Lawmakers Welcome Tax Reform but Insist Deficit Must Be Trimmed

Members of Congress welcomed President Reagan’s endorsement of tax reform Wednesday night but Republicans and Democrats quickly cautioned that nothing should interfere with their primary pursuit this year: deficit reduction.

Reagan’s upbeat tone apparently was what Congress wanted to hear. “The President once again gave an impressive speech,” said Sen. Howard M. Metzenbaum (D-Ohio). “We all share his goals for a better America.”

Rep. Guy Vander Jagt (R-Mich.) praised the President for “consistency and great courage in the continuation of his commitment to get the federal government back on track.”

Bipartisan Tax Plan

Clearly the most popular aspect of the speech on both sides of the aisle was the President’s pledge to work with Congress to develop bipartisan tax reform legislation--a modified version of the flat tax. “Now that the President will get behind it, it at least keeps it alive,” said California Rep. Robert T. Matsui (D-Sacramento).

Members of the House Ways and Means Committee pledged to begin hearings before the end of February on a variety of tax simplification proposals already before Congress. An Administration official who asked not to be identified said the White House will add its own specific bill to the hopper by March.

Sen. Strom Thurmond (R-S.C.) said he is eager to see the new tax simplification proposals. “It is very important that we work with him to lower tax burdens, protect families and maintain incentives for business, growth and more jobs,” he said. “His plan to develop bipartisan legislation for this is a real challenge to Congress.”

Huge Deficit

At the same time, members of Congress were quick to emphasize that tax reform would not eliminate the need for reducing the federal deficit, which the Administration estimates at $222 billion this year. “The deficit is still the major issue,” Matsui said.

Metzenbaum remarked: “The Administration and Congress now need to work out a budget that attacks the nation’s huge deficit but also is fair to all Americans. The biggest roadblock, we all know, is the Pentagon. President Reagan must tell Defense Secretary (Caspar W.) Weinberger that the military establishment has to share in the sacrifice.”

Vander Jagt, while praising the President’s arms control initiative, warned that the key to world peace is a sound American economy. “Our future abroad and the future of negotiations with other nations depends on our success in dealing at home with the deficit,” he said.

Thurmond praised Reagan’s continued support for a balanced budget amendment, something that the South Carolina senator has advocated for 20 years. He said Reagan’s request for a balanced budget amendment and line-item veto--proposals that Congress has rejected in the past--”are going to get my full support.”

Minorities Dissatisfied

Although many members praised Reagan’s call for increased opportunity for all Americans, Rep. Robert Garcia (D-N.Y.), former chairman of the Hispanic Caucus, boycotted the State of the Union message on grounds that the President has turned his back on minorities.

“I am tired of listening to Ronald Reagan say that he is helping get this nation back on its feet, when he is actually cutting the rug from under communities such as mine,” Garcia said. “I have listened to the President in silent outrage for the past four years, and I can no longer do so in good conscience. . . .