This year, the budget's not the only game in town
Politically viewed, the battle over President Reagan's 1984 budget will be waged between ''realism'' and ''results.'' On one side will be Mr. Reagan's advisors, stressing a more tempered set of economic assumptions and seeking to gain business community confidence and political credit for acknowledging deficits of $208 billion in fiscal 1983 and $ 189 billion in 1984. They'll also promise declining deficits to the $117 billion level in 1988.Skip to next paragraph
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But such statistics are often not what they seem. This image of declining federal deficits toward balance in the future was pronounced ''the mirage effect'' by one Reagan official, observing that presidential budgets are typically drawn to project such politically popular results.
On the other side will be the President's opponents, stressing results forecast earlier by Reagan but never achieved. In September, 1980, candidate Reagan promised a balanced budget by the current 1983 fiscal year, a $28 billion surplus by fiscal 1984 and a $93 billion surplus in fiscal 1985. As recently as last January, the administration forecast a 1984 deficit under $100 billion - and now they must secure $43 billion in further federal cutbacks to hold the deficit to $189 billion for next year.
Democrats will point out that Reagan promised - for example, in Green Bay on Oct. 2, 1980 - to put millions of the then 8 million unemployed Americans back to work. His new budget projects jobless levels hovering near 12 million the next two years.
But the budget debate won't be the only game in town.
This year, the budget will likely become absorbed in the building 1984 election campaign. Last weekend the Republican National Committee chose a new chairman and general chairman - Nevadans Frank Fahrenkopf Jr. and Sen. Paul Laxalt, respectively - for the next political round.
The Democratic National Committee meets this week in Washington to lay its 1984 campaign plans. On Feb. 2, Sen. Alan Cranston (D) of California officially kicks off the Democratic presidential nomination scramble with his announcement of candidacy.
The economy in 1983 will have to share the stage with foreign affairs, defense, and arms control to a much greater degree than in Reagan's first two years.
This week, Vice-President George Bush left for Europe for a week of arms-talks reconnaissance. Secretary of State George Shultz likewise is off to China. These travels will vie with the economic debate for prominent play on the evening news. Through the year, the President is expected to look increasingly to defense and foreign affairs for major administration initiatives. The anticipated economic recovery will be relied on to help alleviate domestic troubles.
The Reagan budget itself does not face outright rejection in Congress, some Hill leaders say. But both the House budget committee, controlled by Democrats, and the Senate budget committee, run by Republicans, will produce their own versions of the budget. They are expected to be closer to each other than to the President's document. In conference sessions to resolve differences, the administration is expected to sign on with the Republicans' version.
Decisionmaking will clearly shift to the Hill and away from the White House - a process that began last year when Reagan accepted a $98 billion package of tax hikes.
In part, the administration's decision to offer a budget based on more sober economic forecasts was designed to reduce the prospect of rejection by Congress.Such a rejection would have undercut the confidence of both the public and the financial community in Reagan's leadership.
As it is, if the recovery occurs as expected, news of economic revival will likely rival if not supplant reports of lingering unemployment and unused productive capacity.
Many Republican professionals rate Reagan's reelection chances, assuming he runs, as at least even for 1984. So far, the President has closely retraced Carter's slippage in the polls. But Reagan also has some things going for him.
The public does not blame Reagan for causing unemployment. And 56 percent of the public, a majority, think his economic program will eventually help the country, according to the latest CBS/New York Times poll taken in mid-January.
However, Reagan's prospects for 1984 are not the same as Republican prospects generally, GOP strategists quickly add. In Senate races, particularly, the Republicans appear headed for a drubbing that could deprive them of control.
Indeed, the need to make more ''realistic'' economic assumptions was demanded by Capitol Hill Republicans worried that the party's political base, not just the President's, was at risk if economic results were again mismatched with overly buoyant forecasts.