The possibility that Alice Rivlin may be Bert Lance's replacement as budget director is one clue that his departure from the Washington scene, now fervently desired even by his old friends, will by no means end President Carter's deepening troubles.
Economist Rivlin, director of the Congressional Budget Office, is being pushed for the Office of Management and Budge (OMB) by congressmen and labor leaders convinced that only dramatically increased federal spending can save the faltering economy. The end of Lance, they feel, is a golden opportunity for somebody - Rivlin, say - less committed to a balanced budget. Lance has vigorously championed the business community's view that opening the federal-spending taps invites disaster.
Not only will the coming economic-political crisis be more difficult for the president to handle without Lance, but he may have to do it in a political atmosphere polluted with suspicion and accusations. The President's mishandling of the Lance affair has whetted post-Watergate blood lust with talk of other coverups and claims that the Carter presidency is permanently tainted.
Lance feels the certainty of his departure may be a shade premature at this writing. "You won't believe this," he told a colleague early this week, "but I'm going to win this fight." However, nobody at the White House believes that, and one insider personally close to Lance puts it this way: "The President will fire him if he doesn't quit."
Assuming Lance is a goner, Carter must immediately face economic problems of a kind uncongenial to Presidents.
A mythology has originated among the administration's middle-level officials and spread into the press: The reason for the soggy, sluggish economy is Lance's successful opposition to an individual tax rebate and to heavy federal spending.
With lance partially immobilized the last six weeks, the spenders have attacked. The Department of Housing and Urban Development (HUD) is pushing a new budget whose excess over Lance's ceiling in the words of one OMB official, is "one of the biggest [that] people here have ever seen."
This may merely reflect the strongwilled Patricia Roberts Harris, Secretary of HUD, but the implications are wider. With Lance no longer the watchdog, HUD is coming up with spending figures that - if duplicated throughout the government - would transform Carter economic policy. Other departments will be watching closely.
Obviously, the ultimate success of Harris and her colleagues will be significantly influenced if not determined by who succeeds Lance. Rivlin is the choice of many in the bureaucracy and on Capitol Hill and has substantial support in the Treasury. White House aides report that Robert Strauss, the President's trade negotiator, strongly opposes that selection. But the political push will be toward a more permissive voice at OMB, whether the choice is Rivlin or not.
Indeed, that push is so strong that key Democratic operatives are certain that an un-Lanced administration will forsake a balanced budget and go on a spending binge before the 1978 election. But how to camouflage such a program to make it faintly palatable to the business community?
Some staffers at the White House and Treasury think a moderate "incomes policy" - wage and price guideposts - may be the answer. But here the camouflage may be worse than what it hides. Besides, Treasury Secretary W. Michael Blumenthal is adamantly opposed to guideposts.
A more realistic camouflage would be retaining Dr. Arthur Burns for two more years after his term as chairman of the Federal Reserve Board expires next January. There was no chance whatever of Burns's reappointment until the Lance affair, now, the White House is at least considering keeping Burns on as a reassurance to business that will be all the more necessary if the spenders take over.
To Bert Lance and business-oriented economists, the worst of all possible worlds beckons: heavy spending that will not cure unemployment while a compensatory tight-money policy at the Fed conducted by Burns drives up interest rates and depresses the bond market. Blumenthal and Strauss, who have been at odds with each other, are the only administration officials who might avert this course.
Fiddling over the Panama Canal while the economy threatens to burn, Jimmy Carter has shied away from the difficult questions of money. But what has been unpleasant up to now may become impossible when, having drawn first blood, the wolves determined not to let the Lance affair end so quickly descend on Carter.