This sure is a strange town.
President Reagan, a landslide election victor partly because of his vows to balance the federal budget and cut government spending, has prepared a financial plan for fiscal 1983 that calls for a $91.5 billion deficit and a record $757.6 billion of spending.
And there are so many assumptions built into any budget--about what inflation will be, the rate of employment, savings and investment by the private sector--that the deficit could grow wildly if the president's economic forecasts are wrong.
A key to all of these assumptions is a human element that no economist or financial planner can assess adequately. It goes by different names, such as inflationary expectation, the psychological factor or consumer confidence.
Unless the tens of millions of American workers, consumers, industrialists and investors feel good about the future in some way, they won't do much but try to husband their resources and sustain the status quo.
Thus, many hours of research and interviews with Americans are conducted throughout the country virtually every day as business and government statisticians try to fathom the true state of the future by probing how we feel today about what we will experience in the future. It's as inexact a science as much that passes under that name, but Americans seem to love surveys and the surprising thing is that periodic consumer confidence polling has been remarkably accurate in tracking broad economic advances and declines.
Thanks to the University of Maryland, we have for the first time this morning such a survey for the Washington and Baltimore metropolitan regions.
The fact that a local institution is gearing up to provide such information on a regular basis is good news for Washington business, because of a dearth of regular economic data on this area.
But more interesting are the results of the initial consumer confidence survey confined to this part of the country. Mr. Reagan and his advisers at the White House will probably be perplexed to discover that Reaganomics seems to playing better here than in Peoria.
According to the University of Maryland public opinion sampling, more residents of the Washington and Baltimore areas think they will be better off financially a year from now than does the nation's population as a whole.
Also, compared with national surveys, fewer area residents expect their family incomes to decline and more think that now is a good time to buy.
Before the administration discards its anti-Washington, anti-government rhetoric, however, consider these apparent contradictions uncovered in the new survey: Far more Washington-Baltimore residents than in the nation as a whole expect the economy to get worse over the next year and fewer area residents expect interest rates to go down.
One conclusion from these findings could be that citizens in these parts expect national economic problems to remain critical but that the big Washington-Baltimore region, with its large concentration of government or government-related work, will suffer less.
Unemployment figures back up this conclusion. Currently, metropolitan Washington is suffering its highest rate of joblessness since World War II--5.2 percent of the work force, or 85,300 persons, looking for work. But that looks good compared with the nationwide rate of 8.5 percent. What does not look good is the jobs situation in the District alone, with an 8.6 unemployment rate and about two-thirds of all the area's citizens out of work.
A broad regional consumer confidence survey cannot pinpoint one jurisdiction like the District, because the sampling is not large enough. And one can assume that such a survey in the District alone would not reflect nearly as much confidence as the new College Park report shows for the Washington-Baltimore region, which includes the two cities, all adjacent suburban counties in the two metropolitan areas and Calvert, St. Mary's and Frederick counties of Maryland.
John Robinson, director of the university's Survey Research Center and the man responsible for using national sampling tools to develop a regional survey, says the occupational makeup of the region probably has something to do with the unusual mixture of attitudes--the greater optimism about one's personal financial future coupled with more pessimism about the overall economy.
With 5.5 million residents, the Washington-Baltimore region has the highest concentration of scientists and professional-technical employes in the nation. "The University of Michigan data national consumer confidence samples show that higher income respondents are more optimistic about economic situations generally," he said.
Robinson's team from College Park surveyed more than 1,300 persons in the region through telephone calls between Oct. 15 and Jan. 15. The sampling procedure is standard although the three-month survey period is probably not concentrated enough to get an accurate picture of the most up-to-date attitudes.
Mr. Reagan's latest concept of New Federalism is only a few days old, for example. And that plan includes a reduction of 150,000 in the federal work force over the next seven years. Although the impact on area government jobs is unclear, initial data reported in The Post's Business & Finance section by staff writer Thomas F. Dimond last week indicates that relatively few jobs here are on the chopping block. A total of 440 area federal government workers were fired between last Oct. 1 and Dec. 31.
Government reductions-in-force, or RIFs, will continue at a somewhat accelerated pace in the coming months, in any event, and the opinion sampling last October and November may not really reflect this reality.
This in no way should detract from what Robinson has started, since future surveys would be conducted over a much shorter period of time. "By using consumer expectation questions in the survey that are derived from recognized national surveys like the University of Michigan and the Roper organization, it will be possible to determine whether or how economic trends in the region differ from those in the rest of the country," he said. "We hope to be able to conduct future surveys in the region that will pinpoint consumer factors that are not available from government agency sources."
Robinson's initial survey, to be made public soon, was conducted for the Washington/Baltimore Regional Association, a group of business leaders in the D.C. and Baltimore markets who are promoting a common market. First National Bank of Maryland, a member of the organization, provided financial backing for the first survey.
Some specific questions and results:
Do you think that a year from now you will be better off financially; worse off financially, or just about the same as now?
Better off: 40% region; 30% U.S. (Michigan survey).
About the same: 41% region; 47% U.S.
Worse: 19% region; 20% U.S.
Do you think now is a good time to buy the things that you want and need, or a good time to wait, or someplace in between?
Time to buy: 31% region; 25% U.S. (Roper).
Someplace in between: 30% region; 29% U.S.
Time to wait: 39% region; 43% U.S.
In the next 12 months, do you expect the economy to get better, get worse, or stay about the same?
Get better: 28% region; 29% U.S. (Michigan).
Stay about same: 32% region; 41% U.S.
Get worse: 40% region; 27% U.S.