Congress unable to resolve budget deficit, opts for status quo. With big-ticket items off the table, Congress tinkers with what's left

The long budget battle is essentially over, at least for this year. Congressional staffs and key members yesterday began working out details of a compromise that both houses could accept. Some cuts for domestic programs remain controversial.

But President Reagan has already made the crucial decisions for the 1986 budget by overruling the GOP Senate's proposal for social security restraints and an oil import tax.

As a result, any final agreement will be a modest deficit-reduction package, not the dramatic multiyear cut sought by the GOP Senate.

``It may not be as meaningful as we hoped,'' Senate majority leader Robert J. Dole (R) of Kansas told his colleagues yesterday, but ``I think it's better, marginally better,'' than no budget at all.

House Speaker Thomas P. O'Neill Jr. (D) of Massachusetts, who had opposed cutting social security, sounded upbeat. ``We hope we can have a budget,'' he told reporters.

The Speaker added that an earlier House proposal for budget cuts is ``the best we can do.''

For majority leader Dole, who has insisted on a frontal attack on deficits, this year's effort has ended. He has watched the President pull the rug from under a Senate budget plan two times in only three weeks. The Kansan warned of ``a great deal of frustration'' among his fellow senators but conceded defeat.

Only a temporary power outage early yesterday in the Capitol provided comic relief in the strained relations with the White House. With one overhead light shining dimly in the darkened Senate chamber, Dole quipped to reporters, ``I feel powerless.''

He added in reference to the Reagan administration, ``Talk about pulling the plug. They really did it.'' The joke probably has equal parts of truth and humor. Ever since he took over as majority leader early this year, Dole has pushed single-mindedly to cut the US deficit, which is now estimated at $200 billion or more a year.

But dire warnings about rising levels of red ink from the senators have yet to convince the rest of the government, including their own Republican President.

``There is not a will to address this huge deficit,'' said Senate Budget Committee chairman Pete V. Domenici, adding that the ``will is lacking everywhere.'' The New Mexico Republican has ruled out the possibility of any ``real, significant, reliable'' deficit reduction this year.

Rep. Dick Cheney of Wyoming, a member of the House GOP leadership, also expressed disappointment. He described a meeting of congressional Republican leaders and the President yesterday as ``not very good.''

When asked how the convalescing Mr. Reagan looked, Representative Cheney said, ``He looks good. He's just a little soft on the deficit.''

For the Senate GOP, the result will almost certainly mean more independence from the White House. As Dole told reporters this week, ``I think that, for a while at least, there'll not be too many senators listening to pleas from the White House on anything.''

However, some Republican senators said yesterday that the damage would be only short term. Sen. Bob Packwood (R) of Oregon, chairman of the Senate Finance Committe, said he saw no slowdown on thee President's tax-reform proposal.

Democratic leaders took care not to claim a victory as President Reagan took social security off the cutting block. ``I can understand that they'd be disappointed,'' said House majority leader Jim Wright of Senate Republicans. ``I cannot understand that they'd be surprised.''

The Texas Democratic congressman said he had warned Senator Domenici last January that the House would not go along with any social security reductions. The Senate had proposed giving federal pensioners a cost-of-living adjustment every second year, instead of annually.

The final budget compromise will probably come close to the $50 billion in cuts that both Houses have made a target. Since new estimates put the deficit higher than first thought, however, the result will be less dramatic. Also, the budget is unlikely to make permanent reforms.

About half of the budget cuts will come from cutbacks in the defense spending requested by the Reagan administration. Both houses have already agreed to only a small increase for next year for the Pentagon.

Democratic House members yesterday indicated that they would try to reduce the Pentagon budget even more. House Speaker O'Neill said after a meeting with Democrats that he would delay voting on a House-Senate agreement on the defense authorization bill for 1986.

The delay would give the House an opportunity to push for a lower budget figure for defense. As now proposed, the defense bill includes the higher figure, $302.5 billion in budget authority, for the Pentagon.

Both houses have proposed domestic cuts. But there is disagreement over the items to be reduced. For example, the Senate eliminates several programs, a plan that House leaders have rejected.

The House has called for more fees to ranchers using federal grazing lands and fewer payments to states for minerals extracted from federal property.

Despite differences, Dole indicates the two Houses should be able to wrap up budget decisions by Friday.

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