Americans mixed on Obama budget and fret over deficit

By Tim Gaynor

PHOENIX (Reuters) - Many Americans applauded the spending plans and tax breaks set out in President Barack Obama's record budget, while others questioned the yawning deficit it would entail.

"I like Obama, so I am willing to be cautiously optimistic," David Bell, 62, an attorney in San Francisco, said of the $3.55 trillion (2.5 trillion pound) spending plan that Obama hopes will stop the economic slide in its tracks, create jobs and lay the foundations for new growth.

"If anyone has a shot at creating a budget that will be good (with) good priorities, he's got the best chance."

Obama said on Thursday the budget is a "first step" towards creating or saving millions of jobs and laying the foundations for growth, amid the worst economic recession in decades.

The spending plan also seeks to enact a bold agenda to upgrade schools, expand healthcare coverage next year, while cutting taxes paid by Americans on lower and middle incomes.

"It'll be nice to have a few dollars! But I'm probably going to be spending it on maintaining the lifestyle I had five years ago," said Carole Brazsky, 65, a retired social worker in Scottsdale, Arizona, whose savings have been pinched by the downturn and soaring healthcare costs.

But others said they were unhappy at the huge spending set out in the proposal, which foresees a whopping $1.75 trillion deficit for the 2009 fiscal year.

"Eventually everything is going to have to be paid back ... Let everything bottom out as low as it can go and work its way back from there," said Martin Prior, 40, an electrician from California, who called the budget a "disaster."