Washington Thunder Before a Compromise

White House, GOP likely to find common budget ground after certain veto

THE threats are sharp, the rhetoric hot, but when it comes down to the final buzzer, it's likely that the Democratic president and Republican Congress will settle on a budget for 1996.

No one is eager to predict a scenario for compromise. The Republicans, fresh from passing different variations of a historic balanced-budget plan in each house of Congress, are savoring their victory.

The White House, knowing President Clinton has a reputation for waffling and capitulation, is tight-lipped about its game plan. The only certainty is that Clinton will veto the budget bill that reaches his desk, probably in a couple of weeks, after the House and Senate work out differences.

But in key ways, even in areas that represent fundamental changes in the way government does business, Clinton and the Republicans are already on the same wavelength. Indications of common ground make it possible to imagine how they will arrive at a compromise solution.

They both agree that working toward a balanced budget is a desirable goal. For now, the Republicans are sticking to a seven-year "glide path," while Clinton's scenario now stands at nine years. They both envision fundamental reform of welfare. Clinton has already bought the idea that the New Deal-era, federally run system is broken and should be turned over to the states.

Both sides have also tossed hefty tax cuts into the mix, a controversial concept that necessitates even deeper spending cuts. The Republicans want a $245 billion cut over seven years, while Clinton's seven-year cut would amount to $105.5 billion.

Even conservative Democrats in the House and Senate, who developed their own balanced-budget plan that they hoped could serve as a blueprint for the ultimate Clinton-Republican compromise, did not propose any tax cuts.

"Some felt we shouldn't begin the process with tax cuts," says Rep. Martin Olav Sabo (D) of Minnesota, the ranking Democrat on the House Budget Committee and a supporter of the conservative Democratic budget plan.

But then, "it's an unusual year," Congressman Sabo adds. "It's an adventure into the unknown."

Indeed, with Republicans running Congress for the first time in 40 years, and a Democrat in the White House to serve as a ready target for hot rhetoric, the next several weeks will be nothing if not adventurous.

Over the weekend, both Republicans and administration officials were talking anything but compromise, instead sharpening their tongues over the budget process and laying down markers over the pieces of the budget they care most about.

In a speech to environmental journalists in Cambridge, Mass., Vice President Al Gore spoke out against a provision in the budget to allow oil and gas drilling in Alaska's Arctic National Wildlife Refuge (ANWR). The plan would bring $1.3 billion in revenues over seven years under the Republican plan.

"If they satisfy us on 100 percent of everything else we ask for and they open ANWR to drilling, President Clinton will veto the whole thing," Mr. Gore said.

House Speaker Newt Gingrich (R) of Georgia, for his part, warned the president not to become a "roadblock" on the path to historic change.

Clinton "should think twice about vetoing the balanced budget and jeopardizing long-overdue revolutionary change," he said in response to the president's vow to veto a final budget bill if it mirrors the current House and Senate versions.

Clinton has lodged general complaints about the Republican budget plans, but has offered few clues as to how he might square their plan with his. He rejects the GOP's plan to reduce federal aid to college students, but may find play on that issue given the Senate's rejection of the House's planned $10 billion cut.

He also rejects the plans in both houses to tighten eligibility for the Earned Income Tax Credit program, which gives tax breaks to the working poor. Clinton wants to retain existing eligibility criteria and crack down on fraud.

THE big sticking points between Clinton and Congress are the huge federal health-insurance programs for the elderly and the poor, Medicare and Medicaid. On Medicare, the Republicans want to trim the growth in Medicare spending by $270 billion over seven years, while Clinton's plan would spend $124 billion less.

Even there, they agree on the basic notion of reducing the program's explosive growth, but the difference in savings is so large that compromising somewhere in the middle would leave the rest of the budget completely out of whack.

On Medicaid, Clinton rejects the GOP plan to end the program as a federal entitlement, and his projected cost savings come in at $115 billion less than the Republicans' over seven years.

In his weekly radio address, Clinton threw out a tough opening salvo to the Republicans as they prepare to start their House-Senate conference today. "Back off your cuts in these vital areas," he said. "Until you do, there's nothing for us to talk about."

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