Viewpoint
The Battalion
Thursday
Texas A&M University
June 11, 1981
fnting of i
Slouch
By Jim Earle
“That was some dive, but why would he do it in the shallow
end?“
The economy plan is always
greener on the other side f
ith the prc
By DICK WEST
United Press International
WASHINGTON — There are times when
the current tax debate sounds something
like a lawn care manual.
President Reagan, as we know, says a
5-10-10 formula would make the economy
grow best. He recommends three tax cut
applications — 5 percent the first year and
10 percent the next two years.
While this is a switch from his earlier
endorsement of the 10-10-10 formula,
many congressional Democrats insist the
mixture still is too rich.
Democrats tend to favor just two applica
tions, although some would rather give the
economy but a single treatment and then sit
back and see what happens.
Both sides seem to agree it wouldn’t do
much good to fertilize with tax cuts as long
as the economy is overgrown with federal
programs. So the present plan is to spray
the economy with a powerful fundkiller be
fore applying 5-10-10 or any other tax cut
formula.
The theory is that thinning out federal
programs will give more desirable private
projects room to take root and sprout. And
maybe it will.
Anyway, the conventional wisdom is that
fall is the best time to apply a tax cut —
particularly in an election year.
The experts say spring applications may
cause the economy to grow too rapidly,
allowing inflation to spread and actually
weakening the root structure.
They say an economy that is shot through
with infaltion has less chance of surviving
longer summer periods of stock market
slumps and dollar shrinkage.
There likewise is a danger that interest
rates will spring up too high, preventing the
seeds of economic recovery from germi
nating.
But in the fall, the right tax cut formula
will promote healthy growth and put the
economy in better shape to withstand such
winter shocks as the Christmas shopping
season. Or so the experts claim.
The warnings we hear most often are that
Bji the lost i
of the state.
HWritten
plard B.
From Texas
I) Heritag
volume pub
H Series s
A&M Assoc
dents.
|The sig
for the
the 10-10-10 and 5-10-10 m ' x t ures «,
mainly enrich the upper end qftM k .. ,
nomy, leaving barren spots m the r| tor “yhei
and practically starving the lowereim ses tha
Democrats contend the altemaftlapply.
mulas they have proposed wouldlil Robinson
conducive to level growth. Hobjectiv'
a em P h
If there were a greening ot tab; j^g], sc hol
pay, that would be a pretty goodbe u
the formula would benefit the roittKinunity
of the economy. | interest t
But if a thick mat of inflation cliolf^
i . i ,i Mlie book
income gains and prevented their!*|
maturing into savings accounts, tkiBj est i IK j
be evidence the complaints abouttkaL. s truc
nistration formula were well taken |dh centu
1 personally feel more expeii®
should be done before Congressai®
administration finally settle on a tar.®
inula. I would like to see variousfoi®
tested on small patches of taxpayers!■
being applied to the economy as a„
Having some guinea pig tendenciL A AU
:
econ
that
the;
self, I would even he one ofthev
Reagan's staff uses
‘recycled strategies'
- Unitci
EOLLE
tie breeck
methods t
produce hi
By DAVID S. BRODER
WASHINGTON — One of the impress
ive things about. Ronald Reagan’s opera
tives is their shrewdness jn recycling strate
gies that have worked for them before. Evi
dence is found in the current propaganda
campaign that might be dubbed, “Son of
October Surprise.”
“October Surprise I” was drummed up a
year ago, on the eve of the convention that
would make Reagan the Republican pres
idential nominee. At that point, he was
ahead of President Carter in the polls, but
not securely so, and there was sharp con
cern in the Reagan camp that Carter would
exploit the power of incumbency to rescue
himself from defeat.
Particularly were the Reaganites worried
that Carter might try to time some foreign
policy spectacular like a Middle East sum
mit or a breakthrough in the stalled Iranian
hostage talks in the weeks just before the
election, thereby capturing the headlines
from his challenger and refurbishing his
own leadership image.
So word began coming from the Reagan
headquarters that they fully expected an
“October surprise” from the President. As
they later acknowledged, those statements
were not based on any inside knowledge,
but were designed to minimize the damage
from an event they could not control. And,
in fact, when the last-minute flurry of hos
tage talks did occur on the eve of the elec
tion, the Republicans were able to say, “We
told you so.”
“Son of October Surprise” was launched
last week by White House chief of staff
James A. Baker III. He volunteered the
observation in several meetings with repor
ters that he expected a backlash to develop
against the Reagan budget cuts this fall.
