Obama to Call for Increased Spending in Speech

President Barack Obama will throw down a challenge in his State of the Union message by calling for increased spending at a time when congressional Republicans are demanding deep cuts to reduce the ballooning deficit. Obama will call for new spending Tuesday night on education, infrastructure, and research, The Wall Street Journal reports.

Obama will try to make the case that federal dollars must be spent to grow jobs, build roads, and invest in renewable energy development. Nonetheless, sources familiar with the speech said Obama will also make a plea for budget cuts, the paper said. Programs likely to be cut include agricultural subsidies and controversial Pentagon programs such as an alternate engine for the Joint Strike Fighter and C-17 transport planes.

Republicans argue that drastic spending cuts are needed now because federal spending and a $1.3 trillion budget deficit are hindering job creation. House Republicans want to slice $100 billion from the budget this year and other GOP members are calling for cutting $2.5 trillion in spending over the next decade, the Wall Street Journal said.

Administration officials maintain that such deep cuts would stall the nascent economic recovery and argue that targeted cuts such as a two-year wage freeze for federal workers and ending redundant or nonfunctional programs are a better path. The White House is betting that worry about the country falling behind China, India, and other emerging nations will sway the public toward investing in growth, the paper said.