Mixed signals from balanced budget team
Washington — The administration has climbed down from the stands and joined the push to pass a constitutional amendment requiring a balanced budget. But other members of the team -- legislators and lobbyists long identified with the issue -- aren't sure they and the White House are fighting for exactly the same thing.
President Reagan has, indeed, specifically endorsed the balanced budget amendment now percolating through Congress. However, high administration officials are quietly saying they want some changes made. Veterans of the budget amendment drive are thus being buffeted by conflicting emotions: pride that Reagan is now publicly behind them, and puzzlement over what he really wants.
''After all, it's not as if this amendment were written on the back of a brown paper envelope,'' says Lewis Uhler, president of the National Tax Limitation Committee (NTLC).
The legislation in question is known familiarly as ''SJ Res. 58.'' Written by Milton Friedman and various other conservative economists, this proposed constitutional amendment would require Congress each year to adopt a balanced budget, unless three-fifths of both chambers vote otherwise.
In addition, the US government's tax receipts couldn't increase faster than national personal income. To dodge this obstacle, Congress would have to pass specific tax increase legislation, a move that requires a majority vote and a presidential signature.
During his prime-time April 29 address on the economy, President Reagan called on Congress to pass a balanced budget amendment. On May 1, in his weekly radio chat, Reagan reiterated his support of such an amendment, and then talked warmly of SJ Res. 58 and its House of Representatives brother, HJ 350.
That support may be qualified.
At a recent breakfast with reporters, Secretary of the Treasury Donald Regan said the President was endorsing SJ Res. 58. But ''there are some specific suggestions we'd like to make,'' Mr. Regan added. He declined to elaborate.
Other administration officials confirm the White House may attempt to tinker with Res. 58.
''Nothing is minor or technical when you're talking about a constitutional amendment,'' said an administration official who asked not to be named.
Although not, strictly speaking, an adminstration representative, Federal Reserve Board chairman Paul Volcker has also voiced concern about this particular approach.
''I am not personally satified that the proposal, as it stands, is fully workable,'' Mr. Volcker told the House Judiciary Committee on May 5, though he added it was an improvement over previous attempts.
One area under scrutiny is a provision that allows Congress to waive the amendment whenever the US is fighting a declared war.
''Do you want to broaden the national emergency exception?'' hints the administration official. ''We were in Vietnam and Korea without a declaration of war.''
There may also be support within the administration to make the tax-increase hurdle even higher, by raising the requirement for tax bill passage to a three-fifths vote. This would make it tougher for Congress to balance the budget by raising taxes.
An internal memo in the Office of Management and Budget (OMB) has reportedly questioned how the amendment would work if interest rates were higher than expected, or entitlement expenditures greater than anticipated.
Less likely is a White House request to insert into the amendment broader presidential power to impound appropriated funds. OMB director David A. Stockman floated this possibility last year, when discussing the amendment, and was ''jumped on, hard,'' according to a congressional staffer working on the issue.
The OMB -- an agency whose influence has grown almost magically during the reign of Mr. Stockman -- is likely the key to a final administration position.
''I'm confused as to where OMB is on this,'' says William Shaker, NTLC vice-president.
Mr. Shaker and the NTLC have been pushing for a balanced budget amendment since the mid '70s, and for SJ Res. 58 in particular since its introduction last year. Unsure about what the administration will propose, they are now drafting a letter requesting that President Reagan leave Res. 58 alone.
''Momentum has built around the amendment as presented,'' says NTLC president Uhler.
That momentum will have to carry the amendment up a road that will only get steeper. Even the President's nod of approval may not get it through the House.
SJ Res. 58 has graduated out of the Senate Judiciary Committee, and now sits waiting a floor vote. With 53 cosponsors, it stands a good chance of clearing the Senate.
The House version, HJ 350, faces a much tougher time. House Judiciary chairman Peter W. Rodino Jr. (D) of New Jersey has long opposed the amendment. House conservatives, led by Rep. Newt Gingrich (R) of Georgia, will probably not be able to link the amendment to the coming debt-ceiling vote, say congressional sources.