Washington — The Gulf crisis has helped President Carter make one of the most remarkable political recoveries in history. On the other hand all his troubles are head of him on the domestic front. They are economic troubles. They will be troubles for the nation, too, according to every indication.
Mr. Carter's own appraisal, made in his annual economic report Jan. 30, is hardly cheerful. Unemployment will be higher, double-digit inflation will continue for a while, and there will be recession. It is the most sober report, I believe, in the history of the Council of Economic Advisers, set up under the Employment Act of 1946. As a politician, Mr. Carter must be praised for giving so frank an examination of the problem at the start of a presidential election. Independent economists who have been testifying before the Joint Economic Committee of Congress, or reacting with their own appraisals, also draw a sober picture.
Mr. Carter himself is restrained when he concludes his economic survey:
"There are no economic miracles waiting to be performed. But with patience and self- discipline, combined with some ingenuity and care, we can deal successfully with the new world. The 1980s can be a decade of lessened inflation and healthy growth."
This measured optimism will hardly send readers leaping with joy. Experts going over the 329-page report and the US budget aren't even sure that "patience and self-discipline" are going to be forthcoming, let alone "ingenuity and acre." For example, how about Russia, Afghanistan, and higher defense costs? How about self-discipline in Congress over petroleum imports?
"However you rate the performance of the economy during the last half of the 1970s," says Lester C. Thurow, noted MIT economist, "the performance during the first half of the 1980s is apt to be worse." That's the cheerful way he begins his testimony to Congress.
Another economist, Walt W. Rostow, thinks the President should institute a "state of emergency" right away; something has to be done, he argues, to meet "the failure of the executive branch under three presidents, and the failure of Congress, to generate a policy capable of reducing oil imports."
Maybe Congress and President will work out a successful oil solution, but it will almost certainly leave political strains, whatever it is. At the same time the experts can't agree among themselves. Here is Franklin A. Lindsay, a corporation executive and spokesman for the prestigious Committee for Economic Development, telling Congress that the big thing to avoid is a system of comprehensive wage-and-price control. And here on the other hand is Barry P. Bosworth, who managed Mr. Carter's anti-inflation program from 1977 to 1979, saying that he now favors such controls. Yes, inflation has built up such momentum now "that nothing but a major recession or mandatory controls can break it," says Mr. Bosworth, now working at the Brookings Institution.
How does that affect politics? A good many political articles I read imply that once President Carter gets the Democratic nomination he's as good as elected. But if people vote on pocketbook issues instead of Afghanistan I should think the Republicans have a good chance. How about 13.3 percent inflation for an issue? Leon Keyserling, President Truman's economic adviser, tells Congress that Mr. Carter's economic approach is all wrong: that he should be fighting inflation by stimulating production rather than by checking expansion.
Mr. Carter is getting a lot of advice from a lot of people these days. The advice, alas, is conflicting. He argues that he is following a middle course. Maybe it will work. In the meantime, attention has turned to Maine and New Hampshire, Iran, and Afghanistan, and some have forgotten that a critical situation exists in the immediate family pocketbook. It won't go away, probably , till long after the election.