Deficit Remains as Major Issue Facing Congress

When the 99th Congress convened last Jan. 3, Senate Majority Leader Bob Dole (R-Kan.) declared that balancing the federal budget would be the lawmakers’ chief priority in 1985. “We want to get out in front on this,” he said.

But an acrimonious year later, Congress has closed up shop just as it began--promising to trim the mammoth federal deficit in the session ahead.

When the House and Senate at last adjourned for a monthlong Christmas recess Friday, the budget was still awash in red ink, and Dole acknowledged in an interview that Congress would have to grapple with the issue again next year. “It hasn’t changed much,” he said.

New Mechanism in Place

Congress’ familiar year-end promise to cope with future deficits has new teeth. In perhaps its most significant action of 1985, Congress put in place a new and revolutionary mechanism requiring automatic, across-the-board spending cuts if it fails to force the deficit below a series of annual ceilings declining to zero in 1991.

Apart from the budget, Congress took many halting steps in 1985. Although it sent a sweeping farm bill to President Reagan and enacted some other major legislation as well, it failed to complete work on Reagan’s top legislative priority--overhaul of the tax code. The House passed a bill that will go to the Senate next year.

Congress’ failure to reduce the deficit did not come for lack of trying. In the summer, after extended political maneuvering, Congress passed a budget outline aimed at reducing the federal deficit, about $212 billion last year, to $171.9 billion.

But in the following months, it failed to pass an omnibus bill containing many of the spending cuts and minor tax increases necessary to implement that budget. That bill, the last piece of business awaiting congressional action before Friday’s adjournment, was left unfinished because negotiators for the two houses could not agree how to pay for the cleanup of hazardous waste sites under the Superfund program.

In the absence of the far-reaching bill to reduce the deficit, Congress accomplished piecemeal trims in its regular spending bills. Despite them, however, the government is still operating at an annual deficit of about $200 billion as tax revenues have lagged because of slower-than-expected economic growth.

Gone are the days when Congress could be counted on to produce major social legislation every year. Lost in the shuffle of this year’s deficit mania were proposals to reform the immigration laws and reverse a 1984 Supreme Court ruling easing civil rights enforcement. “Every time we tried to get away from the budget, it just came back again,” a weary Republican aide said.

Little Progress on Trade

Among the issues on which Congress made little headway was the nation’s enormous trade deficit, which many congressmen made their own personal top priorities. Reagan vetoed a bill to slash textile imports, the only major trade legislation to clear Congress.

Institutional problems contributed to the paralysis. According to an analysis prepared by congressional staff members, at least 70% of the bills enacted in 1985 were inconsequential--laws equivalent to the declaration of National Sewing Month. And the Senate seemed virtually incapable of conducting major business in working hours, with nearly one-third of its roll-call votes coming after 6 p.m. and almost 20% of them on weekends.

Still, it was by no means a wasted year on Capitol Hill. “In some important respects, it ended remarkably more productive than it seemed likely to several months ago,” political scientist Thomas Mann said. “We are not suffering from stalemate, which was the old criticism of the American political process.”

‘Kept the Place Running’

As Dole put it: “We kept the place running. We got our work done.”

Earlier last week, the House passed and sent to the Senate a sweeping tax-overhaul package that would reduce the top individual rate to 38% from 50%. In addition, Congress approved $50 billion in crop subsidies sought by the nation’s beleaguered farmers.

Nor were the lawmakers timid when it came to trimming federal programs. On Thursday, the House and Senate agreed to something that seemed improbable just a year ago--a defense spending increase insufficient to keep pace with inflation. That brought the President’s massive military buildup to a screeching halt.

More specifically, Congress limited to 50 the number of MX missiles that can be deployed, banned the testing of anti-satellite weapons, ended a 16-year moratorium on chemical weapons production and embraced the Reagan doctrine of U.S. support for anti-Communist insurgencies in Nicaragua, Afghanistan and Cambodia.

Political scientists credit the emergence of several powerful committee chairmen for what progress Congress made. Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.) guided the tax package through the House, and Sen. Richard G. Lugar (R-Ind.), the new chairman of the Senate Foreign Relations Committee, succeeded in producing the first foreign aid bill in four years and a compromise on sanctions against South Africa.

More Reliance on Leadership

“What is happening now is a retreat from the post-Watergate power-sharing of the 1970s and a turning back toward a greater reliance on leadership,” said Norman Ornstein, a congressional scholar at the American Enterprise Institute. “The discipline promotes action instead of deadlock.”

In many ways, these actions in 1985 only set the stage for what is to come next year. Pressure for deficit-reduction will be greater in 1986 as the November congressional election approaches, but the solutions may be even harder for members of Congress to swallow.

The budget-balancing law, known for its chief sponsors, Sens. Phil Gramm (R-Tex.) and Warren B. Rudman (R-N.H.), is so controversial that many in Congress question whether it will ever be implemented. “It’s going to lead to unthinking and unwarranted cuts in programs that help everybody,” warned California Sen. Alan Cranston, the Senate’s second-ranking Democrat.

Like Cranston, some members of Congress are predicting that the spending squeeze next year will be so tight under Gramm-Rudman that current efforts to overhaul the tax code will quickly give way to legislation to increase taxes. Many members of Congress say that they would support a tax hike, but Reagan has kept them in check by adamantly opposing one.

Warning on Defense Cuts

Defense spending will be another target of deficit reduction. But Sen. Ted Stevens (R-Alaska) warned in an emotional speech Thursday that this year’s trend toward defense spending cuts, if continued, would force the United States to trim its armed forces, return to the military draft, reduce its commitment to the North Atlantic Treaty Organization and abandon its goal of a 600-ship Navy and a 40-wing Air Force.

“If we don’t correct this trend,” he said, “even the goal on which we all seem to agree--the improved readiness of conventional military forces--is put in jeopardy.”

Despite the overall reduction in defense spending, Sen. Pete Wilson (R-Calif.), a member of the Senate Armed Services Committee, argued that the President “got most of what he wanted” this year for a number of major weapons systems. Most notably, Reagan received $2.7 billion--nearly double last year’s total--for his controversial “Star Wars” space-based nuclear missile defense.

At the same time, Wilson acknowledged that next year’s battle on these same issues is “going to be very, very tough.” Liberals were clearly encouraged by several major victories this year, including the ban on anti-satellite weapons testing and the decision to limit deployment of MX to 50 missiles.

Move to Lift Ban Seen

Stevens said that Senate Republicans will try early next year to lift the ban on anti-satellite weapons tests. Meanwhile, House Democrats will make another effort to block production of binary nerve gas artillery shells before the law allows it to begin next Oct. 1.