The Carter administration has run virtually into a stone wall in its efforts to develop a viable anti-inflation program.
Although high-level discussions still are continuing, policymakers concede they do not know how to wind inflation down further.
Officials say the odds are that, despite the administration's hopes, the price spiral will not subside significantly from its present 6 to 6.5 per cent pace.
And while top advisers will not admit it publicly, the goal President Carter set last April - to trim inflation to 4 per cent by late 1979 - effectively has been scrapped.
The dilemma arises because policy-makers are caught in a box:
On one hand, the administration cannot afford to rely on the traditional way of winding inflation down - austere budget and credit policies that would worsen unemployment.
On the other hand, business and labor opposition has precluded any turn to formal wage-price restraints. Even Kennedy-style voluntary "guideposts" have been rejected.
It was last April 17 that Carter first announced a mild anti-inflation program - a 19-point package that most observers felt fell far short of his earlier pledge.
It was then that Carter set the goal of reducing the U.S. inflation rate to 4 per cent by the end of 1979. He also promised to develop a stronger program in coming months.
The administration's efforts so far have been limited. The Council on Wage and Price Stability, the White House watchdog agency, has set up a price-monitoring system.
But even that has been modest. And other plans to establish an "early-warning" mechanism to prevent new supply bottlenecks has been shunted to the Commerce Department.
A key White House effort last summer to "jawbone" restraint in steel prices was defied openly by the industry.
And other anti-inflation efforts have been eclipsed by political considerations. The President overruled his economic advisers on the farm bill and cargo-preference bill.
Barry M. Bosworth, director of the council concedes that the administration's efforts so far have been "almost exclusively" to prevent any further acceleration of inflation.
"They have not been aimed at unraveling the present inflation rate," he says.
Moreover, Bosworth admits "we can't come up yet with a workable program on how you go about unwinding the present spiral - at least, not that has any chance of succeeding."
Insiders say the administration is studying some proposals by Arthur M. Okun, the Brookings Institution economist for a quick cut in sales taxes to hold inflation down.
However, even Okun concedes that the sales-tax cut would be a "one-shot" approach - something short of the full-fledged "incomes policy" Carter has promised.
The stalemate is important because Carter advisers fear that unless they develop a sound anti-inflation program, it will heighten pressure on the Fed to keep money tight.
"It's not that the administration is unwilling to do anything," one planner says. "It's just that there's nothing we can see that really is comprehensive and viable."
Policymakers' oforecasts are, basically, for a continuation for the next 2 1/2 years of the 6 per cent inflation rate that has prevailed since last spring.