Just a week after the Democratic National Convention called for a $12 billion anti-recession jobs program, the Senate Budget Committee responded yesterday by cutting the previous congressional allocation for jobs by $300 million in fiscal 1981.
Without much more than a passing reference to the platform, the Democratic-controlled committee first voted 6 to 4 to reject a relatively modest $1.2 billion increase in the $9.1 billion funding plan for employment and training that Congress approved in its first budget resolution in June. Democrats split evenly on the vote.
Then, voting by the same margin, the committee cut $300 million from the $9.1 billion and curtailed advance funding to start the Carter administration's youth employment initiative in fiscal 1982.
The action prompted a testy exchange between Committee Chairman Ernest F. Hollings (D-S.C.), who proposed an even bigger cut in jobs spending, and Sen. Howard M. Metzenbaum (D-Ohio), who called the jobs reduction "shocking" and a "turning back of the clock."
When Hollings suggested that South Carolina and other southern states brought about their own economic resurgence without federal jobs aid, Metzenbaum retorted that it was done only with "cheap labor." It was done largely because industries wanted to move out of states like Ohio, said Hollings. "Why don't you do something about your poor tenant farmers?" snapped Metzenbaum.
Opponents of a major economic stimulus effort to counter the recession argued that it would come too late and only add to another round of soaring inflation. "I don't see how it will do anything but rekindle inflation . . . it would come into full bloom about the time that unemployment dropped," said Sen. Pete V. Domenii (R-N.M.).
Metzenbaum said he would introduce a $6.7 million anti-recession package later in the committee's deliberations on the budget but conceded he was outnumbered on the committee and held out little hope of success.
The $12 billion anti-recession plank had been added to the Democratic platform under pressure from backers of Sen. Edward M. Kennedy (Mass.) for the presidential nomination and over objections from the Carter administration. If its debut in the Senate Budget Committee is any indication, it will not go far in Congress.
The committee's action on jobs -- the first congressional response since the platform was approved -- came only a day after the committee voted to increase military spending by $5.6 billion over what Congress provided in its June budget resolution.
Taken together, the votes on jobs and defense indicate that the committee is continuing -- even enlarging -- its tilt toward defense as it seeks to contain the recession-caused deficit that has destroyed Congress' hopes for the first balanced budget in 12 years.
The tentative spending targets adopted in June called for a $200 million surplus. But rising unemployment has siphoned off revenues and added to unemployment benefits and other social costs to the extent that both Carter administration and congressional budget experts are now predicting a $30 billion deficit -- even without the tax cut that Congress is expected to approve for fiscal 1981.
It is to keep down the size of this embarrassing election-year retreat that the Budget Committee is proposing retrenchment -- at least in some social spending.
In the case of defense, the committee majority argued that the extra money was needed to cover the increasing costs of programs that were approved in the first resolution.
But, in unemployment assistance as well as jobs, the committee moved to cut back outlays that had been approved in the first resolution.
A major exception to this retrenchment was the committee's approval of full funding for the rapidly expanding food stamp program, amounting to a $1.3 billion increase over benefits assumed in the first resolution. The full funding was recommended by Hollings and approved, 9 to 7.
However, the committee voted to save $1.2 billion by attempting to block proposed expansion of controversial trade adjustment assistance, which is designed to help workers laid off when domestic industries are hurt by imports.
With the recession adding to layoffs in the auto, steel and other import-threatened industries the anticipated cost of trade assistance has risen from $400 million to $1.3 billion for 1981. At the same time, Congress is considering legislation to extend benefits to employes of secondary suppliers to firms affected by imports, at an additional projected cost of $1.2 billion.
Congress had presumed adoption of this legislation in its first budget resolution. Yesterday's committee action had the intended effect of blocking or at least delaying it.
Meanwhile, a breakthrough appeared likely in the three-week impasse in the House over a $10 billion package of spending cuts in revenue measures. This has been holding up action on the second budget resolution.
House Budget Committee aides said a floor vote on the package now appears likely next week, with or without a restriction on offering amendments. When the Rules Committee voted narrowly to permit a vote on an amendment dealing with pensions for federal workers, Democratic leaders held up the package out of fear that this and other amendments might unravel the whole delicate patchwork.
Budget officials indicated that prospects have brightened for getting the package through the House relatively unscathed.