Media playback is unsupported on your device Media caption President Obama: "We all need to make sacrifices"

President Barack Obama has called for raised taxes on the rich as well as cuts in government spending in what he termed a balanced approach to cutting the huge US budget deficit.

In a speech in Washington DC he outlined a package of tax increases and spending cuts aimed at reducing the deficit by $4tn (£2.45tn) by 2023.

He attacked Republican plans he said would harm the poor and elderly.

Republicans have said any increase in taxes is a "non-starter".

"We have to live within our means, reduce our deficit, and get back on a path that will allow us to pay down our debt," Mr Obama said in a speech at George Washington University.

"And we have to do it in a way that protects the recovery, and protects the investments we need to grow, create jobs, and win the future."

The ballooning US deficit is set to be a top issue in the 2012 election campaign, and in recent weeks, Republicans have laid out their own plan to cut it, based on big reductions in healthcare and social programmes for the poor and elderly and in education spending.

Their vision is less about reducing the deficit than it is about changing the basic social compact in America President Barack Obama

The deficit is forecast to reach $1.5 trillion (£921bn) this year and both Democrats and Republicans have said cutting it is a priority.

Mr Obama on Wednesday unveiled his own proposal - in a speech in which he used the word "vision" more than a dozen times.

The remarks came after Republicans had accused him of failing to exercise leadership, and many US political analysts said the Republican opposition had seized the political momentum.

Republicans on Wednesday attacked Mr Obama's speech as mere campaign rhetoric, noting he recently launched his re-election bid. Primarily, they firmly rejected his proposal to raise additional tax revenue from the wealthy.

"At a time when millions of our countrymen remain unemployed, the president again proposes tax increases on job creators," said Jeb Hensarling of Texas, a member of the party's House leadership team, calling Mr Obama's speech "class warfare".

Representative Paul Ryan of Wisconsin, chairman of the House budget committee, said: "Exploiting people's emotions of fear, envy and anxiety is not hope, it's not change, it's partisanship. We don't need partisanship. We don't need demagoguery. We need solutions."

Led by Mr Ryan, Republicans have offered their own proposal that would go further than Mr Obama's, slashing $6.2 trillion from government spending over the next decade, in large part through cuts to government programmes that serve the elderly and the poor.

Analysis President Obama answered calls to tackle the US budget deficit by going on the attack. He ripped into Republican plans to rein in spending on social programmes, saying it would lead to "a fundamentally different America". His plan is more balanced, he claimed, but will still match deficit reductions the Republicans are promising - except over 12 years rather than their 10. Mr Obama was short on details on how he'll achieve this, except to rule out extending Bush-era tax cuts for the wealthy and other loopholes they enjoy. The Republicans have already said no to that. Simply by making this speech President Obama has given ground. The budget plan he announced just two months ago proposed much smaller deficit cuts. Sorting out the US government's disastrous finances is becoming the defining issue ahead of the 2012 presidential elections. It's just that no one can agree how to do it. See Also: US media on Obama speech

The proposal would also drastically reduce taxes for wealthy Americans, a move conservatives say would boost economic growth.

The House is due to vote on Mr Ryan's proposal on Friday.

In his speech, the president repeatedly drew a contrast with the Republicans' proposal, insisting that spending cuts should not harm the US social safety net, such as the social security retirement system and healthcare programmes for the poor and elderly.

In particular, he singled out the Republicans' proposal to cut taxes for the wealthy while making elderly Americans pay more for their healthcare, as analysts say the Republican plan would work out.

"This is not a vision of the America I know," he said.

"They want to give people like me a $200,000 tax cut that's paid for by asking 33 seniors to each pay $6,000 more in health costs? That's not right, and it's not going to happen as long as I'm president.

"The fact is, their vision is less about reducing the deficit than it is about changing the basic social compact in America.

"There's nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires."

Bruising battle ahead

Buoyed by the fiscally conservative Tea Party movement, Republicans have won a series of policy victories, including forcing $38.5bn in government spending cuts for the remainder of the current fiscal year.

On Wednesday, Mr Obama also sought to brush back liberals in his own party who warn cutting spending now would hinder the nascent economic recovery.

"Doing nothing on the deficit is just not an option," he said. "Our debt has grown so large that we could do real damage to the economy if we don't begin a process now to get our fiscal house in order."

US political observers expect the fight over the government budget for the fiscal year beginning 1 October to be bruising, as Republicans and Democrats push their competing visions.

Last week, the US government came within an hour of shutting down as Republican and Democratic leaders battled to reach an agreement on a budget for the next six months.

The deal reached just before midnight on Friday cut $38.5bn in government spending to 30 September.