"Outrageous"

New row over who gets what

"Outrageous and deplorable conduct." "The height of hypocrisy."

"He'd better wake up."

The object of all these choice phrases from the big, booming voice of South Carolina's Senator Ernest F. Hollings was none other than the President of the U.S. The chairman of the Senate Budget Committee was indignant because Jimmy Carter had just appeared to change his mind about the budget that Hollings had shepherded through a House-Senate conference committee. In the same week that Carter told the crew of the homecoming nuclear aircraft carrier Nimitz that he favored higher pay for servicemen (see cover story), the President also told a group of civic leaders that Congress's proposed budget provided too much money for the military. "He doesn't want a balanced budget," roared Hollings. "He wants a campaign budget."

Hollings' charge was not entirely unfounded -- it is, after all, campaign time --but the dispute was more complicated than that. The latest round in the budget battle began when hawkish Senators led by Hollings talked the House members of the Senate-House conference committee into approving $153.7 billion in defense spending for fiscal 1981, which begins Oct. 1 , or $5.8 billion more than the House had voted. To balance the increase, the conferees slashed $4.3 billion out of education and job-training programs, food stamps, aid to mass transit, assistance to help the poor pay fuel bills, and federal aid to cities. They also raised total spending by $1.5 billion, to $613.8 billion, which on paper would leave a hairline budget surplus of $500 million. (Actually, the recession is all but certain to throw the budget into a sizable deficit.)

Five of the eleven House conferees refused to accept the compromise, but the others thought they were following the President's wishes. True, the military totals were $3.2 billion above the $150.5 billion that Carter had recommended in March. But inflation is likely to raise the cost of buying the weapons that the President wanted more than expected, and Carter's call for an increase in military pay would cost at least an extra $1 billion. So they were astonished when Carter announced that the committee compromise gave the armed forces "more than we actually need" and cut back on "those very things [social spending] that would prevent recession from getting out of hand." White House aides urged the House to vote down the budget resolution and send it back to conference with instructions to trim military spending and put the difference into job-training programs, food stamps and aid to transit and cities.

Carter's objection got a quick response from House Speaker Thomas P. (Tip) O'Neill, who had reluctantly endorsed the committee compromise and then joined in opposing it. "I kind of vacillated a bit myself," he said. New York's hawkish Democrat Samuel Stratton, on the other hand, summoned the Joint Chiefs of Staff to testify before his House Armed Services Subcommittee on Investigations on Thursday morning, just before the scheduled floor vote. The chiefs usually support a President's budget recommendations publicly, whatever their private reservations. But this time they agreed --not very reluctantly--that they need and could use all the money the conference committee wants to give them.

Nonetheless, Carter got the liberal Democratic support that he had encouraged. On Thursday night the House voted down the budget resolution by a lopsided 242 to 141. Only 97 Democrats voted for it; 146 turned thumbs down. Republicans also voted against it, 96 to 44, in part because some believed there was no point in helping Democrats to produce a supposedly balanced budget that the Democrats could then brag about during the campaign. But the Republicans made the confusion total by slipping through a motion--passed after many Democrats had left the chamber--instructing the House delegates to a new conference to hold out for exactly the increase in military spending that had just been rejected.

The new conference will have to patch together some kind of further compromise. Meanwhile, the budget quarrel is delaying an extension of the time during which the Government can exceed the statutory ceiling on the national debt, needed soon if the Government is to continue paying its bills. At week's end the fractious Congress voted for an extension, but only for five days.

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