President Barack Obama pledged boldly to cut the trillion-plus dollar US budget deficit by half in his first term, even as he announced massive spending to revive the sagging economy.
He issued the vow shortly after telling state governors he was sending them $15 billion to help with health care payments for poor people a first outlay by Washington of Obama's $787 economic stimulus plan designed to rescue the nation's economy from the steepest downturn in eight decades.
In a day of fevered economic activity, the administration also announced it had revamped financial bailout plans with an eye to injecting fresh capital into financial institutions starting Wednesday. Several regulatory agencies issued the statement as concerns grew that some of the biggest US banks likely need more federal money to survive the fallout from the worst financial crisis since the 1930s.
The plan was designed boost available capital by shifting the nature of government holdings in the banks without fresh injections of cash.
The statement did not name any specific banks or respond to reports that the government was considering increasing its ownership of Citigroup Inc. The White House just last week downplayed persistent speculation that some banks could be effectively nationalized by the federal government.
