Power Game (117 page)

Reagan had different motives for going along with the scheme. He was still trying to use high deficits to force Congress to cut the size of government. Many Democrats believed that Reagan had purposely built up the deficit as a leash on Congress. Indeed, Reagan compared dealing with Congress to a father cutting his son’s allowance to stop him from spending money foolishly. In his 1987 budget message, Reagan bluntly declared that “the deficit problem is also an opportunity—an
opportunity to construct a new, leaner, better focused, and better managed federal structure.” That is, to cut programs.

By late 1985, Reagan himself looked bad on the deficit. His strategists figured that endorsing Gramm-Rudman would make Reagan look better. Moreover, his aides told me, they reckoned Congress would never pass the bill, sparing Reagan from its impact. So, faced with steamroller support for Gramm-Rudman in the Senate, Reagan endorsed the plan on October 4, though he tried to deny its intent: He barred any tax increase, excluded Social Security, and insisted that he could still get defense spending increases. Chief of Staff Don Regan, who talked the president into buying the scheme, belatedly sent him a memo on October 4 warning that it could hit the Pentagon hard.
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But it is doubtful the president received or read that memo in time. Two cabinet-level officials told me that Reagan did not understand the bill’s impact on defense spending before he endorsed it.

Typical of blame-game politics, the president and most Senate Republicans were signing onto the plan for radically different motives. This had the façade of compromise. Reagan, like Gramm, wanted the automatic sheer to chop Democratic-style domestic programs. Most Senate Republicans wanted not only to cut domestic programs but to pressure Reagan to raise taxes and trim back on defense; twenty-seven Democrats felt the same way. On October 9, the Senate passed the plan by a 75–24 vote—as part of a bill raising the debt ceiling above $2 trillion.

Escaping Blame: Reverse Houdini

When Congress gets tangled in the partisan warfare of divided government, it often ties itself in knots. All sides resort to one-upmanship. That is what happened on Gramm-Rudman. The House Democratic leadership, initially stunned by the Senate vote, eventually put a reverse squeeze on Republicans. It was a case study in the legislative power game.

Old-line Democratic committee chairmen wanted to fight. The group that Tip O’Neill nicknamed the “old oaks” (Claude Pepper of Florida, Jack Brooks of Texas, Jamie Whitten of Mississippi, Peter Rodino of New Jersey, and John Dingell of Michigan) urged the speaker to kill Gramm-Rudman—to pass the debt-ceiling bill without it. They saw it as an outrageous, unconstitutional giveaway of congressional power to the president, because his budget director would get authority to decide when and how to carry out the automatic budget cuts.

But O’Neill knew the Democrats had no chance unless they were unified, and revolt was rippling through the rank and file. Democratic conservatives liked the budget-balancing purpose of Gramm-Rudman. Moderate Democrats feared looking passive on the deficit while the Republicans were billboarding a new panacea. Whip Tom Foley told the committee chairmen they were outgunned.

“You’re the toughest unit in the U.S. Army,” Foley kidded them. “You’re willing to take on machine-gun emplacements with your hands, kick the treads off Tiger tanks with G.I. boots.” But he warned them that it would take winning all the Democrats—”and you can’t get that kind of vote!”
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Within forty-eight hours, O’Neill had adopted a Democratic damage-control strategy: matching the Republican squeeze play. With two moderates in charge, Foley and Gephardt, the Democratic tactic was to endorse Gramm-Rudman’s goals and then revise its specifics. There followed two months of tense maneuvering. House Democrats eventually got agreement from Senate Republicans to suspend Gramm-Rudman during a recession. They also inserted provisions to protect Congress. Their plan provided that the Congressional Budget Office share with the budget director the power of deciding when to activate automatic budget cuts—and empowered the comptroller general (an agent of Congress) to specify the actual cuts. Those provisions got bipartisan support.

But House Democrats also played blame-game politics: a game of political chicken. They decided to expose the Republicans by tightening the Gramm-Rudman scheme to make the public howl at the cuts it imposed. “Let’s really make it hurt,” was the Democratic war cry.

“There’s no doubt there was a strain of partisan political vengeance,” Foley told me. “The feeling was, ‘Let’s get revenge on those bastards. They want deficit reduction—let’s give it to ’em early in the year so they’re gonna have to explain to their constituents why all these programs are cut out six months before the election.’ ”
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Gramm’s original bill had been a clever blame-game ploy. It gave Senate Republicans a partisan advantage—publicity for fighting the deficit in 1985 and 1986, but delaying actual cuts until after the 1986 elections. Democrats ridiculed it as a tactic to save Republican Senate seats in 1986. The Democratic countersqueeze was to make Gramm-Rudman bite into programs in early 1986, so that voters would feel the pinch before the 1986 elections and punish Republican candidates. To compound the political pain, Democrats also pushed for deeper cuts in 1986.

Foley, Gephardt, and company also made sure the axe would fall
fully on Pentagon spending and fought to exempt their pet social programs from automatic cuts. In the end, the Democrats spared a string of programs from Gramm’s guillotine: Social Security, veterans pensions, and such programs for the poor as food stamps, Medicaid, child nutrition, supplemental income for the elderly, and welfare for families with dependent children. Cuts on Medicare and four other health programs were limited.

Finally, the Gramm-Rudman law passed by large majorities, creating optimism in financial markets that the government was serious about licking the deficit. But the lopsided majorities were misleading. At the White House, officials admitted privately that they were counting on the law’s being ruled unconstitutional. Members of Congress filed suit.

