The political reality behind the budget debate that fills the air is not pretty to contemplate. But it is important to understand.
For the past five years, the American people have not come within a mile of paying for the amount of government we receive -- and seem to want. We have been living in a dream world. We enjoy the benefits of government services, from subsidized transportation to cost-free medical care to spy-satellite protection against Soviet sneak attacks, while the bills pile up unpaid.
Deficits are not new. But deficits of this scale have never before been seen in times of peace with a healthy overall economic performance and low inflation. They cannot continue because we are approaching the point at which interest on the debt will absorb so much of the annual tax collections that no money will be left to pay for government services -- no matter how vital.
Why do we have such deficits? The blame is widespread. When President Reagan proposed deep tax cuts in 1981, House Democrats and Senate Republicans both decided to expand his overgenerous initiative, permanently weakening the revenue base. On the spending side, as he insisted on billions more for defense, members of Congress dug in to defend politically popular forms of domestic spending. There was no outlay discipline to match the shrinkage of the tax base. The Senate Republicans were the first to sober up from this fiscal binge, and each year, starting in 1982, they have been battling to close the gulf between spending and revenues. Last year, some of them hit on a new device -- the Gramm-Rudman "automatic" deficit reduction plan -- in hopes that it would force President Reagan and the House Democrats to help fill in the cavernous gap between the government's income and its outlays.
But because House Democrats and the president both had the power to block or veto Gramm-Rudman, Senate Republicans had to tailor the "cure" to meet the same demands that had caused the disease. What they hoped to do was "put everything on the table" and forge a balanced solution to the deficit problem. But by the time they were finished negotiating with Reagan and the House Democrats, half the budget was exempt from automatic cuts and another quarter was substantially protected. The remaining quarter faces severe slashes -- so long as the president holds to his position that there can be no tax increase.
That is one reason why Sen. Warren B. Rudman (R-N.H.), cosponsor of Gramm-Rudman, is so eager to avoid resort to his plan's distinctive feature -- the September "trigger" for automatic "sequestration" of big chunks of unprotected programs, both defense and domestic.
As one of the Senate's more sensible men (and as a politician facing reelection in November), Rudman realizes there will be nothing reasonable and much that is damaging if "the trigger" must be pulled. He argues that Congress has both a duty and the ability to reach the $144 billion deficit-target for fiscal 1987 that Gramm- Rudman sets, without resort to the trigger.
He points to the new and strengthened tools Gramm-Rudman gives the House and Senate budget committees to help them enforce fiscal discipline and reach the specified target this summer, and in a fashion that weighs the relative worth of various programs.
Those tools are there, but it remains to be seen if they will be used. So long as Reagan adheres to his stated position that there be no significant cuts in his defense buildup and no tax increases, the temptation will be strong for Congress to hang equally tough in protecting domestic spending. In this game of budgetary "chicken," the national interest is the likely loser.
In recent days, a flurry of optimistic deficit estimates has convinced some members of Congress that the fiscal 1987 target can be reached without a great deal of strain or pain. Low inflation, declining oil prices and a healthy economy have reduced the projected 1987 deficit from over $200 billion to just over $180 billion. But the main reason for the apparent improvement, Congressional Budget Office Director Rudolph G. Penner explains, is that his office and its executive branch counterpart, the Office of Management and Budget, are building the assumptions of Gramm-Rudman into their new "bare- bones budget projections."
"The situation is not as good as it looks," Penner says, noting for example that where defense spending was previously projected to grow 3 to 5 percent above inflation, the new budget projections assume zero real growth. Similarly stark assumptions are made on domestic spending.
"There will be no easy cuts" from this reduced base, Penner says. On the contrary, using this base "it will be much tougher" to find the $38 billion to $40 billion in new and additional reductions to reach the Gramm-Rudman target. Penner makes the key point when he says, "We're obviously not fighting about deficits these days; we're fighting about the role of government."
And we are still searching for politicians at either end of Pennsylvania Avenue who will say that we have to pay for the government we get.