Budget Chief Talks Up Surplus in 5 Years : Economy: Darman backs a constitutional amendment. He says the President’s plan and a cap on spending could erase the deficit.

White House Budget Director Richard G. Darman on Wednesday praised congressional efforts to pass a constitutional amendment requiring a balanced budget, and said that adopting President Bush’s economic plan together with a cap on spending growth for mandatory benefits could produce a federal budget surplus in five years.

While the Democratic-controlled House and Senate still appear unlikely to reduce capital gains taxes or adopt other elements of Bush’s growth package, the Administration’s approach to limiting future outlays for Medicare, Medicaid and other mandated benefits received a respectful hearing Wednesday from the House Budget Committee.

“Chances are we may get a constitutional amendment,” said the committee chairman, Rep. Leon E. Panetta (D-Carmel Valley), “but if the Administration is so strongly in favor of a balanced budget that it believes it should be enshrined in the Constitution, one must wonder why the Administration has never proposed a balanced budget (amendment) before.”

Despite Panetta’s skepticism, deficit-reduction efforts appear to be taken more seriously than at any time since Congress and the White House agreed in 1990 that spending for new programs must be matched by new revenue or compensating spending cuts.

Advocates of balanced-budget amendments to the Constitution in both the Senate and House have expressed confidence that they have the votes this year to pass the legislation. Opponents agree that there is little chance of stopping the measure which, once passed by Congress, must be ratified by three-fourths of the states.

Darman, who once questioned the wisdom of such an amendment, said he is convinced that it is essential to eliminate red-ink spending projected at $400 billion for the next fiscal year.

“The protection of future interests cannot be left to rely on politics-of-the-moment,” Darman said. “The public itself is now clearly fed up. . . . The same populist tendencies that make a balanced-budget amendment necessary seem likely to assure that it soon will be adopted.”

Robert D. Reischauer, director of the Congressional Budget Office, however, cautioned at the hearing that such a measure “could be little more than another empty promise, one that further erodes public confidence in our political institutions.”

While nearly everyone agrees on the need to reduce the deficit, he said, the goal has been hard to achieve because it would require either raising taxes or reducing government services, or both.

“The deficit cannot be brought down without making painful decisions to cut specific programs and raise particular taxes,” Reischauer said. “In this election year, it would be a cruel hoax to suggest to the American public that one more procedural promise in the form of a constitutional amendment is going to get the job done.”

Darman testified mainly about how to cap spending increases for mandatory benefit programs, which, he said, account for most of the growth in federal outlays.

Such programs, which cannot be cut by Congress, provide benefits automatically to those entitled to them under the law. They range from Medicare for people over 65 years old to child nutrition and student loan programs.

“The public is largely unaware that almost two-thirds of the federal budget is at present beyond effective control,” Darman said. “As a matter of public responsibility, this borders on the scandalous.

“If we pass a balanced-budget amendment this year . . . we’d have the obligation to present a budget that could balance in four or five years,” Darman said. “This solution can be applied without touching Social Security.”

Meanwhile, on a related issue, the Senate ignored a veto threat from President Bush and voted to cancel $8.3 billion in spending from this year’s budget, including a cut of $1 billion in the B-2 program and $1.3 billion in research under the Strategic Defense Initiative, also known as “Star Wars.”

The vote was 61 to 38, insufficient to override an expected veto.