Gramm-Rudman Arguments Begin at Supreme Court

The Reagan Administration, engaged in a far-reaching constitutional conflict with Congress, urged the Supreme Court on Wednesday to strike down the automatic deficit-reduction provisions of the Gramm-Rudman balanced budget law.

In oral argument, Solicitor General Charles Fried told the justices that the landmark law violates the separation of powers by giving an officer of Congress--the comptroller general--budget-cutting authority that should be reserved to the executive branch.

“Here we have an officer (the comptroller) who gives orders to the President,” Fried said. “These powers are entirely novel. . . . This grant of authority violates the Constitution.”

On the other side, lawyers for the comptroller, the Senate and the House leadership all defended the constitutionality of the law and the key role of the comptroller in the budget-reduction process.

Lloyd N. Cutler, representing the comptroller, called the nation’s spiraling deficits “a growing cancer that may soon become inoperable.”

And he warned that if the Administration’s argument is accepted, it could endanger the independence of numerous federal agencies headed by officers who, like the comptroller, are not removable from office at the will of the President.

“You would take over the side (with Gramm-Rudman) the Federal Reserve Board, the Federal Trade Commission and many other agencies,” Cutler told the court. “If you adopt that doctrine, there would be sweeping implications for those agencies.”

Courtroom Jammed

The justices heard two hours of brisk debate over the law in a courtroom jammed with spectators, including Administration officials, members of Congress and constitutional scholars.

Under review is a decision by a special three-judge federal court last February that invalidated the law’s deficit-reduction mechanism on the grounds that it violates the separation of powers.

Despite its technical nature, the case will have an immediate practical effect on efforts to trim the nation’s growing budget deficit--now about $208 billion--and also could alter the traditional balance of power between the President and Congress. A decision by the justices is expected by July.

Series of Targets

The law mandates a balanced budget by 1991 and establishes a series of progressively lower annual deficit targets to achieve that goal. If Congress does not meet those targets, the law provides for automatic, across-the-board cuts to be computed by the comptroller--and then the President must put them into effect.

The law also contains a “fallback” provision that will take effect automatically if the role of the comptroller is invalidated in court. If that occurs, the Congressional Budget Office and the White House Office of Management and Budget would prepare a list of cuts that Congress, if it wishes, could vote to enact.

Several of the justices appeared to be uneasy with the duties assigned the comptroller under the law. Chief Justice Warren E. Burger, in a question about the unprecedented delegation of budgetary authority, observed that “for 199 years these functions have been carried out by Congress and the President.”

Ordinarily Obscure

The comptroller, an ordinarily obscure officer of the government, heads the General Accounting Office, a watchdog auditing and investigative agency of Congress. He is appointed by the President to a 15-year term but can be removed from office only by Congress.

Fried, the government’s chief advocate before the court, vigorously denied that in its challenge to the law, the Administration is seeking to undermine the authority of a host of independent federal agencies. “That is simply a ‘scare’ we don’t intend to throw into this court,” he said.

But Justice Sandra Day O’Connor interjected to say: “Mr. Fried, I confess you scare me with it--so why don’t you explain?”

The startled solicitor general replied that, unlike the role anticipated for the comptroller under the law, the Federal Reserve and similar independent agencies “do not give orders to the President.”

Called Unproper Move

Alan B. Morrison, an attorney representing a group of 12 House members who challenged the law, argued that Congress, in an effort to avoid political accountability, improperly delegated its authority to make spending decisions to an unelected official.

“Congress tried to create an elaborate mechanism to reduce the deficit without increasing taxes or cutting spending programs because it was unable to muster the votes to do so itself,” Morrison said.

Steven R. Ross, representing the House leadership, urged the justices to be “especially wary” of overturning a hard-won, badly needed political compromise. In giving the comptroller a pivotal role, Ross said, Congress legitimately sought to “wall off” the budget-cutting process from partisan influences.

The legal counsel for the Senate, Michael Davidson, struck a similar note, saying that Congress, in selecting the comptroller for the job, was searching for someone who would be “neutral and impartial.”