Surprised Citizens Discover That Exercise in Budget-Cutting Can Be a Taxing Chore

Sharon Barbosa of Irving, Tex., has a message for policy-makers in Washington: She’s willing to pay the price for eliminating the huge federal-budget deficit.

“We’re all going to have to absorb some of the hard times,” concluded Barbosa, the owner of a research and writing service, as she and several dozen other Dallas-area residents completed a three-hour budget-writing exercise last week sponsored by the Committee for a Responsible Federal Budget.

Along with similar groups in Oklahoma City and Sacramento, participants in the Dallas seminar learned some fundamental truths about just how much pain is involved in erasing the $170 billion in red ink that is projected to greet the next President: It would take wrenching spending cuts in long-cherished federal programs and probably the largest tax increase in U.S. history.

That hardly qualifies as news for most lawmakers and other federal officials in Washington, who know that last year’s budget summit between Congress and the White House did little more than postpone the day of fiscal reckoning beyond the next election.

But it might come as a surprise that voters--once they understand the depth of the problem and the options for coping with it--say they are ready to bite the bullet, as long as everyone else has to sink their teeth into it at the same time.

Conveying this message to the politicians is one of the primary purposes of the budget exercises that the nonpartisan, nonprofit committee will be sponsoring in other regions of the country this year.

As Oklahoma Gov. Henry Bellmon, the former ranking Republican on the Senate Budget Committee, said as he convened the Oklahoma City session, “Let them know what you think, and hopefully it may help strengthen their backbones.”

How much spine-stiffening can be accomplished in the face of public-opinion polls that show the American electorate strongly opposed to tax increases and tough spending cuts is a difficult question.

Few of those who participated in the recent budget sessions failed to grasp the political perils of their recommendations. “I’m glad people aren’t voting for us based on what we said today,” observed Ed Crone, an employee of the Eastern Oklahoma Development District.

In addition, the people who took part in the budget exercises were what politicians like to call opinion leaders: business people, local officials, civic leaders and elderly activists. The kind of voters who cannot take off three hours at midday to role-play a budget-committee markup--blue-collar workers, for example--were in short supply.

Nonetheless, many of those who did attend came with the preconceived and common view that a $1.1-trillion federal budget must be marbled through with enough fat that truly unpleasant choices such as trimming Social Security or raising tens of billions of dollars in new taxes would be avoidable.

Pat McElroy Jr., an executive vice president of a Duncanville, Tex., bank, for example, approached the task of cutting federal spending with gusto.

He announced to his table in advance that cutting $70 billion from the fiscal 1990 budget to meet the Gramm-Rudman-Hollings budget law’s goal of a $100 billion deficit that year should be done predominantly through spending reductions rather than raising taxes.

And when told that a $10-billion cut in the defense budget would probably translate into 65,000 layoffs of uniformed and civilian employees in the Defense Department, McElroy was undaunted: “I’ve always wanted to lay off 65,000 people,” he said. “Let’s go for it.”

Yet by the time McElroy’s group had completed its exercise, it had voted to raise taxes by $51 billion in fiscal 1990 while cutting spending by $33 billion.

Working from a set of policy choices prepared by the Congressional Budget Office, other groups in the three cities came to similar conclusions.

Achieving the $70 billion in deficit reduction that will be required next year under the Gramm-Rudman-Hollings law, most participants discovered, necessitates going to big-ticket items: the $300-billion defense budget, the costly entitlement programs such as Social Security, Medicare and agricultural subsidies, and higher taxes.