A defiant President Reagan said yesterday that the recession has "begun to level out" and vowed that he would not retreat on his tax cut program despite increasing restiveness among Republican members of Congress concerned about the deficit.
"I would say that the president has not moved one inch," Senate Finance Committee Chairman Robert J. Dole (R-Kan.) said, after he and other Republican members of the panel had joined Minority Leader Howard H. Baker Jr. of Tennessee for a meeting with the president at the White House.
Reagan went from that meeting to a gathering of small-business leaders in the East Room of the White House where he gave a fiery pep talk, reminiscent of his campaign speeches, in defense of his economic program.
The president asked his audience a series of rhetorical questions, concluding with, "Would you agree we are on the right road to recovery and we should stick it out?"
The audience roared its approval. Reagan gave himself a mock slap on the face and said, "Thanks, I needed that."
On his way out of the room Reagan was stopped by reporters, one of whom asked his reaction to accounts that the recession was deepening.
"It has begun to level out," Reagan said. "That always happens at the bottom. You've got to have a curve before you turn up."
When another reporter observed that the Titanic had sunk even though its rate of decline had changed, Reagan made a sweeping curve with his right hand and picked up on the metaphor.
"The ship is afloat," he said. "It's just in the hollow of the wave and riding out for the next curve."
Some of the senators who met with Reagan yesterday left with the impression that the president had hardened his views. One Senate source said that the president had appeared "much stronger" in refusing to retreat than in previous meetings.
This was also the message carried out of the meeting for public consumption by deputy White House press secretary Larry Speakes, who said that Reagan was standing by budget cuts, military spending increases and his tax reduction program. Speakes, who has sometimes been vague about whether the "principle" of Reagan's program means sticking to the 10 per cent tax reductions scheduled to occur in July of 1982 and 1983, said yesterday that Reagan does not plan any change in the tax cuts.
"If there's anything the president is firm on, it's that tax cut this July and next July," Speakes said.
He also quoted Reagan as saying, in response to calls for modification of his program: "There will be no uncertain sound to our trumpet."
The comment appeared to reflect a hardening during the day of the White House position. Earlier, Speakes had called a proposal by Dole to do away with the 1983 tax cut and advance indexing of taxes from 1984 to 1983 "an interesting concept."
The Dole plan attracted some interest from congressional Democrats.
"I think it's something we should look into," said House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.). "I think middle-class Americans would be better off . . . . It's far more progressive than the proposal we have now."
In other developments yesterday relating to Reagan's economic program, thousands of college students lobbied Congress in protest of cuts in federal loans and grants for education. Some of them chanted, "Books, not bombs."
And Paul B. Simmons, deputy commissioner of Social Security, said the administration is "wide open" to any recommendations for changes in the system made by the National Commission on Social Security, providing they have bipartisan support.
"We wouldn't be dissatisfied with anything that comes out with bipartisan support that has a bipartisan chance of getting through Congress," Simmons told the House Budget Committee task force on entitlement programs.
Simmons said that the administration does not now support any freezing of cost-of-living increases.
"Our position is that we support COLA cost-of-living adjustments as now constructed," he said, adding, however, that the administration would be willing to consider changes that were supported by the committee and had bipartisan backing.