Hints at Summit on Budget Compromise : Miller Praises ‘Positive’ Democrats

Federal Budget Director James C. Miller III praised Senate Democrats Wednesday for exhibiting a “positive” approach toward the President’s budget and held out the possibility of a summit meeting to work out a spending compromise.

“I was impressed with the evidence of cooperation” from Democrats who refrained from strongly partisan attacks on the President’s 1988 budget proposal, Miller said after appearing at a lengthy hearing of the Senate Budget Committee.

However, he emphasized that--if any proposed meeting between the President and congressional leaders becomes “a session to increase taxes--there will be no summit.”

Democratic committee members, in control for the first time in six years, repeatedly called for a meeting with the President to reach a budget agreement. The last White House-congressional budget summit took place in 1984 and it succeeded in heading off hostile wrangling that could have dragged on throughout the congressional session.

Skeptical Greeting

The President’s program, which provides a deficit of $108 billion for the fiscal year starting Oct. 1, was greeted skeptically by Democrats at the first hearing since the President’s proposal was submitted Monday.

Some members complained about proposed restrictions on aid to farmers, cutbacks in loans for college students and higher fees for new Medicare beneficiaries. But the tone of the rhetoric generally was moderate, with virtually no mention of the President’s political vulnerability because of the controversy over arms sales to Iran.

“I didn’t hear anyone here say the budget is dead on arrival,” said Sen. Lawton Chiles (D-Fla.) the committee chairman. “What I did hear over and over was (the desire) to get some kind of meeting under the leadership of the President. I hope you will take that back to the President,” he told Miller.

“I am very grateful for the quality of the exchanges,” responded Miller, noting that it would “be very useful for us to have some further conversations” before any meeting between congressional leaders and the President is arranged.

Sen. Donald W. Riegle Jr. (D-Mich.) said that the President’s budget would not get five votes if put to an immediate test in the Senate but that a “bipartisan” approach could fashion a compromise within a few months. Last year, passing a budget took 10 months.

‘Fragile Opportunity’

“I’m willing to make cuts in areas I support if it is part of a package,” said Riegle. “We ought to have a compromise and start to work on it now. There is a very fragile opportunity to do something together.”

Yet, many agree that a bipartisan budget agreement might be hard to arrange. The President wants a reduction in domestic spending and increased defense outlays without any tax hike. Many Democrats oppose the domestic cuts and are inclined toward a tax measure.

The newly elected House Speaker, Rep. Jim Wright (D-Tex.), hinted Wednesday that a tax hike may be inevitable. “I never favor higher taxes; I favor facing the realities facing us,” Wright told reporters. “I hope we will have the honesty to face this problem. It depends on what Congress chooses to do,” he said.

At the Senate budget hearing, Sen. Timothy E. Wirth (D-Colo.) told budget director Miller that a summit to resolve the tax and spending issues “is absolutely imperative.”

“The ball is in your court,” said Wirth. “This is the year to do it before presidential politics rears its head.” Sen. Paul Simon (D-Ill.) offered similar advice, saying, “there are some political compromises that can be achieved.”

Avoids Commitment

Miller was receptive, but carefully avoided committing to any meeting, saying that Congress should first give serious attention to the President’s proposals, which call for a budget of $1.024 trillion.

He said that “remarkable” progress had been made in closing the gap between revenues and spending. In contrast to 1986’s annual deficit of $221 billion, the 1987 budget provided for a deficit of $174 billion.

The President’s 1988 budget proposes $18 billion in spending cuts and $24 billion in new revenues to reach a deficit level of $108 billion, meeting the target figure in the Gramm-Rudman budget balancing law.

However, one of the authors of the deficit control legislation, Sen. Warren B. Rudman (R-N.H.), said that he would not mind if Congress misses the $108 billion target by $20 billion or $30 billion.

“We are finally heading downward (in the deficit) and that’s what is truly important,” said Rudman, a new member of the Budget Committee. The law “is not a mechanism, as the press has written, but a mentality, and we have that mentality.”