“I think you’ll see some fairly strong reac
tion to the budget cuts when they hit the
street in October or November, ” Baker said
in a meeting with reporters and editors at
the Washington Post. Later, at the White
House in a television interview, he re
minded listeners that the President had
said that curbing inflation would not be a
brief or painless process. Expressing con
cern about the impact of the backlash on
Reagan’s standing and leadership, Baker
said business, churches and volunteer
groups all would have to help ease the pain
that may be caused by federal program cut
backs.
It is easy to see what is worrying - the'
White House, but hard to judge how effec
tive the effort to discount the reaction in
advance will he. Budget-cutting has been
the most popular game in Washington this
winter and spring, but the effects of those
cuts may not be as popular around the coun
try this fall.
This autumn, prices of lunches in school
cafeterias' will go up — and so may the
number of kids crowded into a classroom.
Transit fares will be higher and so will the
cost of college-student loans — all because
of reductions in federal subsidies. City jobs
that have been filled by CETA workers will
have to be financed from local taxes — or
abolished. Workers losing private jobs will
have fewer unemployment benefits.
The likelihood is that many state legisla
tures will be in special session this fall,
readjusting the budgets they are not pas
sing, in order to cope with the 25 percent
cutback Reagan is imposing on many feder
al grant-in-aid programs. In many states,
the choice will be posed in politically cruel
terms — higher state and local taxes or a
real reduction in education, public safety,
health and welfare programs.
The impact of the cuts will be highlighted
in mayoral campaigns that will be taking
place in many of the major cities and in the
spotlighted gubernatorial contests in New
Jersey and Virginia.
At just about the same time, the House
and Senate will be going back over the
budget ground they covered this spring,
setting the final terms for fiscal 1982 spend
ing. If the Democrats are not completely
inept, they will find ways to link the Reagan
budget to the “backlash” Baker is predict
ing at that time.
Reagan’s great hope is that the recent
signs of easing inflation will not prove illus
ory — that the squeeze on state and local
budgets will be assuaged by relief on the
inflation front. But even so, the prediction
of a budget backlash is a sound one.
As usual the Reagan operatives know
what they are doing — and they are doing it
well.
Reagan guarded from budget backk
By HELEN THOMAS
United Press International
WASHINGTON — President Reagan is ex
pected to see some backlash from his
budget slash in the fall when the effects of
the cuts are felt, according to a top aide, hut
steps are being taken to assure Reagan does
not fall in the popularity polls.
Chief of stafff James Baker says the White
House already has a plan for handling the
situation. It will ask private volunteer
groups to help the needy whose assistance
has been severely diminished.
“We re not naive enough to think that
when the budget cuts become effective that
they will not be noticed out there,” he said.
Then he added that Reagan’s top aides also
“are considering ways to treat with that,”
and he does not believe that president’s
popularity will be dramatically affected.
“Were looking into the possibility of
ways in which the private sector can pick up
some of the slack through voluntarism
proposals, industry, church groups and the
like,” he said.
When it was noted that he appeared
more concerned about Reagan’s popularity
than the deprivation that some groups
might suffer. Baker said his popularity is
“important for him to be able to continue to
he able to get his programs through the
Congress and to build consensus and to
exert leadership. ”
Meantime, Reagan is in a glamorized co
coon, rarely speaking himself, hut permit
ting his top aides to make the hard hall
statements. Baker also has told the nation
that Reagan will probably run for re-
election to wipe out any problem of lame
duckism.
When Reagan himself is approached or a
question is shouted at him by reporters
from afar, he smiles broadly in a very
friendly fashion, waves and goes on his way.
All of his policies, actions and thoughts are
being conveyed by his staff, while he re
frains from news conferences and rare pub
lic utterances.
He has not held a news conference since
March 6, and more and more his aides have
blocked possible lines of communication
with the president himself.
Only once in a while, to the distress of
their ever watchful eyes, has a reporter
been able to approach the president
was true in the case of an Oval office pit
taking when Reagan met with troubla
ter Philip Habib, who had just retrj
from a Middle East mission.
Democrats and Republicans t
Hill, meantime, have been put on4
that to go against the popular presided]
be a way of ensuring their defeat at tli(|
in 1982.
Members of Congress said that in
ing support for his tax cut legist
Reagan assured some of the
Democrats that he “could not find ittj
conscience to campaign against you f
support my economic program.”
Later, his aides explained
the president was not talki
tuity and if they were on tl
on other programs he purs
off.
The same message has be
publicans who may stray
Warped
By Scott McCullar
The Battalion
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