US Republicans have broadly welcomed President Barack Obama’s plan to withdraw most troops from Iraq by 2010.

However, they suggested he should give credit to his predecessor for stability brought by the “surge” strategy of pouring extra troops into Iraq.

House Republican Minority Leader John Boehner described the plan as responsible while remaining flexible.

Iraqi PM Nouri al-Maliki said his forces were capable of controlling security in Iraq after US troops leave.

President Obama announced that the US “combat mission” would officially end by August 2010.

‘Responsible approach’

However, up to 50,000 of 142,000 troops now there will stay until the end of 2011 to advise Iraqi forces and protect US interests, he said.

Mr Obama praised the progress on security made but warned: “Iraq is not yet secure, and there will be difficult days ahead.”

A London-based spokesman for Mr Maliki’s party, Zuhair al-Nahar, told the BBC: “The Iraqi security forces have proved their efficiency and have proved their capability.

“In many provinces, for example in the south, you hardly see any presence of American troops and in many areas of Baghdad the same applies.

“So the Iraqi security forces have shown that they are capable of controlling the security situation.”

Among Republican support, House Republican Minority Leader John Boehner said Mr Obama had outlined “a responsible approach that retains the flexibility to reconsider troop levels and to respond to changes in the security environment”.

Republican Senator John McCain, Mr Obama’s former rival presidential candidate, said he supported the plan.

He said it was “one that can keep us on the right path in Iraq,” the Associated Press news agency reported.

He told senators: “Let us have no crisis of confidence now.

“Instead, let us welcome home our fighting men and women – not just thanking them for serving in Iraq, but congratulating them on bringing us to victory there.”

However, Democratic congressman Dennis Kucinich questioned keeping some troops in Iraq while withdrawing others.

“You can’t be in and out at the same time,” he said.

Some Democrats are concerned that the timetable falls short of Mr Obama’s election pledges on troop withdrawal.

Mr Obama had said previously that he would completely pull out troops within 16 months of taking the top job in January 2009.

In his address at Camp Lejeune, a Marine Corps base in North Carolina, Mr Obama said his national security team had drawn up a “new strategy” for US involvement in Iraq.

The strategy recognised that the long-term solution in Iraq must be political and that the most important decisions about its future must now be made by Iraqis, he said.

Senate Majority Leader Harry Reid described Mr Obama’s plan as “sound and measured” but said the US “must keep in Iraq only those forces necessary for the security of our remaining troops and the Iraqi people”.

House Speaker Nancy Pelosi said the plan was “good news” because it signalled an end to the war, but called for clearly-defined missions for the remaining troops.

WASHINGTON – President Barack Obama charted a dramatic new course for the nation Thursday with a bold but contentious budget proposing higher taxes for the wealthy and the first steps toward guaranteed health care for all — accompanied by an astonishing $1.75 trillion federal deficit that would be nearly four times the highest in history.

Denouncing what he called the “dishonest accounting” of recent federal budgets, Obama unveiled his own $3.6 trillion blueprint for next year, a bold proposal that would transfer wealth from rich taxpayers to the middle class and the poor.

Congressional approval without major change is anything but sure. The plan is filled with political land mines including an initiative to combat global warming that would hit consumers with considerably higher utility bills. Other proposals would take on entrenched interests such as big farming, insurance companies and drug makers.

Obama blamed the expected federal deficit explosion on a “deep and destructive” recession and recent efforts to battle it including the Wall Street bailout and the just-passed $787 billion stimulus plan. The $1.75 trillion deficit estimate for this year is $250 billion more than projected just days ago because of proposed new spending for a fresh bailout for banks and other financial institutions.

As the nation digs out of the most serious economic crisis in decades, Obama said, “We will, each and every one of us, have to compromise on certain things we care about but which we simply cannot afford right now.”

Signaling budget battles to come, Republicans were skeptical Obama was doing without much at all.

“We can’t tax and spend our way to prosperity,” said House GOP leader John Boehner of Ohio. “The era of big government is back, and Democrats are asking you to pay for it.”

