EVENTS ARE not going to leave the Reagan administration much time for debate and study of economic policy. The questions rolling toward it are going to be settled fast, one way or the other -- if not deliberately by the new administration, then by default. Within a matter of weeks, policy will be fixed on a course difficult to change. Mr. Reagan and his advisers are currently preoccupied with recruiting personnel. But they will need, at the moment they step into the White House, answers to three particularly urgent questions.
The first will probably be Chrysler, and the Reagan administration's position on aid to the automobile industry. Chrysler desperately needs another $400 million in federally guaranteed loans. But federal approval will be contingent on further concessions by the United Auto Workers, requiring renegotion of the existing contract. That takes time. Both the company and the union are anxious to get these loans approved before Inauguration Day, but that may not be possible. If not, Mr. Reagan's first substantial decision, as president, will be the survival of the Chrysler Corp. Even if this round of loans can be completed before Mr. Reagan arrives, the next application cannot be far behind it.
The second question will probably concern oil stocks. The industrial countries have exercised great restraint during the past three months, and that's why the war between Iran and Raq has not caused another wild leap in oil prices. But that restraint has required, among other things, drawing oil stocks down rapidly in the industrial countries. The war is apparently going to go on indefinitely, and sometime soon, perhaps around late Jaunary, the oil companies -- and the industrial countries' governments -- will have to decide whether to continue this rapid drain of their stocks. The alternative is to start bidding against each other for foreign supplies.
Mr. Reagan would be wise to lift all gasoline and crude oil price controls immediately, on the day he takes ofice. Beyond that, his administration will need to keep working closely with the companies and with other governments -- pursuing an actively interventionist policy -- to avoid panic. If the companies, and foreign governments, begin to think that Mr. Reagan is merely going to leave it all to the market, the market will respond as it did in 1979 when prices doubled. One immediate victim would be Mr. Reagan's own hopes for declining inflation and better economic growth.
The third of these questions concerns interest rates, driven to extraordinary levels by fears of higher inflation ahead. The lenders and borrowers who make up the financial markets believe that Mr. Reagan will cut taxes, but they do not believe that he will actually do much about spending. The most influential forecasts in the financial world all assume a federal deficit in 1981 as large as that in 1980. They foresee little or no improvement in inflation. If the Reagan administration can't act quickly to change that atmosphere, the prospect for low and stable interest rates will remain poor -- with somber implications for employment, not to mention oil prices and the future of Chrysler.