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by Julianna Goldman and Roger Runningen
Jan 6 (Bloomberg) — President-elect Barack Obama said he expects to inherit a $1 trillion budget deficit and that similar shortfalls are in store “for years to come” as the government grapples with a recession and other spending demands.
A “trillion dollar deficit will be here before we even start the next budget,” Obama said after meeting in Washington with his economic advisers, including Peter Orszag, who has been designated as director of the Office of Management and Budget. “Potentially we’ve got trillion-dollar deficits for years to come, even with the economic recovery we are working on.”
Obama said he wants his budget and economic teams to craft a stimulus plan that stabilizes the economy and begins the process of “getting our budget under control.” That includes barring lawmakers from inserting pet spending projects, known as earmarks, into the legislation, he said.
Some congressional Democrats, including Senate Budget Committee ChairmanKent Conrad of North Dakota, are calling the incoming administration to come up with a long-term plan to cut the deficit. Conrad said today on Bloomberg TV that the nation’s financial situation is “unsustainable for the long term.”
A plan for dealing with budget imbalances “has to be put in place” as the new administration and Congress craft a stimulus plan, he said.
Obama said he agrees.
“It’s not just Democratic or Republican colleagues on the Hill that are concerned about this, I’m concerned about this,” Obama said. “I’m going to be willing to make some very difficult choices in how we get a handle on this deficit.”
Along with Orszag, those who took part in the session were Timothy Geithner, Treasury secretary-designate; Christina Romer, director-designate of the Council of Economic Advisors and Lawrence Summers, director-designate of the National Economic Council.