Reagan Vetoes Appropriations Bill, Hits Congress as Incapable of Tackling Deficit

President Reagan, accusing Congress of an “ingrained incapacity” to tackle the deficit, Friday vetoed a budget-busting, $13.2-billion appropriations bill for the White House, Treasury Department, Postal Service and other agencies.

The legislation contained $951 million more than the Administration originally requested for the current fiscal year and was about $300 million above a congressional budget target that Reagan endorsed in August.

Congress is considered unlikely to override the veto, the 42nd of Reagan’s presidency and his third this year.

‘Chronic’ Crisis

In rejecting the money bill, Reagan blasted Congress for failing to resolve a “chronic budgetary crisis.” He scored the lawmakers for producing a budget resolution 2 1/2 months late, for having sent him only four of 13 appropriations bills that were due Oct. 1, for exceeding his requests on non-defense spending and for failing to pass balanced-budget and line-item veto bills.

“The old propensity to spend and spend and to capitulate to one interest group after another continues unabated,” Reagan charged.

He complained that the vetoed bill failed to pare postal subsidies adequately and contained several “highly objectionable” language provisions.

Job Review Regulations

One such provision would restrict the Administration’s issuance of new regulations dealing with job reviews for federal employees. Others would curb the authority of the General Services Administration to contract out certain services to the private sector and would forbid review by the Office of Management and Budget of marketing orders for agricultural products.

The bill provided $820 million for the Postal Service to subsidize lower mailing rates for charities and other groups. The Administration had sought to eliminate the subsidy.

Administration officials also protested that the bill included too much money for the Internal Revenue Service and the Customs Service. Congress brushed aside a proposal to cut the 85,235-member IRS work force by 1,254 positions and the 13,391-member customs staff by 887. Instead, Congress added enough money to increase the IRS staff by about 1,800 and the Customs Service by 623.

Functions Hampered

By increasing staff, the legislators had hoped to alleviate problems that have nagged the two agencies and hampered their revenue-collection functions.

Budget constraints on the IRS have reduced the number of audited tax returns, and the agency has been plagued by computer problems that snarled the handling of 1984 income tax returns. The Customs Service, meanwhile, has struggled to keep up with the surging amount of imports coming into the United States and to stem the flow of illegal drugs into the country.

Rep. Edward R. Roybal (D-Los Angeles), chairman of the House Appropriations subcommittee on Treasury, Postal Service and general government, contended that the Administration’s demand for cuts was penny-wise and pound-foolish. He argued that scaling back the two agencies would dramatically decrease federal revenues--thereby increasing the deficit even more.

Streamlining Cited

The Administration maintained that the agencies could do an effective job with fewer people by streamlining operations and adopting more efficient administrative policies.

When the Democratic-controlled House passed the funding bill Nov. 7 by 237 to 171, it fell 35 votes shy of the two-thirds majority required to override a veto. The Republican-led Senate gave final approval to the bill by voice vote, but it almost certainly would vote to sustain the veto.

Failure to upset the veto would force Congress to write another bill with less money in it and possibly eliminating the provisions Reagan opposes.