THE MANEUVERING over the elusive Gramm/Rudman amendment has come full circle. When first put forward, the measure called upon Congress to make sharp cuts in the deficit, beginning most likely this winter. If Congress failed, it called upon the president to impose spending cuts to do the job. The cuts had to be in Social Security and defense as well as the run of other domestic programs. The idea was partly that, as an alternative to these spending cuts, the president might agree to a tax increase. Everyone had a gun to his head.
Then the backing off began. First the sponsors said no cuts would have to be made in Social Security. They had 37 million hostages and let them go. Then they also stretched out the deficit-reduction schedule to make it unlikely any cuts would be felt until after the 1986 elections. Thirty-four Senate seats are up then, of which 22 are Republican; Republican control of the Senate is at stake.
Now the third predictable step is being taken or, at least, attempted. There is talk that defense should be eased out of the process as well. The administration has been ambivalent about Gramm/Rudman all along. The president embraced it, but indicated he reserved the right to press for defense increases. Now Defense Secretary Caspar Weinberger has warned that "we can't have our defense and our security policy be a total prisoner of a rigid formula designed to reduce the budget," and said he does not think the president "would . . . feel required to make reductions in defense." The staff of the House Armed Services Committee has done an analysis warning that the cuts required in defense could be severe. A somewhat discomfited Sen. Phil Gramm, the amendment's cosponsor, said "if these people don't want to cut defense, all they've got to do is cut something else."
But what? That has been the problem all along. The president is opposed to both a tax increase and a cut in defense; he and the Democrats are both opposed to a cut in Social Security. Defense, Social Security and interest on the debt make up two- thirds of the budget. The remaining third -- which includes a lot of other programs that people don't want to cut -- cannot bear the entire burden.
In September 1975, when he was gearing up to run against Gerald Ford for the Republican presidential nomination, Ronald Reagan said he had a plan to cut $90 billion from the federal budget without any cuts in Social Security or defense. It turned out that meant cutting the rest of the government in half, and when then-president Ford attacked him for it, candidate Reagan sheepishly backed off. "I simply announced a broad program last September," he said early in 1976. "I made no pretense of fleshing it out."
So still today. The president's aides last winter laid out a series of declining deficit targets, and the president himself could not find enough domestic spending cuts to hit them. Now his budget director has indicated that there could be difficulty in reaching just the target in the Gramm/Rudman amendment for next year. What is needed is a tax increase, but that would violate the first principle of feel-good economics. And so the ruinous maneuvering goes on.