Tax-Increase Bill Won’t Leave Oval Office Alive, Reagan Says : Politically Risky to Boost Spending, Lawmakers Told

President Reagan, intensifying his budget battle with Democrats, warned lawmakers today that it is politically risky to boost federal spending and vowed that any tax-increase bill reaching the Oval Office “won’t make it out alive.”

Boasting of 54 consecutive months of economic growth during his Administration, Reagan said, “You don’t tax and spend your way to recovery.”

The President flew to this Atlantic Coast community near the Kennedy Space Center in the first of a series of almost weekly trips to marshal public support for his budget policies, which are sharply at odds with those of the Democratic-ruled Congress.

Greeted by Crowd

Hundreds of cheering people braved gloomy skies and muggy weather to greet Reagan at the airport. Standing on a box behind his armored limousine and using a portable broadcasting system, he told the crowd he wants Congress to adopt a budget “without burdening the people with taxes.”

Reagan stressed the same point later at a company picnic of Dictaphone Corp. and in a speech at a luncheon of the local Chamber of Commerce. The crowds cheered his promise to stand fast in opposing tax increases.

“There are some people up in Washington who seem determined to destroy our economic expansion and send us right back into the malaise . . . and stagflation of the 1970s,” the President said. Taking aim at the Democrats’ budget plan, he said: “Believe me, any tax hike bill that makes it into the Oval Office won’t make it out alive.

“So the tax-and-spend crew might as well just face the facts--there isn’t going to be any tax hike in this Administration.”

$1-Trillion Budget

After weeks of arguing, House and Senate Democratic leaders agreed last week to a $1-trillion 1988 budget that includes $19.3 billion in new taxes next year and $64 billion over three years.

The package would give the President an extra $7 billion for the military, but only if he accepts all the tax increases.

Reagan said the budget process “has become an embarrassment to the American way of governing” and asked citizens “for your support to put pressure on Congress to bring reliability and credibility to the federal budget process.”

He noted last year’s enactment of a tax-overhaul plan that eliminated many loopholes and lowered many tax rates but said “there is some bad news” on the spending front.

Special Interests

“Last year we got the special interests out of the tax code. Now it’s time to get them out of the budget,” he said.

“The amazing thing is, some in Congress seem to believe that spending more and more on behalf of this or that special interest group is actually good politics. But sooner or later, the answer will come not from the special interests but from you, the people.”

Reagan repeated his frequently stated call for approval of several budget changes, including a constitutional amendment requiring a balanced budget, a deficit-reduction package and veto power to kill individual projects in large budget bills.