Obama plans to move aggressively toward rebalancing the tax system, extending a $400 tax credit for most workers — $800 for couples — while letting expire President George W. Bush’s tax cuts for couples making more than $250,000 a year.

Thursday’s 134-page budget submission, a nonbinding recommendation to Congress, says the plan would close the deficit to a a more reasonable — but still eye-popping — $533 billion after five years. That would still be higher than last year’s record $455 billion deficit.

And the national debt would more than double by the end of the upcoming decade, raising worries that so much federal borrowing could drive up interest rates and erode the value of the dollar.

Also, to narrow the budget gap, Obama relies on rosier predictions of economic growth — including a 3.2 percent boost in the economy next year — than most private sector economists foresee.

There is already resistance from Democrats who are upset with the budget’s plan to curb the ability of wealthier people to reduce their tax bills through deductions for mortgage interest, charitable contributions and state and local taxes.

That tax hike would raise $318 billion over the upcoming decade toward a down payment on Obama’s high-priority universal health care plan. Cuts to the Medicare and Medicaid federal health programs would supply an additional $316 billion, but that still wouldn’t provide enough money to guarantee coverage for all, and Obama wants Congress to come up with hundreds of billions of dollars in additional hard-to-raise revenues to pay for the rest.

Then there is the proposed clampdown on the Pentagon budget, which would get a 4 percent boost, to $534 billion next year, but would then get increases of 2 percent or less over the next several years. Domestic programs favored by Democrats would, on average, receive a 7 percent boost over regularly appropriated levels — even as many agencies are already swimming in cash from the just-enacted economic stimulus plan.

Taken together, Obama’s plan contains so many difficult-to-digest ideas that it’s virtually certain to be significantly redrafted during debates later this year.

“It’s going to be a tough row to hoe, but he has large Democratic majorities and a lot of popular support and we’re in times of crisis,” said Robert Reischauer, president of the Urban Institute. “So his prospects of him getting much of what he is seeking, while not good, are higher than … we’ve seen in the past.”

Senate Budget Committee Chairman Kent Conrad, D-N.D., predicted Congress would pass much of Obama’s plan, though with significant revisions. For instance, he’s unimpressed with a proposal to reduce payments to farming operations with sales above $500,000 per year and says the plan to curb tax deductions for the wealthy faces uncertain prospects because of opposition from lawmakers from high tax states and universities whose endowments have shrunk.

A plan to devote up to $250 billion to support as much as $750 billion in increased spending under the government’s rescue program for banks and other financial institutions landed with a thud.

Republicans scoffed at the idea that Obama’s plan calls for much sacrifice on the spending front, citing the big increases for many agencies. they also pointed to tax increases and hundreds of billions in revenues from a contentious proposal to auction off permits for carbon emissions in a bid to address global warming.

Obama and top aides emphasized that they didn’t make the financial mess.

Said the president: “We cannot lose sight of the long-run challenges that our country faces and that threaten our economic health — specifically, the trillions of dollars of debt that we inherited, the rising costs of health care and the growing obligations of Social Security.”

“For too long, our budget has not told the whole truth about how precious tax dollars are spent,” he said. “Large sums have been left off the books, including the true cost of fighting in Iraq and Afghanistan. And that kind of dishonest accounting is not how you run your family budgets at home. It’s not how your government should run its budgets either.”

Among the many programs that would receive generous boosts are education and cancer research. The size of education Pell Grants would automatically increase every year by inflation plus 1 percent, while Obama promises to double cancer research over several years. He also wants to put the United States on a path to double foreign aid.

Obama’s budget contains almost $1 trillion in tax hikes over 10 years on individuals making more than $200,000 and couples earning over $250,000. About $350 billion more would be raised through a variety of other hikes, including raising taxes on hedge-fund managers by taxing their compensation as income rather than at the 15 percent capital gains rate. Obama would also increase taxes on corporate income earned abroad.

Some $526 billion in revenue from carbon pollution permits would be used to extend the “Making Work Pay” tax credit of $400 for individuals and $800 for couples beyond 2010 as provided in the just-passed economic stimulus bill.

