The U.S. Senate, to its great credit, has overwhelmingly rejected the Newt Gingrich-Phil Gramm proposal to slash taxes before enacting the spending cuts needed to put the nation on the road to a balanced budget. In rebuffing the "crown jewel" of the House Republican "Contract with America," 23 Senate Republicans joined with all 46 Democrats to defeat the 31 supporters of Mr. Gramm's ploy to advance his presidential ambitions.
Sen. John H. Chafee, one of the GOP opponents of irresponsible tax cutting, said the Senate had displayed a "wonderful resolve" by putting top priority on eliminating huge federal deficits. He was right. The battle, however, is far from over. Once the Senate and House work out a compromise budget resolution, which we would hope holds tax cuts to a minimum or eliminates them entirely, authorization and appropriations committees will have to enact painful spending reductions.
Political fireworks are bound to erupt over restrictions on popular entitlements, such as Medicare, Medicaid, veterans benefits and farm subsidies, that have led to explosive growth of the national debt. It is then that Republican deficit hawks will have to show their mettle against Democrats catering to the special constituencies that make up the traditional base of their party.
Much of the budget debate on $1 trillion in spending cuts to balance the budget by 2002 is ensnarled in presidential politics. Just as Mr. Gramm made sure he would not be outdone by Mr. Gingrich on tax cuts popular among GOP conservatives, so Senate Republican leader Bob Dole voted for the Gramm proposal only after it was assured decisive defeat. Mr. Dole obviously plans to be a big player in shaping a more modest tax cut to rival the plan offered by President Clinton.
As Senate Republicans split wide open along the fiscal fault line that divides their party -- Reaganite tax-cutters versus traditional budget balancers -- Mr. Clinton had to backtrack from premature signals about what kind of a compromise he would accept. He told a New Hampshire radio station last weekend that he believed the budget could be balanced "in less than ten years -- this, in contrast to the GOP seven-year plan -- and that he would "propose a counter-budget" to what Senate and House negotiators work out.
This undercut the cat-and-mouse strategy of the White House. Hence, the president's hasty retreat into obfuscation. Having failed last fall to grab the high ground of opposing any tax cuts until sufficient spending reductions are assured, he now will have to negotiate half-way measures.
The heroes of the current battle are the three Republican chairmen of the Senate Budget, Finance and Appropriations Committees, Pete Domenici, Bob Packwood and Mark Hatfield. Their united opposition to Gingrich-Gramm tax cuts and their insistence on spending reductions that can bring the budget into balance provided the muscle and logic for the Senate's "wonderful resolve."