Move Designed to Draw GOP Support : Panel Calls Closed Session to Draft Budget Package

The House Budget Committee, after a slow start Wednesday on a Democratic-sponsored deficit reduction plan, moved into a closed-door session to try to draft its fiscal 1986 budget package.

Although the committee has never met previously in closed session to devise its budget plans, Democrats and Republicans voted 26 to 3 to bar the public from the panel meeting. The committee adjourned shortly before midnight, and Chairman William H. Gray III (D-Pa.) said: “There have been no decisions made with regard to anything.”

Democrats said the private meeting would offer their best opportunity to win Republican support for their plan, which was officially disclosed Wednesday and drew sharp criticism from Republicans who claimed that they had not been given adequate time to study it.

Democrats hope to complete action on the budget plan today, which would allow them to bring it before the entire House before it adjourns next week for its Memorial Day recess.

Because Democrats hold a 20-13 majority on the committee, it appears almost certain that they can prevail there. However, they hope to draw Republican support that could make it easier for them to pass their plan on the House floor.

$230-Billion Deficit

“I don’t think (the Democratic plan) is very far from where (the Republicans) want to be,” Rep. Vic Fazio (D-Sacramento) said.

The Democratic package achieved its goal of matching the $56 billion in 1986 deficit reduction that was narrowly approved last week by the Republican-controlled Senate. Without the proposed changes in spending policy, next year’s deficit is expected to approach $230 billion.

However, the Democratic plan fell short of the Senate effort in subsequent years, leaving a $120-billion deficit in 1988, about $15 billion higher than that projected under the Senate plan.

Although both packages reject a tax increase as a means of reducing the deficit, Democrats on the House Budget Committee were less inclined than the Senate to consider domestic programs as a source of savings. They cut roughly two-thirds as much as the Senate from social spending and instead placed greater restraint on the defense budget.

Defense Freeze in ’86

Committee Democrats voted to freeze next year’s defense budget at this year’s level, rejecting the Senate proposal to allow it to grow enough to keep up with inflation of about 4%. (Actual defense spending next year would rise because the Pentagon still would be able to use funds appropriated for long-term projects authorized in previous years--money that is already in the funding pipeline. The freeze would apply to new Pentagon programs and spending commitments.)

Like the Senate, the Democrats on the House committee rejected efforts by the Reagan Administration to terminate dozens of federal programs. The only program they propose to eliminate is general revenue sharing--no-strings-attached grants to local governments--which is scheduled to expire next year.

But, unlike the Senate’s decision to deny Social Security recipients any increase in benefits, the plan before the House committee would allow benefits to rise as scheduled and keep up with inflation, projected near 4% annually for the next few years.

To achieve some of the savings that they claimed, Democrats relied on complicated accounting. For example, they claimed $2 billion by assuming that the Pentagon would spend its funds more slowly than expected. They also assumed that the federal government would settle its legal dispute with states such as California over how oil revenues from outer continental shelf leasing should be divided. This, they said, would open up an account being held in escrow and bring the federal government a $4-billion windfall next year.