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Obama chides Republicans on spending cuts at school event

U.S. President Barack Obama holds a meeting with small business owners at the White House in Washington October 11, 2013. REUTERS/Kevin Lama
U.S. President Barack Obama holds a meeting with small business owners at the White House in Washington October 11, 2013. REUTERS/Kevin Lama

By Mark Felsenthal

NEW YORK (Reuters) - President Barack Obama warned congressional Republicans on Friday that their next budget negotiations will need to be about more than just spending cuts after a fiscal stalemate that resulted in a 16-day government shutdown.

Visiting a school that offers students a fast track to technology jobs to underline his point, Obama said some tax loopholes need to be eliminated to create more tax revenue for the government that can be used to trigger more job growth.

"I don't want to hear the same old stuff about how America can't afford to invest in the things that have always made us strong. Don't tell me we can afford to shut down the government, which cost our government billions of dollars, but we can't afford to invest in our education system," he said in a speech.

After a bruising budget impasse that shut down the federal government for 16 days, lawmakers on Wednesday were to begin reconciling vastly different spending plans put forward by the Democratic-controlled Senate and the Republican-led House of Representatives.

In a sign that tensions still exist over the bitter budget feud, Obama could not resist scolding Republicans.

"By the way, I just sat in on a lesson called 'Real World Math,' which got me thinking whether it's too late to send Congress here for a remedial course," he said.

The Democratic president was visiting Pathways in Technology Early College High School in Brooklyn, whose curriculum he has praised as a beacon for the future, to contrast his budget priorities with those of Republicans.

Obama spoke about budget strategy Friday with Senate Democratic leader Harry Reid, House Democratic leader Nancy Pelosi, and the top Democrats on the conference committee, Senator Patty Murray and Representative Chris Van Hollen.

Obama "reiterated a shared principle that we should focus first and foremost on how we can grow our economy and create good jobs with good wages for middle class families," White House spokesman Josh Earnest said aboard Air Force One.

The president's renewed focus on the budget comes just over a week after the end of a stalemate that resulted in the government shutdown and threatened a U.S. debt default. Since then, Obama has been back on the defensive over the seriously flawed online gateway to health insurance that is central to his signature 2010 healthcare law known as Obamacare.

White House aides said the president was looking ahead to the next round of the budget debate and wanted to contrast his goals of boosting government spending on things like schools and infrastructure with those of Republicans, who are focused on reining in the nation's debt and deficit and shrinking the role of government.

Obama reminded the audience that the deficit is projected to shrink this year to about half of what it was in 2009. He said he is open to further deficit reduction, and to trimming benefits to be paid out over the long term under the Social Security retirement and Medicare healthcare program for the aged, but only if they are accompanied by ending tax breaks and increasing revenues to the government.

"We need a budget that is responsible, that is fiscally prudent, but a budget that cuts what we don't need, closes wasteful tax loopholes that don't create jobs, freeing up resources to invest in the things that actually do help us grow, things like education and scientific research and infrastructure - roads, bridges, airports," he said.

LOWER EXPECTATIONS

Some lawmakers taking part in the budget negotiations expressed lower expectations.

House Budget Committee Chairman Paul Ryan said on Thursday a new round of budget negotiations starting next week should focus more narrowly on replacing automatic spending cuts rather than an elusive "grand bargain." Ryan will lead Republicans on the 29-member panel that is trying to reach a deal before December 15.

Both parties want to minimize the impact of the across-the-board sequester cuts that went into effect in March and avoid a further $109 billion round of reductions due on January 15.

The Pathways in Technology high school earned praise from the president during his State of the Union speech this year for a six-year program that allows students to earn a community college degree as well as a chance to work with the partner company of the school, IBM.

The school, which also collaborates with the City University of New York, allows students to get an associate of arts degree in computers or engineering.

Obama praised the school as a model for efforts to compete with the education systems of countries like Germany, which he said was preparing students for technical jobs immediately after high school.

(Additional reporting by Roberta Rampton in Washington; Writing by Steve Holland; Editing by Eric Walsh)

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