TWO ECONOMIC PROGRAMS now confront Congress -- one of them President Reagan's, the other the House Democratic leadership's. They are remarkably similar in general purpose. The differences are in method and theory, particularly in the tax cut. The outline of the Democrats' response was clear in the figures that Budget Committee Chairman James Jones brought out on Monday. Dan Rostenkowski, the chairman of the Ways and Means Committee, developed the tax proposal in considerable detail on Thursday, when he spoke in Chicago. Each of these statements is put forward in the name of an individual chairman, and each speaks hopefully of bipartisan support. But, taken together, they constitute a party position that is both explicit and constructive.
Simultaneously, in the Senate Budget Committee, the first signs appeared of Republican defections from the administration's position. For several members of the committee, the administration's supply-side theory evidently presents too great an affront to orthodox conservatism. The Reagan plan would cut spending and taxes by roughly similar amounts next year, leaving the federal deficit at approximately its present size until at least 1983. Having made speeches for years about the dangers of large and persisting deficits, the Republican senators are not unanimously persuaded by the supply-side strategists that they were wrong.
The supply-siders hold that tight restraint on the money supply will rapidly pull down the inflation rate, while the tax cut generates real economic growth to balance the budget. Orthodox fiscal conservatism suspects, gloomily, that the reverse will prove to be the case -- that tight money will pull down the growth rate while the tax cut generates more inflation. The supply-siders want a tax bill ensuring a succession of tax-rate reductions through 1984. Orthodox conservatism worries that the corresponding cuts in spending are going to get much harder as elections get closer.
The choice here isn't between any customary right and left, but between two types of conservatism. The Reagan administration has committed itself to the more adventurous and exciting of the two. The House Democrats seem to have taken possession of the position that represents tradition and experience.
The nation will measure the success of this year's economic program, Mr. Rostenkowski said, "by the rise or fall of the inflation rate." That's probably right, and on that he and the administration agree. The next question is which policy seems more likely to succeed without intolerable increases in unemployment and damage to social welfare. As a tax policy, the Rostenkowski alternative is far safer and surer than the Reagan supply-side plan.