WASHINGTON -- President Clinton and congressional leaders pledged last night to work together to avert a government shutdown next month, but they cautioned that major differences over the budget still need to be resolved.
Mr. Clinton summoned the Republican and Democratic leaders to the White House to begin discussions on avoiding major disruptions to the government when the new fiscal year begins Oct. 1.
Spending bills funding government operations are supposed to be enacted and signed into law by Oct. 1, but Congress is far behind in its schedule. And even after the bills are passed, several could be vetoed by Mr. Clinton, who disagrees with GOP budget priorities.
Mr. Clinton told the congressional leaders that it probably would be necessary to enact a short-term measure that funds federal operations while the disputes over the spending bills are resolved.
Republican leaders signaled their willingness to cooperate and to prevent a government shutdown.
"We don't want to lay off government employees," House Speaker Newt Gingrich said after the meeting. "We don't want people to be in a position where they're being harmed. If there's any way we can work together in a mature, adult manner and get this thing done right, I think we are going to cooperate totally."
But the Georgia Republican insisted that there would be no compromise with Mr. Clinton if it meant abandoning the GOP's pledge to put the government on track to balance the budget in seven years. Mr. Clinton has recommended a plan that could take 10 years.
Senate Republican Majority Leader Bob Dole of Kansas also said basic GOP principles would not be sacrificed. "It's not our desire to shut down the government. But I think we have a lot of work to do."
The stakes in the coming battle are high.
Republicans want to demonstrate to voters that they are serious about cutting the budget and can be trusted to run the Congress. Democrats hope that voters will rebel at the scale of the GOP cuts and turn to their party in next year's elections.
At issue are competing ideologies, with conservative Republicans demanding a major downsizing in the power of the federal government, while liberals and moderates attempt to defend the programs enacted over the past 60 years to combat poverty, pollution and other problems.
"What's being tested here is whether we can govern," said Republican Sen. Charles E. Grassley of Iowa, a senior member of the Budget Committee. "What's at stake is whether or not Republicans, as the new majority for the first time in 40 years, can deliver. The public's trust in us is going to be jeopardized if we fail."
But as Sen. Frank R. Lautenberg, a New Jersey Democrat and liberal member of the committee, sees it: "The question is whether this government has a mission to provide needed services to its people. . . . It's a fight between those who want to protect the few at the top and those who want to provide a hand up to people in trouble."
Although the initial skirmishing will begin soon, the major battle will be joined in November. That's when Congress hopes to hand Mr. Clinton a huge bill that would put the government on course to balancing the budget in seven years. Major changes in Medicare, Medicaid, welfare programs and tax law could be rolled into the legislation.
Also expected in the bill: authorization to increase the government's ability to borrow money. Without that authority, the government would have to shut down nonessential services and programs -- and could default for the first time in history on billions of dollars of interest payments due to private, public and foreign investors.
Such a default, many economists say, could undermine investor faith in the nation's credit and drive up interest rates.