European Stars And Stripes (Newspaper) - April 18, 1989, Darmstadt, Hesse                                Page 10 the stars and stripes  or. Budget pact a matter of smoke and mirrors As he announced his budget agreement with Luj Congress in a Rose Garden ceremony president Bush Al said it constr suied a first manageable step in resolving he dentil problem that has plagued the United Stales. Bui a first manageable step toward what the president and the Law makers have Given them Silvas a useful Bil of political cover in reaching an agreement minimal though it is by mid april. That has t been accomplished this Earty in years it will be harder now for Wall Street and foreign governments and Ordinary american voters to say us icy have grown used to saying that no one is doing Anvil inc. Bui the negotiators Haven t really Cut spending All that much of he $28 billion in red Ink thai has sup Posedly been banished Only a limited amount rep resents real savings. Most is to come from asset sales More efficient lax collection user fees and $5-3 billion in new lax revenues. Accounting gimmicks and one Lime expedients abound in the plan such As a Cut of s500 million in the food stamp program representing the Stamps Squirrel led away in mattresses and Lin boxes forgotten and presumably fated never to be redeemed. Even at that there arc a lot of economic assumptions involved assumptions thai sen. Lloyd bins Lori. The judicious Texas Democrat who Heads the finance committee is said to regard As wildly optimistic and even at that there is no agreement on How those new tax revenues will be found with Bush still insisting on his Campaign pledge of no new taxes and the congressional democrats Ever suspicious that icy arc to be cast As the villains of the piece the lax and spend bad Guys. Just As Bush got an agreement on Centra America by giving up something he could t have pushed through anyway military Aid to the rebels in Nicara Gua so he has won agreement on the budget by giving up his proposal for a reduced tax on capital gains another non starter. Tok Tough questions have in fact been finessed at k ast for the moment. This agreement does t do much for the budget or the deficit said Stanley Collin Der a budget analyst for Price Walc House one of the nation s leading account ing firms but it does a Greal Deal for the poli  the republicans emphasized the atmospherics. The president himself stressed once again the need for bipartisanship a theme he kept at the head of his Agenda even in the midst of the struggle Over the Nomi nation of John Tower As defense Secretary and he a Kari Felt that Friday s agreement helped in his Effort 10 rebuild Trust Between Capitol Hill and the while i Louse. Richard g. Armari the budget director asserted Paul Blustein that what he called a honeymoon ceremony in the Rose Garden was a notable accomplishment less than three months into a new administration especially if you think Back to where we were in october and no vember with the two parties extremely polarized with radically diff rent views on How to approach the whole fiscal  the problem with that View of course is that the honeymoon May be grounded in illusion and May for that reason and others be very Short. There is the immediate problem which is How to raise that Pesky $5.3 billion. The capital gains notion is apparently out largely because the democrats think it would increase revenues in the first year but Cost Money after that. Sen. Jim Sasser d-tcnn.,.chairman, of inc Senate budget committee said that it Halwo chances of passage by this Congress slim and  but neither he nor other democrats arc volunteering Many ideas of their own except things whose chances with Bush Are slim and none. Then there is the longer Range problem which is next year. Meeting this year s legally mandated deficit ceiling is relatively  the negotiators have just shown especially with the use of a few Handy budget gimmicks but in fiscal 1991  is Likely to gel a lot tougher. Not Only is the deficit ceiling lower but the areas available for cuts in spending arc being reduced by the cuts already made in the last several years. Sasser said that the next time we re going to have to Start looking for some  the political dynamics will be different next year Loo. All of the House and a third of the Senate will be up for re election and thus less inclined than Ever to take the blame for a tax hike. Soil would have been Caster All around it seems to have made the hard choices hit time Alan Greenspan chairman of inc Federal Reserve has been warning that any budget agreement had to be substantive if it was to convince the financial markets and the trading partners of the United Stales that this country had finally decided to re impose control Over its own economic destiny few economic and political professional even suggested that the Rose Garden pact met that Standard. Almost everyone no Rcd with House speaker Jim Wright who said it was not a heroic agreement and Many agreed with a leading Wall Street banker who called the Deal a matter of smoke and  Bush borrowing tactic from Nixon administration a Virv administration it seems adopts some technical sounding idea for making inc Federal government work. Belter. President Carter favored Zero based budgeting for the Kennedy and Johnson administrations planning programming budgeting system was the rage. Now the flush administration is dust ing Oltan approach that president Nixon brought to Washington management by objectives or mba. President Bush sent a memo to Cabinet secretaries and chiefs of major agencies asking them to give this mob Effort your personal at  mob is a big hit among the business school set. It sounds logical and sensible in theory. The idea is that executives should set goats and frequently Check thai Progress is being made toward them. The labor department for example might set a target of retraining i million workers by a certain Dale. Bui actually making it work Well that s another matter. The Nixon exp crime with mob for example did t exactly revolutionize the Way Washington functions. According vol John e. Chubb a senior fellow at the Brookings institution. Most departments kept doing pretty much what icy had been doing it generated a lot of paperwork to indicate to higher ups that their activities related to the objectives Chubb said. Not everyone agrees that inc Nixon experience was such 3 Flop but Bush administration officials say they Learned some lessons from in. For one  Stead of setting dozens of objectives As the Nikon administration did Bush is urging his managers to choose a handful. In his memo. Inc president wrote "1 request each of you to identify three to five candidate objectives that you be Lieve should be major priorities in your area Bush asked Cabinet members to submit these objectives by May t to Richard g. Darman director of the of fice of management and budget. The memo went on to say that bomb in conjunction with the White House office of policy development would help Bush select two or three objectives in each of your  then bomb and the White House will work with you and your staffs to develop appropriate tracking systems and Monitor Progress i achieving the selected objectives the official chiefly responsible for pushing mob is Darman a Harvard business school graduate and former faculty member at Harvard s Kennedy school of government Darman Long has maintained thai lop officials should focus on a manageable number of major goals and used the practice to Good effect when Hui was Deputy Treasury Secre Lary in the Reagan administration. It s a Good thing to do because it makes you think about what s More important versus a hat s less important said Hill Champion a professor who held senior posts in the Carter administration and in the Massachusetts state government under democratic gov. I Chad s. Dukakis. But a formal mob system has Pitfalls. Champion said. One danger is that peo ple gel so focused on inc objectives that they lose sight of other important prob Cimi. Another is thai you can make the system so complicated and time con suming Alt you do is destroy forests in Oregon by creating paperwork require ments. Frank Hotl Soll bomb executive associate director vows that bomb will avoid the mistake of imposing a uniform monitoring system. If for example a depart ment chooses an objective of. Gaining passage of a Bill the monitoring process will be rather simple he said if it chooses a numerical goal the process will involve quantitative measurements. Moreover Bush officials Hope that their mob exercise will Benefit from the Reagan administration s More Stream lined accounting system thai meshed 400 disparate systems in different agencies still experts arc sceptical said Chubb an awful lot of management reforms end up being  to Wii Hodiw foil