Statement of Administration Policy: S. Con. Res. 120 - Budget for U. S. Government for Fiscal Years 1987-89

While the Administration appreciates efforts by the Senate Leadership to improve S. Con. Res. 120, it cannot support increasing taxes, particularly to fund domestic programs that are no longer needed. Nor can it condone providing insufficient funds for the Nation's defense program for the second year in a row.

Although recent modifications in S. Con. Res. 120 did reduce the tax increase and raise the defense numbers somewhat, the claims of additional real savings in domestic programs are illusory. Rather than make real (net) cuts in programs, for the most part the modifications to S. Con.

Res. 120 just change the baseline and alter inflation assumptions. Although the Administration believes that such adjustments are appropriate as economic and other conditions change, they should not be mistaken for real reductions in spending.

Therefore, the Administration cannot support 5. Con. Res. 120 in its present form, but instead looks forward to working with Congress to produce a more acceptable Budget Resolution, particularly with respect to the parameters for FY 1987.