House Leaders Rebuffed in Vote on Budget Cut Debate : Foes See Peril to Joint Talks With White House

WASHINGTON — House leaders lost a crucial test vote today on a $23-billion tax and spending plan denounced as “flimflam” by critics who said they prefer an alternative being drafted in talks with the White House.

Lawmakers voted 217 to 203 against the debate rules, ignoring a plea from Speaker Jim Wright (D-Tex.) to back the measure as “honest to God deficit reduction.”

“What has been said here, Mr. Speaker, is there ought not be a quick rush to judgment,” House Minority Leader Robert H. Michel (R-Ill.) said after the vote.

Four dozen Democratic defectors joined 169 Republicans in voting down the rule and blocking consideration of the deficit plan.

Critics from both parties said they were afraid action on the plan would interfere with development of a compromise package being negotiated privately by lawmakers and White House aides and send confusing signals to Wall Street, which has been troubled by the high deficit.

Majority Rules

“I bow to the majority. That’s part of the business of this chamber,” Wright said after the vote.

He sent the legislation back to the House Rules Committee with instructions to break off controversial welfare reform provisions that some lawmakers said did not belong in the deficit reduction package.

House leaders said they will try again Friday to debate the measure.

During debate, Michel complained that the bill was put together “in a flimflam sort of way” and complained that the timing of today’s debate was a mistake because it could interfere with negotiations between the White House and Congress to find a compromise deficit reduction formula.

Conflicting Views

“This entire process should be junked,” agreed Rep. Edward R. Madigan (R-Ill.). “We should allow the summit process to continue.”

Rep. William H. Gray III (D-Pa.), chairman of the House Budget Committee, disagreed.

“We come today to put a down payment on deficit reduction,” he said. “There is no better time than now for us to begin a deficit reduction program.”

“It isn’t perfect,” Wright said, “but it is deficit reduction and it’s the first chance we’ve had. It’s deeds instead of words.”

The negotiations on a compromise, now in their third day, continued even while the House conducted preliminary debate on its own proposal.

Skeptical About Progress

Participants have consistently reported progress, but Chairman Jamie L. Whitten (D-Miss.) of the House Appropriations Committee was skeptical.

“I’ve read in the papers about the progress we’d made. I haven’t seen it,” said Whitten, one of the 14 congressional negotiators.

President Reagan received an update from his budget negotiators, who reported they were stressing spending cuts in the drive to reduce the deficit by at least $23 billion.

During a brief picture-taking session, White House Chief of Staff Howard H. Baker Jr. told Reagan in an Oval Office meeting that he wanted to let him know “the progress and state of the negotiations.”

“It sounds to me like you’re talking about the right issues,” Reagan replied.