Reagan aide denies '82 deficit may soar toward $60 billion or more
Washington — The President is taking issue with those who are forecasting that the '82 deficit will be at least $60 billion, perhaps more than $70 billion. Instead, Mr. Reagan's position is that the deficit will be "only a few billion" above his earlier projection of $42.5 billion.
At the same time, the President's communications chief, David Gergen, says Mr. Reagan is sticking solidly with his intention to balance the budget by 1984.
What this means, Mr. Gergen told reporters over breakfast Aug. 18, is that "sizable cuts in spending now lie ahead."
Mr. Gergen acknowledged that the deficit had been getting somewhat bigger than anticipated, that Budget Director David A. Stockman has noted some "upward creep" -- which at the most would be less than $10 billion.
Here Mr. Gergen was asked whether it might not be more difficult for the President to get Congress to agree to the second round of tax cuts than it was with the first.
"That's a fair assumption," he said. "That's what we believed back several months ago. But a significant political change has taken place. We now have a building political momentum that will allow the President to make the necessary remaining cuts."
Calling Mr. Reagan's fall agenda "a very busy one," Mr. Gergen said "it is clear now that economic recovery will be the President's No. 1 priority. We will now translate legislative gains into concrete pocketbook gains for the American people."
Besides new moves to reduce or end federal programs, the President, Mr. Gergen said, will make additional efforts to bring about more efficiency in all the departments.
On what he called the "secondary tier of priorities" for the fall, Mr. Gergen included the following:
1. A presidential decision in September on what he will do about supporting the Voting Rights Act.
2. Social security -- "The President expects there now will be a bipartisan bill moving through Congress."
3. The social issues. Mr. Reagan will be supporting antiabortion measures, prayer in the schools, and tax credits for private-parochial schools.
On other subjects Mr. Gergen said:
* The President will under no circumstances trim expenditures that relate to the country's strategic military posture. He had pledged to strengthen that posture -- and he will stick to that promise.
* There is, as Mr. Gergen sees it, a "good chance" that the Republicans will take over both houses of Congress in the 1982 elections.
* Mr. Gergen, attributing his information to economic experts in the administration, forecast a reduction in interest rates by the end of the year and, perhaps, a slight increase in unemployment by that time.
"We are encouraged," he said, "by the drop in the rate of inflation. Murray Weidenbaum [chief of the President's Council of Economic Advisers] has said that we are finished with the phenomenon of double-digit inflation."