Accuse Them of Failing to Build Public Consensus for Change : Officials See Danger in Candidates’ Silence on Deficit

HOT SPRINGS, Va. — Republican and Democratic budget-cutters warned Saturday that it will be difficult to muster support early next year for a major deficit-reduction effort because both presidential candidates are avoiding the issue and are failing to build the needed consensus for change.

The concerns were expressed at a meeting of top corporate executives here by the Republican and Democratic co-chairmen of a congressionally chartered commission set up to draft a federal deficit-reduction plan, and by the chairmen of the House and Senate Budget committees.

Panel to Offer Plan

The budget panel, formally known as the National Economic Commission, is hoping to propose a plan late this fall on which the new Administration--and Congress--could act soon after the next President takes office on Jan. 20.

The idea, endorsed by strategists from both parties and expected by the financial markets, is for the new leadership to use the political momentum to tackle the budget problem seriously.

But the co-chairmen--former Republican Transportation Secretary Drew Lewis and Robert S. Strauss, one-time Democratic National Committee chairman--warned that, partly because the candidates are not focusing on the budget-deficit issue, there still is not sufficient public awareness of the problem to pave the way for serious action in January or February.

“There has to be an awareness in this country,” Lewis said during a press conference. “Without support from the next President,” he warned, “Congress is not going to be willing to fall on its sword” to make the tough political choices needed to cut the budget effectively.

And Sen. Lawton Chiles (D-Fla.), chairman of the Senate Budget Committee, said the next President “is going to have a problem now convincing the people that they have a problem. How do you operate in a limited period of time?” to take advantage of the new President’s initial popularity, he asked. “You’ve got to convince the people that we need to act.”

Both Strauss and Lewis also sought to soften the impact of an assertion by Strauss two weeks ago that the commission was planning to recommend cuts in Social Security, Medicare and defense spending as part of any overall deficit-reduction scheme it proposes later this year.

His remarks, considered too controversial by some political strategists, were condemned by Vice President George Bush’s camp. Aides to Democratic candidate Michael S. Dukakis skirted the issue, but Dukakis was said later to have been distressed by the Strauss pronouncements.

Comments ‘Misinterpreted’

On Saturday, both Strauss and Lewis said Strauss’ comments had been “misinterpreted” last month, and that Strauss actually meant only to suggest the obvious--that any budget-cutting plan probably would have to involve “spreading the misery evenly,” including cutbacks affecting discretionary spending, federal entitlement programs and defense spending, along with possible tax increases as well.

Strauss, however, did not rule out or deny the prospect that some Social Security benefits might have to be restrained as well.

The two presidential candidates have been using a two-tiered approach to the deficit-reduction issue. Privately, both camps agree the new President will have to act quickly and forcefully to work out a budget-cutting compromise with Congress early in the term. But publicly, they have avoided proposing any specific plans, and Bush has said flatly he will not consider raising taxes.

House Budget Committee Chairman William H. Gray III (D-Pa.) lambasted Bush for “boxing himself in” by ruling out any possibility that he might go along with a tax increase next January, saying he has “not met too many people” who believe the United States can balance its budget without one.

Gray called Bush’s alternative plan for a so-called “flexible freeze,” which would hold current spending intact in hopes that the deficit would shrink gradually, “fiscal frozen fruitcake.”

Gray also criticized the candidates for avoiding the budget-deficit issue. “You are creating a situation where the next Congress will find it very difficult to come up with a lasting, permanent solution,” he warned.