Why Reagan is ready to compromise on tax-cut plan

The tug of war over the Reagan tax package has reached the point where the President apparently can have it all if he so desires. So says Rep. James R. Jones (D) of Oklahoma, chairman of the House Ways and Means Committee. As of now, according to Mr. Jones, some 30 Democrats would side with Mr. Reagan on a three-year, 10 percent annual tax cut if the President puts forth the same kind of all-out lobbying effort he made in behalf of his budget.

Congressman Jones, talking to reporters over breakfast, said this assessment based on conversations he has had in recent days with House Democrats. He said that, of course, Mr. Reagan would have to keep most of the Republicans behind him to win.

At the same time the signals from the White House indicate a willingness to compromise on the Reagan tax package. In fact, Monitor conversations among White House aides have indicated that the President is eager to compromise.

This softening of the Reagan position is based on a new reading of the financial markets, which have responded for the most part in a negative way to the Reagan plans on taxes.

Jones says he reads the shifting Reagan ground as not so much a response to opposition within Congress but to new presidential assessments of Reagan's own program.

The approximately 30 would-be Democratic defectors in the House on the Reagan tax proposal are made up, says Jones, of three groups:

1. "The more conservative Democratic members who feel that Kemp-Roth [the three-year tax plan] should have a chance."

2. "Those who, if Reagan applies the political pressure again, would say yes to him."

3. "And those who don't believe the Kemp-Roth idea is going to work but who want it tried because they say, 'All I'm going on is my own personal assessment, so let's give it a try.'"

The move toward presidential compromise on the tax package has had the appearance of being made because concessions were necessary to get it through the House. But now there are growing indications that the President is letting up a bit simply because he is coming to believe that the country now should have something a little less than the full, three-year tax cut.

Jones said the Democratic votes available to Reagan on the tax issue "are not hard votes. If the overwhelming reaction from the public toward the Kemp-Roth bill would change, these House members might change their minds."

"But if he uses intensive lobbying," Jones added, "the chances are good the President will get his full tax package." He said he thinks Reagan will accept compromises on social security legislation that will ease public criticism of him on that issue and that he will be able to keep his widespread public support.

White House chief of staff James A. Baker III said in a recent interview with the Monitor that the "primary test" (presidential) of any compromise legislation is that it be "sufficiently stimulative for what Mr. Reagan thinks has to be done with the economy."