Bills May Trigger Automatic Cuts, Reagan Warns : Congress Told It Nears Spending Limit

President Reagan warned Congress again Thursday it is in danger of exceeding the spending limits set by the Gramm-Rudman budget act, and may end up triggering automatic across-the-board spending cuts of between $10 billion and $20 billion.

In another of the periodic reports required by the budget legislation, the Administration said that it would not have to order such reductions now because spending levels still are $700 million below the $146-billion deficit ceiling that would set off the required cutbacks.

But James C. Miller III, director of the Office of Management and Budget, said that the lawmakers still have in the hopper some half-dozen bills that together would breach that ceiling by $3.7 billion--including a $1.3-billion omnibus drug bill, a $1.4-billion child-care program and a $700-million welfare reform bill that is favored by both parties.

If the $146-billion deficit total is exceeded, he warned, the Administration would be required to make “meat-ax cuts” in programs ranging from defense preparedness to education and drug enforcement that would prove politically painful to both parties. Under the Gramm-Rudman law, the cuts would be made on Oct. 15, only three weeks before the November election.

Miller and President Reagan, in a companion statement, both urged the lawmakers to bring their spending bills into line with the bipartisan budget compromise that the Administration and congressional leaders hammered out last November.

“Unless the Congress follows (the compromise) to the letter,” Reagan said, “ . . . this small margin of safety will evaporate.” He said that the cutbacks would prove “damaging to essential programs on which the American people depend.”

The warning was part of an elaborate procedure established under the Gramm-Rudman legislation to ensure that both Congress and the Administration meet the budget targets. The Administration would have had to order its first cuts Thursday if the spending total had exceeded the target, but the calculations showed $700 million to spare.

Reagan issued a similar warning in late July, cautioning that lawmakers would have to hold down the size of the emergency drought-relief bill, or they would exceed the budget. Congress pared that cost somewhat, but simultaneously moved ahead on several other bills.