Lights Out on Congress

By William R. Doerner

As the Senate prepared to convene in regular morning session last Tuesday, a cable failure at an electrical substation suddenly cut power in a square-mile section of Washington, including the Capitol building. Office workers groped through dim hallways toward daylit exits, subway trains coasted into motionlessness, and tourists stood around in knots, prevented by guards from entering the darkened Capitol. But no mere utility collapse could be allowed to shut down the U.S. Senate. Under the pallid glow of a lone emergency light, the lawmakers went about their business as usual. Since the bells normally used to call the Senate to order had been knocked out, a clerk gained the attention of the nation's most exclusive debating society by thumping loudly on a metal trash can. Quipped Majority Leader Robert Dole: "We work in the dark most of the time anyway."

Comic as the scene appeared, the tinny noise and dimmed chamber were depressingly apt metaphors for the goings-on in official Washington. In a spectacle of cross-accusations and intraparty squabbling that was politically bloody even by the capital's standards, legislators and Ronald Reagan finally reached agreement on a budget resolution that set spending targets for the fiscal year beginning Oct. 1. Senate and House negotiators worked late into the night, and Reagan, in one spectacular heave, sandbagged the Senate leadership of his own party. Almost no one was happy with the watered-down document that emerged, and everyone faulted everyone else. Said North Dakota Senator Mark Andrews: "People are growing seven fingers on each hand so they can point their fingers at who is to blame."

There was even widespread disagreement over the size of the cut made in the runaway deficit. Using calculations supplied by the White House Office of Management and Budget, House leaders claimed that the $968 billion budget was $57.5 billion less than it would have been if current spending programs continued unabated. The Senate declared the total savings next year would be only $55 billion. The nonpartisan Congressional Budget Office, working with projections that in the past have often proved more realistic than OMB'S, said the new budget would save only $39 billion.

Even the most optimistic reckoning put the 1986 deficit at more than $ 170 billion, less than the anticipated $200 billion but a long way from Congress's original target of $100 billion or less by 1988. "We really haven't reduced the deficit all that much," said Dole on NBC's Today show. "It's a small step forward. It's not a big step." Complained Florida's Lawton Chiles, ranking Democrat on the Senate Budget Committee: "Our problem is not the budget process. It's the absence of will." Congress, said Democratic Congressman Barney Frank of Massachusetts, had gone "from winking to blinking to nod." For his part, Reagan promised to keep up the fight against letting new taxes creep into the budget. "You didn't send us to Washington to feed the alligators," he said in his Saturday radio broadcast. "You sent us to drain the swamp."

But the President did not have much to brag about either. In May, with Reagan's backing, the Republican-controlled Senate passed a budget resolution that would have halved the current deficit by 1988, in part by skipping a Social Security cost of living adjustment (COLA) next year. But Reagan later reneged on his support of the COLA holiday, largely because House Democrats turned the issue into a partisan taunt, and an outraged Dole was forced to come up with a fresh formula. It included COLAS at two-year rather than one-year intervals (saving: $12 billion over three years) and a new $5-per-bbl. duty on imported oil (about $9 billion annually).

Dole and Senate Budget Committee Chairman Pete Domenici brought the new package two weeks ago to White House Chief of Staff Donald Regan. While the lawmakers realized that the President by then firmly opposed any reduction in Social Security benefits, they argued that he could safely support a money-saving adjustment that would keep recipients even with inflation at regular intervals. As for the oil import fee, said Dole and Domenici, even though Reagan was dead set against new taxes, this was a relatively painless one.

Regan said he would ask the President to consider the proposal. Reagan went to Camp David and called his chief of staff the following morning. "Don, I don't see how we can go on with this," the President said, recalling his promise during last fall's debate with Walter Mondale not to raise taxes. "He said I would lie [and raise taxes]," Reagan went on. "I won't do that."

Dole, meanwhile, had scheduled a meeting last Monday afternoon with House Speaker Tip O'Neill to try to win Democratic backing for the budget plan. Just minutes before the session was to begin, however, the Senate majority leader got a telephone call from Reagan saying that he had already made up his mind against both new features of Dole's plan. Almost immediately, and without warning the Senator of what it was about to do, the White House released a summary of Reagan's message to Dole, adding public insult to private injury. Callously rebuffed by a President from his own party not once but twice, a furious Dole joked weakly, "I guess Tip and the President are breaking out the champagne." G.O.P. Senator Slade Gorton of Washington more accurately summed up the state of mind of Senate Republicans. Said he: "The President of the United States has sold us down the river again."

Such was the depth of resentment that Dole conspicuously failed to show up the next morning for Reagan's regular meeting with Senate G.O.P. leaders. As the President entered the Cabinet Room, he jokingly observed to his disgruntled audience, "Maybe I should have thrown my hat in first." Turning serious, Reagan reiterated his old opposition to new taxes. As for the change in Social Security, Reagan said defensively, "Tip has taken that off the table," meaning that House Democrats had publicly rejected the idea.

