Scoring on a Reverse

With blocking from the democrats, Reagan wins another showdown

"When it came to the test, a bipartisan majority bit the bullet," said an exultant Ronald Reagan a few minutes after the votes were counted. Continuing his remarkable streak of legislative victories, the President had deftly corralled enough Congressmen of both parties into approving a contradictory but much needed correction to his economic policies. In retrospect, the 226-to-207 victory was hardly surprising: the President has made such miracles seem commonplace. What was out of the ordinary was the nature of the triumph. Reagan, who had come to Washington preaching a gos pel of tax cuts, had wrested from an election-edgy Congress a huge tax increase that is expected to raise $98.3 billion over the next three years.

In supporting a tax increase, Reagan caused a deep rift within his Republican ranks and fractured for the moment the conservative coalition that had formed the foundation of his previous successes. Only by appealing to the patriotism and good sense of his liberal critics was he able to carry the day. In so doing, Reagan somewhat lifted from the Democrats the political albatross of being the party of high taxes. His victory, however, showed that Reagan has developed a political skill that is far more important than whatever difficulties he created: the flexibility to modify his ideology and put together new coalitions. "All of us here to day are united by something bigger than political labels," he said last week as House Speaker Tip O'Neill, the florid av atar of old-style liberalism, stood by his side in the Americans." Rose Garden. "We are all Americans."

What caused Reagan to reverse field, with the economy essentially stagnant and nearly 10 million Americans unemployed, was a crippling fear that deficits over the next three years could reach $500 billion if no adjustments were made in his program. In order to keep at bay this looming behemoth and bring interest rates down, Reagan accepted the need to raise new revenues. This pitted him against some of his usually most ardent supporters, like Congressman Jack Kemp of New York, who argue the supply-side theory that only by reducing taxes can the economy expand. The dispute, said Kemp, was "a historic clash of ideas."