Congress Budget Office Disputes White House Projections of Deficit : Says Proposed Cuts Would Hold Figure at Just Under $190 Billion a Year, Not $82 Billion, by End of Decade

The drastic domestic spending cuts proposed by the Reagan Administration would accomplish little more than holding the federal budget deficit at just under $190 billion a year for the rest of the decade, the nonpartisan Congressional Budget Office estimated Wednesday.

Disputing White House projections that its budget would lower the deficit to $82 billion by 1990, CBO Director Rudolph Penner told the Senate Appropriations Committee that adoption of Reagan’s spending plan in full would push down the deficit from about $215 billion this year to $186 billion in 1986, remaining at that level through the end of the decade.

And if there is no change in current policy, the CBO projected, the deficit would rise to $302 billion in 1990.

‘Fake’ Figures Denied

At a separate hearing, Budget Director David A. Stockman denied suggestions by Democrats that the White House was using “fake” or “cooked” figures to support its budget projections.

The differences between the CBO and Administration deficit projections, both Penner and Stockman noted, are largely caused by less optimistic assumptions by the CBO about interest rates and economic growth.

However, the CBO estimates and other independent analyses suggest that an earlier prophecy by Stockman--that the government is likely to incur $200-billion deficits “as far (into the future) as the eye can see”--may not be far from the truth.

Stockman also insisted that he would remain in his job for a while, despite a newspaper report in which an anonymous White House official suggested that Stockman should leave soon because of the backlash from his statements about bloated military pensions and allowing indebted farmers to fail.

‘Something to Contribute’

“I plan to be here,” Stockman told the House Budget Committee. “I think I have something to contribute, and I believe they know that downtown (in the White House).”

Stockman also added another spending program included in Reagan’s budget to those he would like to cut back. He called the $8-billion synthetic fuels fund “a waste,” implying that the only reason it was left in the budget was to satisfy a deal the Administration made last year with Democratic congressional leaders.

House Budget Committee Chairman William H. Gray III (D-Pa.) told Stockman that his personal “candor is a refreshing contrast to the old-fashioned shell game of this year’s budget proposal,” but he urged Stockman to “take a message back to the President . . . to tell the nation exactly why we need to cut the deficit and not point fingers.”

Reagan Figures Disputed

In the first detailed congressional analysis of Reagan’s budget proposals, the CBO’s Penner said that White House estimates of $51 billion in spending cuts next year and $507 billion over the next five years are exaggerated. According to CBO estimates, total cuts under the Reagan budget would add up to $33 billion in fiscal 1986 and $364 billion from 1986 to 1990.

Penner pointed out that even though the cuts would be more modest than the Administration officially projected, the White House is proposing “a major assault on the projected budget deficits” through “very radical policy changes.”

The CBO estimated that non-defense spending over the next five years would be cut $406 billion from current projections under the White House budget plan, while defense spending would rise $43 billion above the 5.5% after-inflation increase Congress already has assumed.

Different Assumptions

The congressional office also downgraded the Administration’s deficit reductions by assuming that real economic growth would average about 3.3% instead of the 3.9% projected by the White House and that interest rates on short-term Treasury bills would remain near their current level of 8.2% instead of falling to the 5% level estimated by the Administration.

Solely because of these different economic assumptions, the CBO deficit estimate is $93 billion higher than that of the White House. The extra $11 billion on the deficit is caused by technical differences in estimating government spending and taxing patterns.

Senate Appropriations Committee Chairman Mark O. Hatfield (R-Ore.) called it “mind boggling” that the deficit, even under the most optimistic White House assumptions, would be well above the $60-billion level that Reagan inherited from former President Jimmy Carter. And Sen. Lawton Chiles (D-Fla.) accused the White House of handing Congress a spending plan that was “not really a meaningful deficit reduction budget.”

Meanwhile, an independent analysis by Shearson Lehman Bros., a New York investment firm, suggested that Reagan is likely to persuade Congress to go along with only about half of his proposed spending cuts this year--leaving budget deficits above $200 billion for the rest of the decade.