Budget bill will pass, top Democrats say Deficit would shrink $496 billion

WASHINGTON — WASHINGTON -- Democratic congressional leaders announced yesterday they had struck enough bargains on President Clinton's economic program to secure its passage in the House and Senate later this week.

Despite all the dickering in the joint House-Senate conference over the past three weeks, the budget deal outlined by legislative leaders is not much changed from the proposals approved by Congress in May and June. The agreement aims to cut the deficit by $496 billion over five years by raising about $243 billion in new taxes and restraining the growth of spending by about $253 billion.


Most of the new taxes would fall on corporations and upper-income people, though a gasoline tax increase of 4.3 cents a gallon would affect almost all Americans.

Final details of the package were not scheduled to be released until today because several subcommittees of the joint conference were still tying up loose ends.


President Clinton will speak to the nation tonight on the budget bill. The speech at 8 p.m. will be televised by ABC, CBS, CNN and NBC.

House Speaker Thomas S. Foley of Washington and Senate Majority Leader George J. Mitchell of Maine said they were confident they had massaged the bill enough to get it through.

"It should be obvious that we're not going to bring it up just to have it defeated," Mr. Foley said.

Among the negotiators' final concessions was to reduce a proposed tax increase on Social Security recipients in order to pick up the crucial vote of Arizona Sen. Dennis DeConcini, one of six Democrats who voted against the bill during its first trip through the Senate.

Under the new proposal, single people whose incomes exceed $34,000 and couples above $44,000 would have to pay tax on up to 85 percent of their Social Security benefits. The thresholds were $32,000 for singles and $40,000 for couples in an earlier version of the compromise.

A spokesman for Mr. DeConcini said the senator would not comment on the agreement until he had more information about it, probably today.

Putting the deal together has been particularly tricky because the budget passed the House in May by only six votes and squeaked through the Senate in June on a tie vote broken by Vice President Al Gore. Each time the negotiators made a concession to gain conservative support in the Senate, they risked losing liberal votes in the House.

Mfume pleased


Black Caucus Chairman Kweisi Mfume of Baltimore, who had raised concerns about some details of the package last week, said last night the bargain looked much better to him now. It includes $29 billion in tax credits for the working poor, the establishment of empowerment zones to spur investment in blighted areas and other social spending.

"Based on what I've heard, it looks like we've been able to restore funding for the biggest package of anti-poverty, pro-family initiatives in the last 12 years," said Mr. Mfume, who planned to call a caucus meeting this morning to discuss the deal.

Among final changes made to accommodate Mr. Mfume and other House liberals was a plan to phase in $56 billion in cuts in the growth of Medicare financing, and restoration of a Medicaid cut that would have affected inner-city hospitals that serve tuberculosis patients.

Republican leaders of the House and Senate reiterated their vehement opposition to the plan, which the entire GOP membership is expected to vote against.

Dole denunciation

Senate Republican Leader Robert J. Dole of Kansas said it would amount to "the largest tax increase in the history of the world."


Robert H. Michel, of Illinois, the House Republican leader, protested that "nothing in the measure helps create jobs."

President Clinton kept up his public relations campaign for the budget package, meeting and calling wavering Democrats and granting interviews with news organizations in key states.

And he struck back at Ross Perot yesterday, saying the 1992 independent presidential candidate "doesn't have a vote in Congress" and should stop "wallowing around" in budget criticism.

The former presidential candidate was roaming the Senate corridors lobbying against the bill. He came back three times and then waited quite a while for an audience with Sen. J. Bennett Johnston of Louisiana, another of the six Democrats who have opposed the budget bill.

"It was bizarre," said Scott Trahon, a spokesman for Mr. Johnston. "He praised the senator for his earlier vote against the bill and told him it was better to vote for nothing than to support a bad bill."

Mr. Johnston, who wants a substantial increase in the amount of spending cuts, is probably a lost cause, anyway. But the White House has high hopes for Mr. DeConcini, whom the administration believes it could have called upon during the earlier vote on the budget if his vote had been absolutely necessary.


Making up for Boren

It became necessary Sunday when the White House lost for certain the vote of Sen. David L. Boren of Oklahoma. He had supported the budget bill when it passed in June.

His opposition forced the administration to court Mr. DeConcini by reducing the number of retirees affected by tax increases on Social Security.

Mr. DeConcini, a third-term senator facing re-election next year after being tarred in the Keating savings and loan scandal, was worried about the reaction of his constituents, many of whom are retirees.

In another bid for Mr. DeConcini's favor, President Clinton has agreed to sign an executive order that would put all tax revenue intended for deficit reduction into a specially designated trust fund.

No travel break


Budget negotiators decided against including a concession on the tax deduction for business travel and entertainment expenses, which would have been aimed at picking up the support of Democratic Sen. Richard Bryan of Nevada.

Both the House and Senate had already voted to reduce the tax deduction to 50 percent from 80 percent. They considered partially restoring the tax break, but instead they agreed to a smaller concession that would change the way restaurant owners report employee tip income for tax purposes.

No comment from Senator Bryan was available yesterday.

Of the three other Senate Democrats who opposed the budget last time -- Richard Shelby of Alabama, Frank Lautenberg of New Jersey, and Sam Nunn of Georgia -- none seems to be reconsidering.


It got ugly yesterday outside the guarded wooden door marked "Ways and Means," where close to 100 lobbyists and reporters were taking part in a classic Washington ritual -- the stakeout. Article, 9A.