President Reagan carried the campaign for his version of income tax reduction to the citadel of his opposition tonight in a speech that also reflected his growing touchiness over criticisms of his foreign policy.
Reagan spoke in the home city of Chairman Dan Rostenkowski of the House Ways and Means Committee, author of the Democratic alternative to the president's proposal for a 25 percent interest tax rate reduction over a 33-month period beginning Oct. 1.
The Democratic bill calls for a 15 percent cut over three years. Reagan maintains this would not keep up with an anticipated 22 percent increase in the inflation rate during the same period.
"In other words, the present choice is between out tax cut or no tax cut at all -- indeed, a tax increase," Reagan said.
Before he reached his familiar economic message, however, Reagan took pointed issue with press criticism that he has been inattentive to foreign policy and hasn't made a major speech on this issue since he became president.
"Well, to begin with, I just don't happen to believe it is necessary to spell out in detail and in advance a formula which will guide our every move in international relations," Reagan said. "Basically, good foreign policy is the use of good common sense in dealing with friends and potential adversaries. We know where we're going and think it might be counterproductive to make a speech about it."
Reagan contended that his administration had brought the nation nearer to peace and security by laying the foundation for "a long-range buildup of our military forces," and that it had improved relations with the European allies and Japan.
The president also said that the Middle East mission of special envoy Philip Habib had "helped to avert war." And Reagan made these additional claims for his foreign policy achievements:
"In southwest Asia we have reinvigorated our strategically important relations with Pakistan; in southern Africa we have initiated work on a realistic Namibian solution, and in the Caribbean we have launched an effort to attack the root causes of instability while we are making it clear the United States will not tolerate interference by Cuba with the lives and freedom of other nations."
These were some of the answers Reagan's advisers had wanted him to give June 22 when he was asked in a press conference why he hadn't given a major foreign policy speech. Instead, the president fumbled the question and wound up listing the world leaders who had visited him.
Although the major portion of his speech tonight concerned the economy, foreign policy seemed to be very much on Reagan's mind. He even reached for an unusual foreign analogy while lecturing on his favorite topic: that countries that rely on heavy government intervention in the economy inevitably suffer a downfall.
"Such a government-dominated economy can only be a withering economy," Reagan said. "We need only look around us for evidence. What is happening in Poland today is a classic example. There are probably few people as strong and as valiant as the people of Poland, and yet their economy is described as being in a vicious, downward spiral."
"That isn't the fault of the Polish people," Reagan said in a city that has more people of Polish decent than any community in the world outside of Warsaw. "It is the logical result of an illogical system -- a system that has no trust, no belief or faith in people. And when government has no respect for its citizens, citizens lose respect for government."
Reagan's speech to the $250-a-plate dinner raised an estimated $1.3 million for the reelection coffers of Illinois Gov. James R. Thompson, who will seek a third term in 1982.
In the audience were the parents of press secretary James S. Brady, who was severly injured in the March 30 attempt on Reagan's life.
"Jim Brady should be here," Reagan said. "Jim's parents are here. I talked to him just before I left. He's getting better every day. His job is waiting for him, and we miss him very much."
While Reagan spoke, a crowd of demonstrators, estimated by police at about 5,000, gathered outside the hall and chanted in cadence: "Ronald Reagan, he shall be removed." Inside, seven persons were arrested when they created a disturbance and refused to leave.