Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, May 15, 1990                   TAG: 9005150373
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-4   EDITION: METRO 
SOURCE: Los Angeles Times
DATELINE: WASHINGTON                                LENGTH: Medium

BUDGET DEFICIT LAW STRIKES FEAR/ GRAMM-RUDMAN COULD REQUIRE UP TO $100 BILLIO

The driving force behind the budget summit negotiations that start today between the Bush administration and congressional leaders is the fear of political bloodletting this fall if automatic spending cuts are not prevented from going into effect.

Unless politicians from both parties can agree on a plan to curb the deficit by a lesser amount, the Gramm-Rudman deficit law would require eliminating as much as $100 billion from a host of popular domestic and defense programs. For those federal activities unprotected from the Gramm-Rudman meat ax, the cuts could hack 20 percent to 45 percent from hundreds of crucial spending programs.

"We could put air traffic controllers on a four-day week. So much for public safety," House Ways and Means Committee Chairman Dan Rostenkowski, D-Ill., warned last week. "Spending on anti-drug activity would be cut by about $2 billion. . . . Now that'll send a clear message to the criminal class."

At the White House, the most horrible scenario would be an economic recession next year that might threaten President Bush's 1992 re-election prospects.

Administration officials argue that it is crucial to wrap together a more limited package with perhaps a total of $50 billion in spending cuts and tax increases to avoid the political backlash and the harsh economic impact from slashing $100 billion.

As a result, all parties to the budget summit have a stake in burying Gramm-Rudman this year.

The negotiations, which are expected to stretch out for at least several weeks if not well through the summer, get under way against a backdrop of mutual suspicion.

Senate Majority Leader George Mitchell, D-Maine, told reporters Monday that "there remains a high level of resentment and skepticism" over Bush's motives after White House chief of staff John Sununu's remarks last week convinced many Democrats they could be walking into a Republican trap designed to blame them for higher taxes.

Meanwhile, the White House strategy is to avoid a backlash from the Republican right and find a way to placate middle-class taxpayers for betraying Bush's "Read-my-lips:-No-new-taxes" stance.

Gramm-Rudman was designed to create the threat of a crisis to force the White House and Congress to reach a deficit compromise. It may finally be succeeding in that goal this year. But it was never contemplated that the law, which aimed at a balanced budget by gradually lowering the deficit ceiling each year, would demand such drastic budget cuts.

Even with a mixture of spending cuts and tax increases, it would be impossible to squeeze $100 billion out of the federal deficit without throwing the economy into a recession.