Obama unveils US$3.8 trillion US budget

US President Barack Obama projected that the budget deficit of the world's largest economy would peak at a new record this year before easing, as he pushed for fiscal responsibility while fighting double-digit unemployment. "In the long term, we cannot have sustainable and durable economic growth without getting our fiscal house in order," Obama said in a statement with the budget’s formal release. His budget for the fiscal year to September 30 next year, a blueprint subject to change by Congress, forecast a deficit of US$1.56 trillion this year, equal to 10.6% of gross domestic product (GDP). The rise was partly due to spending associated with a package of emergency stimulus measures Obama signed last year as the US grappled with recession. While maintaining policies this year aimed at protecting a still fragile economic recovery, with US$100bn earmarked for measures to create jobs, Obama plans to save money from next year by curbing 120 projects, including a symbolic space mission to return to the moon, but will invest more in education and research. The increase in the 2010 deficit compared with a US$1.41 trillion shortfall in 2009 that amounted to 9.9% of GDP. But this funding gap was forecast to dip to US$1.27 trillion next year - 8.3% of GDP and a third of total government spending forecast at US$3.8 trillion