PREVIEW / BUDGET STRATEGY : Democrats’ Struggle on Defense Key to Total Spending Blueprint

Returning from Easter recess, the Democrat-controlled Congress faces a tough opening round of budget negotiations. The initial battle will be over how much to cut President Bush’s proposed $303.3-billion defense budget--a choice that could influence the outcome of overall budget negotiations later this year.

With the defense budget, the Democrats are hoping to establish bargaining positions for a possible budget summit with the Administration later in the year in which the final agreement is hammered out.

In its first formal vote on the defense issue Wednesday or Thursday, the House Budget Committee is expected to chop $8 billion from the President’s request for military outlays in the next fiscal year beginning Oct. 1. That much is easy.

Key Issues

The real fight in the House committee will be over how much to slash the President’s additional request for $306.9-billion in so-called long-term budget authority--permission to make defense spending commitments over the next several years.

(Budget authority--known as “BA” in Washington jargon--represents the total amount obligated for a program; outlays are the amount actually to be spent in a specific fiscal year. Large slices in Pentagon outlays usually require significant cutbacks in troop strength while big reductions in defense budget authority are more likely to hit multibillion-dollar weapons systems that take several years to build.)

With Bush unwilling to raise taxes and large areas of federal spending politically untouchable, Democrats in both the House and the Senate yearn to carve billions of dollars from the Pentagon budget and use the money for education, health care and other social programs.

The defense budget is the key to the rest of the federal spending plan. “It all hinges on the number that we can agree on for the military,” said Rep. Barbara Boxer (D-Greenbrae), one of the liberals on the House budget panel. Without significant defense savings, goals like deficit reduction and add-ons to social programs are unattainable.

Opposing Forces

The struggle in the House Budget Committee is inside the Democratic majority. The liberals want to bring the long-term defense budget authority down as close to $280 billion as they can, if only to establish a bargaining position. They argue that the declining Soviet military threat and the downfall of some Communist regimes have created an unprecedented opportunity to shift priorities.

The liberal strategy also is designed to force long-term cuts so large that at least one major missile system--such as the MX or the Midgetman--must be eliminated.

The other group of Democrats--considered more likely to prevail--favors a smaller reduction, lowering the long-term budget authority to about $286 billion. Any larger reduction, they warn, could trigger a Bush veto of the defense authorization bill, which in turn would thwart the budget-cutters’ plans.

Bush intends to resist both sets of cuts. But he is given little chance of winning in committee or on the House floor next week.

In the Senate, however, the defense budget battle may end in a stalemate. The majority Democrats on the Budget Committee appear deeply divided on military spending, deficit reduction and other issues.

Sen. Jim Sasser (D-Tenn.), the committee chairman, has tentatively proposed a defense outlay of $291.7 billion--almost $12 billion less than the President asked--and a long-term budget authority of $281 billion--almost $26 billion under Bush’s request. He appears to have little committee support.

Outlook

If the House and Senate cannot agree on a budget, the stage will be set for negotiations between Democratic congressional leaders and the Bush Administration. At such talks--now regarded as a virtual certainty--Bush may be able to get agreement from Democratic leaders to include his plan for a capital gains tax cut.

At the same time, Bush may be under pressure to accept a Democratic proposal to raise tax rates on Americans with incomes above $200,000 a year.

Democrats and Republicans expect the budget battle to last almost until Oct. 1, when the new fiscal year begins.

Richard G. Darman, Bush’s budget director, has been mending fences in the Senate with Sasser and Sen. George J. Mitchell of Maine, the Democratic leader, in hopes of negotiating an agreement on the budget.

In the House, the leadership is maneuvering to give the Democrats added leverage.

“Many of us think we’re going to a (budget) summit so we have to have as political a budget as Bush presented to us,” another Democratic staff member said. “It will hit hard on defense.”