Regan Denounces Budget Deadlock as ‘Disgraceful’

As congressional leaders regrouped Thursday in the wake of another breakdown in budget talks, White House Chief of Staff Donald T. Regan angrily denounced the deadlock as “disgraceful.”

Pounding the lectern in a speech before the U.S. Chamber of Commerce, Regan insisted: “The federal government, the world’s largest economy, the strength of the free world, is about to go into its new fiscal year without a budget. How ridiculous can you be?”

Congress is “afraid to come to grips with it, and I’m challenging them to do it,” he said.

Senate Majority Leader Bob Dole (R-Kan.) took issue with Regan’s criticism, saying on the “MacNeil/Lehrer NewsHour”: “I don’t believe Don Regan or the President of the United States, Ronald Reagan, want just any budget.”

Moreover, he suggested that Regan himself may have complicated the budget negotiations. Dole noted: “There are some allegations he slipped up to the House side and made a little deal on the side” that resulted in an agreement last week in which the President backed away from his commitment to support the Senate-passed budget resolution.

Line-Item Veto

Meanwhile, the President, claiming another solution to the deficit, appealed in writing to senators to end their filibuster of a bill that would give him authority to veto individual items of spending bills. Under existing law, he must accept or reject in their entirety the bills that Congress sends to his desk.

Nevertheless, the Senate narrowly defeated a move to end debate on the issue. Dole said he will try again next week.

Reagan, who is recuperating from cancer surgery, wrote senators that the so-called line-item veto “would work as a powerful tool against wasteful or extravagant spending by the federal government.”

Sen. Mack Mattingly (R-Ga.), the bill’s sponsor, read the letter in the Senate chamber.

Senate Appropriations Committee Chairman Mark O. Hatfield (R-Ore.) strongly opposed the measure, arguing that most government spending is set by existing laws and entitlements and would not be vulnerable to a line-item veto.

Political Leverage

Its greatest use, he said, would be as political leverage--giving the President power to hold funding for local projects hostage until senators agreed to give him their votes on various issues. The line-item veto is given little chance of passing the House.

On the more immediate issue of coming up with a fiscal 1986 budget, each side spent the day blaming the other for the breakdown Wednesday of talks between House and Senate conferees.

“I don’t know whether they have their act together where they could pass anything in the Senate,” House Majority Leader Jim Wright (D-Tex.) said. Shortly before the abrupt end to the negotiations, House conferees accused the Senate of repeatedly changing its demands.

But senators insisted that they would “hang tough” in their insistence that the House find new spending cuts. “They’ve got to come up with something more substantial with real savings,” said Sen. John H. Chafee (R-R.I.), a member of the Senate Republican leadership.

Proposals Abandoned

In an agreement with the White House last week, congressional negotiators agreed to abandon the two proposals that offered the greatest savings: a Senate plan to deny next year’s inflationary increases in Social Security benefits and other government-sponsored pensions and the House proposal to allow no increase in new defense spending commitments.

With those two avenues choked off and budget negotiations in limbo, some senators are raising the possibility of new taxes, sometimes cloaked in the euphemism “revenue enhancement.”

Sen. Alan K. Simpson (R-Wyo.), the Senate’s second-ranking Republican, said reducing the deficit through oil import fees, value-added taxes and other less direct taxes “is not repugnant to me.”

‘Break the Logjam’

Sen. John Heinz (R-Pa.), another member of the Senate’s Republican leadership, agreed that such measures might be the only way “to break the logjam.”

But Dole, referring to Reagan’s campaign pledge to levy taxes only as “a last resort,” opposed that option.

“We haven’t reached the last resort,” he said. “We haven’t reached the first resort” of spending cuts.