Correspondents' Correspondence

...The Democrats have room to maneuver in the area of defense As even those most fearful that the Russians are coming in the near future recognize, the Pentagon already is having trouble spending the sums now appropriated It is unlikely that a small reduction in the large increases projected by the White House would actually affect feasible outlays In urging the restoration of some funds for Great Society programs, the Democrats are displaying their traditional compassion and simultaneously reaffirming their detestation of fraud, waste and mismanagement-an unholy too whose friends are hard to locate...

...Unfortunately, the Democrats have based their proposals on assumptions similar to, if not identical with, those underlying the Reagan program Here is the fatal language "A national consensus has developed behind slowing the growth rate of Federal spending, reducing the size of government, including its maze of regulation, and providing tax relief to those w hose taxes have grown because in nation has forced them...

...Similarly, it is highly unlikely that a successful anti-inflation policy can function without an incomes policy in the shape either of mandatory wage-price controls or an experiment with tax rewards to unions and corporations who behave responsibly and tax penalties against those who do not Sidney Weintraub has on several occasions persuasively analyzed the merits of such an approach in these pages The Democrats do finally concede its importance, but they are not ready to bite the bullet...

...The manifesto has content in addition to symbol Quite sensibly its authors reject government spending as I he single cause of in flat ion and cite among...

...into higher tax brackets " And although little is mentioned about money for defense, it is plain that the Democrats support larger Pentagon appropriations as fervently as the Republicans...

...Once these proposals reach the floor of the House, however, Southern Democrats may join Republicans to oppose them Assuming the Democrats stay together against the odds, the final legislation will still almost inevitably be written by a conference committee confronting substantially different spending and taxing plans from the two legislative chambers...

...Nevertheless, House Democrats appear to have scored points as practical politicans Their rejection of keep-Roth is cleverly clothed in anxious rhetoric about projected large del Kits in the 1982, 1983 and 1984 budgets-precise-Iv the reason why three very conservative Senate Budget Committee Republicans voted to reverse earlier approval of figures consistent with Administration plans Hints hang in the air that the Republicans will eventually compromise on a two-year schedule of tax reduction...

...But while the House Democrats are tactically far more adroit than their Senate brethren, it would be a mistake to assume they possess the courage of their own economic diagnosis One need not agree with their assessment of the need for added defense dollars, for example, to observe that if the Soviet threat is to be taken seriously, piling up military hardware is a seriously incomplete response The shortages of personnel that leave the Navy in particular seriously undermanned can probably be remedied only by restoring the draft, yet the Democrats have not so much as raised this thorny subject What is more, inflation in the military sector is currently running at twice the general rate Accordingly, serious attention to the problem within the context of rearmament would seem to call for a postponement of any tax cuts until inflation is genuinely subdued...

...In the skilled hands of Oklahoma's James Jones, who endured basic training in Lyndon Johnson's tough Great Society White House, and Chicago veteran Dan Rostenkowski, a graduate cum laude of Richard Daley's legendary Chicago machine, the Democratic statement of principles has been translated into marginal shifts in 1982 budget expenditures as well as more substantial alterations in Republican tax proposals The Pentagon would collect $4 4 billion less, with the funds to be diverted to some of the social programs assaulted by Budget Director David Stockman On the tax side, the Democrats want to substitute a one-year slash in levies on business and personal income for the three-year Kemp-Roth sequence of 10 per cent annual reductions The one-year approach would raise disposable consumer income to a total of $40 billion, instead of the White House three-year total of $54 billion Moreover, a smaller percentage of the benefits would flow to high income tax-payers and a commensurately larger proportion to families in the $20,000-$50,000 range...

...Correspondents' Correspondence BRIEF TAKEOUTS OF MORE THAN PERSONAL INTEREST FROM LETTERS AND OTHER COMMUNICATIONS RECEIVED BY THE EDITORS The Democrats' Response New York by the time Ronald Reagan returned to the domestic battlefront, the Senate budget debate had deteriorated into squabbling between Republican "moderates" eager to go along with the White House and true primitives out of the Sunbelt who cry for deeper spending cuts and smaller budget deficits In the House of Representatives, by contrast, the Democratic majority that still survives had offered a measure of reassurance about the durability of the two-party system...

...On April 8, House Democrats agreed upon a statement of "Democratic Economic Principles " To note the obvious first, it is something of a triumph for Speaker Tip O'Neill to have devised any verbal formula acceptable to a party that ranges ideologically from Massachusetts' Barney Frank, Father Robert F Dnnan's successor, to Texas freshman Phil Gramm's boll weevil caucus of Southern conservatives...

...In sum, the reasonably coherent Democratic response to the Administration is likely to renew party morale, diminish the inequity of tax reduction, and slightly alleviate the plight of low income recipients of Federal help As a result, the Democrats may fare better in next year's midterm elections than they would have in the absence of this answer to the Republicans But as an effective response to the problems identified by the Democrats themselves, one can rate their tax and spending changes only marginally superior to the original Reagan program-Robert Lekachman...

...other culprits "dependence on foreign energy," "lagging technology," the "adversarial relationship between business and labor," "the escalating wage-price spiral," and "failure to develop our human capital " I am also moved to applaud the statement's emphasis upon tax equity and its inclination to target tax breaks to business in the direction of productive investment, instead of real estate tax shelters...

...The House Democrats even mustered their collective courage to the point of vaguely endorsing restraints upon prices and incomes "Our nation needs an incomes policy, a flexible set of methods for combating inflationary wage and price trends The question of how to design and implement such a policy is highly controversial " Yes, indeed...