Baker: ready to run in 1984 should Reagan bow out

Sen. Howard H. Baker Jr. is like a man with his feet planted firmly in midair - as far as his presidential aspirations are concerned. This irresolution, unusual for the Senate majority leader, stems from the still unanswered question of whether President Reagan will run again.

So Mr. Baker is keeping his options open for 1984. He says he wants Mr. Reagan to run again and says he has encouraged him to do so. Further, he says he thinks Reagan is going to do precisely that.

But at the same time, the genial senator from Tennessee obviously is making sure he carves out a legislative record that will bear his - as well as the President's - imprint, just in case.

Baker's ambition is apparent in his move to discourage the President from shifting the third-year tax cut from July 1983 to January 1, and in getting out in front of the President on gas tax legislation. That ambition has stirred up reports of tensions between him and the White House. The senator now is seeking to deal with such reports, confirming his stronger Senate role but asserting a continued, warm bond with the President.

It was with possible-candidate Baker, more than with majority leader Baker, that reporters met the other morning.

There are reports that there are certain tensions building between the White House and yourself, tied in with disclosures from your colleagues that you intend to run for president if Reagan does not.

I really don't know of any tensions with the White House. I have never had better relations with the President and his staff than I have right now. I'm surprised at that. . . . I have told the President personally . . . that he should run and if he does run it will be my privilege to support him. . . .

We have never had a conversation about what the situation will be if he doesn't run. Because frankly I think he will run.

There are some reports now that you are steering your own course now, not working in tandem with the President any more.

I'm not steering my own course. I am going to try to do what we did for the last two years - have a good team effort between Senate Republicans and the White House. But on the other hand I intend to make sure we (the Senate GOP majority) don't submerge and subordinate our own political individuality. We left our imprint on an awful lot of things in the last two years: On tax policy, on budget policy, on dozens of things.

What did the President say when you told him to run?

He didn't say anything. He thanked me. But that was the end of it.

You have a large number of GOP senators up for office in 1984. The public's pool of patience with this President is drying up. Won't a lot of Republican senators jeopardize their careers if they continue to go lock step with Reaganomics?

To begin with: I don't think we have gone lock step. Nor are we likely to in the future. As I said before, I think we (GOP senators) have left our mark on the legislative agenda for the last two years.

Now on the advancing of the third year of the tax cut: I think it is clear that the President had made up his mind to do this - and decided not to after consultation with us.

I don't think the next two years will be a lock-step operation. It will be a situation of consultation. . . .

Is there a move toward protectionism in the Senate?

Certainly there is a realization that the steel industry and the automobile industry and certain others are in real trouble and facing unfair competition. You hear more often these days the phrase ''fair trade'' as well as ''free trade.'' But I honestly don't think we are about to enter an era of protectionism. Nor do I think we should.

Your position on the Federal Reserve and its handling of interest rates?

I would not now favor a fundamental reorganization of the Federal Reserve. But it would be unconscionable to see interest rates going back up. I would not favor legislation to change the Fed or to establish by statute monetary aggregates or interest rates.

What I do think is that we simply cannot go back to restrictionist monetary policy. We cannot go back to escalating interest rates or to a contraction of the money supply.

Do you feel any better after talking to (Fed chairman) Paul Volcker?

He plays his cards very close to his vest. But, overall, I think I feel better . . . I am now convinced that reignition of higher interest rates is not Fed policy.

If the President asked your advice, would you recommend that Volcker be reappointed as head of the Fed in August?

I'd have to think about it. . . . One thing I think in this field: We've got to establish, and I prefer informally, a higher-level of conversation and coordination between the Fed and the executive and legislative branches of government. . . .

Doesn't Congress send up a poor signal to Wall Street with its lethargic, lazy way of passing appropriations bills and putting a budget together? What's your excuse as a leader?

You really threw me a slow ball there. . . . One way or another we have to rearrange relations between the House and the Senate so we get appropriations bills from the House in a timely way. . . .

Your position on military spending?

I don't see any way at present to make big savings and still remain safe and secure.

Did you learn anything from your bid for president in 1980 that you would profit from in 1984?

There was this question in 1980: Would I have to be unemployed to run for President. I think I answered that. . . . The Republican Party may contribute in an unintentional but significant way to the rate of unemployment if Reagan does not run.

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