The cavalry rides into the budget talks, bringing something for everyone


WASHINGTON -- There's an Alice-in-Wonderland quality to all the Republican celebrating and Democratic cautious optimism over the two parties' agreement to balance the federal budget by the year 2002.

Only a few weeks ago, the notion that the budget could be balanced and tax cuts enacted at the same time, along with more money for education and the protection of Medicare and Social Security, seemed the stuff of political fantasy. Following the day-to-day newspaper accounts of the negotiations, and all the pessimistic back-and-forth, was like watching for grass to come up in the Sahara.

Then, like the cavalry riding to the rescue, came word from the Congressional Budget Office, the official number-crunchers of Capitol Hill, that a new economic forecast based on the humming national economy had unexpectedly produced a five-year $225 billion windfall.

To the budget-balancers of both parties, this news was like Ed McMahon coming to their door. Suddenly it was possible to agree on capital-gains tax and estate-tax cuts and a $500-per-child tax credit close to Republican hearts, while boosting college loans and grants and other educational benefits, dear to Democrats.

Medicare and Social Security cost-of-living payments would not have to take as big a hit as earlier contemplated, health insurance could be extended to 5 million children of the working poor and legal immigrants would not have to be cut from the welfare rolls after all.

The Republicans were much happier than the Democrats for at least one reason -- President Clinton negotiated with them while the Democratic leadership in Congress took a back seat at best. It may not have been as bad as liberal Democratic Rep. Barney Frank suggested when he jibed that he had sent a note to the "Democratic president" at 1600 Pennsylvania Avenue and it came back marked "addressee unknown." But the result was a far cry from what many Democrats, and especially the liberals, wanted to swallow.

This budget agreement, like most others, depends greatly on economic faith and mathematical and legislative legerdemain. The deal encompasses the broad framework only, with Congress left to work out the dollar details in accordance with its constitutional prerogative to raise and spend.

The final reckoning

Aside from the fortunate circumstance for Mr. Clinton that he will be out of office well before the final reckoning comes due in 2002, it's hard to gauge, for all the Republican crowing, what real political capital will be gained for one party over the other by the agreement.

The public, fed up with both parties over years of budgetary wrangling and legislative gridlock, is more likely to respond "It's about time" than to give three cheers for either side -- provided, that is, that grumbling on both sides of the aisle in Congress can be quelled to assure quick approval.

While die-hard dissenters may not block such approval, they can take some of the bloom off the rose with their complaints. Sen. Phil Gramm, the Republicans' chief crepe-hanger, has already weighed in with his doubts about the gift package from the CBO. And one of the Democrats' consistent naysayers, the liberal Rep. David Bonior, has characterized the deal as shortchanging the working stiff again.

Also, the long-term outlook remains grim, what with the baby-boomer generation advancing on retirement age and both Medicare and Social Security imperiled beyond the time this deal's adjustments give both programs more breathing space.

Both sides are pledging a yet-undefined bipartisan approach to tackle the long-term problems of the two giant entitlement programs, whether through creation of yet another blue-ribbon commission or a suddenly enlightened cooperative Congress acting through its normal routine. But for now, it's a matter of hoping for the best, and putting faith where it hasn't been warranted often enough in the past.

Jack W. Germond and Jules Witcover report from The Sun's Washington bureau.

Pub Date: 5/07/97

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