Statement of Administration Policy: H.R. 2072 - Dire Emergency Supplemental Appropriations, Fiscal Year 1989

(House)
(Whitten (D), Mississippi)

The bill reported by the Appropriations Committee is unacceptable. The Administration does not support waiving the Congressional Budget Act for a bill that increases the deficit for discretionary programs in FY 1989 by $1.3 billion and in FY 1990 by $0.6 billion.- The Director of the Office of Management and Budget would recommend to the President that he veto the bill if it were presented to him in its current form.

The bill includes $2.6 billion in discretionary spending, with only $0.1 billion in specific program offsets. Over one-third of this amount is not for funding FY 1989 dire emergencies; instead it is simply forward funding of FY 1990 programs, such as $250 million in payments to individuals of Japanese ancestry interned during World War II; much of the $822 million for anti-drug activities; and, most of the $242 million for the homeless and public housing subsidies.

The Administration supports these programs and has requested funds for these in the FY 1990 budget. However, consistent with the Bipartisan Budget Agreement of 1987, the President proposed only those supplemental that were considered dire emergencies. Moreover, the President included almost $1 billion in proposed offsets to ensure that the net effect of Executive Branch discretionary requests would not increase either the FY 1989 or FY 1990 deficits.

The President and Congress have recently reached agreement on substantive deficit reductions for FY 1990. It is fiscally irresponsible to, at the same time, add substantially to the deficit in FY 1989 and FY 1990. The FY 1990 outlays will make discretionary ceilings much more difficult to attain. This is a bad first step towards meeting the FY 1990 Gramm-Rudman-Hollings target.

We understand that Chairman Whitten will offer an amendment to strike about $1.0 billion from the Committee bill. While this amendment is an improvement to the Committee bill, it does not go far enough. The Administration opposes the FY 1989 supplemental of $822 million for anti-drug abuse programs included in the Committee bill.

Total anti-drug funding increased from $3.8 billion in FY 1988 to $5.3 billion in FY 1989 — a 39 percent increase. Much of this newly provided funding (including $1.0 billion provided in an FY 1989 supplemental last fall) remains unobligated.

As the President demonstrated in his May 15th address on combatting violent crime, he is committed to strengthening the nation's criminal justice system, a critical part of our war on drugs. This commitment does not mean though that the President will forgo the war against the deficit. The $1.2 billion that the President requested for FY 1990 can be accommodated within the overall domestic discretionary spending cap set in the Bipartisan Budget Agreement. Amendments that would add FY 1989 funding for drugs without valid offsets from domestic discretionary programs would be a blatant attempt to circumvent the budget agreement and are not acceptable.

The House Committee bill, as amended by the Whitten amendment, would increase the FY 1989 deficit by $1.1 billion for discretionary programs. Only $.2 billion in offsets are provided for $1.8 billion in new budget authority for discretionary programs. If the Supplemental is passed without striking the $.8 billion in budget authority for drug programs, or offsetting the increased drug spending from domestic discretionary programs, the. Director of the Office of Management and Budget will recommend to the President that he veto the bill.