Lawmakers Question Obama Budget Plan

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WASHINGTON-- Global stocks have taken a beating after Monday's historic decline in the Dow.

Stocks closed at their lowest level in 12 years.

It seems fitting then that the nation's top finance official heads to Capitol Hill today to answer questions about the economy and the White House's proposed $3.6 trillion budget.

Full Court Press For Team Obama

Call it Team Obama's economic defense squad -- Treasury Secretary Tim Geithner and White House Budget Director Peter Orszag testify on Capitol Hill to quiet doubts and build support for President Obama's proposed budget for 2010.

But with critics on both sides of the aisle, even the President acknowledges their work is cut out for them.

"I realize that passing this budget won't be easy," Obama said. "Because it represents real and dramatic change. It also represents a threat to the status quo in Washington."

The budget calls for billions in new spending for health care, higher taxes on top wage earners and businesses, and an energy plan that aims to reduce pollution. But the plan is also panned as a sure-fire way to see Americans' electric rates go up.

Some Lawmakers Have Their Doubts

Today, lawmakers intend to let their voices be heard.

"Frankly, I believe that the people of this country think that we are spending entirely too much money, the money that we don't have," said Rep. Eric Cantor, R-VA during an appearance on ABC's This Week.

"And as we see in this budget that has been presented last week, it is proposing massive tax increases on people and on businesses that can't afford to pay them," he added.

The hearings come on the same day the dow opens below 7,000 for the first time in 12 years.

White House Defends AIG Bailout

Monday's dramatic close was fueled by another $30 billion bailout for insurance giant AIG after the company reported the biggest record loss in history.

The White House defends the bailout as necessary, saying AIG is too big to fail.

"The treasury department and others felt that the systemic risk of doing nothing was simply unacceptable," said White House Press Secretary Robert Gibbs.

The Root of the Economic Crisis?

Critics argue more money should be spent to fix the root of the economic crisis -- housing.

Fourth quarter numbers show the problem is only getting worse, with the number of people who are 60 days or more behind on their mortgage payments up 53 percent.

But in the midst of all the bad, there is some good news.

Consumer spending rose six-tenths of a percent last month. The first increase since June. Personal income rose four-tenths of a percent.

It's a bit of a silver lining Americans hope will expand along with the economy as soon as possible.

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