On Wednesday, Treasury Secretary Timothy Geithner testified before the Senate Finance Committee to outline President Obama's Fiscal Year 2010 Budget. In opening statements, both Chairman Max Bauchus (D-MT) and Ranking Member Chuck Grassley (R-IA) commended the budget proposal and expressed eagerness to find out how to best "roll[ing] up our sleeves" to tackle the tough challenges facing the country. Before detailing the salient budget initiatives that will "return the nation to a sustainable fiscal position" and rectify "[l]ong neglect of critical investments," Secretary Geithner first lauded the Obama administration's "immediate response to several problems confronting the country" including the passage of the America Recovery and Reinvestment Act, and introduction of the Financial Stability Plan and Homeowner Affordability and Stability Plan.
A brief summary of Secretary Geithner's remarks concerning the President's proposed budget is as follows:
- Budget Honesty - The budget offers an "honest assessment of the dimensions of the problems facing the country in the intermediate and long-term," including acknowledging that, the effort to stabilize the financial system may cost significantly more than the costs incurred thus far.
- Reducing the Deficit - The budget will bring the deficit down to $533 billion by fiscal year 2013 or 3% of GDP, a point at which the national debt will stop "growing faster than the economy itself."
- Key Revenue Provisions - The budget's revenue provisions, including "cutting taxes for 95% of working Americans," zero capital gains rates on small business owner investments, and taxing the "carried interest" of hedge fund managers and private equity managers, are all designed to encourage growth and recovery, improve fairness of the tax code and support critical priorities.
- Investing in Health Care - Reforming America's health care system to "[m]ake it less costly, more comprehensive and fairer" by setting aside a reserve fund of more than $630 billion over ten years to help finance reforms and including over $20 billion for health information technology, comparative effectiveness and prevention.
- Investing in Education - New education tax credits and revised education grants are "[s]ubstantial strides towards ensuring that a college education is affordable for all Americans, and to ensure that American workers are prepared to compete in the global economy."
During questioning, Secretary Geithner affirmed that it was “critical and imperative” that the country “get back on a path to fiscal responsibility” and admitted it would be difficult to do without “shared sacrifice.”