Item Veto: Unexpected Effects

THERE is little in the ``Contract With America'' on which the Republicans in Congress and President Clinton are likely to agree. The item veto might prove to be the exception. Republicans have long argued that an item veto is an essential tool to guarantee fiscal responsibility. Presidents, regardless of party, have long agreed. As a presidential candidate, even Michael Dukakis, that arch-liberal, asked for an item veto.

The standard story about the item veto is that it would allow presidents to unpack congressional logrolls - compromise bills loaded with wasteful spending targeted at the districts of greedy legislators. The idea is that a president armed with an item veto will be able to remove the inefficient projects and keep only the parts he prefers. Ostensibly, these will be the parts of the legislation that benefit the country as a whole. This story might be true, but only if the messy compromise legislation is sent to the president in the first place.

The story fails to consider Congress's strategy: If the president has an item veto, compromise legislation won't be sent up Pennsylvania Avenue. This might suit some people, but do not expect either members of Congress or the president to be among them. Logrolls may be unpalatable because they represent compromise all around, but Congress passes them, and presidents grit their teeth and sign them, which suggests that both sides prefer them to no compromise at all. With an item veto, no compromise is just what we can expect.

Consider two policies - call them policy C and policy P, Congress's favorite and the president's favorite. Congress would like best to pass C, and would like least to pass P. The president prefers the opposite. Both sides would rather pass both policies - call this CP - than nothing at all. Without an item veto, Congress passes CP, the president reluctantly signs it, and both sides consider themselves better off than if no bill had passed.

Now add the item veto. The president cannot make a credible promise to abide by a compromise and accept policy CP. Congress knows that if it passes CP, the president will veto the C part and promulgate P. But this is Congress's least preferred outcome, so it will send the president nothing. There will be no compromise. Both sides will be worse off than they would have been without an item veto.

Think back to the mid-1980s and the protracted battles between Congress and President Reagan over aid to the Nicaraguan contras. When Congress provided contra funding, it was included in omnibus legislation that was otherwise entirely objectionable to the president and would have been vetoed had it not been attached to a program the president wanted badly. If Reagan had an item veto, then when faced with the omnibus legislation he could have eliminated everything but the contra funding. Knowing this, Congress would have sent no bill at all. As it was, neither side much liked the final policy. Perhaps it was bad policy. The broader point is that both Congress and the president liked the compromise better than they would have liked no legislation. And no legislation is exactly what they would have had if Reagan had an item veto.

BOTH parties are talking about cooperation, although no one expects to see much of it. The one thing on which both sides appear to be poised for agreement is the item veto. Yet the item veto could destroy the ability of Congress and the president to reach compromise - and to commit to compromise credibly - on a wide array of issues. The only thing voters seem to like less than messy compromise is policy deadlock.

The bottom line on the item veto is that the Republicans should be careful about what they give the president. And Mr. Clinton should be careful about what he asks them for. Because in this rare case, he might get it. The Opinion/Essay Page welcomes manuscripts. Authors of articles will be notified by telephone. Authors of articles not accepted will be notified by postcard. Send manuscripts by mail to Opinions/Essays, One Norway Street, Boston, MA 02115, by fax to 617 -450-2317, or by Internet E-mail to OPED@RACHEL.CSPS.COM.