Democrats Fear Plan Falls Short on Spending Cuts

Democrats in Congress gave President Clinton’s economic package a wary embrace Thursday, but many expressed concern that the President did not go far enough in cutting spending to reduce the budget deficit.

With initial public opinion running strongly in favor of the plan, Democratic leaders basked in the rosy afterglow of Clinton’s Wednesday night speech and expressed confidence that they will be able to shepherd his economic package relatively intact through the legislative gantlet.

“The thrust of this program will be enacted,” House Speaker Thomas S. Foley (D-Wash.) predicted. “I’m not saying every single line of the President’s recommended program is going to be enacted but then I hope we have alternatives that reach the same goal.”

Yet some Democrats, facing a relentless chorus of Republican criticism, complained that Clinton had not cut spending enough.

For most of these Democrats, the issue was one of balance--only by making deeper cuts in federal spending, they contended, could Clinton’s proposed tax increases be made palatable to American voters.

Despite the characterization of Clinton as a new kind of Democrat, they worried that he had left their party vulnerable to the old tax-and-spend accusations that have drawn political blood in the past. Once the details of the package become clear, some said, early support may evaporate quickly.

“I think it’s selling right now but it’s selling on the basis of the rhetoric,” said Rep. Pete Geren (D-Tex.), who complained that Clinton had “gone to bat and chosen to hit a double, rather than a home run.”

Geren said that he and other conservatives are trying to put together a package of additional spending reductions but added that it is unlikely that they will be able to persuade a majority of lawmakers to go beyond the “high water mark” set by the President.

Yet there was sentiment for further cuts among liberals as well. “I hope we don’t stop here,” Rep. Anthony C. Beilenson (D-Los Anageles) said. “We’re not asking an awful lot from most Americans.”

Despite any such concerns, Democrats were buoyed by a pair of public opinion polls showing that Americans overwhelmingly back Clinton’s package. An ABC News poll said that 74% of Americans approved of his proposals and 18% disapproved. A similar survey by CNN and USA Today found 79% of Americans supporting the plan.

The polls were taken shortly after Clinton’s speech, however, before most Americans were exposed to varying opinions and evaluations of the package.

The speech also set off an avalanche of phone calls to Washington. In the hour after Clinton’s speech, roughly 400,000 calls were made in one hour into Washington over AT&T;’s long distance lines, a spokesman said, about 14 times more than during the same hour on the previous night.

The Capitol switchboard registered 126,698 calls over a 12-hour period through noon Thursday, compared to 84,000 on an average day. A breakdown of calls was not available, but congressional offices indicated that Democrats heard from more supporters than opponents of the plan, while the reverse was true for Republicans.

The White House also received a huge volume of calls, but Press Secretary Dee Dee Myers provided few specifics.

Once the economic package arrives in Congress, Democratic leaders believe that their best strategy will be to pass it in two parts, scheduling an early--and relatively easy--vote on the portion of it that will funnel billions of dollars in new spending into congressional districts. That action, which could come as early as next month, would be followed by a tougher vote to reduce the deficit with tax increases and spending cuts.

The advantage of such a plan is that it would allow lawmakers to take credit for popular programs before they are forced to face possible voter wrath over deficit-reduction steps. It also would address concerns that the economy may slide back into recession, unless it gets a boost from new government spending.

Many in Congress, however, worry that this two-step approach could weaken the overall plan, particularly if a delay on deficit reduction gives interest groups time to gear up their opposition. “If we separate the sugar and the medicine into two separate spoonfuls, Congress will always swallow the sugar and never take the medicine,” Sen. David L. Boren (D-Okla.) said.

Promoting the package in testimony before the House Budget Committee, Leon E. Panetta, director of the White House Office of Management and Budget, agreed on the need to tie the two votes closely. “Members need to say to the American people that while stimulus is necessary, so is deficit reduction,” he said.

Republicans, meanwhile, were warming up the arguments that they plan to use in trying to defeat the proposal.

“What the President basically talked about last night was cradle-to-grave government funded by cradle-to-grave taxes,” Sen. Phil Gramm (R-Tex.) contended. He dismissed Clinton’s proposed $16-billion infrastructure spending proposal--one of the plan’s most popular elements--as “a boondoggle of giveaway to the big city political machines that helped elect the President.”

Outside the Capitol, the special interest groups that had been the chief target of Clinton’s rhetoric generally were muted in their criticism. The American Assn. of Retired Persons, for example, said that Clinton’s plan, which includes higher taxes on Social Security benefits for relatively well-off retirees and cuts in Medicare spending, “can be made more equitable.”

Once legislation is drafted, the package is likely to face its toughest test in the Senate.

House procedures make it difficult for opponents to offer amendments, unless they are amenable to the Democratic leadership. Thus, House members will be forced to vote to approve or kill--but not change--the portions of the package as they are laid before them.

In the Senate, on the other hand, members have broad power to pick apart legislation and reassemble it. Already, for example, Sen. J. Bennett Johnston (D-La.), chairman of the Senate Energy and Natural Resources Committee, has indicated that he may try to substitute a value-added tax for Clinton’s proposed energy tax.

Sen. Sam Nunn (D-Ga.), chairman of the Senate Armed Services Committee, told reporters that he has concerns that the President is cutting too much from defense. He noted that the Pentagon has not yet answered many of his questions about the specifics of the plan and added that he is uncertain whether he can support it.

“I’ve got to wait and see how the package is put together and how the cuts are made,” Nunn said.

Gramm and other Senate Republicans gave notice that they plan to force separate votes on many of the package’s most unpopular elements, hoping that a series of embarrassing votes will rob the Democrats of the political cover they would get from considering the plan in its entirety.

The first test of Clinton’s support could come as early as next week when the House will consider spending $4 billion to extend unemployment compensation.

At every turn, the President’s allies are going on the offensive, insisting that critics put forward their own alternatives.

“Let’s do something,” Panetta said. “Let’s not engage in gridlock. Let’s get some kind of plan moving.”

In a dramatic exchange, Panetta challenged Rep. John R. Kasich of Ohio, ranking Republican on the House Budget Committee, to say whether he would support an increase in the top-bracket tax rate to 36%. When Kasich hesitated, Panetta lashed out: “You are the perfect example of gridlock the public is tired of.”

“Things have to change and your party has to confront the fact that if we are going to deal with deficit reduction, we need everybody,” Panetta added. “We need the wealthy, business--we need everybody.”

Although the Democrats have an 82-member majority in the House, they hope to draw some support from moderate Republicans. “If we don’t get them, we start running into deep trouble,” a leadership aide said.

But thus far, there is scant evidence that any Republicans are ready to join forces with the President.