President Barack Obama vowed to cut $4 trillion in cumulative deficits within 12 years through a combination of spending cuts and tax increases, setting the stage for a fight with congressional Republicans over the nation’s priorities. 

In presenting his long-term plan for closing the budget shortfall, Obama set a target of reducing the annual U.S. deficit to 2.5 percent of gross domestic product by 2015, compared with 10.9 percent of GDP projected for this year. He reiterated his support for overhauling the tax code to lower rates while closing loopholes and ending some breaks to increase revenue.

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