U.S. to Attack Budget-Cutting Provision

The Justice Department will go to federal court Friday to attack the key budget-slashing provision of the new Gramm-Rudman deficit reduction law as unconstitutional, sources close to the department said Wednesday.

Atty. Gen. Edwin Meese III served notice last week that the Administration would not defend the provision, which triggers automatic wide-ranging spending cuts if Congress fails to meet certain deficit-reduction targets over the next five years.

Since then, sources said, the department has decided to prepare a legal brief in support of a suit filed against the Gramm-Rudman measure by the Treasury Department’s employees’ union. That suit, filed late Wednesday night, and a similar one brought by Rep. Mike Synar (D-Okla.) will be argued before a three-judge panel in federal district court here Friday and almost certainly will reach the U.S. Supreme Court.

‘Subservient’ Official

Justice lawyers, led by Assistant Atty. Gen. Richard Willard, are expected to argue that the deficit-reduction law, passed by Congress and signed into law by President Reagan last month, violates the Constitution by empowering a “subservient” official--the head of the congressional General Accounting Office--to effectively order the President to make spending cuts.

The legislation, named for its principal Senate sponsors, Phil Gramm (R-Tex.) and Warren B. Rudman (R-N.H.), sets declining ceilings on annual deficits until a balanced budget is reached in fiscal 1991. Congress and the President can reach the targets with spending cuts or higher taxes, but if the elected officials fail, the General Accounting Office would direct the President to cut most federal programs by a specified percentage.

Sources said the Justice Department suit will argue that the head of the GAO--the comptroller general--is an officer of the legislative branch, not an “officer of the United States” who, under the Constitution, can administer laws. But even if the comptroller general is found to be an officer of the United States, the department will argue, he is prohibited by the Constitution from giving an order to the President.

A Right to Challenge Law

On a technical point, the Justice Department is expected to say that it believes the Treasury employees’ union has a legal right to challenge the law because its members stand to be damaged by loss of cost-of-living increases in pay and pensions under the mandatory budget-cutting process. However, the department will argue that Synar has no such legal right to sue.

Union President Robert M. Tobias charged at a news conference that the automatic spending cuts of the Gramm-Rudman law would “lay waste to the two major sources of the country’s revenue, the Internal Revenue Service and the U.S. Customs Service. . . . If Gramm-Rudman is not stopped in its tracks, the country will lose $3 billion in revenue this year and nearly $32 billion over the duration” of the law.

A provision of the Gramm-Rudman law, anticipating the possibility that its automatic spending cuts could be found unconstitutional, contains a fallback provision: that the cuts would take effect only if the President presented them to Congress and Congress voted for them.