Behind frequent hints of compromise in the great budget battle of 1982, a fallback strategy of confrontation is quietly evolving at the White House.
"We're either going to have a deal in a week to 10 days, or we're going to have a confrontation," one senior White House official said yesterday.
While outwardly optimistic that the budget bargaining sessions between congressional leaders and White House officials headed by chief of staff James A. Baker III will produce a package acceptable to both sides, administration officials privately acknowledge that a stalemate is possible. If this happens, they say, Reagan would revert to a confrontational strategy he practiced in his early years as governor of California and attempt to blame the Democrats for the failure of the proposed compromise.
This fallback strategy, which Reagan in election campaigns often has described as "making legislators feel the heat if they couldn't see the light," is the reason that the president persistently refuses to call the extended bargaining sessions "negotiations." They are only "discussions," Reagan maintains, and Baker is only listening.
Senate Majority Leader Howard H. Baker Jr. (R-Tenn.) dismissed this description as a fiction yesterday, saying, "You can't have that range of meetings . . . and not call them negotiations--they are negotiations."
But whatever the participants call them, Reagan's advisers are determined not to have the president prematurely involved in bargaining sessions that could propose such controversial provisions as a 4 percent income tax surcharge and limitations on cost-of-living increases for Social Security recipients. James Baker has called Reagan's involvement with an unsuccessful attempt to cut Social Security benefits for early retirees his "biggest mistake" of 1981, and it is a blunder that White House officials are determined not to make again.
House Speaker Thomas P. O'Neill Jr. (D-Mass.) has kept almost as great a distance from the negotiations as Reagan himself--and for much the same reason.
Democratic leaders are even more reluctant than Reagan to be associated with any restrictions on Social Security during an election year.
Sen. Paul Laxalt (R-Nev.), Reagan's closest friend in Congress, yesterday defended the distancing of both Reagan and O'Neill from the negotiations as necessary.
Laxalt is optimistic about the budget discussions, and he is believed to have urged Reagan to accept a compromise package if one is achieved.
The Nevada senator, who says that both Reagan and O'Neill "are flexible and are going to act in the national interest," is optimistic for largely negative reasons.
"It's going to be tough for all incumbents if the economy continues to deteriorate," says Laxalt, who is not up for election this year. "I think that's what's moving us to a settlement."
Christopher Matthews, administrative assistant to O'Neill, made much the same point.
"The reason that there is going to be a deal is that the consequences of failure would be catastrophic," Matthews said.
Reagan advisers see a compromise as preferable to the backup strategy of confrontation.
They think that the president is likely to get more than half the credit for any settlement and that he also will receive the larger share of blame if Congress is unable to agree.
"The name of the game is leadership," said one aide yesterday. "People are looking for solutions, not someone to blame."
Senate Finance Committee Chairman Robert J. Dole (R-Kan.) said yesterday that it would be "extremely difficult to accomplish anything" in Congress if the budget negotiations fail.
"People aren't going to want to be making cuts if all they're doing is reducing the deficit from $170 billion to $165 billion," said Dole. "If there's a package to bring it under $100 billion, that's another matter. If we fail, it's going to be a long, hot summer."
Despite these imperatives, White House advisers rate the chances of a settlement as no better than 50-50.
But if the negotiations fail, Reagan will try to blame the declining economic situation on his Democratic predecessors and his Democratic adversaries in Congress. At that point this could be the administration's only remaining political alternative.