Mayors Call Reagan Budget Devastating : Say It Could Create ‘Two Societies: One Rich, One Poor’

CHICAGO â€”  President Reagan’s proposed 1986 budget would be devastating for American cities, and if passed could create “two societies--one rich and one poor,â€� the president of the U.S. Conference of Mayors said today.

New Orleans Mayor Ernest Morial also said the proposed budget would prevent people from moving into the middle class and create the potential for street uprisings reminiscent of the 1960s.

Reagan’s $973.7-billion spending plan, which carries a projected $180-billion deficit, was unveiled last week.

Morial and nearly 20 other members of the executive committee of the conference met in Chicago to discuss the impact on the cities of Reagan’s budget proposals and a strategy for opposing them.

More Meetings Planned

Similar meetings are planned in Boston, Atlanta and San Francisco in the next two weeks.

Morial said at a news conference that the mayors’ group had analyzed the proposed federal budget and “in the name of deficit reduction, the budget would cut or eliminate nearly every federal investment of benefit to our cities.�

He said if the federal budget proposals were to pass for fiscal 1986, the real-dollar loss in important federal urban programs since 1981 would be 80%, and even more if inflation were taken into account.

Milwaukee Mayor Henry Maier said urban mayors already are having a difficult time keeping cities running, and their problems would be intensified by “the disaster posing as a budget proposed by this Administration.�

Raised Taxes 19 Times

He said that in his last 24 years in office, he has had to raise taxes 19 times to provide needed city services.

The Reagan Administration is threatening to take away the “pittance� it contributed to fighting the physical decay of the cities, he said, while maintaining what he called a bloated military budget.

Chicago Mayor Harold Washington said his city’s budget office estimated that if Reagan’s budget passed, Chicago would lose $307 million in direct funding in 1986--or nearly half the city’s federal funding.

Washington said that in 1986-88, Chicago would lose more than $1 billion, or more than 14% of the operating budget.

2,000 Layoffs Feared

That would force layoffs of nearly 2,000 workers, severe cuts in community development, and mass transit fares could be increased by 50%, he said.

“If these cuts go through, we’ll have to go to the taxpayer or cut back on vital city services,� Washington said. “They (the federal government) want to return programs back to us without returning requisite dollars.�

Morial said that the Administration was trying to sever the partnership between the city and federal government and give up effective programs such as general revenue sharing, urban development action grants and public transit block grants.