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Deficit Debate Stalls Senate on 1985 Budget Action

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Washington--The Senate spent much of its time last week haggling over various proposals to cut the size of the federal deficit in fiscal 1985.

But it failed to agree on an approach to the problem, leaving next year's funding levels, including those for education, in doubt at least until this week, when the lawmakers were scheduled to take up the issue again.

At the urging of President Reagan, say budget observers, Senate Republicans earlier this year developed an unusual method of lowering fiscal 1985 spending, and thus the deficit, by passing legislation calling for fixed budget "caps" on federal programs. Without a move to cut it, the deficit could reach about $200-billion this year.

Budget Ceilings

In recent years, Congressional budget committees have initiated the annual budget process on Capitol Hill by setting budget ceilings that are nonbinding on the appropriations committees, which allocate funds to each federal program.

The idea behind the Republican initiative is to use the force of law to ensure that overall spending in broad categories (defense, entitlements, other non-entitlement domestic programs, for example) is held down, while continuing in the appropriations committees the authority to set specific funding levels for individual programs.

Under the so-called "Rose Garden" proposal, introduced by Senate Majority Leader Howard H. Baker Jr., Republican of Tennessee, as an amendment to a relatively unimportant revenue bill, the Federal Boat Safety Act, defense spending would be allowed to grow by 7.5 percent after inflation from fiscal 1984 to fiscal 1985, while spending for the remainder of federal programs not considered entitlements, including all education programs except the Guaranteed Student Loan Program, would be frozen at fiscal 1984 levels. The department's appropriation for the current fiscal year is $15.4 billion.

Last Tuesday, on what observers called a surprisingly close vote, 49-49, the Senate rejected a Democratic alternative to the Baker amendment. Sponsored by Senator Lawton E. Chiles of Florida, the ranking Democrat on the Senate Budget Committee, it would have reduced the budget by $204 billion over the next three years (compared with $144 billion for the Administration-supported plan) by cutting after-inflation growth in the defense budget to 4 percent and raising taxes by $34 billion over that period.

Funding Increased

Under the Chiles amendment, the total amount of funding for all non-entitlement domestic programs, such as education, would have been increased by $2.6 billion above current appropriation levels.

Six Republicans voted for the Chiles plan, but it failed under Senate rules on the tie vote; two Democrats, former Presidential aspirants Senator John Glenn of Ohio and Senator Ernest F. Hollings of South Carolina, were absent. Mr. Glenn was said to be on vacation in the Caribbean and Mr. Hollings was reported to be in his home state at a funeral.

Other Proposals Downed

Then, on the same day, the Senate voted 51 to 43 to table a plan by Senator Bill Bradley, Democrat of New Jersey, that would have called for an increase in education spending to $17.6 billion.

On Wednesday, by a wider margin, in a vote of 72 to 23, the Senate defeated proposal by Slade Gorton, Republican of Washington, that would have set non-entitlement domestic spending at the same level as that called for by the Chiles plan.

Another Republican Plan

Then on Thursday, the Senate considered a plan by a group of moderate Republicans, led by Senator John H. Chafee of Rhode Island. Supported by the education community, it would have reduced after-inflation defense spending to 4 percent and increased non-entitlement domestic spending by $5 billion, rather than the $2.6 billion proposed under the Chiles plan.

The moderate Republican plan would have also set a single cap on all discretionary spending, defense and nondefense, instead of separate caps for those areas. This would have given the appropriations committees the option of shifting funds from defense to domestic programs.

Spending for education under the Chafee plan was recommended at $17.6 billion.

'Rose Garden' Plan Delayed

Observers suggested that another plan, sponsored by Mr. Bradley and five other Senators, might be considered this week. That plan would also call for an education budget of $17.6 billion. So far, Senator Baker has not brought his proposal up for a vote, apparently because he lacks the votes to have it approved, Congressional sources say. In addition, it is also believed that supporters of the Rose Garden strategy have sought to delay the vote on their proposal as long as possible because they suspect it will have a better chance of passing once the Senate has voted down all the major alternatives to it.

Susan Frost, director of the Committee for Full Education Funding, a coalition of more than 80 national education organizations, said the budget caps, if passed as expected, will play a key role in the budget process.

Although they do not specify funding levels for individual programs, she said, they force appropriations committees to play individual programs against each other--for ex-ample, education versus health--by setting binding overall limits.

"If the budget doesn't allow for increases in programs," she said, "then the appropriations committees have to take it from elsewhere to give us an increase, and that is difficult to do."

Once a deficit-reduction package is passed by the Senate, it will be sent to a conference committee, where differences with a similar package already passed by the House will be worked out.

The House plan includes larger deficit reductions than those in the Reagan-backed plan, more defense cuts, and fewer domestic cuts.

Then both chambers will draft budget resolutions based on the deficit-reduction package. After that, House and Senate appropriations committees will set specific spending levels for individual programs, while keeping overall spending within the limits set by the deficit-reduction bill.

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