Obama said he's met Republicans more than halfway on cutting the deficit, stating that he has already signed legislation that will reduce the deficit by $2.5 trillion, with more than two-thirds of that coming through spending cuts and the rest by "asking the wealthiest Americans to begin paying their fair share."
He expects his 2014 budget to cut another $2 trillion from the deficit, but doing so in a "balanced and responsible way."
He said that tax code reform is needed so that wealthy Americans and corporations cannot take advantage of loopholes.
"If you're serious about deficit reduction, then there's no excuse to keep these loopholes open," he said.
Obama's remarks also addressed entitlement reform. "Both parties agree that the rising cost of caring for an aging generation is the single biggest driver of our long-term deficits," he said.
"If we want to keep Medicare as well as it has," Obama continued, "Then we're going to have to make changes. But they don't have to be drastic ones."
He said the way to reduce Medicare spending is to cut the cost of health care, not shifting the burden to the elderly or the poor.
Judd Gregg and Ed Rendell, co-chairs of the Campaign to Fix the Debt, said in a statement, "While ideally the president would go further toward ensuring the debt follows a downward path over the long term, and not just this decade, the proposal represents what could be a starting point for productive and bipartisan budget negotiations."
Obama also called on both parties to have "a serious, reasoned debate" and come together around common sense and compromise.
"If anyone thinks I'll finish the job of deficit reduction on the backs of middle class families or spending cuts alone," he said, "they should think again."