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The Budget Follies

February 23, 1986

The more the Administration tries to explain its fiscal 1987 program, and the deeper one burrows into the budget document, the more it appears to be steeped in fantasy and mythical assumptions. David Stockman may have crunched the numbers so they looked good, but at least he could discuss them with some measure of reason and logic.

Stockman would not have committed the sort of blunder made this week by his successor as director of the Office of Management and Budget, James C. Miller III. While the Administration believes that the homeless are not a federal responsibility, Miller said, there are federal grants that localities can use to assist the homeless. Asked to name one, Miller picked the $350 million Community Services Block Grant.

Guess what? The new budget would eliminate the Community Services Block Grant. Gone as well would be a separate $70 million program for the homeless. A budget director can't remember every item, but killing that block grant is an Administration priority for 1987.

Another major initiative is the President's campaign against welfare dependency. Guess who he picked to oversee a study of welfare and the family? Atty. Gen. Edwin Meese III, the same Meese who said in 1983 that he had seen no "authoritative evidence" of hungry children in America and who questioned the need of some people who go to soup kitchens. Another study may unearth something new, but with Meese in charge it would have no credibility.

Meanwhile, Reagan continued to retreat in the War on Poverty, arguing that welfare has made poverty worse. "I guess you could say poverty won the war," he said. That is wrong, but the President keeps saying it. Welfare needs reform, but there can be no progress until recipients can be trained for jobs and jobs can be found. The most effective job training program would be abolished by the 1987 budget.

Other defects in the budget put in question the Administration's estimate that it will take $38 billion in cuts to reach the $144 million deficit level mandated by the Gramm-Rudman Act.

Even Republican experts say the defense budget is understated by nearly $15 billion. If so, it would take more than $50 billion to achieve the required deficit reduction and maintain the defense buildup Reagan wants. The budget also counts on $7 billion from the sale of federal assets during fiscal 1987 with minimal prospects of achieving such sales. The government proposes saving $6.4 billion through management reforms, some of which may be achieved while others likely will not.

Other "savings" are really just a shift of the burden from the federal level to state and local governments and directly to the people through $2.5 billion in new fees. For example, OMB proposes to change the allocation of federal timber receipts that now go to affected local governments, saving $308 million at the expense of depressed areas like California's Humboldt County. The budget wizards complained that the income from the timber sales often did not cover the cost of conducting the sales. If so, why in the name of waste, fraud and abuse was this business-minded Administration selling federal timber at less than cost in the first place?

Blandishing his veto threat, the President dared Congress not to take his budget seriously. That's one dare Congress should accept.

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