A year of rare budget harmony between Congress and the White House is culminating with formal announcement of what the two camps have been working toward: There will be no automatic, across-the-board cuts in federal spending this year.
The Office of Management and Budget informed Congress on Friday that its final projection of the fiscal 1989 federal deficit is just under the $146 billion target. If that figure had been surpassed, defense and domestic spending would have had to have been cut by at least $10 billion.Such an amount might seem small given the $1.1 trillion federal budget. A cut of that size, however, would expose lawmakers and President Reagan to severe criticism, and avoiding such a spending reduction has been a major priority in Washington this year.
"Lots of people were disposed to avoid that," said Sen. Lawton Chiles, D-Fla., chairman of the Senate Budget Committee.
OMB's final projection for the 1989 fiscal year deficit is just under $145.5 billion. The fiscal year began Oct. 1.
If there had been $545 million more in federal spending, the Gramm-Rudman deficit reduction law would have required government expenditures to be cut by whatever amount would have reduced the deficit to $136 billion.
Because of delays in completing anti-drug legislation and other bills, Congress will continue working next week, rather than adjourning for the year Friday as planned.
That means that Congress could pass additional spending bills for fiscal 1989 that would add to the deficit. But under the Gramm-Rudman law, spending enacted after Oct. 15 - which is two weeks into the fiscal year - is not calculated, and there are no legal consequences to adding to the deficit after that date.
However, there would be political consequences.
OMB Director James C. Miller III - who leaves office today - wrote in his resignation letter that he was urging Reagan to veto any spending measure that would push the deficit beyond $146 billion, even though it would no longer set off automatic cuts.
"I urge you to maintain a commitment to deficit reduction during the final days of this Congress," Miller told congressional leaders.