Mending and Bending

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Reagan delivers a conciliatory message, but hardly an inspiring one

On the surface, the speech sounded accommodating, even statesmanlike. Instead of a partisan pitch to "stay the course," it stressed the need for a "bipartisan spirit" of unity. It offered compassion rather than rigid ideology to those suffering from the recession, and it had soothing words for women, blacks, the elderly and others who have felt slighted by the Administration. There was even what seemed a bold cure for the dozen-digit deficit plaguing the economy: a "freeze" on the overall level of Government spending.

Yet despite its comforting tone, Ronald Reagan's State of the Union address* last week provoked an immediate chorus of grumbles, not the least of which emanated from leaders of his own party. A cadre of conservatives led by Senator Charles Grassley of Iowa and Congressman Newt Gingrich of Georgia argued hat the so-called freeze should be applied more evenly across the board to defense is well as domestic spending. In addition, lamented Senate Budget Committee Chairman Pete Domenici of New Mexico, "even with a freeze, you've still got a big deficit problem out there." Senate Finance Committee Chairman Robert Dole insisted that food stamps and health programs could be cut no further and rejected Reagan's proposal to impose a stand-by tax of about $50 billion a year starting Oct. 1, 1985, if deficits are still more than 2.5% of the G.N.P, or approximately 5100 billion. Majority Leader Howard Baker also denigrated the contingency tax plan as an invitation to unrestrained spending, and added that the proposed increases in the defense budget would cause 'a real donnybrook, a ferocious debate."

With so many Republicans expressing skepticism, it hardly seemed surprising that most Democrats reacted with outright hostility. "He spoke of fairness," said House Speaker Tip O'Neill, "but insisted on retaining the third year of his unfair tax program and insisted on protecting the defense industry from the same level of austerity that he wants to impose on domestic programs." Indeed, if there was any bipartisan spirit, it was one of shared displeasure over the centerpiece of Reagan's State of the Union address: the budget he has submitted for fiscal 1984, which begins next October (see following story).

Even so, the President's pragmatic tone, and the fact that his plan leaves room for bargaining, should ensure that his budget will not be rejected out of hand, as was the dead-on-arrival plan he delivered to Congress last February. "The debate this year is going to be within the framework presented by the President," says his top lobbyist, Kenneth Duberstein. Hill leaders agree. But because Reagan's program includes so many unpalatable specifics, another grueling yearlong struggle over spending and taxes is surely in store. "The budget fight will be bloody and partisan," predicts Republican Congressman Dick Cheney of Wyoming.