The budget would make permanent the expanded $2,500 tax credit for college expenses that was provided for two years in the just-passed economic stimulus bill. It also would renew most of the Bush tax cuts enacted in 2001 and 2003, and would permanently update the alternative minimum tax so that it would hit fewer middle- to upper-income taxpayers.

Obama’s $634 billion head start on expanding health care could easily double as lawmakers flesh out details in coming months on how to provide medical coverage to all of the 48 million Americans now uninsured while also trying to slow increases in costs. Health care costs now total $2.4 trillion a year and keep rising even as the economy is shrinking.

Thursday’s submission was an overview of a more comprehensive plan that will be submitted in April.

President Obama is proposing to begin a vast expansion of the U.S. health-care system by creating a $634 billion reserve fund over the next decade, launching an overhaul that most experts project will ultimately cost at least $1 trillion.

The “reserve fund” in the budget proposal being released today is Obama’s attempt to demonstrate how the country could extend health insurance to millions more Americans and at the same time begin to control escalating medical bills that threaten the solvency of families, businesses and the government.

Obama aims to make a “very substantial down payment” toward universal coverage by trimming tax breaks for the wealthy and squeezing payments to insurers, hospitals, doctors and drug manufacturers, a senior administration official said yesterday.

Embedded in the budget figures are key policy changes that the administration argues would improve the quality of care and bring much-needed efficiency to a health system that costs $2.3 trillion a year.

By first identifying a large pot of money to underwrite health-care reform — before laying out a proposal on who would be covered or how — Obama hopes to draw Congress to the bargaining table to tackle the details of a comprehensive plan. The strategy is largely intended to avoid the mistakes of the Clinton administration, which crafted an extensive proposal in secret for many months before delivering the finished product to lawmakers, who quickly rejected it.

“We aim to get to universal coverage,” administration budget aide Keith Fontenot told health-care activists last night. Obama is “open to any ideas people want to put forward. He wants to work openly with the Congress in a very inclusive process.”

Virtually every major player in the health-care sector will find something to object to in Obama’s plan, an intentional decision made in the hope that “a little bit of pain” will be offset by the appeal of insuring millions more people, said one White House adviser.

About half the money for the new fund would come by capping itemized tax deductions for Americans in the top income bracket. The proposal, which administration officials characterize as a “shared-responsibility issue,” would reduce the value of tax deductions for families earning more than $250,000 by about 20 percent, according to administration documents.

Nearly one-third of the money would be generated by eliminating subsidies that the government pays insurers that sell Medicare managed-care plans. Instead, the Medicare Advantage plans would be put under a competitive bidding process, for a savings of $175 billion over the next decade.

“The administration believes it’s time to stop this waste,” according to the documents.

Even before the budget proposal became public, the Obama team began selling it to groups that will be central to the upcoming debate. Top lawmakers were brought to the White House for briefings, while constituency groups heard the highlights in an evening conference call yesterday.

“This is the first step towards getting health-care reform done this year,” White House domestic policy adviser Melody C. Barnes told allies in one call. “We can’t underestimate the importance of rallying around this budget. It serves as a footprint for something bigger.”

During the campaign, Obama promised to reduce the number of uninsured Americans, improve the quality of care and save the typical family $2,500 a year in medical costs.

“We know that this is not enough to achieve our overall goal of getting health care for every American, but it is a significant down payment,” Neera Tanden, a top Obama health adviser, said during a conference call.

Given the economic crisis and the soaring federal deficit, many had begun to fear that health reform would be postponed, said Drew Altman, president of the nonprofit Kaiser Family Foundation.

“What this does is, it allows the train to move forward,” he said. “But there are still big issues to work out about how to reform health care and how to come up with the rest of the money.”

Many of the targeted savings are familiar and controversial.

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If the tax-deduction cap is enacted, it is likely to hit many small businesses, said House Republican Leader John A. Boehner (Ohio).

