Lawmakers’ Budget-Debt Accord Stalls

Congressional negotiators failed again Thursday night to reach a compromise on legislation that would both resuscitate the Gramm-Rudman balanced-budget law and extend the federal debt limit.

House negotiators reached a tentative accord among themselves on a revised timetable for bringing the federal budget into balance through a new mechanism that would trigger automatic, across-the-board spending cuts if Congress and the White House failed to reach the deficit targets.

However, a final agreement among the House negotiators hinged on parallel talks producing sufficient changes in the congressional budget process itself to satisfy Republican lawmakers.

“We are in general agreement, but we reserve the right to see the results of budget reform,” said House Minority Whip Trent Lott (R-Miss.). “If we make progress on budget reforms, we may have something.”

By the time negotiators broke off their talks late Thursday, that agreement was still proving elusive and Senate negotiators were divided among themselves over how long the new automatic spending cut provision should last.

Meanwhile, House and Senate leaders said they are determined to get an agreement on reinvigorating the Gramm-Rudman law in time for Congress to recess for its August holiday today or Saturday. Adding to the pressure was a fear among House leaders that the Senate would not go along with yet another short-term extension of the federal debt limit, this time until September.

If a Gramm-Rudman agreement is achieved, it will be attached to legislation that allows the federal government to borrow up to a $2.8-trillion ceiling, which would give the Treasury sufficient borrowing authority through May, 1989. The current debt ceiling of $2.3 trillion was scheduled to revert to $2.1 trillion at midnight Thursday night. Without an extension, the government would run out of cash and default on its security obligations beginning Aug. 17.

Negotiations between the House and Senate over new deficit targets and a revision of the automatic-spending-cut mechanism that was struck down last year by the Supreme Court bogged down Wednesday night. At that time, Senate conferees rejected a House demand that the spending-reduction provision be in effect for just two years--that is, until the end of the Reagan Administration.

But Thursday afternoon, Democrats and Republicans in the House agreed in principle to an amendment that would have the “trigger” that would require automatic spending cuts in place for three years and would require the government to have a balanced budget in fiscal 1993, two years later than the timetable in the existing Gramm-Rudman law.

In addition, the changes would mandate a $23-billion reduction in the federal deficit--currently estimated at $182 billion--in fiscal 1988, which begins Oct. 1.