THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Thursday, October 20, 1994 TAG: 9410200415
SECTION: FRONT PAGE: A1 EDITION: FINAL
SERIES: Senate Race '94
19 DAYS UNTIL ELECTION DAY
SOURCE: BY DAVID M. POOLE, STAFF WRITER
DATELINE: RICHMOND LENGTH: Long : 130 lines
On the campaign trail, Oliver L. North paints a grim picture of future generations being engulfed by federal debt.
``We've tied a millstone called debt around their necks,'' he says, ``and sent them out to swim in a rising tide of red ink.''
Yet North promises a military buildup and a smorgasbord of tax breaks that would cost the federal treasury nearly $100 billion a year, according to independent experts. And North provides no specific means for paying for his plan, other than symbolic spending cuts and changes in the way Congress writes its budget.
``North basically has no clue,'' said Dan Palazzolo, a University of Richmond political scientist who has studied the federal deficit.
``It's a phony plan,'' said Warren Rudman, who founded the Concord Coalition, a bipartisan group dedicated to eliminating the federal deficit.
The budget debate in Virginia's U.S. Senate race has focused almost entirely on Draconian steps that incumbent Sen. Charles S. Robb says he would take to stop the swelling of the nation's $4 trillion debt.
Robb went so far as to declare in a debate that ``I would take food from the mouths of widows and orphans if I had to, to try to solve that problem.''
North wasted no time in criticizing Robb for that statement, but the Republican's answer to the deficit question - contained in a 54-point ``Agenda for Change'' - does not address the painful choices that experts say are needed to bring federal expenditures in line with revenue.
North proposes a middle class-pleasing blend of tax cuts and increased defense spending. Many Republicans running for the House of Representatives this year have adopted a similar approach by signing a ``Contract with America.'' But North goes further.
He would eliminate income taxes on Social Security; restore the $2,000 deduction on all Individual Retirement Accounts; triple the personal exemption for children; provide tuition tax credits for parents who send their children to private schools; retroactively repeal the 1994 tax increase for wealthier Americans; and give tax breaks to companies that create jobs.
On the spending side, North would reverse some recent defense cuts by injecting the Pentagon with an extra $13 billion a year.
The bottom line, experts say, is that North's combination of tax cuts and defense spending would actually increase the federal deficit, which is estimated in the current year at $160 billion.
Analysts view North's prescription for the deficit as equivalent to a doctor giving sugar pills to a diabetic.
``It's ridiculous,'' Rudman said. ``It's the same kind of crap that has gotten us in the mess we're in today.
``Listen, I have nothing against Oliver North. But if his campaign doesn't agree with that, simply ask them where the money is coming from.''
North proposes a number of specific cuts: cutting the salaries of members of Congress by half, ending free congressional parking at National Airport, eliminating funding for the National Endowment for the Arts and stopping the purchase of federal lands for environmental or recreational purposes.
But the cuts add up to less than $1 billion a year.
``This stuff doesn't even add up to chump change when compared to the deficit,'' said Martha Phillips, executive director of the Concord Coalition.
``To think we can both cut taxes and make token spending cuts is just naive,'' said Susan Tanaka, vice president of the Committee for a Responsible Federal Budget, a bipartisan group in Washington.
North insists that real savings will be achieved by changing the way Congress does business through the line-item veto, term limits and a balanced-budget amendment.
Analysts note that a balanced-budget amendment would not let Congress off the hook. It still would have to make wrenching decisions.
The structure of the federal budget makes it difficult to reduce the deficit, which is projected to reach $400 billion a year by the end of the century. Three categories - defense, interest on the national debt and entitlements such as Social Security - account for nearly 90 percent of the federal budget.
In other words, Congress could eliminate every other federal program - support for education, transportation, environmental protection, etc. - and barely have enough money to eliminate the deficit.
The upshot is that any meaningful attempt to reduce the deficit would require cutting popular programs like Social Security and Medicare or raising taxes.
North rules out tax increases, but he declines to specify what other cuts he would make. His 54-point plan is silent on entitlements.
North refused to be interviewed for this article.
Robb, a self-described ``deficit hawk,'' has demonstrated a willingness to both raise taxes and tackle entitlements.
Last year, Robb voted for President Clinton's budget that reduced the deficit by $500 billion over five years through a roughly equal mix of spending cuts and tax increases.
The Democrat admits he has strayed into a political netherworld by advocating ``means tests'' - limiting benefits for wealthy individuals - for entitlement programs like Social Security and Medicare.
``You can't always tell people, `Yes, I'll spend more money on the programs you like,' '' Robb said. ``You can do it, you may get elected by it - and then there will be complete cynicism that sets in about the whole system and everybody in it.
``That's why it continues, because people don't think we're dealing honestly with the public.''
Rudman, who served with Robb, gave Virginia's junior senator credit for standing up when it counts. Robb hopes to turn his blunt honesty to his advantage by appearing as a courageous politician, though offering to raise taxes is seldom a winning strategy.
So far, the only deficit reduction message Robb has imparted has been his gaffe, which spawned bumper stickers promoting ``Widows and Orphans for North.''
Independent candidate J. Marshall Coleman has staked out a middle ground on the deficit question.
Coleman wants to increase defense spending by $50 billion a year - a figure North originally committed to and then reduced - and rules out tax increases as a way to bring the budget into balance.
Like Robb, Coleman would means-test all entitlements except Social Security, which he calls the government's ``compact'' with wage earners who pay into the system. MEMO: North ahead in latest Mason-Dixon Poll/A14
ILLUSTRATION: MORT FRYMAN/Staff
In Virginia Beach on Wednesday, Oliver L. North gets the backing of
former hostage David Jacobsen. Related Ad Watch/A15
D. KEVIN ELLIOTT/Staff
John Vellines, left, meets J. Marshall Coleman after the candidate
on Wednesday spoke to the Norfolk Sertoma Club in Virginia Beach.
KEYWORDS: U.S. SENATE RACE CANDIDATES CAMPAIGN by CNB