WASHINGTON -- Boston Mayor Raymond Flynn today proposed the federal government freeze all spending and consider raising taxes to cut the federal deficit, but President Reagan was reported to be 'strong as 10 pounds of onions' against any new taxes.
Flynn, representing the U.S. Conference of Mayors, rejected President Reagan's proposed cuts in federal revenue sharing, urban development grants, housing assistance and job programs.
'The history of my city tells me that it is the 42 percent of Boston families who are poor who will pay for these cuts; in the currency of dashed opportunity,' Flynn told the House Budget Comittee in prepared testimony.
Flynn said Boston used its revenue sharing funds for 24 percent of its police protection. He said without that money police service would drop.
Flynn said the mayors plan a trip to Washington March 26 to 'put forward the Conference of Mayors proposal for a freeze on all spending and the consideration of new revenue sources to bring down the deficit.'
Floyd Hyde, President of the National Housing Conference, a coalition of housing groups, called for across-the-board taxes as a way to reduce the deficit. Hyde rejected Reagan's proposals for increases in federal housing loan fees.
'The only way you are going to get out of this (deficit) is with an increase in revenues,' said Hyde, who told the committee he is a Republican.
Hyde said President Reagan's tax cut three years ago is largely responsible for the more than $200 billion deficit.
But Reagan sent a strong signal to Congress today that any attempt to use higher taxes to reduce the deficit will meet with a veto.
'Trading spending cuts for new taxes is absolutely the wrong answer,' White House spokesman Larry Speakes said. 'We have a blueprint for reducing the deficit. That's cutting spending. The committee should forget taxes and get down to the business of cutting spending.'
Speakes said Reagan remains convinced that 'nothing ... could do more harm to the American economy' than the imposition of higher taxes in an effort to cut the deficit, which is estimated to exceed $220 billion this year.
'If there is one thing he is adamant on, it is no -- and I repeat, no -- new taxes,' Speakes said. 'He is as strong as 10 pounds of onions on this.'
The Senate Budget Committee began its second week of deficit-reduction efforts hardly any farther down that road than they were a week ago and with the possibility of taxes looming in the distance.
After last week's work, the Republican-led committee was about $18 billion shy of Chairman Pete Domenici's goal of cutting $50 billion to $60 billion off the more than $200 billion in red ink in the federal budget.
The panel voted to save many 'middle class' programs that President Reagan wanted cut and decided to take a little more off the military budget than he wanted.
Still to be considered is the proposal from Domenici, R-N.M., that echoes Reagan's -- to end general revenue sharing of federal funds with local governments.
The Democratic-led House committee is finishing up its hearings on the budget this week and plans to start discussions next week.
Over the weekend, both Domenici, R-N.M., and Sen. Lawton Chiles of Florida, ranking Democrat on the committee, indicated the panel will have to look seriously at taxes if it is unable to cut spending.
Several of the Democrats on the committee have tentative proposals in hand that would raise selected taxes, though none touches personal income taxes. So far, Republicans have been reluctant to address the tax issue, citing Reagan's strenuous objections among other things.
Another touchy topic -- freezing Social Security cost-of-living hikes -- is also likely to re-emerge this week. Last week, the committee took three votes but failed to decide how to handle the item that affects 36 million Americans.
