Budget Voodoo

Until now the 1987 budget process was another game of chicken, with Congress and the White House daring each other to go first. That changed, however, when budget director James C. Miller III took a giant step backward to the voodoo economics of the 1980 Reagan campaign. Just change the budget figures and let the market work its will and there will be no problem. The 1987 budget deficit naturally will fall below the Gramm-Rudman target of $144 billion, he said.

Miller commented as the Senate was debating the 1987 spending plan drafted by its Budget Committee under Chairman Pete V. Domenici (R-N.M.). It would cut defense from $320 billion to $295 billion, trim President Reagan’s deep domestic cuts and raise $12.5 billion in new taxes. The White House has been stonewalling the Domenici plan in spite of negotiating attempts by Senate Majority Leader Bob Dole (R-Kan.).

The stonewall strategy is a dangerous one against the backdrop of Gramm-Rudman, which requires a budget compromise that would bring the annual deficit down below $144 billion. If that is not done, the law triggers automatic budget cuts that no one wants.

Miller denied that he was advocating “cooking the books” to make the the figures appear to satisfy Gramm-Rudman. Congress’ figures are “malarkey,” he said, and, “I’m correcting the books.” In fact, Domenici and others contend that the Reagan budget exceeds the Gramm-Rudman goal, even with an improved economy.

On Wednesday the Senate showed the lack of support for the Reagan proposal to eliminate 44 domestic programs. Domenici put the list of 44 toa test vote, and it was rejected, 83 to 14.

Little has been heard from Democrats, particularly House Democrats. If there is a tax increase, they want the Republicans to go first.

But Rep. Leon E. Panetta (D-Carmel Valley), a former member of the House Budget Committee, is proposing a potentially reasonable solution. He has suggested a 20-20-20 plan: $20 billion in defense cuts, $20 billion in domestic cuts and $20 billion in revenue increases. That would cut the 1987 deficit to about $130 billion, well below the Gramm-Rudman mandate. But Panetta notes that Congress has been notoriously poor at hitting budget targets in the past, and his plan provides a prudent cushion against unexpected turns of events. If the economy is stronger than expected, so much the better. “Taking a bigger chunk out of the deficit this year will make it that much easier to reach the deficit targets set in law for fiscal years 1988 through 1991,” Panetta said. Or the size of the final tax increase could be whittled appropriately.

A commendable feature of Panetta’s plan is that it would cut domestic spending by a significant amount, but manage to protect the same low-income-assistance programs that would be safeguarded under Gramm-Rudman. The Reagan budget would not.

In the end, budget chief Miller suggested that Congress could just go through the motions of the budget-resolution process, knowing that the figures probably are wrong. Then the real budgeting could be done via passage of the various appropriation bills. More voodoo. On the current course, Miller said, the Senate merely is following the same old policy of “tax, tax, spend, spend--except for defense.” These shopworn, gratuitous remarks, mind you, are being directed at the White House’s friends , the Republicans who control the Senate, where 22 of the 53 GOP seats will be at stake in November.

If the White House’s petulant foot-stamping seems familiar, it is pretty much a rerun of last year’s budget game. But the stakes are higher, and this year time is shorter. Congress must implement its budget decisions by Aug. 20 or the Gramm-Rudman countdown begins. Once again Domenici & Co. have had the political courage to go first. Progress will be made only when the White House is willing to put a constructive foot forward, too.