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From the White House point of view, the budget's key accomplishment was lowering the projected deficit to $29 billion. With the economy now in the fourth year of recovery and expansion, there really should be no deficit at all; but attempting to slow the flow of red ink is a move in the right direction. For that, Budget Director James Mclntyre deserves much credit. Unlike years past, when Carter involved himself deeply in the budget-drafting process and reviewed the document virtually line by line, this year he left the task largely to Mclntyre. The budget boss mainly succeeded in keeping new spending proposals by agency and department heads out of the package. With the President stressing the need for austerity, and Mclntyre and his staffers at the-Office of Management and Budget having what amounted to carte blanche to cut, Cabinet officers quickly realized that appeals to the White House over OMB reductions were pointless. At the Department of Health, Education and Welfare, for instance, one of the few new programs to survive OMB scrutiny was a $38 million plan for improving mental health services by the states, and, said one HEW official, "that was only because Rosalynn Carter chairs the President's Commission on Mental Health."
On the other hand, existing programs were not cut much at all. Total spending for HEW rises a bit more than 10%, to $199.4 billion next year, and the department's share of the budget grows fractionally to 37.5%. Similarly, at Housing and Urban Development, spending is up slightly more than 18%, to $ 10.6 billion. Boasted one HUD staffer: "We didn't lose one program that we didn't want to lose."
Some of the biggest and most controversial components of the budget are projected to climb most steeply of all. In keeping with a pledge that Carter made to the U.S.'s NATO allies last spring, defense spending will rise 3% in real terms, to $125.8 billion in fiscal 1980. Much of the increase will go for strengthening U.S. forces in Europe as well as for upgrading the nation's strategic arsenal of nuclear-equipped missiles, planes and submarines in order to improve the Administration's bargaining stance in the current SALT talks with the Soviet Union. Carter proposes, for example, to order the eighth submarine in the $21 billion-plus Trident program, in which costs have been shooting out of sight. He also calls for spending $237.5 million to continue development of the cruise missile system, which the Pentagon wants as a counterweight to the Soviet nuclear strike force.
Spending on the panoply of social programs also grows. The cost of funding for Social Security, welfare, food stamps, civil service pensions and other income-security programs leaps 13%, to $179.1 billion. The trend continues upward largely because expenditures for many programs rise automatically with the rate of inflation. Social Security, at $115.2 billion, is by far the largest single item hi the budget, and the reforms proposed by Carter would save only $600 million.