The situation now unfolding has no parallel in recent history. Senior associates of the president are conspiring with leading members of Congress of both parties to force the president to abandon his opposition to any significant change in his own defense, economic and budget plans.
The plot is well understood by all concerned, even though the president's adamancy has forced their discussion into underground and sometimes cryptic exchanges. Whether they can succeed in their effort, under these circumstances, is very doubtful.
Even before budget director David Stockman made his doubts public late last year in the interview with William Greider, two salient and interrelated facts were becoming clear to almost everyone except Ronald Reagan. The persistence of high interest rates--which the administration was powerless to attack directly--was distorting the economy, driving it into a severe recession, and almost certainly blocking any strong and sustained recovery. That fact undercut the hopes that a series of deep tax-rate cuts at the heart of Reaganomics would trigger an economic boom.
The rates were frozen at historically high levels-- despite the welcome decline in inflation--because of the widespread recognition in the financial community that the federal government could not finance its activities on the revenue base that was left after last year's presidentially encouraged orgy of tax cutting. For deficits to diminish in coming years, planned growth of all government spending, including defense and individual entitlements, must be restrained. And some of the squandered revenue base must be recaptured.
The official administration position is that the president cannot--and should not--move off his own budget unless and until Congress presents an alternative. That has a surface plausibility but, as a practical matter, it is a ruinously rigid stance.
The president's immobility is not benign. In public rhetoric, he is taking potshots at those who have recognized the need for politically unpopular steps like higher taxes and lowered benefits. In private, I am told, he has been "taking the heads off" those of his appointees and businessmen friends who have the temerity to suggest that his dogmatism is dangerous.
The result is that the process of negotiation between the parties and the houses in Congress and between Congress and the administration has been forced into backdoor channels. Realistically, the chances of the government's assembling a counter- budget against the vocal disapproval of the president are exceedingly slim.
The effort continues for one very simple reason: time is running out. If the budget cannot be rewritten this spring, in time to encourage an economic turnaround, then the advent of the election campaign will destroy any hopes of bipartisan cooperation on that project.
Even more compelling is the realization that a breakdown in the budget process this spring will in itself have serious repercussions. It will deepen the fears of staggering future deficits, put upward pressure on interest rates, abort the short-term recovery and quite possibly topple such big enterprises as to inflict long-term damage on domestic and international confidence in the American economy.
I have never seen a time when more thoughtful men and women in both parties were more concerned about the country's future. The president's aloofness from the process and his hostility toward those who are struggling to work without him put the heaviest burden of responsibility for future events on Ronald Reagan's shoulders. He is risking more than he seems to understand.