A funny thing happened to the Economic Development Administration, one of the Great Society's workhorses, on the way to the graveyard. The Reagan administration decided the old mare had a few more good turns left in her and put her back in harness.
Nothing could have pleased Reagan's bemused opponents on Capitol Hill more. "It's really marvelous. It looks like the administration is getting religion," chuckled Rep. James L. Oberstar (D-Minn.), chairman of the House subcommittee on economic development. "The president discovered EDA and that it's a good program."
That is an overstatement. But it is true that the president, on a trip to New York City last weekend, found it politically convenient to announce EDA grants of more than $5 million for two projects in the city. Two days later the EDA announced the unfreezing of 60 more EDA grants and guaranteed loans for projects totaling $70.8 million in 24 states and territories.
The White House hadn't bothered to clue in the generals in its war on spending. In two days of testimony last week, David A. Stockman, director of the Office of Management and Budget, and Commerce Secretary Malcolm Baldrige insisted there was a hammerlock on pending grants.
On March 11, Stockman told the subcommittee that the only time EDA funds would be released was "when a contrast has been signed and an obligation made." Other informal commitments wouldn't be honored, he said. "If we were to fund all these nonlegally binding letters or other indications that funding might be forthcoming we will not cut the budget for two or three years."
This kind of talk agreed Rep. Bud Shuster (R-Pa.), a staunch Reagan supporter. He said he was willing to go along with Stockman's proposals to do away with EDA, but warned if the OMB director didn't change the rules he was playing by, "support for the administration will evaporate quickly among members whom you otherwise would expect to support you."
The next day, Baldridge expanded the grant-giving criteria slightly to include old projects with cost overruns and ones that had received written permission to start construction. But he gave no hint that any projects would be unfrozen soon and insisted, "we have to draw the line or we will be in endless wrangling."
While Baldrige was testifying, however, Richard Williamson, assistant to the president for intergovernmental affairs, was in his White House office preparing a list of projects for Reagan to announce during his New York visit. The list was forwarded to Baldrige Thursday evening. The projects were all in the bureaucratic "pipeline," Williamson said, adding, "If we hadn't been making the trip to New York the timing of the announcement would have been different."
The largest New York project, a $4.5 million grant to buy the Brooklyn Army terminal, didn't meet the criteria Stockman and Baldridge had laid down. At least two of the other 60 projects, one in Louisiana and one in Pennsylvania, didn't either.
Everyone seemed to have his own explanation of what happened. Harold Williams, acting EDA administrator, claimed Stockman and Baldrige had simply been misunderstood. Shuster claimed the administration was bowing to requests from Republicans in Congress. Oberstar attributed it all to political expendiency. "I think it's good the president saw he had all these wonderful projects on the shelf and decided to pass out the goodies," he said.
"It's like one old southerner told me, 'Reagan knows what makes the old mare go,'" he added.
Danny Scott, a member of the economic development committee in Springhill, La., was simply confused. When he visited Washington late last week to lobby for a $1.2 million grant for an industrial park, he was told "our chances were practically impossible because all EDA funds were frozen."
He returned home crestfallen. Springhill, a town of 6,700 had been trying to get the grant ever since an International Paper Co. plant employing 1,600 persons closed three years ago. It had been a grueling and frustrating process, he said. "By the time all our paperwork was done they probably needed a two-ton truck to carry it to Washington."
On Monday, a letter from EDA arrived in Springhill advising civic leaders "don't get your hopes up." The next day, Scott was told by the office of Sen. Russell Long (D-La.) that the grant had been unfrozen.
"If you see whoever is in charge up there, tell them to mail our check before they change their mind," he said yesterday.