This is the week that will make or break tax reform -- and provide a crucial test of presidential leadership. With Gramm-Rudman behind, President Reagan is pulling out all stops to round up Republican support for the tax-overhaul bill shaped by the Democrats. After a hectic weekend of phone calls and public pleading, the President is scheduled to visit Capitol Hill today for a meeting with House Republicans.
Last-ditch White House maneuvering could still recover the fumbled ball for the President, following the politically embarrassing defeat for the measure last week. Frustrated by the lack of White House consideration for their concerns and poor political liaison, the vast majority of GOP lawmakers defiantly refused to allow the Democratic bill to come to the House floor for debate and a vote.
A second rejection of a rule vote by House Republicans would be a political blow to the President, pointing to his declining influence with the Congress in his second term and adding to talk of a ``lame duck'' presidency.
But Mr. Reagan has so often landed on his feet after an ostensible setback that political observers have learned not to underestimate his political resolve and resiliency.
At the same time, it remains a question how important tax reform is to the American people. The issue has not generated a surge of support, despite a strong pitch for reform made by the President during his travels around the country. Some political analysts see little political damage to the President even if tax reform fails.
``If tax reform goes down the tube, citizens won't care,'' says election expert Richard Scammon. ``There was never a groundswell of demand for it, and the consequences of not winning cannot be disastrous. It's mostly yak-yak talk inside the [Washington] Beltway.''
But other observers suggest that attitudes in official Washington help shape public opinion at large. A defeat on tax reform would therefore be perceived as a loss of presidential influence in Congress.
Looking to 1988, it could also reinforce the impression among many voters that the Republicans are the party of the rich. This is an image Reagan seeks to alter by backing tax relief for the poor and higher taxes for business (though not as much higher as the Democrats seek).
White House aides are now banking on lining up enough Republican support to win a vote on a new procedural resolution that would clear the way for consideration of the measure. A senior White House official says he still expects House passage of the bill, which would then go to the Senate to be taken up early next year.
The challenge for Reagan is to pick up GOP support without losing any Democrats. Rep. Dan Rostenkowski (D) of Illinois, chairman of the House Ways and Means Committee, says the task is doable. If Reagan gets down in the trenches and uses the full force of the presidency, Mr. Rostenkowski said on ABC-TV's ``This Week with David Brinkley'' Sunday, he should be able gain more than the 50 votes needed to pass a rule bill.
In return for their votes, Republican legislators are seeking some changes that the House Ways and Means Committee rejected in its plan, as well as assurances from Reagan that he would veto any final tax plan that did not contain certain GOP provisions. Rep. Richard Cheney (R) of Wyoming, chairman of the Republican Policy Committee, said Sunday that he would not change his position against the tax-reform measure and that the President ought to work with the Republicans for a better bill instead of relyi ng on the Senate to improve it.
While tax-code overhaul is on the line this week, the Gramm-Rudman budget-balancing bill has left more questions than it has answered. President Reagan conspicuously avoided a splashy ceremony when he signed the controversial legislation last week. That reflects the political and economic uncertainty that surrounds the measure.
Republicans and Democrats will claim political advantages in Gramm-Rudman.
On the face of it, it is a plus for the Republicans, who have managed to turn attention away from the national debt, which has doubled under the Reagan administration. The public may now be left with the perception that something has been done about skyrocketing deficits, thus letting Reagan off the hook for huge deficits caused by his economic policies.
``The Republicans were trying to find a way so as not to get stuck with having increased the debt limit, so it was a masterful shifting to Gramm-Rudman,'' says Charles Jones, a congressional expert at the University of Virginia. ``No one heard about the debt limit again.''
The Gramm-Rudman plan, which aims at a balanced budget by 1991, also serves Reagan's primary domestic goal of scaling back federal spending. Under the measure, failure of Congress to arrive at the mandated deficit targets will automatically trigger presidential cuts in defense and domestic programs.
But the Democrats see Gramm-Rudman forcing such deep and unpalatable reductions in defense spending that the President will finally come around to proposing a ``last resort'' tax increase. ``Democrats have gone along with Gramm-Rudman because they perceive an advantage,'' says another budget expert Allen Shick. ``They're not going to cave in on domestic priorities.''
Even the administration is queasy about the quixotic Gramm-Rudman plan, as indicated by the decision not to highlight Reagan's signing of the bill. The President himself voiced the ambivalence by mentioning the constitutional questions still to be resolved.
Although no one is yet sure how the bill will work, Gramm-Rudman is expected to set up a confrontation between the President and Congress as Democratic and even Republican lawmakers battle to keep programs their constituents favor, and the President fights to keep his defense programs intact.
Public-opinion analysts say the budget deficit never had political teeth in the 1984 campaign and it is still an abstraction to most people.
``I never saw much political power in the budget deficit,'' says Andrew Kohut, president of the Gallup polling organization. ``And now that something has been done, people can put it in the back of their mind.''