Budget-cutting knives flashed all over Capitol Hill yesterday, sometimes striking government programs, sometimes just creating gusts of political hot air, as committees worked to bring programs under their control into conformity with the stripped-down budget resolution Congress approved last month.
In the House Banking Committee, cuts approved by the majority Democrats in federal housing programs prompted Chairman Fernand J. St Germain (D-R.I.) to recommend to investors that they buy stock in companies making tents. "There'll be a lot of people living in them," he predicted, after the Democrats agreed to $9.1 billion in cuts Germain described as "a total disaster" for federal housing programs.
The Banking Democrats also voted about a 40 percent cut in the lending authority of the Export-Import Bank, an institution dear to some of the nation's large exporting corporations.
The Senate Agriculture Committee voted to end free summer lunches for low-income children and to reduce government support for distributing milk to school children for savings of $245 million next year.
Across Capitol Hill the House Agriculture Committee adopted in its farm bill a set of changes ostensibly designed to keep costs within the budget total. But the committee achieved this goal with legislative sleight-of-hand and with cuts in the food-stamp program, and would leave most of the basic and costly commodity price-support programs relatively unscathed. Even the dairy lobby got its way in the House committee.
The House Banking Committee voted to cut virtually every housing program under its jurisdiction except public housing for the poorest Americans. The biggest cuts are in the so-called Section 8 subsidized housing program, which pays part of poor people's rent over 30-year lives of new buildings. The result would be to reduce new starts of subsidized housing units from 250,000 to 176,000 next year.
The Banking panel also cut $2.4 billion from the Export-Import Bank. The House has already rejected such a cut, bowing to the big businesses that use the bank to finance their exports.
The Senate Agriculture Committee, also trying to conform to its instructions from the budget resolution, went along with the administration's plan to wipe out the summer lunch program after being assured by John Bode, deputy assistant secretary of agriculture, that there would be "no adverse impact on the truly needy." His contention was sharply disputed by Sen. Patrick J. Leahy (D-Vt.), who said many summer recreation programs organized around the free lunch would disappear.
The Senate panel also voted tentatively to deny some low-interest loans to farmers, though it refused to accept the administration plan to make rural electrical cooperatives raise money on the private money market instead of through the federal financing bank.
The House Agriculture Committee passed "reconciliation" legislation that is supposed to comply with the budget resolution, but which Republicans on the panel said flatly did not. The committee claimed savings of $2.5 billion by taking $1.5 billion out of food stamps, and claimed an additional saving of $450 million by "reducing" the diary price support from 80 to 75 percent of parity.
In fact, the level has already been reduced to a de facto 75 percent, and authorization for an 80 percent support will expire later this year. The result of this maneuver, if it were to hold up throughout the budget process, would be to give dairy farmers a much more generous subsidy than the Reagan administration wants, but count this as cut. But it appears unlikely that the House panel's action will be the final word on this matter.
House and Senate gave swift final approval to $13.2 billion in extra spending for this year, over a lonely protest from Senate Appropriations Committee Chairman Mark O. Hatfield (R-Ore.) that this supplemental appropriations bill pads Pentagon spending while performing "budgetary surgery without the benefit of anesthesia on the handicapped, the old, the hungry."
The omnibus bill, which combines supplemental appropriations with rescissions (spending cuts) requested by President Reagan, also imposes the strongest-ever curbs on Medicaid-financed abortions. Abortion funding in cases of rape and incest will be eliminated, permitting it only when a woman's life is endangered. But a House proposal to extend the restrictions to federal workers' health plans was dropped. Also dropped was a provision aimed at ending government pressure for affirmative action for women and minorities.
Just over half the new spending authority goes for defense, with the heaviest cutbacks coming in social welfare programs, which prompted Hatfield's complaint. He compared Pentagon cost overruns with domestic program cuts, noting that a $607 million increase for the F18 fighter plane nearly equals cuts in welfare benefits, and that $757 million in cost growth for the M1 tank equals the cut in energy conservation funding.