Office of Management and Budget Director David Stockman suggested yesterday that the second budget resolution be used as a vehicle for getting the latest round of spending cuts proposed by President Reagan through Congress.
The administration is considering various options for forcing through the new 1982 cuts, all of which are "forceful," one budget aide commented yesterday. The president has already threatened to veto "budget-busting" bills.
Under attack from Sen. Ernest F. Hollings (D-S.C.) for his "very casual" and "very Hollywood" approach to the new spending proposals, Stockman backed off from blaming Congress for failing to cut the budget enough earlier this year. He told the Senate Budget Committee, "I would not say that it is the fault of this committee or this Congress" that spending threatens to overshoot in fiscal 1982. He added that it's simply "a fact of life" that the momentum built into the budget was greater than expected.
Hollings accused Stockman of threatening to "destroy this whole [budget] process" by proposing new cuts for the current fiscal year at this late stage. Committee Chairman Sen. Pete Domenici (R-N.M.) also urged in an opening statement that the administration send full details of its new proposals to Congress as soon as possible.
He indicated that the administration's proposed 12 precent across-the-board cut in discretionary programs is not the only way to achieve the needed savings. Other senators agreed that Congress may want to find the savings elsewhere.
Stockman said to the panel that the president had "invited a dialogue" on the new cuts. However, given the urgency of shrinking the budget, people are "not in a position to nit pick about details," he said. The administration previously pushed Congress to follow closely its original spending and tax proposals.
Stockman promised that he "will go after every sacred cow" in the budget but opposed strenuously the suggestion of delaying or repealing major portions of the tax cuts just enacted.
The Federal Reserve is not to blame for present high interest rates, the budget director told the Senate panel. He said the high cost of money is due to large deficits and can be brought down lastingly only if the deficit is shrunk.
He denied that there is any difference of opinion within the administration on the broad course of money policy and dismissed as "newspaper chatter" the suggestion that there is a "real debate over the direction of money policy" going on within the administration now.
The Fed has done a relatively good job over the past few months, he said.
In a sometimes stormy session, senators made clear their concern over how difficult it would be to win further spending cuts, while the budget director argued that more cuts are essential to build confidence in financial markets. "Otherwise the whole economic program could well be interrupted," he said.