There is an abiding cynicism in this administration's approach to the deficit. The president's fiscal policy does not add up; it never has. Yet he, his advisers and his spokesmen are undeterred. This president, who has done more than any other to unbalance the budget, opens his news conference by endorsing a misbegotten balanced-budget amendment to the Constitution. Then he calls for continuation of the defense buildup, but continues to reject a tax increase to pay for it. "I'll veto any tax hike that comes across my desk," he says again. He has also ruled out cuts in Social Security -- a third of the domestic budget -- while in Congress his own party has ruled out cuts in other large domestic programs in this election year.
So what does he propose? His chief of staff, Donald Regan, goes to Capitol Hill and with a straight face suggests increased asset sales. By selling off government loan portfolios and other government property, "you could get any amount you want," Mr. Regan suggests.
It's a gimmick, and everyone knows it. Sell the assets this year, and what do you do next? The underlying problem is that revenues now cover only 80 percent of costs. You can make up reasons not to be alarmed: the stock market is up, the dollar has come down, inflation remains low, the recovery continues (albeit sluggishly). But you cannot continue indefinitely to run this economy with feel-good deficits the size of these. Already a little of the problem shows up. The unemployment rate is still above 7 percent, entire sectors of the economy -- farming, oil, manufacturing -- are weak, and the forecasters now think government revenues may tail off next year. You reach a point where you can't cut the deficit for fear of hurting an economy whose weakness is all the while adding to the deficit. If you can't ease the deficit down in relatively good times, however will you ease it down in bad?
For six years, this administration has lived in the land of the free lunch. It wants the deficit reduced, but doesn't want to do any of the things necessary to reduce it. So Congress will have to. The House and the Senate are close to a sensible budget resolution; they ought not to let the White House sabotage that effort. As politically difficult as it may be, it is in the interests of both parties in Congress to do the president's dirty work for him. Suppose the Democrats elect the next president. Do they want him to spend his administration mopping up after this one? The same argument applies on the Republican side. For political as well as fiscal reasons, it is past time to put this government's finances in order.