President holds a firm line with Congress on budget
In his toughest language yet, President Reagan has told Congress that he will veto any move to raise taxes. Congressional leaders are searching for a way to salvage the budget-writing process instituted in 1974. In Paris, President Francois Mitterrand, anticipating the coming economic summit of Western industrial nations in Williamsburg, Va., charged that America is trying to make Europe pay for the US budget deficit.
Dominating the scene is a simple arithmetic problem: Unless something is done , the United States faces an annual $200 billion deficit. US recovery at home and in much of the rest of the world may depend on how this problem is solved.
Mr. Reagan began his nationally televised evening press conference Tuesday with a calm, confidently delivered statement. It was an ultimatum. No, he said, he would not yield to pressure for higher taxes unless he gets a recommendation more to his liking.
''The American people didn't send us to Washington to continue raising their taxes, spending more on wasteful programs, or weakening defense,'' he said.
As the President and Congress maneuver for position, the mood is being watched closely here. Reagan wants more money for defense, less for taxes; his opponents want faster movement toward a balanced budget by cutting defense spending and raising taxes. The President, they assert, is presiding over the largest deficit in history. Reagan says he's defending the nation against congressional ''big spenders.''
''It is time to draw the line and stand up for the American people,'' the President said firmly on television. ''I will not support a budget resolution that raises taxes while we are coming out of a recession. I will veto any tax bill that would do this.''
How much partisanship will enter the deadlock remains to be seen. Democratic leaders have received some support from Republican moderates. If the deadlock does not break, the budget-shaping machinery itself could be in jeopardy. House majority leader James C. Wright Jr. (D) of Texas called the President ''the biggest alibi artist ever to serve in the White House.'' House Speaker Thomas P. O'Neill Jr. (D) of Massachusetts stated, ''Presidents are supposed to correct problems, not complain about them.''
Washington has not seen a deadlock like this since the 1974 budget procedure was adopted. Reagan has quietly assumed the high ground that he is protecting the nation from congressional spendthrifts. In contradiction, some members of Congress quote the optimistic promises of Mr. Reagan when he took office to balance the budget and produce a surplus.
The world waits while Washington argues over its budget. President Mitterrand , at a conference in Paris with West German Chancellor Helmut Kohl Tuesday, declared that Europe should press America to put its budget in order. He blamed the world's economic difficulties on the US deficit, high US interest rates, and the high exchange rate of the dollar. These issues will inevitably come up at the Williamsburg summit later this month.
Many respected economic observers believe the industrial world is coming out of its recession, though less-developed countries are still overwhelmed with debt. They feel that much depends on America. Reagan contributed to the problem, some argue, with excessive tax cuts and enlarged arms expenditures.
At his press conference, however, President Reagan said he expects another cut in interest rates ''in the very near future.''