The Democratic-controlled House defied President Reagan last night and approved, 229 to 196, a $863.5 billion federal budget for next year that would raise taxes by $30 billion, increase domestic spending by $33 billion and cut the Pentagon's proposed increase by more than half.
The Democratic victory came after two straight years of Reagan budget victories in the House, and amounted to the most serious repudiation of his economic program thus far by either house of Congress.
Democrats held their defections to 36 and picked up four Republican votes in the face of a drumbeat of heavy criticism from Reagan, who was scheduled to go on nationwide television less than an hour after the vote with an appeal for his proposed 10 percent after-inflation increase in defense spending.
Reagan faced trouble on defense in the Republican-controlled Senate as well, however.
Even as the House was approving a 4 percent military increase, which Republicans charged was really less than 3 percent, Senate Budget Committee Chairman Pete V. Domenici (R-N.M.) was circulating a staff proposal for a budget that included a defense increase of approximately 5 percent.
After the House vote, however, Domenici said that the House defense proposal "is going to cause a lot of people in the Senate to look at a higher defense number."
Some Senate Republicans have been talking of proposing more than 5 percent if that is what is necessary to get a compromise of roughly that amount in conference with the House.
In day-long debate on the Democratic-drafted House budget, Democrats chided Republicans for refusing to propose a budget of their own, as the GOP did successfully in league with conservative Democrats in 1981 and 1982.
The only alternative to the Democratic budget is "no budget at all," argued Budget Committee Chairman James R. Jones (D-Okla.), charging that the Republicans couldn't make the difficult choices necessary to produce a deficit lower than the Democrats' $174.5 billion figure, which is $14.3 billion below Reagan's.
It is "tellingly revealing of the bankruptcy and abdication of the minority party . . . that they have offered nothing," said Majority Leader James C. Wright Jr. (D-Tex.).
The Democrats' bill should be called the "Revenge on Ronald Reagan Act of 1983," charged Minority Leader Robert H. Michel (R-Ill.), calling the budget "blatant political propaganda" to help the Democrats at the polls.
The budget, Michel added, is the "offspring of an unholy union between political spite and political opportunism."
"I've never seen such a grab bag in my life," complained Rep. Delbert L. Latta (R-Ohio), ranking Republican on the Budget Committee.
At one point, in an apparent attempt to apply a kiss of death to the Democratic proposal, Republicans charged that the budget, which would allow a 4 percent pay raise for military and civilian federal employes, included a hidden 4 percent congressional pay raise.
Jones angrily denied the allegation, calling it a "red herring."
After the vote, House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.) said:
"The people believe that Reagan policies are unfair and have gone too far. This evening, the House voted to restore fairness and balance to our national policies." O'Neill said he looked forward to working with Senate leaders "in achieving the kind of balanced policies the American people want."
Wright said, "This sends a message to Ronald Reagan. We stand ready to work with him. We're not seeking confrontations. But when he attacks us with vicious epithets like 'bringing joy to the Kremlin,' he steps out of the character the American people expect." The remark referred to Reagan's suggestion last Friday that the Democratic plan would bring "joy to the Kremlin."
Among Washington area members, only Reps. Michael D. Barnes (D-Md.) and Steny H. Hoyer (D-Md.) voted in favor.
The Democrats' budget was a repudiation of tax, defense and social welfare spending policies that Reagan pushed through Congress in 1981 and 1982, and was a return to their more traditional budget priorities.
Drafted by the Budget Committee in close consultation with the whole Democratic caucus as well as with party leaders, the Democrats' budget projected a lower deficit than Reagan did--$174.5 billion instead of $188.8 billion--largely by anticipating $30 billion in new taxes, nearly $10 billion in defense savings and a faster-growing economy.
Enough was left over to add roughly $33 billion to Reagan's request for domestic spending, a sharp contrast to the previous two years, when Democrats attempted little more than damage-control in their budget drafts, all of which were rejected.
This enabled the Democrats to ignore virtually all of Reagan's latest round of proposed program cuts, to restore some of the money that had been cut from social programs over the last two years, and to accommodate some new programs, including $17 billion for jobs, industrial development and recession relief.
But so extensive were the cuts of the last two years that, according to O'Neill, only 25 to 30 percent of the spending that had been slashed in 1981 and 1982 was being restored in the current budget.
In contrast to Reagan's charge last week that the Democrats were pointing "a dagger aimed straight at the heart of America's rebuilding program" by trying to halve his proposed defense spending increases, O'Neill said, "We've only modified it the Reagan program to a degree . . . . We're being extremely moderate."
The Democratic budget put all the big benefit programs off-limits for further cuts and increased spending for those that are targeted to the poor, including food stamps, child nutrition and Aid to Families with Dependent Children.
Among the biggest increases, spending for education, training, employment and social services would rise by more than half. Funds for the beleaguered Environmental Protection Agency would be increased by one-fourth. Energy-related spending would go up by more than one-third. Big increases were also proposed for research and development.
New programs anticipated by the budget included foreclosure relief for farmers and homeowners, health insurance for unemployed workers, an industrial development bank and compensation for veterans who were exposed to Agent Orange during the Vietnam war. Additional benefits for the long-term unemployed were also proposed.
While the budget specified $30 billion in new taxes in fiscal 1984, the Ways and Means Committee has indicated that it will actually propose increases of about $8 billion, raising questions about whether the revenue target would be met and inviting Republican charges that there were hidden deficit increases.
Although the budget did not dictate which taxes would be raised, Budget Committee members said they had in mind repeal of both the 10 percent income tax cut scheduled for July 1 and indexing tax rates to inflation after next year, all of which could be accomplished within the revenue targets.
On defense, Republicans, citing Congressional Budget Office figures, said that the Democrats' proposed spending increase was more like 2.3 percent than 4 percent. But the Democrats contended that their budget, while cutting Reagan's proposed increase by more than half, would give the Pentagon $1.6 trillion over the next 5 years, in contrast to $1.8 billion under Reagan's plan. They said $1.6 trillion was enough.
In addition to a 4 percent pay increase for civilian and military employes of the government, the Democrats' budget would delay cost-of-living increases for federal retirees by six months, rather than 12 months as the administration proposed. It does not anticipate other cost-cutting revisions that Reagan proposed in the federal retirement system.
In drafting the budget, the Democrats used an unusual procedure, including what amounted to a referendum of all 268 Democrats in the House on its contents. This both strengthened the outlook for the budget on the floor and contributed to its liberal tilt.
But it drew stern warnings from Republicans of future troubles.
Republicans may well be "reduced to confrontation . . . legislative ambush, harassment and delay," said Rep. Barber B. Conable (R-N.Y.).