The Senate United Means the Congress Divided
Following requests by the Armed Services Committee and Joint Chiefs of Staff, Republicans and conservative Democrats led by Senator Ernest "Fritz" Hollings raised Muskie's defense outlay target by $7.5 billion. To make room for this increase, they had to cut other spending. After a week of tough bargaining, SBC emerged on April 3 with a package significantly higher than HBC's on defense, lower on domestic spending, and equal on revenues. Foreshadowing its choices in 1981, the Senate committee protected veterans, agriculture, and defense programs. It
thus showed its natural bias, compared to the House, for the interests of smaller southern and western states and against the industrial Northeast and Midwest.[15]
Agreement between House, Senate, and president became less likely when, on April 28, Secretary of State Cyrus Vance resigned in protest of the April 25 aborted attempt to rescue the hostages in Iran. Needing support in Congress, Carter convinced Senator Muskie to replace Vance. Muskie's departure made Hollings, leader of the Democratic hawks, the new chairman of Senate Budget.
The Senate's plan, passed 68 to 28 on May 12, promised a balanced budget.[16] Barely. The next step was the House-Senate conference on the resolution.
Giaimo was willing to come up some on defense, but Hollings would hardly come down at all. Late on May 21, Giaimo agreed to $5.8 billion more in defense outlays and $10.5 billion more in budget authority than the House had allotted. He thereby lost support not only from Obey but also from a group of moderate Democratic budgeters (Representatives Timothy Wirth of Colorado, Leon Panetta and Norm Mineta of California, Richard Gephardt of Missouri, and William Brodhead of Michigan) who had supported him to that point. They joined Carter and O'Neill in urging the party to reject the agreement. Republicans could not resist the urge to torpedo a Democratic resolution. On May 29 the conference agreement was overwhelmingly defeated. Ignoring the arguments of Majority Leader Wright (and the Washington Post that the size of social program cuts had been overstated, most Democrats also voted nay, 146 to 97.
The budget resolution "was defeated last year," said Obey, "and there was no great harm done. The Senate simply learned it had to listen more closely."[17] But this time the message was immediately scrambled. On a motion by Delbert Latta, the House followed its rejection of the agreement by instructing the conferees to accept the resolution's high defense figure. In his thinking, Giaimo had been right that the House wanted more defense, but wrong that a majority would support more defense and a budget resolution. Flummoxed, he called the combination of votes "ridiculous." "When you vote down one resolution because it's too high on defense and turn around and instruct the conferees to accept the Senate defense numbers, it's questionable," he understated. "Now I've got two mandates."[18] It was May 29, and the first resolution had been due May 15.
Back to work went the conferees. If it had been a normal year, they could have added some more social spending, increased the deficit slightly, and made a deal. That was what they had done in 1979, changing the social/defense balance at the expense of the deficit. In 1980, however, the conferees could not "budget by addition" because they were supposed
to be "budgeting by subtraction" in order to balance the budget. The fact, obvious to all by early June, that they were not going to balance the budget anyway, did not make things better.
The participants had begun to discover they cared for other things besides the deficit. Yet they could not—partly believing in balance, partly believing in the value of public belief in balance—give up that idea. Instead, they added deficit and balance together, arguing that following their policy preferences would balance the budget. How could two "rights" make a "wrong"?