“Everyone agrees that all Americans deserve access to affordable health care,” he said, “but is increasing taxes during an economic recession, especially on small businesses, the right way to accomplish that goal?”

If the budget is approved by Congress, drug companies will be required to increase the rebate they pay on medications sold to Medicaid patients from 15 percent to 21 percent. The proposal, which would raise $19.5 billion over 10 years, is likely to spark strong opposition from the industry, which has argued that the current rebate cuts into profits.

Wealthy senior citizens would also be asked to pay higher premiums for Medicare drug coverage, similar to the higher premiums they now pay for physician visits, according to the Obama blueprint.

The budget figures also represent significant shifts in how the United States will pay for medical care.

For example, experts have identified hospital readmissions — especially for elderly patients — as a sign of poor care and unnecessary expense. About 18 percent of Medicare patients are readmitted to the hospital within 30 days of an original visit. The new approach would establish flat fees for the first hospitalization and 30 days of follow-up. Hospitals with high readmission rates would be paid less.

Obama, who is set to host a White House summit on health reform next week, has argued that reining in health spending is critical to the nation’s long-term fiscal outlook.

Medicare and Medicaid, the government’s two primary safety-net health programs, currently consume 5 percent of the gross domestic product, or $660 billion a year. At their current growth rates, absent restructuring, the two programs will equal 12 percent of the GDP by 2050.

Health-care costs are “one of the major reasons why small businesses close their doors and corporations ship jobs overseas,” Obama said in a speech to Congress on Tuesday night.

“This is a cost that now causes a bankruptcy in America every 30 seconds. By the end of the year, it could cause 1.5 million Americans to lose their homes,” he said. “. . . Given these facts, we can no longer afford to put health-care reform on hold.”

The whole world, it seems, wants to know: What kind of dog are the Obamas getting and, for goodness sake, when?

Speaking to PEOPLE at the White House recently, Michelle Obama leaned in and confided: “You’re getting some scoops here.”

So, when? In April, Mrs. Obama says – after she and the President take daughters Malia, 10, and Sasha, 7, on a vacation for spring break.

Here’s a sample of a typical family conversation on the matter: “So Sasha says, ‘April 1st.’ I said, ‘April.’ She says, ‘April 1st.’ It’s, like, April!,” Mrs. Obama recalls. “Got to do it after spring break. You can’t get a new dog and then go away for a week.”

And what kind of dog will soon be frolicking on the South Lawn? Mrs. Obama says the family is looking for a rescue Portuguese water dog who is “old enough” and a “match” for the family dynamic.

“Temperamentally they’re supposed to be pretty good,” she says of the breed that Sen. Ted Kennedy has also lobbied for (he has two Water dogs of his own). “From the size perspective, they’re sort of middle of the road – it’s not small, but it’s not a huge dog. And the folks that we know who own them have raved about them. So that’s where we’re leaning.”

The name game
The only thing still up in the air is the name. And Mom’s not feeling it with some of the names her girls have come up with.

“Oh, the names are really bad. I don’t even want to mention it, because there are names floating around and they’re bad,” Mrs. Obama says with a laugh. “You listen and you go – like, I think, Frank was one of them. Frank! Moose was another one of them. Moose. I said, well, what if the dog isn’t a moose? Moose. I’m like, no, come on, let’s work with the names a little bit.”

Asked if she can believe the public interest in her family dog search, Mrs. Obama shakes her head. “Okay, that’s surprising,” she says. “One of the things I didn’t anticipate is the level of the excitement about the dog. I knew my kids were excited. They’ve been excited for years. They’ve even calmed down, because they feel like, ‘They said we’re going to get one, so let’s just shut up about it.’ ”

Diplomatically, and careful not to insult enthusiastic dog-lovers, she adds: “It’s all great and gracious attention. People are just being as helpful as you can imagine. So I know that we will find the perfect breed. And we’ll find people who are caring folks who will help us find the dog of our dreams.”

President Obama on Tuesday outlined an ambitious agenda that requires “significant resources,” even as he aims to halve the deficit by the end of his first term.

