The Reagan Years: An Assessment; CUTTING RED TAPE

While the size of government has not declined appreciably, Reagan is credited as having had a signficant impact in both the public and private labor sectors because of his dismissal of the air traffic controllers. ''He showed he would not allow government to become hostage to its civil servants,'' says one analyst.

On the ''big government'' front, however, social welfare is the area that has stirred the greatest controversy. For 40 years or more the nation operated on the basis that government should help pull up the bottom rungs of society through income-maintenance and social programs. Several presidents, including Richard Nixon and Jimmy Carter, tried to reform the welfare system, with little success.

But Reagan has gone further. He came into office with a clear philosophy that welfare is a debilitating system and that government, while it has an obligation to care for the ''truly needy,'' should seek to wean welfare recipients away from welfare and into jobs. Nor does government have the task of narrowing the gap between the rich and the poor. In Reagan's view, a robust economy is the route to improvement for everyone.

''It is not in our tradition to assume that government should level everyone, '' comments a high administration official. ''And it's not a proper goal of policy to equalize income. There should be incentives to get ahead and opportunities to work out of poverty.''

The administration's basic approach, therefore, has been a series of reforms aimed at targeting welfare benefits on those unable or unwilling to work.

Democrats and even some moderate Republicans criticize the President for his ideological views and the often harsh results of his cutbacks in social spending.

But many independent observers believe that Reagan correctly read the general American perception that welfare spending had reached an excess and that there was not enough concern for efficiency and frugality.

Perhaps one indication of this is that the federal government's social spending cuts, which fell heaviest on poor people, were not supplanted at the state level. In a study of 14 states and 40 local governments, Princeton University's Urban and Regional Research Center found that they ratified the Reagan cuts.

''The predominant pattern was a decline in benefits and funding for social projects,'' says Mr. Nathan, director of the center. ''The cuts hit when recession was its worst and they did nothing.''

As a result, says Nathan, the size of the public sector vis-a-vis the private sector is declining. Moreover, he says he finds that while welfare dependency is a severe problem, most welfare recipients accept the idea of ''workfare'' - doing some work while receiving benefits.

While all the research data are not in yet, other studies suggest that ''workfare'' is having a deterrent effect. That is, when told they will have to work, a large proportion of welfare recipients - as high as 20 percent - find other ways of supporting themselves rather than go into a ''welfare job.'' And while some states find that many working poor, faced with losing their benefits because they are earning above the permitted income ceiling, choose to quit their jobs and go entirely on welfare, the vast majority do not become full-time welfare recipients.

It is not denied, however, that many working poor are suffering severe hardship because of cuts in welfare. Moreover, because some working poor do elect to go wholly on welfare, it is questionable whether the government ends up with a net saving.

''Welfare is a complex question,'' says Mr. Nathan, ''but Reagan is changing the climate. And he may be a lot more successful in doing something about it than we have been talking about for 40 years.''

Next: Reagan's foreign policy agenda

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