DAVID GREENE, HOST:
This is MORNING EDITION, from NPR News. Good morning. I'm David Greene. Well, President Obama has delivered his budget proposal to lawmakers on Capitol Hill, and he'll be speaking about it later this morning. But it is not clear if anyone in the Republican leadership is even willing to negotiate the details. The plan does call for some spending cuts, as Republicans have been demanding; but also, new investments in preschool and public works and also new tax revenue, which for many Republicans is a deal-breaker.
Our White correspondent, Scott Horsley, joined us to talk about what the president hopes to accomplish with this budget. Good morning, Scott.
SCOTT HORSLEY, BYLINE: Good morning, David.
GREENE: So not a whole lot of appetite in Washington recently for big, new spending, but there's some of that in here.
HORSLEY: That's right. The president's calling for a fairly modest, $50 billion in new public works spending. Some would say that's small potatoes at a time when we're still suffering from relatively high unemployment, and we certainly have plenty of roads and bridges that need repair. But the president's been pushing the idea of public works spending for a long time now, without much result. That's the sort of short-term shot in the arm for the economy he's calling for here.
A longer-term investment the president wants to see is money to make high-quality preschool more widely available. The president talked about that in his State of the Union address. And today, we're going to see the price tag. It's not cheap, but the White House says we could pay for this with higher taxes on cigarettes.
GREENE: A tax on cigarettes to pay for a big change in education. OK, so that's some of the new, potential investments. But where are the spending cuts here?
HORSLEY: Well, the president says he's at least willing to rein in spending. And this budget codifies the last deficit-cutting offer he made to House Speaker John Boehner, the offer that Boehner walked away from back in December.
GREENE: The so-called grand bargain, as we called it in Washington?
HORSLEY: That's right. And as part of that offer, the president says he's willing to cut hundreds of billions of dollars from government health care programs over the next decade. Most of those cuts would come not by cutting benefits, say, to Medicare recipients; but instead, negotiating better prices on prescription drugs, that kind of thing.
The president also says he's willing to accept a new inflation calculator that would result in smaller cost-of-living increases for Social Security and other government programs. And that's not endearing him to liberals in his own party. We saw - sort of a counterweight to the Tea Party on the right yesterday. Here's Jim Dean of Democracy for America. He was protesting outside the White House.
JIM DEAN: Real Democrats do not cut Social Security, Medicare or Medicaid, period.
(APPLAUSE)
DEAN: It is shameful. And I'm here to tell you that any Democrat who wants to go along with a proposal like this can look forward to a primary in 2014.
(SOUNDBITE OF CHEERING)
GREENE: Wow, there's a political threat. That sounds like a pretty firm line from the left on any cuts to entitlements; I can imagine probably about as firm as the line Republicans are drawing on tax increases.
HORSLEY: Right. That's been the deal-breaker with Republicans, and that's why the president hasn't been able to strike a grand bargain in all this time. Now, the White House says it's only willing to go along with entitlement savings if it can also get tax increases. The budget calls for hundreds of billions of dollars in new taxes from people at the top of the income ladder, mostly by limiting the value of their tax deductions.
Now, it's far from clear that any Republicans will go along with that. And the fear, on the left, is that the president will sort of start with this budget, and then move to the right - although yesterday on your program, we heard Treasury Secretary Jack Lew say this budget should not be seen as an opening bid.
(SOUNDBITE OF ARCHIVED AUDIO)
SECRETARY JACK LEW: We've had two years of intense back-and-forth and negotiation. And I think that some of the early responses suggest that others may read it as a starting point. And I would just caution them that that's a mistake. That's not the way to go, to find the sensible center, to resolve these issues; and to get on and solve the problems the American people expect us to solve.
HORSLEY: The White House says with this budget and the offer to Boehner in December, the president has already moved more than halfway in the GOP direction.
GREENE: And I guess one challenge for the president is, the Republicans like to point out that the president got a tax increase already at the beginning of the year, right?
HORSLEY: That's right. He got $600 billion in new revenue from the wealthy in the fiscal cliff-avoiding deal at the beginning of the year. Now, that's less money than he could have gotten automatically, by simply allowing all the Bush-era tax cuts to expire. People said at the time - some - that the White House had left money on the table. The president has insisted he can squeeze more revenue out of Republicans. He's having another private dinner tonight with about a dozen GOP Senators. And we'll see if he finds any negotiating partners willing to go along.
GREENE: You know, even though the Treasury secretary told us on the program that this is not a starting point, that this far along in a negotiation that has been going on for a long time, I can imagine there's going to be a lot of back-and-forth on Capitol Hill.
(LAUGHTER)
HORSLEY: Maybe. Or maybe just silence.
GREENE: That doesn't often happen.
(LAUGHTER)
GREENE: NPR's White House correspondent Scott Horsley. Thanks, Scott.
HORSLEY: My pleasure. Transcript provided by NPR, Copyright NPR.
