Why labor balks at balanced budget amendment

A rigid constitutional amendment that would require a balanced federal budget and that would restrict the taxing authority of Congress would be ''a serious threat to America's constitutional and economic well-being,'' the AFL-CIO says.

Such a proposal, backed by the Reagan administration, has cleared the Senate Judiciary Committee and is expected to reach the Senate floor before the summer recess. Its principal sponsors are Sens. Peter V. Domenici (R) of New Mexico, Strom Thurmond (R) of South Carolina, and Orrin G. Hatch (R) of Utah, conservatives who believe their legislation has ''real possibilities'' of being enacted.

They are counting on support mobilized by growing public -- and legislative -- concern over the country's budget deficits. Legislatures of 31 of a necessary 34 states have already adopted resolutions calling for a special constitutional convention to consider such a budget amendment.

Organized labor, which opposes the Senate legislation, is ''pretty confident'' that it can be blocked in the House if not in the Senate. To become law as a constitutional amendment the Domenici-Thurmond-Hatch proposal (SJ Res. 58) would require passage by a two-thirds vote in the Senate and House and then ratification by three-fifths of the states.

Although the AFL-CIO says it does not believe that this can happen now, it is ''taking no chances because of the potentially adverse impact passage could have on the economy,'' according to Lane Kirkland, president of the federation. Mr. Kirkland has sent letters to all members of the Senate urging repudiation of the proposal because of its inherent dangers.

An arbitrary constitutional mandate to balance the budget every year would ''immobilize congressional authority to use its fiscal powers -- taxing and spending authority - to abate such problems as depression, inflation, natural disasters, or other economic crises, each of which presents a different set of economic circumstances demanding a different kind of economic response,'' Kirkland says in his letters to senators.

Replying, the sponsors of SJ Res. 58 point out that under their proposal Congress could set aside a balanced budget requirement by a three-fifths vote in both the Senate and House, should emergencies arise. They also say that their proposed amendment would mandate ''fiscal responsibility'' by Congress and future administrations.

Kirkland also argues in his letters to senators:

* Those who drafted the Constitution carefully designed it to have a flexibility ''capable of meeting the needs of the people'' rather than as ''a meaningless repository of economic and social theories quickly outdated by shifting political trends.'' Kirkland says the Constitution would lose much of that flexibilitiy under the amendment.

* The amendment would ''in effect hand over to a minority of Congress'' power to block deficit spending for the public good, regardless of what the people want, by requiring a three-fifths vote to exceed a budget. According to AFL-CIO, ''Congress would diminish its role as the elected representative of the people in the development of economic policy.''

* Such a balanced budget amendment ''would have significantly deepened past recessions'' by taking away the authority of Congress to use its fiscal power to abate the nation's economic problems.