Governors Support Freeze on Spending : Leaders Also Back Balanced-Budget Amendment, Line-Item Veto

Spurred by congressional pleas for moral support in trimming the huge federal deficit, leaders of the National Governors Assn. on Sunday gave bipartisan approval to the idea of a freeze on most defense and domestic spending, including cost-of-living adjustments for Social Security beneficiaries.

The economic policy statement adopted by the executive committee of the governors association, holding its three-day winter meeting here, also endorses a constitutional amendment requiring a balanced budget and line-item veto authority for the President. Democratic governors agreed to accept these proposals, both strongly backed by the Reagan Administration, along with other modifications to gain Republican support for the policy statement.

The statement also sought to avoid partisan controversy on taxes by stating merely that “it may be necessary to raise some additional revenues,” although some Democratic governors indicated that they would have preferred stronger language.

“Realistically, politically, (a tax increase is) going to have to be done,” said Kansas Democratic Gov. John Carlin, chairman of the association. “There aren’t enough votes for enough cuts without something on the revenue side.”

Democrats, who constitute more than a 2-1 majority of the nation’s governors, would be able to control the language of the association’s policy positions if they wanted to. But governors from both parties argued that any position that the association took would require bipartisan backing to have significant impact on public opinion and the Congress.

Full Meeting Tuesday

The statement will be submitted to a full meeting of the association Tuesday. It calls for holding non-defense discretionary spending for fiscal 1986 to the same level as the current year and allowing for increases over the next four years at half the rate of inflation.

Defense spending for the next fiscal year should be limited to the current level, with an allowance for inflation, the governors said. Defense spending for the next four years would increase from 1% to 3% after taking inflation into account.

The debate and vote on the policy statement followed the submission of a report released Saturday by the conference staff, which recommended cuts in military spending and tax increases if necessary to bring down the federal budget deficit.

The statement endorses “full funding” for such programs as Aid to Families with Dependent Children, food stamps and Medicaid. But it urges Congress to “restrain the growth” of such entitlement programs as Medicare, Social Security and farm price supports.

The executive committee also approved a tax reform proposal that condemned the present tax code as “complex, inefficient and unfair” and called for a modified flat tax.

“We think it’s time the governors be at the table,” with a tax reform plan “since 33 of the states’ taxing systems are tied to the federal tax system,” said Colorado’s Democratic Gov. Richard D. Lamm, author of the resolution.

The governors will get a chance to give their views on the budget to the President directly when they meet with him at the White House today. On Tuesday, the last day of their conference, they are scheduled to meet with lawmakers on Capitol Hill.