Why Put It Off ?

Hardly anyone likes the $995-billion federal spending plan that Congress has adopted for the fiscal year starting Oct. 1. But that is the problem with facing reality in an era of $200-billion-a-year budget deficits and the Gramm-Rudman deficit-reduction act.

The budget resolution is about the best that Congress could do, given the election-year aversion to new taxes. The White House does not like it because the measure cuts President Reagan’s defense-budget proposal from $320 billion to $292 billion--down to about this year’s level. But Congress yielded to the President’s demand that the new budget contain no new tax revenues other than those that he had proposed.

The Reagan Administration will claim that the $292-billion defense budget will jeopardize national security, even though it continues the massive defense buildup that started at the $156-billion level in 1981. But the President has a way out if he wants additional defense funds badly enough: by proposing new taxes or spending cuts to finance them. Since Congress would, and should, reject any further domestic spending reductions, that locks the President into taxes as the price for more money for the armed forces. Rep. William H. Gray III (D-Pa.), the able chairman of the House Budget Committee, noted that the only way to make headway against the deficit is to make tough choices. But the President always has had difficulty making tough choices, and that’s the reason the deficit has grown so large. Now Congress finally seems to have gotten control of the budget process. It is abundantly clear that additional budget deficits could be, in the long run, as hazardous to national security as the cancellation or delay of dubious future weapon systems.

The White House also will complain vigorously that the budget does not cut domestic programs enough. But, while defense outlays have soared, spending for human resources has declined from 53.4% of the budget in 1981 to 49% this year. The resolution cuts Medicare by $700 million; ends federal revenue sharing to local governments; reduces a number of domestic programs by 10% below this year’s levels, and freezes most others.

The major problem with the resolution, which sets guidelines for specific appropriation bills, is that it may not actually cut the 1987 deficit to the $144-billion target specified by the Gramm-Rudman law. If the economy fails to live up to expectations, Congress would have to take further action to avoid the severe, arbitrary budget cuts that Gramm-Rudman would trigger.

There is the chance that the Supreme Court soon will rule that the mandatory-cut provision of Gramm-Rudman is unconstitutional. But the $144-billion target would still be in force, and Congress would have no choice, politically, but to meet it.

The irony of Congress and the President quibbling over $3 billion or $4 billion in new taxes to finance the budget is that people are congratulating themselves over the Senate’s recent adoption of a tax-overhaul plan that provides an individual income-tax rate reduction of more than $175 billion. Congress and the President have put their heads in the sand and pretended that taxation has nothing to do with budgeting and vice versa.

On the one hand, the government cuts spending to the bone and flirts with potentially disastrous Gramm-Rudman budget reductions. With the other hand, it promises to dole out billions in new tax reductions. They used to call that robbing Peter to pay Paul. The tax-overhaul bill figures make it abundantly clear that the modest tax increase needed to solve the budget dilemma is clearly affordable. The nation can pay now for the budget that it needs, or pay later. Why not now?