Choices on the Budget

Superficially, the difference between the House and Senate versions of the 1986 federal seem intractable. Digging below the surface, the differences seem even more intractable. The result is that Americans will be bombarded with political rhetoric this week as House and Senate members of the budget conference committee attempt to reconcile their differences.

The political struggle involves more than plain budget numbers. Everyone’s major goal this year was to reduce the 1986 budget deficit by roughly $50 billion and to bring the annual deficits down to about $100 billion by 1988. Both versions of the budget trim the deficit by just about $56 billion during the next fiscal year. Neither hits the 1988 goal.

The difference is in not how much was cut from the President’s budget, sent to Congress back in February, but where.

The big issues are Social Security and defense. The budget of the Democratic-controlled House maintains annual cost-of-living increases for Social Security and other federal retirement programs and, to help finance them, freezes defense spending at 1985 levels. The budget passed by the Republican-controlled Senate in conjunction with the Reagan Administration freezes cost-of-living adjustments and grants the Pentagon a 4% rise for inflation.


The hazard is to cast the debate in either-or terms. The fact is that paying an estimated $6 billion next year to the elderly--which Congress should do--will not deprive the nation of a strong defense. The momentum of the defense buildup will carry the Pentagon through the year without any real cuts.

Beyond these issues, the two budgets provide a contrast of political philosophies and priorities on virtually every page. The House version clearly was crafted with more emphasis on the long-term good of the nation and its citizens; the Senate’s more with an eye on savings for savings’ sake.

For instance, the Senate plan would eliminate direct loans by the Export-Import Bank just at the moment when they are most needed, when U.S. firms are struggling to compete in foreign markets.

The Senate budget also would severely cut into health care, food assistance and housing programs and slow the modernization of the nation’s Air Traffic Control system.


The House version is no Christmas tree. It essentially freezes most domestic programs where they are now and cuts others. But at least it does so with some effort at meeting needs where needs are the greatest: in American living rooms as well as the Pentagon.