Indeed, the Supreme Court ruled the automatic cutting mechanism unconstitutional, as the canniest White House and congressional strategists had expected. The Court saved the politicians from themselves, as some had intended.
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The Gramm-Rudman law had a fallback procedure: The automatic budget-cutting could take effect, provided that Congress and the president agreed. But that never happened; the blame-game rivals kept on arguing. Even if the Court had upheld Gramm-Rudman, the conflicting motives of Reagan, Senate Republicans, and House Democrats suggest there would have been endless maneuvers to avoid its full and fair implementation—because a genuine budget compromise had not been reached.

In short, the 1985 Gramm-Rudman act turned out to be not a model of political responsibility but an exercise in the politics of evasion. Not that everyone’s intentions were cynical. Many in Congress wanted to curb the deficit, and some worked hard to that end. But after President Reagan blocked the consensus approach, all sides vied to look good fighting the deficit, while using the fine print to protect their pet programs—thus perpetuating big deficits. Instead of the deficit declining, it shot up. The 1986 Gramm-Rudman target was $144 billion, but the deficit hit a record level of $220.6 billion.

Unintentionally, Gramm-Rudman became a metaphor for divided government. Because no one wanted to deliver any bad news to voters, the politicians invented a Rube Goldberg contraption that made the dirty work of cutting programs and raising taxes seem impersonal. Congress literally tied itself in knots. Barney Frank of Massachusetts called Gramm-Rudman a “reverse Houdini.” Houdini was known for miraculous escapes from impossible predicaments; Frank felt Congress was great at the opposite—locking itself into unbreakable deadlocks, so
voters cannot fault anyone in particular. That is what Gramm-Rudman did. It offered everyone from President Reagan to the most junior Democrat in Congress what politicians love—political cover: a way to look well intentioned but avoid blame for unpleasant action.

In late 1987, still at loggerheads with Reagan over the deficit, congressional leaders tried again. They revived Gramm-Rudman, but giving Reagan’s budget director power to activate the automatic cutting mechanism. The deficit target for 1988 was still $144 billion, two years behind schedule. Pressure was again on Reagan to raise taxes or cut defense, and Treasury Secretary Jim Baker accused Congress of pointing a “gun at his [Reagan’s] head.”
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Protesting loudly and insisting he would not raise taxes or cut defense, Reagan signed the bill. But the melodrama may have been overdone, for the bill was a watered-down version—postponing really tough action until after the 1988 election.

Conservatives such as Nebraska Democrat James Exon contended the new law was political gimmickry. “The entire Gramm-Rudman process actually delays serious action on the deficit,” Exon asserted. “Rather than force action, the Gramm-Rudman process fakes action.… After two years of operation, by and large, Gramm-Rudman has not worked. The new version of the law does not bring with it a new promise of deficit reduction. If anything, it pushes difficult decisions away from this Congress and President Reagan onto the next Congress and the next president.”
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Eventually, it took the 508-point nose-dive in the Wall Street stock market average to jolt Reagan into negotiations with Congress to make even a modest dent in the 1988 deficit. The long-term deficit problem was left to the next administration and the next Congress.

Gramm-Rudman remained on the books, less a solution to the problem than a symbol and symptom of divided government. It underscored the political deadlock at the heart of American government: the partisan division between Congress and the White House, created by voters. And divided government will continue to produce “sons of Gramm-Rudman” until there is leadership in both branches of government committed to genuine compromise, or until voters put a single party in charge of White House, Senate, and House for long enough to resolve such basic long-term problems as the deficit.

Voters like to blame politicians for the “mess” in Washington, as if voters themselves had no role in the problem. Yet obviously, what happens inside the beltway depends greatly on what the voters decide—on millions of people voting the “paralysis ticket.” For the root cause of divided government is rampant ticket splitting, which paralyzes government.

Perhaps the most important fact about the American political system today is that we have no clear-cut majority party. Our history shows that it usually takes a single party with a cohesive program and dominance in both Congress and the White House to run our political system. Yet today, neither party has such command. The Democratic party’s long hegemony has ended. Republicans have won four of the last five presidential elections, but no new Republican majority has replaced the Democrats’ New Deal coalition, because of the rise of independent voters. Today, we have two minority parties, and the equilibrium between them works against effective government.

A Republican takeover as the true majority party would have required a sea change at the grass roots. It has nearly happened, but not
quite—mainly because of split-ticket voting. It is true that America’s established voting habits have changed over the past two decades, even from Reagan’s first victory to his second. Important streams of voters in both North and South have defected from the Democratic party, but many of them did not become Republicans. Several times Republicans have felt a realignment within reach, but the electorate has not yet swung over. And its long hesitancy not only throws uncertainty over the 1988 election, but foreshadows more years of political muddle.

What marks the present political era is not a major political realignment but “dealignment”—the erosion of one majority without the formation of a new one, plus the simultaneous weakening of the party system.

We still use party labels as if they meant today what they have traditionally meant in American history, but they do not, and the difference is crucial. We talk about the rivalry between parties for the White House or control of Congress, as if they were solid blocs. The language is unchanged, but the reality of the party system—the nature of parties, their functions, their power, and their cohesion—has changed significantly.

American parties have always been looser coalitions than the more ideological parties of European democracies have been. Our parties are confederations of state parties, rather than unified, top-down national structures. Even in our most partisan Congresses, party-line voting does not nearly match the party discipline of major European parliaments. In America, it is considered a “party vote” when the majority of one party in the House or Senate opposes a majority of the other party. That permits large defections in both parties; by contrast, in the British House of Commons, it is quite rare to have even one defection from the governing party on a vote of consequence. Such discipline makes a vital difference for governing.