U.S. President Barack Obama said on Thursday that he will trim 121 programs worth some 17 billion U.S. dollars from his 3.4 trillion-dollar budget for fiscal year 2010.

"We can no longer afford to spend as if deficits don't matter and waste is not our problem," Obama said when unveiling the 1,300-page budget. "We can no longer afford to leave the hard choices for the next budget, the next administration -- or the next generation."

Half of the savings come from shavings from the 534-billion-dollar defense budget for the 2010 fiscal year starting in October.

"We're going to save money by eliminating unnecessary defense programs that do nothing to keep us safe -- but rather prevent us from spending money on what does keep us safe," said Obama.

He noted that one example is the 465-million-dollar program to build an alternate engine for the Joint Strike Fighter.

"The Defense Department is already pleased with the engine it has," said the president. "They do not want -- and do not plan to use -- the alternate version. That's why the Pentagon stopped requesting this funding two years ago. Yet it's still being funded."

The oil and gas industry will also be hit by the budget, which would rescind tax breaks at a cost to the industry of 52.4 billion dollars over the next 10 years, according to the media.

White House Budget Director Peter Orszag said on Thursday that Obama's plan for program cuts is just a start and that a lot more needs to be done to dig the government out of its fiscal hole.

"Seventeen billion dollars a year is not chump change by anyone's accounting," he said.

However, Republicans were not satisfied with the cuts.

"While we appreciate the newfound attention to saving taxpayer dollars from this administration, we respectfully suggested that we should do far more," said House Minority Leader John Boehner.

The U.S. Congress passed the budget a week ago with no support from Republicans.

The budget predicts that the federal budget deficit will rise to 1.7 trillion dollars in the ongoing fiscal year, which ends on Sept. 30, 2009, and then dip to 1.2 trillion dollars in the 2010 fiscal year starting Oct. 1.

The projected deficits would be much larger than the previous record of 454.8 billion dollars set in fiscal year 2008.

The huge deficits reflect the soaring costs of the government's economic stimulus package and financial rescue program, and the recession, which has resulted in sharp decline in tax revenue.

The recession, which started in December 2007, also has boosted government spending for benefit programs such as unemployment insurance and food stamps.

In February, Obama submitted Congress a 3.6-trillion-dollar budget, which he later described as "an economic blueprint for our future -- a foundation on which to build a recovery that lasts."

The budget for the 2010 fiscal year, Obama's first one, seeks to shore up the world's largest economy while also overhauling health care, energy and education.

(Xinhua News Agency May 8, 2009)