House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.) yesterday proposed changes in Senate-approved legislation to force a balanced budget by 1991 but acknowledged that the measure will probably pass the House, with or without significant modification.
O'Neill's proposals include exemption of programs for the poor from automatic cutback provisions as well as such earlier Democratic demands as a speedup in the deficit-reduction schedule to require spending cuts before next year's elections.
But House Democrats were still struggling late yesterday to wrap up their counteroffer for submission to what has been billed as a showdown bargaining session today. And initial Senate Republican reaction to some of O'Neill's proposals, including safeguarding of low-income programs, was chilly.
Today's session of the House-Senate conference on the budget measure is viewed as a critical one for several reasons, including a threat from Senate Finance Committee Chairman Bob Packwood (R-Ore.) to continue bargaining only if House conferees responded with a counteroffer to the Senate plan.
A breakup of the conference would have the effect of tossing the whole issue back to the House, where formidable pressure for approval of the Senate plan could be expected, especially if Democrats cannot agree on an alternative.
The Senate plan, sponsored by Sens. Phil Gramm (R-Tex.), Warren B. Rudman (R-N.H.) and Ernest F. Hollings (D-S.C.), sets fixed annual targets to reduce annual budget deficits from $180 billion to zero over five years. If Congress falls short of the targets, the president would be required to make across-the-board cuts in most programs to achieve the requisite savings.
House Democratic leaders have criticized the plan on constitutional, economic and political grounds, and O'Neill reiterated his personal opposition yesterday, saying it was a "complete mishmash."
But the speaker also said he thinks the House is likely to go along with the Senate plan, with some modification, if the conference breaks up. "Do I think it would pass?" he asked. "Yes, I think it would."
Of the four "principles" raised by O'Neill for inclusion in the House Democrats' bargaining strategy, two are already part of the Senate plan: exclusion of tax increases and Social Security from steps that would be required to cut deficits to meet targets in the legislation.
The others were exemption of low-income programs and reduction of the deficit target for this year from $180 billion to no more than $172 billion, the level anticipated in the congressional budget for fiscal 1986. House Democrats have charged that Senate Republicans set a high target in order to protect themselves from painful spending cuts before next year's elections, when control of the Senate will be at stake.
O'Neill did not specify which low-income programs should be excluded, but other sources said they might include aid to families with dependent children, Medicaid, Supplemental Security Income for the aged and disabled and the feeding program for women, infants and children.