One Small Step, Now the Journey : Time is here for the hard work of budget making

Other than clearing the way for full resumption of government operations, the main thing that came out of Sunday’s budget deal is that President Clinton and congressional leaders are now committed to balancing the budget by the year 2002, a considerable and laudable goal. Unfortunately, there was little in their two-para- graph agreement that addressed the key differences between Republicans and Democrats on how and what to cut in reaching a balanced budget.

It’s true that the compro- mise--which saved face all around--at least keeps the nation on the highly desirable track of deficit reduction. But it must be noted that the ac- cord could just as easily have been reached a week earlier.

CLINTON’S SPIN: In exchange for signing onto the GOP deadline, Clinton se- cured language that he says ensures adequate funding for Medicaid, education and other programs as well as committing Congress and the President to unspecified tax policies that would help working families and promote economic growth.

As always, the devil is in the details. From the very beginning of the budget process, Republicans have backed Draconian spending cuts--$1 trillion over seven years-- along with the unrealistic proposition that $245 billion in taxes be cut over the same period. It is indeed imperative that federal outlays in a variety of programs including Medicare and welfare be slowed or scaled back. But if the proposed tax cuts were postponed, the resulting negative impact would be les- sened substantially.

On Monday the Republicans indicated a willingness to talk about a smaller tax cut and to add money for education and the environment when new talks with the White House begin next week.

Moderate Democrats have proposed holding off on any tax cuts so that spending reductions do not have to be as steep and deep as the Republicans have proposed. This is a much more credible way to construct a multiyear framework for getting to a balanced budget because cutting both revenues (taxes) and spending at the same time would make it exceedingly difficult to reach that goal within seven years.

AN UGLY BUSINESS: Instead, as spending is reduced, taxes need to be largely main- tained until the government can balance its budget and then begin to draw down its accumulated debt. At that point major tax cuts will be in order.

The budget negotiations have been marred by ugly partisan politics, ideological excesses and highhanded shenanigans. There’s little reason to think all that will suddenly cease as Washington works on a new budget that will get the nation past Dec. 15, when the current funding authority expires. Even if, as some think, the budget accord on Sunday marked a return to civility in Washington, the real test will be whether the continuing negotiations take the nation to a meaningful, substantive dialogue. Fifty years after the New Deal, America’s needs are quite different. Accordingly, national priorities must be rethought and refocused.