MISSOURI COMMENTARY: ENTITLEMENTS ARE KEY TO BUDGET CURE

Teachers will soon be handing out grades as the school year comes to a close. For Speaker Newt Gingrich's Contract With America, the grades would be straight A's for invention, strategy and implementation.

Those are the marks for the first semester -- the first 100 days. We are now in the second semester and here's where the heavy lifting begins.

The centerpiece of the contract is a balanced budget within seven years, by 2002. That was the essential, compelling pledge the Republicans made in the 1994 campaign. They promised, as prudent and conservative politicians, that they could better put our country's fiscal house in order than the spendthrift Democrats. That pledge, perhaps more than any other item in the contract, was the driving force of the Republican electoral upsurge.

Polls show that the American people want a balanced budget -- just so long as the cuts don't affect programs that they like such as Social Security, Medicare, college loans and grants, health research, the FBI, narcotics enforcement, immigration control, and a multitude of others. Polls also show that a majority of Americans do not want a tax cut if it means reductions in vital services like health and education.

So now in the second semester, Speaker Gingrich and his allies have to produce on cutting the deficit.

Already they have made their burden more onerous. They are pushing through a huge tax cut which is a very curious way to reduce the deficit. How you move to a balanced budget by decreasing revenues is beyond comprehension.

Social Security is "off the table." President Bill Clinton, Senator Bob Dole and all other politicians desiring to survive realize that most sacred of the sacred of federal programs shall remain holy and untouched.

Overall defense spending is for practical purposes also "off the table." Part of Republican dogma is that the Clinton defense cuts have gone too deep. It is unlikely that a Republican Congress will find big hunks of money to take out of the military budget to apply to the deficit.

The next huge money resource is Medicare. That's where Gingrich and Dole thought they might find as much as $250 billion to use for the march to the balanced budget in 2002. Medicare itself, we are told, goes broke in that same year.

Medicare is not as old a program as Social Security. It has not as yet acquired protected status so that, like a historic landmark, it must be preserved as is. But it's getting close. So when the senior citizen organizations realized that Medicare appeared to be targeted to pay for both the tax cut in progress and for a large portion of the deficit reduction, they screamed "foul." It was a scream that echoed clear across Capitol Hill.

Presidential candidate Bob Dole knew he couldn't run for national office as the enemy of the elderly. Gingrich saw that he couldn't hold together his House arm, all of whom face the voters' wrath in 1996. Gingrich regrouped. He promised not to cut a dime out of Medicare, but rather he would rework the program to "reform" it. Dole danced around "reform" too. The old voucher gimmick was trotted out as a possibility, but few Republican congressmen were ready to accept that one. Some even mentioned a dose of managed care ala Clinton.

Chairman Bill Archer of the House Ways and Means Committee said the Medicare problem was all President Clinton's fault. After all, Clinton knew about the Contract With America pledged to balance the budget in 2002 and also knew that the Republicans had pledged to cut taxes and had intended to cut some Medicare benefits. He should be a "leader" and tell the Republican Congress how to work itself out of its self-imposed dilemma.

What the Republicans want is political cover. There is no way you can cut taxes and reduce the deficit at the same time. There is no way you can balance the budget in 2002 or 2022 without constraining the growth of the entitlement programs. Every officeholder in Washington knows it, but none can risk saying it. Automatic entitlement growth is what provides the perpetual momentum for more spending and larger deficits.

So now the Congress is in the second semester, the grim task of actually cutting the budget. By the time the large programs are taken "off the table," reducing the smaller items won't do the job. As things stand now, with the big ticket items off the table, there will be no balanced budget in 2002 or any year thereafter. Fixing Medicare, fixing the deficit and simultaneously cutting taxes are incompatible traveling companions on the same bumpy road.

~Tom Eagleton is a former U.S. senator from Missouri and a columnist for the Pulitzer Publishing Co.