the whole year based on Obama's 3.5-trillion-dollar budget plan approved by Congress early this month.

The CBO said its budget deficit estimate for fiscal 2009, which ends on September 30, would be four times the 2008 record shortfall and amount to 13.1 percent of the country's total economic output.

The Obama budget forecasts a 1.750 trillion dollar deficit in fiscal 2009, but foresees that figure falling to 1.171 trillion dollars in 2010.

The plan sees the deficit soaring to the largest percentage of gross domestic product since World War II, but the president touted a string of cost savings designed to lay new foundations for the US economy.

In his address, Obama said that the future of America will depend not only on building a more efficient economy, controlling health care costs and improving the education system, but also on "restoring a sense of responsibility and accountability" to the US federal budget.

"Without significant change to steer away from ever-expanding deficits and debt, we are on an unsustainable course," he stressed.

Obama said that in the coming weeks, he will be announcing the elimination of dozens of government programs shown to be wasteful or ineffective -- and vowed to be tough.

"In this effort, there will be no sacred cows, and no pet projects," he promised. "All across America, families are making hard choices, and it's time their government did the same."

The president said the process of finding ways to cut government spending had already begun, with his aides scouring the budget line by line for programs that do not work and can be replaced with more efficient ones.

He noted that they are focusing on ending tax breaks for companies that ship jobs overseas, ending fraud and abuse in the Medicare program that serves the elderly, and reforming the health care system to cut costs for families and businesses.

According to Obama, his administration is also looking for ways to strengthen protections for government employees who step forward to report wasteful spending and wants to reinstate the pay-as-you-go rule that mandates that any new spending program must be offset by cuts elsewhere.

Obama praised Homeland Security Secretary Janet Napolitano for ending contracts to create new seals and logos for her department that would have cost the treasury three million dollars as well as Defense Secretary Robert Gates for finding ways to eliminate hundreds of billions of dollars in spending.

Earlier this month, Gates proposed halting production of F-22 fighter jets, canceling a new presidential helicopter and delaying ship building plans.

He also called for cutting 1.4 billion dollars from missile defense weaponry in the 2010 budget, canceling plans for more C-17 transport aircraft and scrapping a US Army vehicle that forms part of a hi-tech network known as Future Combat Systems.

Obama also announced that Zients, a management consultant and entrepreneur, will join his administration as chief performance officer and deputy director for management at the Office of Management and Budget.

Meanwhile, Chopra, Virginia's secretary of technology, will serve as the chief technology officer.

"With the leadership of these individuals, I am confident that we can break our bad habits, put an end to the mismanagement that has plagued our government, and start living within our means again," Obama pointed out. "That is how we will get our deficits under control and move from recovery to prosperity."

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