In his first speech to a joint session of Congress, Obama said it’s time to act boldly not just to revive the economy, but “to build a new foundation for lasting prosperity.”

“While the cost of action will be great, I can assure you that the cost of inaction will be far greater,” he said.

The president struck an optimistic tone, asserting that “we will rebuild, we will recover, and the United States of America will emerge stronger than before.”

Obama focused on the three priorities of the budget he will present to Congress later this week: energy, health care and education.

The president said he sees his budget as a “vision for America — as a blueprint for our future,” but not something that will solve every problem or address every issue.

“It reflects the stark reality of what we’ve inherited — a trillion dollar deficit, a financial crisis, and a costly recession,” he said.

Obama said his administration already has identified $2 trillion in government spending cuts that can be made over the next decade.

The president touted the $787 billion stimulus plan he signed into law last week, saying it will invest in areas critical to the country’s economic recovery. He also made bold promises for what these investments will achieve.

Obama predicted that because of the recovery plan, the United States will double its supply of renewable energy in the next three years.

He also said the country will invest $15 billion a year to develop technology for green energy.

Louisiana Gov. Bobby Jindal, who delivered the Republican response to Obama, blasted the Democrats’ stimulus plan, saying, “while some of the projects in the bill make sense, their legislation is larded with wasteful spending.” Read: Jindal calls stimulus “irresponsible”

Obama also pledged a “historic commitment” to health care and said the recovery plan could lead to a cure for cancer. He also promised the “largest investment ever” in preventive care.

On education, Obama set a goal of having the highest college graduation rate in the world by 2020.

He pointed to the billions for education — from early childhood education expansion to college-loan programs — in the economic stimulus package to ensure that every child has access to education “from the day they are born to the day they begin a career.”

Obama also said his budget will pay for more soldiers and Marines, increase their pay and expand veterans health care and benefits. iReport.com: How are you coping with the economy?

Obama said the recovery plans already in the works are immediate steps to revive the economy in the short-term, “but the only way to fully restore America’s economic strength is to make the long-term investments that will lead to new jobs, new industries, and a renewed ability to compete with the rest of the world.”

“Slowly, but surely, confidence will return, and our economy will recover,” he said, asking Congress to join him in “doing whatever proves necessary because we cannot consign our nation to an open-ended recession.”

Obama promised to reform the regulatory system to “ensure that a crisis of this magnitude never happens again.”

The president also signaled that he was willing to take on entitlements, saying that Congress must take on the growing costs of Medicare and Social Security.

Obama described the nation’s financial woes as a “reckoning” for poor decisions made by both government and individuals.

“A surplus became an excuse to transfer wealth to the wealthy instead of an opportunity to invest in our future,” Obama said.

“Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn’t afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day.”

Noting that is easy to “become cynical and doubtful,” Obama said he has learned that “hope is found in unlikely places.”

Obama avoided lofty rhetoric and instead used examples of specific people to personalize his points.

He mentioned Leonard Abess and Ty’Sheoma Bethea — two of the Obamas’ invited guests. Read: Who did the Obamas invite?

Abess is a bank president from Miami, Florida, who reportedly cashed out of his company, took a $60 million bonus and distributed it among people who had worked for him.

Bethea is an eighth-grade girl from South Carolina who, in a letter to lawmakers, asked for help for her school and said, “We are not quitters.”

While the economy was the focus of the speech, Obama also touched on foreign policy.

The president said he’ll soon be laying out specifics on how to win the war in Afghanistan and end the one in Iraq.

“We are now carefully reviewing our policies in both wars, and I will soon announce a way forward in Iraq that leaves Iraq to its people and responsibly ends this war,” he said.

Meanwhile, he said, both Afghanistan and its border with Pakistan will remain a key focus.

Because Obama’s presidency is just a month old, the speech is not technically considered a State of the Union address. The annual State of the Union speech is delivered in the House of Representatives before members of both the House and the Senate as well as the justices of the Supreme Court, the president’s Cabinet and international dignitaries.