Domestic Concerns Top US Presidential Agenda

FOUR years ago, when George Bush became president, the typical American family earned $37,579. By last year, the same family was bringing in just $35,939 annually - a drop of $1,640, or 4 percent.

Job No. 1 for the newly elected president will be helping Americans get back their lost income while expanding the economy and strengthening the industrial base of the United States. (US manufacturing poised for renaissance, Page 7.)

This urgent economic need, combined with intractable foreign problems in the Middle East, the Balkans, and elsewhere are a "staggering" challenge for the next president, says Horace Busby, former secretary to the Cabinet under President Lyndon Johnson.

After nearly 50 years of cold war, the US has built up a tremendous backlog of unmet needs at home, ranging from jobs, health care, and education, to roads, bridges, and sewer systems.

Yet the collapse of Soviet communism has also left an unusual power vacuum that has triggered war in what was once Yugoslavia, mounting tensions in several republics of the former USSR, and dangerous new adventurism by regional powers such as Iraq and Iran.

Americans sent a clear message in this year-long campaign that the next president and Congress must quickly put the US economic house in order - or else.

As this story goes to press, the winner of the presidential race is not yet known. But Stephen Hess, a scholar at the Brookings Institution, says that the winner will have to keep US domestic needs at the forefront, even in matters of foreign policy. Using Gov. Bill Clinton as an example, Mr. Hess explains:

"Clearly, Clinton's major commitments during the campaign were made in domestic affairs. If elected, he's got to be a little careful about getting sucked into other issues in which the American interest is not primary."

An example: the current blood bath in the Balkans, where some Europeans would like to see the US play a large and potentially dangerous peacemaking role.

"Everybody wants to involve the US in their problems," Hess says. But, he warns, such involvement could be politically perilous for the next president until voters are satisfied that problems at home are being solved. Domestic problems can be found in abundance within blocks of the White House gates. The homeless sleep nightly in Lafayette Park, just across the street from the Oval Office. Drugs are peddled on nearby street corners.

Urban decay, unemployment, broken families, rising welfare burdens, and runaway health-care costs threaten the social fabric of Los Angeles, Miami, and other major cities. The nation is struggling with an outdated railway system, crumbling bridges and highways, poor schools, and polluted air and water.

For Americans in 1992, these domestic problems, which are visible every day, far outweigh foreign affairs. Add to those problems the needs of US manufacturing, the banking crisis, and the failure to create a single new net job in the private sector since 1988, and the new president could keep a small army of crisis managers hard at work.

The anti-incumbent atmosphere that the candidates first detected in New Hampshire over a year ago was brought on, in part, by the end of the cold war, analysts say.

Ever since the late 1940s, America has been geared up for the protracted rivalry with the USSR. Its factories hummed with the output of tanks, missiles, rifles, and aircraft, even though the US was losing ground to its western industrial partners in the production of civilian goods like TV sets, VCRs, textiles, and automobiles. With the end of the cold war, the jolt of losing billions of dollars in defense contracts staggered local economies.

Connecticut is a prime example. G. Donald Ferree, associate director of the Institute for Social Inquiry at the University of Connecticut, observes that generations of workers there grew accustomed to building turbine engines for tanks and military aircraft and submarines for the US Navy. It was a way of life for companies and entire communities.

"Many people thought we were going to be building submarines forever," Dr. Ferree says. "Now that's ending, and it's unsettling."

The fixation on the domestic economy will make it tough for the next president to deal with some thorny issues, such as trade. The recently negotiated North American Free Trade Agreement, for example, will need to leap high hurdles in Congress. Will NAFTA create jobs, or cost jobs? Will it help restore America's industrial base, or continue tearing it down?

Issue by issue, policy proposals will have to be made for meeting such tests. The next president's policies could get unusually close scrutiny from a skeptical, and angry, electorate.