President Reagan is shedding his conservative economic radicalism for the more traditional Republican presidential pattern of doing what is needed to win Wall Street's confidence.
Tuesday afternoon, it appeared that the President might be succeeding. The Dow Jones industrial average closed at 831.24, up 38.81 points over Monday's close.
The lock-step Republican support on Capitol Hill which gave Mr. Reagan his previous budget and tax victories has apparently run its course. Reagan finds himself in the familiar position of Presidents Nixon and Ford, with the most vociferous opposition coming from the conservative wing of his own party.
For the first time since the Republicans' major election sweep in 1980, a bipartisan coalition of Democrats and moderate Republicans has apparently formed behind the tax package.
These are major shifts in the Washington power equation that may prove more crucial than any economic impact from the bill itself, political analysts here say.
Reagan may have put too much on the line, with his national TV address Monday night and a concerted lobbying effort for two weeks, say some of his own inner circle.
Because Reagan has won each of his previous big fights -- though with the aid of conservative Democrats and virtually all Republicans -- he remains the favorite in a showdown House vote later this week.
But a victory this week will not save Reagan from another major battle in January, administration officials concede. By then, recalculations of the federal debt will likely show still larger deficits looming. And the even tougher issues of trimming social security and defense spending must be faced.
''They're caught up in how to ride this one out (pass the tax bill) without a long-term plan,'' says one administration official. ''For the moment, it's how to do something about those deficits -- anything that'll give Wall Street some indication that this economy is turning around.
''But it's a large price to pay, to put the President on the line. It's going to be tough for them to go to the well again for the next round . . . What they get from this politically is going to have to last until after the election.''
Some administration officials say they foresee, with the tax hike offensive, the White House getting ready to unload both some of its economic ideology and economic team as the fall approaches. They see a new, more ''realistic'' Reagan economic era ahead after the November elections.
''Somebody's going to have to be the fall guy for this,'' warns one administration official. ''The Democrats are going to try to make it the President. Everybody around the White House is going to make it not be the President. I'm not sure (Treasury Secretary Donald) Regan & Co. aren't going to be the fall guys if this doesn't work. (Budget Director David) Stockman is the obvious fall guy. But he's the budgeteer, not the economic spokesman, the architect of the program.''
For the moment, Washington is seeing an unfamiliar cooperation between Reagan and Democratic leaders on Capitol Hill. Reagan seems to be reverting to the pattern of his days as California governor, when he not only reversed himself on a revenue hike early in his administration, but dealt effectively with the state Democratic leadership.
''In California, Reagan had a Democratic legislature,'' says Allen Schick, a University of Maryland expert on congressional budget and tax affairs. ''He shouted at them but then reached accommodations with them.''
Reagan's predicament is that the innovative phase of his presidency is largely over, and he must deal more directly with the economy itself. ''As long as the economy is turbulent -- unpredictable, zigzagging, adverse, disappointing , veering off course -- you're going to see inconsistency in the White House,'' says Schick. ''If the economy doesn't sit still, neither will the White House.''
Meanwhile, Democrats ''are trying to pull together just enough Democratic votes for the tax bill to squeak through,'' says Norman Ornstein, of the American Enterprise Institute. ''As is typical in American politics, the President is trying to work out a bipartisan coalition of the center. . . . It's a change for Reagan, but it's more typical of Washington operating procedures. Now he's trying to do what Richard Nixon did, and what Jerry Ford did or tried to do.''
Democratic leaders also, for the moment, find it convenient not to play the blame-laying game. But after voting this week on the tax bill, the political battle of seeking Democratic and Republican majorities in Congress will resume.
A big difference, however, is that the GOP conservative right has begun to mobilize on its own behind younger spokesmen like Representative Kemp and Rep. Newt Gingrich (R) of Georgia. Other Republicans, chiefly Sen. Bob Dole (R) of Kansas, who wrote the tax plan in the Senate, have also begun to stake out territory, with future White House ambitions in sight. This kind of encroachment on Reagan's Washington party leadership had not been seen before.