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May 09, 1980 - Image 5

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Michigan Daily, 1980-05-09

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The Michigan Daily-Friday, May 9, 1980-Page 5

Senate budget
plan to include
state portion of
revenue sharing
WASHINGTON (AP)-The Senate, Hatch (R-Utah) to cut spending in the
in the first break with its Budget Com- proposed $612.9 billion 1981 budget by
mittee's 1981 balanced budget plan, an additional $7.3 billion to guarantee a
agreed yesterday to restore $700 million business tax cut and no deficit.
to keep alive the state portion of Hatch argued that the deteriorating
revenue sharing. economy will push unemployment
By voice vote, the Senate approved higher than had been expected in fiscal
the partial restoration of the $1.7 billion 1981, throwing the committee's projec-
state revenue sharing program by ted balanced budget out of whack.
diverting $700 million in so-called "New economic forecasts of a
"categorical" grant money that nor- deepening recession show that this
mally must be used for federally man- budget is already out of balance," he
dated purposes. said.
Hatch's amendment would have cut
THE AMENDMENT, sponsored by the 1981 budget by 2.2 per cent across
freshman Sens. Nancy Kassebaum (R- the board, except for defense and Social
Kan.) and Bill Bradly (D-N.J.), puts Security. He said the extra reductions
the Senate in disagreement with the would allow Congress to approve tax
House which backed total elimination cuts to spur productivity and business
of the state revenue sharing program. investment while still balancing the
By cutting from "categorical" grant 1981 budget.
programs, the change avoids unbalan- However, Sen. Ernest F. Hollings (D-
cing the Senate Budget Committee's S.C.), who is managing the budget on
proposed $612.9 billion balanced budget the floor, urged the Senate to reject
for fiscal 1981, which starts Oct. 1. Hatch's proposal and wait until this
It also excluded from reduction summer to assess the seriousness of the
categorical grants to individuals, such economic situation.

as food stamps and Medicaid, and gran-
ts for education, mass transit, job
programs, community development,
pollution control, highway aid and sub-
sidized housing.
THE AMENDMENT would cut other
grants by 10 per cent. However, when
asked what grants would be reduced,
neither Bradley nor Kassebaum's of-
fice could specify which grants would
be affected.
The vote came as the Senate pressed
to complete work on its defense-orien-
ted 1981 spending plan and join the
House in approving the first balanced
federal budget in 12 years.
Senate Majority Leader Robert C.
Byrd (D-W.Va.) said he had hoped the
Senate would finish its version of the
budget last night so work could begin
reconciling it With the House package.
However, a long list of amendments
still to be considered made achieving
Byrd's goal doubtful.
BYRD CALLED on the Senate to ex-
pedite its budget debate, noting that
1980 money bills to fund food stamps,
black lung benefits, refugee aid and
other federal programs cannot be
passed until Congress adopts the
budget package.
In addition to setting 1981 spending
targets, the budget package would
raise the 1980 spending ceiling which
was breached in March and is preven-
ting approval of new federal spending.
The Agriculture Department has
warned that unless Congress approves
additional money for food stamps,
those benefits will be cut off to the
program's 21 million recipients on June
1.
EXCEPT FOR THE one amendment,
the Senate held to the balanced-budget
course set by its Budget Committee
despite conservative claims that a wor-
sening recession means deeper spen-
ding cuts are needed to eliminate the
deficit.
By a 53-39 margin, the Senate tabled,
effectively killing, a plan by Sn Orrin

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