Democrats on the House Budget Committee struggled behind closed doors Tuesday to meet a Senate-set goal of $56 billion in budget-deficit reductions while keeping Social Security benefits intact and supporters of an across-the- board budget freeze in line.
It was a day of budget talk on the Hill and tax talk in the White House, where President Reagan and his aides are preparing a tax-revision proposal.
”We`re coming in at $50 billion to $57 billion (in savings) without desecrating the senior citizens of America,” said House Speaker Thomas O`Neill, (D. Mass.) during a briefing on the Democratic budget plans.
O`Neill said the House would meet the savings in the Senate-passed plan, but would depart from the Senate plan by preserving Social Security cost-of-living adjustments next year. O`Neill also ruled out a tax increase to reduce the deficit.
Meanwhile, in an obvious effort to head off deeper cuts in the military budget, Defense Secretary Caspar Weinberger said the Pentagon has found $4.02 billion in ”savings” that could be used to reduce the President`s military budget.
The defense leader said the Pentagon so far this year has spent $4.02 billion less than it had projected primarily because its inflation estimates were too high. Normally, Weinberger said, such savings are used to lower military spending when Congress takes up appropriations bills later in the year.
Weinberger said he was identifying the savings earlier so Congress could use them to meet the lower Pentagon spending targets in the recently passed Senate budget resolution, which limits defense increases to the level of inflation.
On the budget action in the House, Majority Leader James Wright (D., Tex.), who supports a minimum corporate tax to cut the deficit, acknowledged that the party was ”divided” over whether to raise revenues to cut the deficit or lower personal tax rates.
The 20 Democrats on the Budget Committee worked out final details of a plan that may be unveiled Wednesday. The group, joined by the committee`s 13 Republican members, were expected to begin ”marking up” a House budget Wednesday.
Rep. William Gray (D., Pa.), the Budget Committee chairman, refused comment on the committee`s progress, although sources said he was trying to negotiate a compromise that would keep conservative Democrats in line.
Congressional sources said it was likely that conservative supporters of an across-the-board freeze, such as Budget Committee member Rep. Marvin Leath (D., Tex.), would be allowed to offer their own package in return for pledging to support the party`s position rather than bolt as the ”Boll Weevils” did in 1981 by teaming up with Republican House members to pass the President`s budget and tax proposals.
In this case, with a number of Republican House members opposed to freezing Social Security, ”the greater fear is if you don`t have them (the conservative Democrats) you don`t have the votes to pass a budget
resolution,” said a Democratic leadership aide.
Leath said that while he can`t speak for other conservative Democrats, he would be satisfied with an assurance that would allow a vote on his proposal in addition to the one the Democratic leaders put forth.
At the White House, Reagan worked on the tax-revision plan, reviewing options prepared by aides, but he did not give his final approval to a tax package being worked out by the White House and Treasury Department, White House officials said.
Reagan, behind schedule on his long-promised tax bill, met with Rep. Dan Rostenkowski (D., Ill.), chairman of the House Ways and Means Committee;
Treasury Secretary James Baker, White House Chief of Staff Donald Regan and other advisers at the White House.
An official said more meetings were planned for Wednesday, indicating that a tax-reform plan is not likely to be unveiled until next week at the earliest. There were indications Reagan might make a televised address on the matter Monday.
Earlier, Reagan`s spokesman, Larry Speakes, said a tax bill might be introduced by the end of this week. Briefing reporters before Reagan`s meeting on the tax bill, Speakes said the President was still undecided on a Treasury proposal to limit personal tax rates to 35 percent and on the amount of personal exemptions to be allowed.
