Injecting reality into Clinton's deficit plan.

• Author: Bresler, Robert J.

THERE COMES a moment in every administration when a president makes a decision that at best casts a cloud over his presidency, or at worst destroys it. For Lyndon Johnson, it was escalating the war in Vietnam; for Richard Nixon, covering up the Watergate burglary; for Gerald Ford, pardoning Richard Nixon; for Jimmy Carter, authorizing the Desert One rescue operation; for Ronald Reagan, selling arms to Iran; and for George Bush, reneging on his promise not to raise taxes.

Has that moment already come and gone in the Clinton presidency? It would be hasty to rush to such a judgment. It would not be too rash, however, to suggest the possibility. In the first weeks of the Clinton Administration, when his advisers were struggling over his deficit reduction proposals, the President made several crucial decisions: * He rejected the advice of his so-called "deficit hawks"--Office of Management and Budget (OMB) Director Leon Panetta and his top assistant, Alice Rivlin--to restrict the growth of the cost-of-living adjustments (COLAS) for Social Security. Instead, he accepted the advice of the "wiser heads" such as Treasury Secretary Lloyd Bentsen and bowed to the threats of the Senate Finance Committee chairman Daniel P. Moynihan (D.-N.Y.) to avoid a difficult political fight with the Congress and the American Association of Retired People (AARP). * After allegedly scouring the non-defense discretionary budget for "programs that do not work or are no longer needed" (the language of the Clinton budget message), the Administration only could come up with nine such programs totaling $6,500,000,000 over a five-year period. These included the elimination of Russian/Eurasian research, the Tennessee Valley Authority fertilizer and community development programs, and the State Justice Institute, as well as reductions in the Export Administration workload. The other cuts came under the heading of "charging fees for government services" (hardly a spending cut) and such vague categories as "streamlining government," "managing government for cost-effectiveness and results," and "technical adjustments." These usually amount to promises devoutly to be wished for and nothing more. * In the entitlement area, the legerdemain was no less cunning. Of the promised $99,000,000,000 in reductions during 1994-97, more than $20,000,000,000 are from increased taxes on Social Security benefits, $17,000,000,000 from promised efficiencies, and $7,000,000,000 from user fees. The...