President Reagan and his closest advisers are becoming increasingly frustrated by the failure of their economic recovery program to bring about an upswing and are beginning to talk of "other measures" if the recession persists.
White House counselor Edwin Meese III, at a dinner with reporters Tuesday, suggested that alternative policies might be considered to bring down interest rates if bankers and financiers do not respond when the budget is passed.
"We'll have to look at a variety of measures," Meese said. "It's better not to discuss it."
The White House yesterday attempted to counteract any impression that the administration intends to pressure the Federal Reserve Board to loosen the money supply or that there is any contingency economic recovery plan.
Presidential advisers say they think that acknowledgement of a backup plan would cast doubt on the program they are following and give the impression of inconsistency that they say they believe was the downfall of the Carter administration.
But there is no denying the gloomy mood pervading the White House as the performance of the economy fails to match their rosy predictions.
"There is no question that there's great, intense scrutiny of where all the economic indicators are by all the economic arms of the administration," one aide said. "And some of them are encouraging, but they are isolated still.
"Obviously we are looking for that ray of light . . . . No question, we'd like some sunshine beaming through by Labor Day."
The bewildering central problem for the White House is interest rates, which have remained high, choking off car and home purchases and reducing business investment, even as inflation has decreased sharply.
When he had the heads of major banks at the White House last week, Reagan tried the art of gentle persuasion, telling them he would work to reduce the budget deficit and that they could help him do that by bringing down interest rates a couple of points or so. But there is no sign that the message got through. Rates have not budged.
For the time being, the administration is continuing its elusive efforts to negotiate a budget compromise that will send the signals of fiscal responsibility that Wall Street says is needed to restore confidence in financial markets.
"Do you think we can resurrect the budget more times than Jesus resurrected Lazarus?" one aide asked.
But in a large sense, the more the administration gets what it wants from Capitol Hill, the more the White House is on the spot to deliver on promises that Reagan's program will work. Increasingly, there is the question at the White House of what if it does not work and the recession continues as the November elections near.
Reagan decided against supporting any recession-relief programs to aid private industry, although political aides had urged support for legislation on Capitol Hill to help the housing industry. But it is a topic of recurring discussion and a task force has been formed to watch such legislation closely and see if there is any reason for changing that policy. While bail-outs may bring political benefit, the White House does not regard them as cures for the economy.
The problem, as seen from the White House, is now largely one of the psychology of financial markets. Advisers suggest that bankers have the money, but are reluctant to lend it because of fears of a new round of inflation.
"There's a misperception as to how tight money is," one White House aide said.
Senior advisers said Reagan probably will continue to bring bankers and business leaders to the White House for talks.
The comments now coming from the White House indicate that in the coming weeks the efforts at persuasion might not be quite as gentle as they were last week.