Reagan Spurns Governors on Spending Freeze

President Reagan emphatically rejected a bipartisan attempt Monday by the nation’s governors to coax him into a deficit-reduction compromise on defense spending, Social Security payments and taxes.

“Not on your life,” Reagan told the governors when it was suggested that he join other politicians in supporting a freeze on cost-of-living adjustments for Social Security beneficiaries.

“He said he’s not going to get suckered again,” reported Republican Gov. James R. Thompson of Illinois, referring to previous times in Reagan’s career when he has gotten into political trouble by seeming to advocate Social Security cuts.

Suggest Tax Hike

The governors, attending their annual winter meeting, carried to the White House a bipartisan resolution by their executive committee calling for a freeze on most defense and domestic spending and suggesting the possibility of a tax increase to substantially reduce the federal deficit, which for the current fiscal year is expected to hit $222 billion.

“He simply ruled it out,” Democratic Gov. Mario M. Cuomo of New York told reporters.

White House spokesman Larry Speakes commented: “I don’t know why it should surprise Cuomo or any other governor what the President’s position is on defense, taxes and Social Security. If we’ve said it one time, we’ve said it a hundred.”

But many governors expressed disappointment. “If that’s the situation, I don’t think we’re going to make much impact on the deficit,” said Gov. Robert Graham of Florida, a Democrat.

Unlike previous meetings between the governors and this or any other President, these state executives were not lobbying for additional federal aid or even seriously attempting to hold on to the level of assistance that they currently are receiving from Washington.

Instead, their basic pitch to Reagan was, as summarized by Kansas Democratic Gov. John Carlin, chairman of the National Governors Assn.: “We accept the fact that we’re going to get additional cuts. We’ll take our share. But we want everyone to share the burden, including the Pentagon.”

In his prepared remarks, Reagan virtually ignored the governors’ call for more Pentagon cuts and a Social Security freeze and chose, rather, to laud the state executives for supporting his push for a constitutional amendment requiring a balanced budget and for line-item veto authority over spending bills. “He has great selective hearing,” observed Democratic Gov. Anthony S. Earl of Wisconsin.

Pointed Exchange

Reporters were barred from listening to a half-hour question-and-answer session between the President and the governors that followed Reagan’s prepared remarks. But the governors afterward freely talked to reporters about what they described as a very pointed exchange led by Cuomo.

According to several persons present, Cuomo was told by the President that the governors were wasting their time promoting further defense cuts, a Social Security freeze and consideration of a tax hike. Cuomo said that in their private session he had expected more presidential flexibility.

“I thought, frankly, he’d say, ‘Well, you know how it works (politically),’ but he didn’t say that,” Cuomo asserted. “He said, in essence, don’t bother. . . . He just ruled out negotiation.”

Thompson said Reagan was especially adamant about Social Security. “Listen, you guys,” the President declared, according to Thompson, “you made that a partisan issue in 1981 and 1982. You guys take the initiative. If there’s a (negotiating) conference, I’ll come to the table--and listen.”

Backed by Deukmejian

Reagan’s position on virtually everything, however, was solidly backed by fellow California Republican George Deukmejian. “I’m in agreement not only with the President but with the people of this country,” the governor said. “He overwhelmingly has the support of the American people.”

Deukmejian said he considered it “appropriate” for Reagan to seek a 5.9% increase in defense spending after adjusting for inflation.

The governors’ executive committee resolution--to be voted on today by all the governors--called for no increase in defense spending after an adjustment for inflation. For non-defense discretionary spending, the governors advocated neither a funding increase nor an inflation adjustment. But Reagan has proposed a 10.1% reduction, after taking into account inflation, for non-defense, non-Social Security spending.

Reagan told the governors that many of their states “are in better fiscal shape today because of the courage that you showed and the hard decisions you made during the recent recession. I hope you can understand that these tough calls have to be made now at the federal level.”