President-elect Ronald Reagan should take early, dramatic action to "turn the economy around," according to Sen. Robert Dole (R-Kan.) chairman-to-be of the influential Senate Finance Committee.
He supported the idea of declaring a national emergency, as suggested by Republican congressman and candidate for director of the Office of Management and Budget David Stockman (R-Mich.), but stressed that there must be "meat on the bones." In other words, Dole said, the new administration must propose immediate action on the economy and send specific measures on tax and spending to Congress as well as cutting spending as much as possible through executive order.
Speaking on "Meet the Press" yesterday, Dole refused to endorse or reject the controversial Kemp-Roth plan to cut tax rates by 10 percent a year for three years. Dole has earlier said that he fears the Kemp-Roth could be inflationary. He said yesterday that it would be his job to back what the incoming administration proposes, although not to rubber stamp whatever Reagan puts forward.
He indicated that he expected the Reagan administration to consult him and other congressmen on their tax plan, and suggested that the final proposal may not be for a straightforward Kemp-Roth.
When asked later what spending cuts he would suggest, Dole said, "I frankly have not come up with a list" yet. He and his staff are working on proposals that he will discuss with Reagan later this week.
Curbs on the growth in social security programs were one area of possible cuts, Dole said, although he did not spell out how these would work. He emphasized on television that the social security fund would need changes by February 1982 or it would risk running out of money. The senator also said, however, that people should not think that the new administration or Senate was "anti-people."
He mentioned three areas of tax reform where he would like Congress to act to help boost productivity and reduce inflation. These were tax credits linked to productivity, an increase in the exemption from income taxes of dividends and interest and tax incentives for savings.
Dole was reported to have played a part in stopping William Simon from becoming Reagan's Treasury secretary. He said yesterday that he hoped the new Treasury secretary was announced soon, and that he would be quite happy if it were Walter Wriston, chairman of Citibank.