Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, January 31, 1992 TAG: 9201310115
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
SOURCE: The Baltimore Sun
DATELINE: WASHINGTON LENGTH: Medium
BUDGET BATTLE BEGINS
House Democratic leaders and White House budget director Richard Darman clashed Thursday on some basic elements of President Bush's budget package, indicating a long battle over spending and tax policy before the November election.At the outset of a House Budget Committee hearing on the $1.52 trillion Bush budget, Rep. Leon Panetta, D-Calif., accused the administration of reviving the "same smoke and mirrors, the kind of budget gimmicks we saw in the 1980s" to minimize the mammoth deficits.
Darman shot back that "partisan cliches, smoke and mirrors, will not help" pass a budget.
At least part of the Bush package to stimulate the economy, including tax breaks for first-time home buyers and business investment, is expected to be approved by Congress close to the March 20 deadline urged by the president.
The Democrats staked out a firm position that money from military cutbacks must be diverted to domestic spending to bolster the economy and make the United States more competitive internationally.
But Darman stated flatly that the $50 billion in proposed military cutbacks over five years must be devoted to reducing the record deficits - expected to reach $400 billion this year.
Asked about beefing up domestic spending with defense savings, the budget director replied: "No; that is the short answer."
In one possible concession to the Democrats, he said that the White House might consider using the military savings to raise the personal exemption for income taxes, but he asserted the president would agree to that change only if Congress kept military cuts to the administration's $50 billion target.
Military spending will decline by 30 percent from 1989 when Bush took office until 1997, Darman said, and "we are at the limit of prudent risk."
House Majority Leader Richard Gephardt, D-Mo. - who went to the hearing to lay out the House leadership stand - told Darman that the Democrats feel strongly that the 1990 budget agreement, which kept domestic and military spending on separate tracks, must be changed to raise domestic spending while keeping untouched the budget's overall spending.
"Democrats will fight as Republicans will fight for what we believe in," he said. "Democrats will cooperate, but we will not fold."
In Philadelphia, meanwhile, Bush urged about 600 members of the Greater Philadelphia Chamber of Commerce to reject "sweet-sounding quick fixes" offered by the Democrats. "Let me tell you the three words that really separate my plan from what I think of the rest of them," Bush said: "It will work."