Reagan's torpedo left Senate negotiators and their House counterparts, headed by Majority Leader Jim Wright and Budget Committee Chairman Bill Gray, with relatively little to argue about. They were able to iron out remaining differences over the next two days. According to OMB estimates, the budget plan will cut projected spending by $277 billion over the next three years, with the savings divided about equally between defense and domestic programs. The largest single reduction in non-defense spending--$11 billion over three years--came from a freeze in most Medicare payments to doctors and hospitals. The military budget will increase only by the inflation rate next year and be held to 3% real increases in the two years after that (see following story). Anxious to get on with their August recess, the lawmakers met in hastily called evening sessions and approved the budget by lopsided votes, 309 to 119 in the House and 67 to 32 in the Senate.

Dole was wary in assessing future dealings with the Administration. Promising "a different approach next year" toward the budget, the still bitter Senate majority leader warned, "There will not be too many Republican Senators listening to pleas from the White House on anything." The crunch could come much sooner than next year. To finance the new budget, Congress must go through the annual exercise of raising the national debt ceiling by Oct. 1 . Administration officials fear that some Senate Republicans will mount a fresh attack on the deficit issue by withholding their vote to authorize an increase in that $1.85 trillion of red ink. Concerned about Dole's pique, the President invited him to the White House late Thursday afternoon. Reagan, Regan and Dole had soft drinks in the family residence, reviewed the budget and talked politics. They parted after half an hour, lightly invoking the Eleventh Commandment: "Thou shalt not speak ill of fellow Republicans."

No amount of amicable chitchat could change the fact that the budget battle had put Congress way behind in its work. One casualty may be Reagan's tax-simplification plan, unveiled in May as the major new initiative of his second term. Both chambers have held hearings on the proposal, and House Ways and Means Committee Chairman Dan Rostenkowski said last week that work on drafting legislation was proceeding. To those dubious that his committee can still produce a bill this year, Rostenkowski warned, "Don't yell fire until you see the flames." In the Senate, however, chances that finished tax-reform legislation could emerge during this session appear negligible. Passage of the bill in 1986, an election year, would be difficult.

Also behind schedule is legislation to replace the law governing federal farm programs, which expires Sept. 30. Unable to agree on the level of federal price and income supports for the next four years, neither house has even managed to get farm legislation out of committee. By the time lawmakers reconvene after Labor Day, wheat-belt farmers will already be planting their winter crop, without being able to calculate what subsidies they can expect from the Government. Moreover, despite tough talk last winter about cutting price supports, the Administration has had to backtrack in the face of overwhelming opposition in Congress. In the midst of the current farm crisis, almost everyone expects subsidies to increase, not decrease, from their current annual average of $14 billion.

With the U.S. trade deficit continuing to soar (to a near record $13.4 billion in June alone), the Administration has sat back while Congress considered a raft of retaliatory measures, many of them dangerously protectionist. Nor has the White House exerted much leadership or imagination in dealing with other problems that cry out for fresh approaches, including immigration and the hard-core poverty that defies general economic recovery. Indeed, at a time when many predicted Reagan would reach the zenith of his power, translating a historic re-election mandate into his vaunted "second American revolution," he and his men have instead acquired a mantle of fatigue. The dimout has nothing to do with the President's illness but a lot to do with the intellectual vitality of his Administration. Nodding toward the White House domestic-policy office, one top official admitted, "It's like a morgue over there."

The malaise stems in part from Reagan's firm belief that, rhetoric aside, the basic agenda remains what it always was: to reduce the scope and cost of Government. He felt no urgent need to search for new horizons following the election, and those around him who normally provided sparks of initiative failed for once to ignite. Admits one: "There was burnout among most of the people who counted." In hindsight, even some Reagan loyalists now concede that, same agenda or not, there was a need early in the second term for an infusion of fresh ideas. Says one: "It is just at this stage of a presidency when you need a new supply."

There are plenty of new faces around Reagan, to be sure, but they have yet to master the technical subtleties of using the White House's clout to full advantage, let alone serve as well-springs of innovation. Nor, as the budget tiff made clear, have key White House officials developed sufficient appreciation for Dole's independent style. In the end, however, the push must come from Reagan.

Columbia University Historian Henry Graff attributes the Administration's second-term torpor to a sort of history-book complacency. "They have nothing further to prove," he says. "They don't have a sense of going for glory." Perhaps. But the period just after Labor Day is also a kind of second new year in the U.S., a time of fresh starts and revived enterprise after the summer doldrums. For both Reagan and the 99th Congress, that would still leave time--but not much--to go for glory. --By William R. Doerner. Reported by Laurence I. Barrett and Neil MacNeil/Washington

With reporting by Reported by Laurence I. Barrett, Neil MacNeil/Washington