Democrats to fight badget

Press, 8 May 1982, Page 8

Democrats to fight badget

NZPA-Reuter Washington President Ronald Reagan, unable to get Congress to support his own 1983 Budget, yesterday heartily endorsed proposals by a Senate committee for a sharp' tax increase and cuts in social programmes to reduce huge Government deficits over the next three years. But the alternative budget, approved by the Senate Bud : get Committee, was unacceptable to Democrats, who control the House of Representatives. The House Speaker (Mr Thomas O’Neill) said that the Senate plan “contains many of the defects” of the Budget proposed by the President in

February. The House Budget Committee would start drawing up its own measures next week, he said. Mr Reagan’s approval of the Senate plan comes after weeks of wrangling between the White House and Congress’ over how to cut Budget deficits of a scale that threatened to keep interest rates high as the Government and industry competed * for funds. Current rates are regarded as a serious factor delaying an end to the recession. They also have dismayed America’s allies, forced in turn to keep their own levels high to .curb any outflow of funds into the United States dollar. ' ■ ’