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Allow Social Security Cuts, GOP's Dole, Simpson Say

January 24, 1986|PAUL HOUSTON | Times Staff Writer

WASHINGTON — The Senate's two top Republican leaders strongly suggested Thursday that Social Security's immunity from budget cuts be lifted because of the severe requirements of the new Gramm-Rudman deficit-reduction law.

Senate Majority Leader Bob Dole (R-Kan.) said Congress had erred when it exempted Social Security from automatic spending cuts that will be imposed under Gramm-Rudman if Congress and President Reagan fail to meet deficit-reduction targets.

"Who said that was sacred?" Dole declared when asked if anything besides Social Security would be safe when Congress begins developing a package of spending cuts--and possibly tax increases--aimed at avoiding the automatic cutbacks.

Despite the political explosiveness of the issue, especially in this election year, the Republicans' No. 2 man in the Senate, Alan K. Simpson of Wyoming, lined up with Dole on Social Security cuts.

In enacting the Gramm-Rudman law last month, Simpson said, Congress "left off the table the biggest item" for budget savings--Social Security cost-of-living increases.

"If we just removed the cost-of-living allowance for a year, we could save billions," Simpson said in an interview on "CBS Morning News." He added: ' 'We're going to have to look at Social Security. We've got to revisit it."

The immediate response from the White House was frosty. "The President is already on record as being opposed to that," spokesman Rusty Brashear said.

House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.), a vigorous opponent of Social Security cuts, noted that Reagan had vacillated on the issue last year, at first opposing trims, then suggesting he favored them, then going back to his original position.

"I don't think Mr. Simpson wants to make (Reagan) break his promise again," O'Neill said.

An attack led by O'Neill in the 1982 elections, charging that Republicans wanted to cut Social Security benefits as a means of keeping the program solvent, helped Democrats make substantial gains.

With both parties gun-shy on the issue, Reagan in 1983 appointed a commission that recommended sweeping revisions in the Social Security program. Congress agreed to a reform package that included a six-month freeze on cost-of-living increases.

Forcing Balanced Budget

But, last year, in developing the Gramm-Rudman law, which is intended to force a balanced budget by fiscal 1991, Congress agreed to exempt Social Security and several veterans' and anti-poverty programs from mandatory across-the-board spending cuts.

Although a number of Democrats agree that Social Security must be brought under the budget ax, their party is trying to recapture control of the Senate this year and Democratic candidates can be expected to pounce on any GOP effort to trim benefits.

Twenty-two Senate seats held by Republicans--including Dole's --are up for election, in contrast to only 12 held by Democrats.

Sen. Gary Hart (D-Colo.), who is dropping out of the Senate so he can concentrate on running again for President, called Thursday for $200 billion in new taxes over the next five years to cut the federal deficit.

Budget Called 'Dead'

In a floor speech, Hart assailed the Gramm-Rudman law as "ill conceived." He said that Reagan's fiscal 1987 budget, scheduled for delivery to Congress on Feb. 3, would be "dead on arrival" because it would rely on massive spending cuts and the selling off of government property to meet the new law's deficit ceiling of $144 billion.

Hart's tax plan would include an oil import fee and a minimum tax on individuals and corporations that escape income taxes through various deductions and loopholes.

Meanwhile, as members of both parties called for tax hikes despite Reagan's strong opposition, Sen. Carl Levin (D-Mich.) said that Congress should use a tax overhaul bill pending in the Senate as a vehicle for raising money to reduce the deficit.

Deficit Action Favored

Levin released a poll showing that 68% of 1,009 persons questioned nationwide favored closing tax loopholes and applying the money to the deficit instead of reducing their own tax bills. Reagan has insisted that such money be used to lower federal tax rates.

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