President Carter's top economic advisers and key House and Senate Democrats have agreed in principle on about $11 billion in proposed spending cuts that they believe Congress ultimately might enact -- the first concrete step in efforts to balance the federal budget.
The list reportedly includes elimination of revenue-sharing grants to states; a 10 percent cut in revenue sharing for cities and counties; an end to Saturday mail delivery, and once-a-year cost-of-living salary adjustments for federal employes instead of twice a year.
Sources say the congressional leaders' endorsement of these cuts is primarily symbolic and does not imply any formal commitment by Congress to enact them. However, the agreement marks a significant step in Carter's bid to build a consensus for the cuts.
The panel is to meet again this morning to try to work out additional proposals. The group, meeting in marathon sessions since Thursday, is seeking $15 billion in spending cuts and $5 billion in revenue-raising measures.
Meanwhile, the joint task force has broadened its talks to include other elements in Carter's expected new anti-inflation package, specifically the possible imposition of credit controls and restrictions on the use of credit cards.
The group is to meet with Federal Reserve Board Chairman Paul A. Volcker tomorrow morning to discuss proposals for tightening credit further.
White House officials have told congressional leaders that Carter will support a major tax cut next year if Congress balances the budget. Administration advisers have raised the possibility of trimming Social Security taxes and providing faster depreciation writeoffs for business.
Meanwhile, the Congressional Budget office suggested yesterday that Congress call a halt to about $5 billion worth of new spending programs and shelve more than $10 billion in grants under existing law as a stopgap way to balance the budget.
CBO Dirctor Alice M. Rivlin proposed this during a House Budget Committee hearing as an interim step the lawmakers could take until they reach a longer-term agreement on which existing spending programs to cut.
Among new initiatives that might be subject to such a freeze would be the Child Health Assistance Program, which would give extra health care to children of the poor; anti-recession aid to cities; the administration's new youth employment program and an expansion of economic development grants.
Grants pending under existing law include urban development action grants, subway construction grants and money to build local water and sewer plants.
Rivlin also discounted an earlier estimate by her agency that cutting spending by $25 billion would slow inflation by only 0.2 percentage points. She said public expectations are now so high that the cuts "would have a larger impact."
Meanwhile, six former presidential economic advisers, Republicans and Democrats, agreed yesterday that Congress should reject wage-price controls and credit restraints; cut spending and keep money tight; and move to spur investment.
Separately, sources said the White House has revised its January economic forecast to predict a milder economic slowdown and a higher inflation rate than the president expected only six weeks ago.
The new figures call for a decline in inflation-adjusted output of 0.4 percent over the year rather than the 1 percent drop the White House predicted earlier, with consumer prices rising by about 12 percent instead of 10.4 percent.
Carter's forecast for the jobless rate shows a rise to 7.4 percent by the end of this year, not substantially changed from the 7.5 percent he predicted in January. A broader measure of inflation shows a 10 percent rate, up from 9.
Meanwhile, Speaker Thomas P. O'Neill Jr. (D-Mass.) told reporters that the president may seek a joint session of Congress later this week to announce his new anti-inflation program.
The president also is expected to announce a decision on whether to accept a recommendation by his new Pay Advisory Committee to relax the current 7 percent pay guideline to a range of 7.5 percent to 9.5 percent.
Both labor and management representatives on the board have been expecting Carter to go along with the plan, but the announcement has been held up during the recent economic policy review.
The proposal by Rivlin was simply an informal suggestion for a way the lawmakers could act quickly to cut back the budget deficit. It is not actually pending in either house of Congress.
Rivlin also proposed speeding up the new congressional budget process to require the lawmakers to trim projected spending overruns in the spring rather than waiting until the fall. She called the current practice "an unusable tool."
She also estimated that Congress will have to come up with between $25 billion and $30 billion in combined spending cuts and revenue increases in order to balance the budget.
Rivlin called the $20 billion deficit now projected by the White House and some congressional leaders an "optimistic" estimate. She warned that the red-ink figure could easily climb to "beyond $25 billion" next year.
The six former presidential economic advisers who expressed opposition to wage-price controls appeared at a hearing of the Senate Banking Committee, which is beginning a review of the administration's current voluntary program.
The six were Walter W. Heller, adviser in the Kennedy administration; Gardner Ackley and Arthur M. Okun of the Johnson administration; Paul W. McCracken and Herbert L. Stein of the Nixon administration, and Alan Greenspan of the Ford administration.
The panel split, however, over whether Congress should enact a tax cut this year: Heller asserted flatly the lawmakers should cut taxes, while others endorsed a tax cut if the budget allowed one.
Sen. William Proxmire (D-Wis.), the Banking Committee's chairman, echoed the group of economists in oppositing wage-price controls. Proxmire began the hearings by asserting that his panel would never propose them and Congress would not pass them.