Washington — The economic plight of special groups of Americans is tilting President Carter toward policies that key advisers rejected as premature only a few days ago.
"It is too early," one top administration official said in an interview April 11, "to think of [granting] special sectoral aid."
Yet that is what the President now is doing, by pumping additional money into the housing market and by earmarking extra funds to help American farmers, beset by rising costs and depressed crop prices.
Behind these measures -- and more may come -- is a "painful awareness," said a White House aide, that some elements of the US population already are suffering deep recession.
These include not only farmers and construction workers, but also the auto industry and small-business men in general, who are being priced out of the credit market.
"We have never lived with anything like this," said a key presidential adviser in an interview. "In the past, credit always was rationed primarily through housing.
"But now," he added, "something is happening to small-business men and farmers, who cannot pass on additional costs. They are paying open-market rates -- 20 to 22 percent -- to borrow money."
"In past recessions," White House inflation fighter Alfred E. Kahn said in a separate interview, "housing was disproportionately hurt. This time the creation of money-market certificates kept mortgage money available, but at the cost of pushing interest rates higher -- so high that now these other sectors are hurt.'
"When we went to the March [credit-tightening] measures," another senior White House official said, "we recognized that we were taking risks for farmers, home builders, small business.
"Yet if we did not clamp down, the risk of long-term structural damage to the economy through ever-higher inflation was even greater."
Thus, as March edged into April and cries of distress poured into the White House from around the country, the President faced a dilemma.
Housing starts were down, unemployment was rising, farmers were crying foul -- and Mr. Carter faced growing political damage as the primary season rolled on.
Still his economic officials warned against sectoral aid, if this would undermine the President's bold effort to balance the 1981 budget through spending cuts.
"We thought about what we could do," said a top administration aide. "We could make money available at subsidized rates to farmers, small business, and home builders.
"Then what would happen? The budget would be unbalanced and interest rates would go even higher."
But, this official acknowledged, "we knew we didn't have much time before a lot of people got hurt."
Apparently, for the President, time ran out sometime between those April 11 interviews and April 17, when -- in a nationally televised press conference -- he unveiled special help to housing and to farmers.
These steps, Mr. Carter stressed, would be confined "within our budget spending limits."
The President hopes, in other words, to provide some relief to depressed areas of the economy, without unbalancing the 1981 budget -- keystone of his anti-inflation effort.
Spending cuts proposed by Mr. Carter March 31 would propel the 1981 budget into surplus by half a billion dollars -- a very thin margin, if new money is to be pumped into the economy.
In the background, however, will be roughly $12 billion in additional government revenues, accruing from the $4.62 a barrel import fee the President has placed on foreign oil.
Mr. Carter insists that this "gasoline conservation fee" (his words) will not be used to balance the budget, as a substitute for spending cuts.
Officials agree, however, that this money remains available as a cushion, or margin of safety, to balance the budget, if recession requires additional outlays.
Meanwhile, Congress has not yet voted the painful spending cuts which would bring the 1981 budget into balance -- cuts that would bite into social programs of various kinds.
Assuming Congress musters up to this task, will legislators -- subject to the same intense political pressures as Mr. Carter -- then approve special relief to one group after another?
It would not take long, analysts agree, for supplementary spending, designed to offset recession, to overwhelm the budget-balancing effort, unless revenues from the oil import fee were thrown into the breach.
"We are trying to stick it out," said a top White House official, "and not overreact to the point of undoing the fight against inflation."
In part, another official said, this involves "differentiating between hardship and recession." As the list of Americans suffering hardship lengthens, so will political pressure grow.
Mr. Carter counts on two factors to bring inflation down dramatically by the end of the year -- only a 20 percent rise in the price of oil this year (compared with 100 percent in 1979) and a 2 percent drop in mortgage interest rates.
If these things happen, the President says -- and if the 1981 budget is balanced and the Federal Reserve Board keeps credit tight -- inflation could plunge from the present 18 percent to perhaps 10 percent by December.
Oil prices, however, could jump more than now foreseen, if Iranian crude is shut off from the world market by a US naval blockade of Iranian ports.
World oil supplies, now ample, could become tight, giving the 13-member Organization of Petroleum Exporting Countries possible leeway to jack up its prices again.