Reagan May Seek Big Budget Cuts

President Reagan’s proposed budget for the next fiscal year may seek up to a record $54 billion in spending cuts and other savings, a 6% increase in defense spending and no new taxes, Administration officials said today.

Those figures, confirmed in part by Budget Director James C. Miller III and in part by other Administration officials, would be included in a budget document designed to pare the federal deficit to $108 billion in the fiscal year that begins next Oct. 1.

Miller said “judicious trimming of bloated programs,” along with new user fees, sales of federal assets and loan portfolios and some program eliminations will be proposed to meet the $108-billion level, which is the fiscal 1988 target of the Gramm-Rudman budget-balancing law.

One Administration source, who spoke on the condition of anonymity, said the Office of Management and Budget headed by Miller is considering resubmitting many of the same proposals it proposed unsuccessfully this year, but with some major modifications and exceptions.

For instance, the Administration has abandoned its proposals to eliminate the Small Business Administration and Amtrak subsidies, although it will likely recommend large cuts in both programs, the source said.

The budget director said in a speech to the National Electrical Assn. that he is likely to recommend to Reagan a “real” defense spending increase of 3% above the $289.7 billion appropriated by Congress for this year.

Management office spokesman Edwin Dale Jr. said this would translate to an actual increase of 6% once inflation was calculated into the formula, suggesting a defense-spending request in the neighborhood of $308 billion.

Another Administration official said the $54 billion in total cuts and savings should be viewed with some skepticism at this stage. It is still a very rough estimate, he said. “It will change. And I think it will change downward.”