House Democrats, brushing aside Reagan administration claims that its economic recovery plan will generate millions of jobs, announced yesterday that they will push for quick enactment of an "emergency" program that could include money for jobs, medical insurance for the jobless, food and shelter and protection from home and farm foreclosures.
The Democratic plan was sketched by House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.) even as President Reagan's three top economic advisers told the House Appropriations Committee that economic recovery outlined in the president's budget was the best way to get Americans back to work.
In the first Capitol Hill appearance by administration officials since Reagan's budget was presented officially Monday, Office of Management and Budget Director David A. Stockman said that, if Reagan's budget is approved, the administration expects the economy to generate 4.6 million jobs over the next two years or less.
"The worst is now over," said Treasury Secretary Donald T. Regan, who described the new budget as a "reasonable approach to the deficit problem that should be credible to the financial markets, the Congress and the American people."
"By far the best thing we can do is have a healthy recovery," said Martin Feldstein, chairman of the president's Council of Economic Advisers. "We will have an additional million jobs within a matter of months."
But the $848.5 billion budget, which proposes another round of spending cuts in social welfare programs while continuing the expensive military buildup, ran into trouble from moderate Republicans as well as Democrats.
"There will be a hell of a shift from defense to social programs, no doubt about it," said Rep. Silvio O. Conte (R-Mass.), ranking Republican on the House Appropriations Committee, before which the three administration officials were testifying.
Conte predicted that Congress will cut $20 billion of the $30.3 billion defense spending increase recommended by the administration for fiscal 1984 and use some of that money for social programs.
He also said that Congress is likely to reject the administration's proposed standby tax increases for fiscal 1986-8 and, instead, forgo existing legislation to index tax rates to inflation after next year. Cuts in programs such as fuel aid for the poor will not be approved, he added.
Even as the administration trio was testifying, O'Neill met with House Democratic committee chairmen and later told reporters they had agreed on legislative goals to "provide relief to those who need it, create employment and get the country on the road to full economic recovery."
For congressional action, possibly as early as mid-March for part of the program, O'Neill said the leaders are considering such initiatives as "emergency" jobs, legislation to protect the unemployed against home and farm foreclosures, food and shelter programs and some kind of legislative intervention to keep workers from losing medical insurance when they lose their jobs.
House Democratic Whip Thomas S. Foley (D-Wash.), who was designated to head a task force on developing the program, said the group will use the $5.4 billion job-creation program that the Democrats pushed unsuccessfully in the lame-duck congressional session late last year as a "reference point" for development of the new program. But the Democratic leaders emphasized that no specifics had been worked out.
O'Neill, who previously had suggested a jobs bill costing $5 billion to $7 billion, said some of those in the meeting argued that more should be spent on creating jobs this year.
For the longer term, O'Neill said, the group also would work on strategies for "public investment to lay the foundation for long-term economic prosperity" and "economic cooperation to create better opportunities for labor, business and government to work together to plan a strategy for long-term economic growth."
Meanwhile, in the Senate, Minority Leader Robert C. Byrd (D-W.Va.) introduced legislation for a national investment corporation to help finance the revival of economically-strained industries.
At the same time, deputy White House press secretary Larry Speakes said the administration will send its own jobs proposals to Congress within 10 days. They are expected to be restricted to measures mentioned in Reagan's budget, including extension of unemployment benefits, subsidies to employers who hire jobless workers and more money for retraining workers.
In their testimony before the House Appropriations Committee, Regan, Stockman and Feldstein were pummeled repeatedly by Democrats for the spending mix in the budget.
Rep. Joseph P. Addabbo (D-N.Y.) accused the administration of squeezing social welfare programs while, as he put it, people are "dying" from malnutrition. Rep. Clarence D. Long (D-Md.) attacked the planned increase in military aid to foreign countries, saying it would only "enable our friends to kill each other."
Stockman responded repeatedly that domestic welfare programs cannot be said to be forgotten when the budget proposes "a half trillion dollars" for them. He said Reagan's proposed defense spending is only 5 percent higher in "real" terms, discounted for inflation, than military spending was in 1970.