The US Budget Two-Step

The President and the Republicans will soon need to dance with each other over taxes and spending. The federal fiscal year starts Oct. 1, and 11 of the 13 spending bills have yet to be passed.

But it's not certain the GOP Congress can hold its own with President Clinton in this new-fiscal-year tango. He's mopped the floor with the Republicans several times before.

This year's political to-and-fro is compounded by a debate over how to spend the projected surplus in tax revenues over the next decade. Republicans will send a bill to Mr. Clinton that calls for giving back $800 billion over 10 years. Clinton wants to hold the line at $300 billion and use the rest for new spending and to pay down the debt.

Republicans will do anything to avoid a government shutdown; they're sure they'd again reap the blame. If they can't agree with the president on taxes and spending, they'll pass a continuing resolution to keep the government open at 1999 funding levels. But there's no guarantee the president will sign it; that gives him leverage.

In addition, both sides say they want to stay within the spending caps agreed to in the 1997 balanced-budget agreement and put billions of surplus Social Security revenues in a "lockbox" that can't be spent on other programs.

As if that weren't enough, Clinton will reportedly ask for another $12 billion in "emergency" spending. The Senate has already passed $7.4 billion in "emergency" farm aid, while the House wants an "emergency" $4.5 billion to pay for the 2000 census.

These goals could all be met if Congress and the president were willing to pay for new spending by cutting or eliminating wasteful and unnecessary federal programs. But the White House isn't interested, and Republicans show little willingness to make the tough choices involved.

Both sides have also squandered an opportunity to reform Social Security and Medicare. Such reforms would not only guarantee the programs will be there for future recipients; they would also go a long way toward ensuring that projected budget surpluses become realities.

If Congress and the president are willing, they can build a compromise around the following points:

*Reduce the GOP tax cut to $500 billion, which leaves plenty of room if those surpluses are smaller than forecast.

*Stick as closely as possible to the overall spending cap. Excess spending reduces future surpluses.

*Restrict "emergency" spending to real emergencies. Disaster and war relief qualify. Aid to farmers and the regular census don't and should be paid for with cuts in other programs.

*Don't pile obligations (like a drug benefit) onto Medicare until it is overhauled - and get reform going.

(c) Copyright 1999. The Christian Science Publishing Society