Statement & Message to Congress on Budget Lesiglation

Statement on Action by the House of Representatives on Federal Budget Legislation

June 19, 1981

Forty-three days ago the House of Representatives joined in a bipartisan commitment to bring runaway Federal spending under control. That was an essential step toward national economic recovery -- toward reducing inflation, creating more jobs, and lowering interest rates. But that was only a step. It required faithful implementation by the committees of the Congress.

Now we are approaching a crucial test. Next week, the House plans to vote on the single largest economic and budget reform package in history. During recent weeks many House committees have made a good faith effort to help bring Federal spending under control. I applaud them for their efforts. But in two major instances, the bill that is emerging in the House Budget Committee has serious shortcomings.

First, many of the measures needed to curb automatic spending programs have not been adopted. These reforms would target programs more directly toward the truly needy while they help to eliminate waste and abuse.

Unfortunately, the House committees adopted only one-third of the savings that these reforms would bring. The result, if unchallenged, will be $23 billion in additional red ink and inflationary pressure in the next several years. Doing only one-third of the job is not good enough.

Secondly, certain House committees have not yet received the message of last November that the American people want less bureaucratic overhead in Washington and less redtape tying up State and local government. Consequently, these committees rejected my proposed consolidation of 88 duplicative, regulation-ridden Federal programs into block grants.

I believe we should permit many social programs to be administered by State and local governments -- which best know the needs of their people and the priorities for meeting them. Instead, some House committees want to hang onto the strings and Washington bureaucracy. This means extra administrative costs at the expense of services for people.

Our nation's needs are too important to tolerate this ``business as usual'' attitude on Capitol Hill. For these reasons, three leaders in the House earlier this afternoon announced plans to offer a bipartisan amendment that would fulfill the commitment of the original Gramm-Latta resolution. After consultation with Hill leaders, I have decided today to throw my full support behind this amendment.

This amendment will ensure:

-- that the budget reduction and reform goals adopted by Congress last month will be translated into new laws and concrete steps to implement my economic recovery program.

-- that the runaway growth of automatic spending programs will be contained and abuse of Federal programs eliminated.

-- that long overdue pruning of Federal overhead and redtape will permit social needs to be met at less cost to the taxpayers.

-- and that today's punishing interest rates and inflation will come down as Federal spending is brought under control.

The American people have waited patiently 8 months for a full-scale attack on runaway spending. Adoption by the House of the bipartisan Gramm-Latta amendment next week will be a major step toward ensuring that the will of the people is carried out. Let there be no doubt: We can and we will put a stop to the fiscal joyride in Washington.

Message to the Congress Reporting Budget Rescissions and Deferrals

June 19, 1981

To the Congress of the United States:

In accordance with the Impoundment Control Act of 1974, I herewith report 6 new proposals to rescind a total of $321.0 million in budget authority previously provided by the Congress. In addition, I am reporting 13 new deferrals totalling $220.1 million, and revisions to five previously reported deferrals increasing the amount deferred by $78.1 million.

The rescission proposals affect programs in the Departments of Agriculture, Education, Health and Human Services, and Housing and Urban Development as well as the Environmental Protection Agency. The deferrals affect programs in the Departments of Agriculture, Defense, Health and Human Services, Interior, and State as well as the National Foundation on the Arts and Humanities.

The details of each rescission proposal and deferral are contained in the attached reports.

Ronald Reagan

The White House,

June 19, 1981.

Note: The attachments detailing the rescission proposals and deferrals are printed in the Federal Register of July 1, 1981.