WASHINGTON -- Congress may move its budget belt over another notch this year, but will not try anything major to reduce the near $350 billion deficit now that the House has defeated the balanced budget amendment, congressional observers say.

"I personally believe we have seen about all we will see this year" of attempts to adopt controls beyond the restraints of the 1990 budget agreement, said William Hoagland, Republican staff director of the Senate Budget Committee.

The House Democratic leadership and House Budget Committee Chairman Leon Panetta, D-Calif., will try to make good on their promises, often stated during the balanced budget debate, to legislate a new five-year deficit elimination regime, he said. But that effort is unlikely to succeed, he added.

"It's just not going to happen. We're too close to the election," Mr. Hoagland said. "There's no time and no forcing mechanism," such as the need for legislation to increase the national debt limit, which often becomes the vehicle for budget reform initiatives, he said.

The bond market should be "happy" that Congress is shifting into low gear on the budget, he added, since any contentious reopening of budget issues as the November election nears "could do a lot of damage."

Jeremy A. Gluck, economist with Mitsubishi Bank, said in Money Market Comment immediately following the House's narrow rejection of the balanced budget amendment June 11 that the vote "puts an end to any serious budget discussions until after the November elections."

But like Mr. Hoagland, he sees a silver lining for the bond market coming out of the congressional inertia likely to prevail for the rest of the year. Among other things, he pointed out, Congress is unlikely to authorize any further borrowing to fund thrift resolutions by the Resolution Trust Corp.

Because up to $100 billion of anticipated borrowing this year was thrift-related, the fiscal 1992 deficit is likely to be closer to $300 billion than the widely quoted $400 billion figure estimated by the Office of Mangement and Budget in January, he and Mr. Hoagland said.

Mr. Gluck sees the deficit reaching no higher than $330 billion because of the postponed thrift resolutions. The Senate committee's Republican staff last week also revised its 1992 deficit forecast down to $340 billion or lower for the same reason.

OBM Director Richard Darman, who has acknowledged the deficit will be lower than the earlier prediction, is scheduled to announce the agency's deficit revision on July 15. Mr. Hoagland says he expects OMB's new figure to be "pretty close" to the committee's esimate.

The dramatically lower deficit forecasts, while providing "no great solace" to a market already flooded with Treasury bonds, do mean that the Treasury will probably not run up against its $4.2 trillion debt limit any time this year, Mr. Hoagland said.

After OMB's January forecast, observers had widely predicted another debt limit increase would be needed this year, even possibly before the election. But Mr. Hoagland said that will not be in the cards before at least February because of the revised estimates.

Besides postponing a debate on the debt limit, the lower debt estimates also may help take the steam out of Rep. Panetta's effort to enact a deficit elimination plan this year, Mr. Hoagland said.

A House aide said Rep. Panetta has continued to meet with budget committee members to reach a consensus on such a plan. This week, they will address the sticky issue of whether to enforce the plan's deficit cuts, as Rep. Panetta has proposed, with automatic spending cuts and an income tax surcharge.

Besides spurring Rep. Panetta's efforts, the emotionally and politically charged balanced budget debate has had the side effect of making House members decidedly more budget-conscious, to the detriment of some key urban and infrastructure initiatives, said the House aide, who asked not to be named.

In the week since the amemdment was defeated, the full House voted to kill all but $34 million of $484 million of fiscal 1993 funding for the superconducting Super Collider. And not long before the vote, the House Government Operations Committee unexpectedly defeated a proposed $5.4 billion cash infusion for recession-strapped cities.

Conservative Democrats on the committee, who previously had been expected to support the emergency urban aid, switched their votes at the last minute in favor of budget austerity, the aide said.

The cut in Super Collider funds was not needed to comply with the budget agreement's stringent limit on domestic spending in 1993, and thus was a belt-tighening move, the aide said.

The immense energy research project fell victim largely because of the role its chief sponsor, Rep. Joe Barton. R-Tex., played as a prominent supporter of the balanced budget amendment, the aide said.

Rep. Barton's district houses the project. In the balanced budget debate, he pushed for a constitutional amendment that would have made it much more difficult to raise taxes, forcing Congress to balance the budget on spending cuts alone.

The House blow to the super Collider gives Rep. Barton and others like him a clear message to "put their money where their mouth is," the aide said.

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