Governors Seek to Forge a Federal Budget Deal

Asserting themselves as a third force in the federal budget dispute, the nation’s governors on Saturday launched four days of intense discussions in search of a bipartisan compromise that could rejuvenate the deadlocked fiscal negotiations between Congress and President Clinton.

Opening the semiannual National Governors’ Assn. meeting in the snowbound capital, the group’s leaders, representing both parties, expressed a steely determination on the part of all governors to find a route toward a seven-year balanced-budget plan that will be acceptable to both the GOP-dominated Congress and the Democratic president.

“We will come together in a bipartisan way and work to resolve the partisan differences in Washington,” said Republican Gov. Tommy G. Thompson of Wisconsin, chairman of the group. “We’re assuming that mantle of leadership and we’re taking our duties very seriously. We are going to be pushing very hard.”

Democratic Gov. Robert Miller of Nevada, the group’s vice chairman, held out high hopes for the talks, saying the four-day session “could be a historic meeting.”

Both governors steadfastly refused to be drawn into a public discussion of potential areas of compromise, but they said the governors will focus on the Medicaid health program for the poor, welfare reform and worker training. Together, those programs comprise as much as 40% of many state budgets, Thompson said.

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“We think we can come up with a package that maybe will transcend the partisanship, the polarization--and will allow both sides to say, you know, that’s a victory for our side, a victory for both sides. So everybody can come out of this a winner,” Miller said.

Speaking at a news conference, Miller and Thompson acknowledged that forging an agreement and winning the necessary endorsement of at least three-fourths of the governors is far from a foregone conclusion, despite their generally amicable working relationships.

But failure to resolve the budget stalemate would have devastating financial consequences throughout the country, according to Thompson, Miller and others.

Many governors attending the conference decried the bitter partisanship that permeated Washington throughout much of 1995 and vowed to demonstrate that goodwill and the ability to solve problems are not lost commodities, at least among governors.

To facilitate their discussions, the governors have scheduled many more private working sessions than are customary--providing participants with an opportunity “to speak candidly with each other,” Miller said.

“We need to solve problems,” Gov. Roy Romer (D-Colo.) said in an interview. “The voters are getting pretty frustrated. They want government to work. And the longer you fail to solve the problems, the less credibility we all have as occupants of public offices.”

Most governors are now in the process of finalizing their own state budgets, but those efforts are seriously hampered by the absence of an agreement in Washington on a federal budget, according to Thompson and others. The federal government has been operating since the beginning of the fiscal year on Oct. 1, 1995, without a final spending plan.

Many governors, he noted, already have assumed in their budgets large savings from proposed federal policy changes in Medicaid, welfare and other large programs.

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If those savings do not materialize as a result of the ongoing budget stalemate, states will find themselves “in terrible financial shape,” Thompson said.

He maintained that three years of effort will be lost if a budget deal is not reached in 1996.

“If we don’t break this deadlock, this logjam, it probably will be another three years before states will be able to really implement the changes in Medicaid and welfare and employment training that [are] necessary,” Thompson said.

Such a delay could be unavoidable until after a new Congress--and perhaps a new president--are elected in November.

Many governors have stayed in close touch over the past months with the principal budget negotiators in Washington. But the governors’ new sense of determination--and “cautious optimism”--developed only in the past few days, Thompson said.

Neither he nor Miller would cite specific reasons for their optimism, other than to reiterate the adverse consequences of a continuing deadlock.

While refusing to discuss strategy or numbers, Miller offered a glimpse of how the governors intend to approach the task of consensus-forging in the days ahead.

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He noted that only about $36 billion now separates congressional Republicans and President Clinton on welfare reform, compared with about $150 billion earlier. Rather than focusing on the remaining gap--which Miller conceded “ain’t chump change”--”we are trying to develop a plan which we think will work at any dollar amount within that parameter,” he said.

Despite Washington’s second major snowstorm this year, 47 governors are expected to attend the four-day session. Clinton is hosting a black-tie dinner for them at the White House tonight, to be followed the next morning by a two-hour work session.

On Tuesday, the president is scheduled to address the organization, which he once chaired as governor of Arkansas. Senate Majority Leader Bob Dole, the front-runner in the GOP presidential contest, is also scheduled to speak to the group.