Nixon's Call to Counter-Revolution

THE guns had barely fallen silent in Viet Nam when President Nixon issued a call to counterrevolution at home. He unwrapped a budget for fiscal 1974 that in effect summons the U.S. to bury the Great Society--by ironic coincidence just after the death of its moving force, Lyndon Johnson. Nixon also called upon the nation to reverse the big-Government trend that has been gathering strength since the New Deal, and to return to a simpler day of self-reliance and local solutions to problems of poverty, unemployment, inadequate housing and crime. The budget, says a high White House aide, "is the opening barrage in a campaign to redirect social policy in this country."

The barrage will touch off a fierce political confrontation that may even become a constitutional struggle on the issues of presidential v. congressional power to set the nation's priorities. The President's budget also marks the public appearance, at long last, of the oldest Nixon: the intense conservative ("more conservative than Barry Gold-water," according to one adviser) who has always existed in private behind the succession of "new Nixons" who have paraded in the spotlight.

Nixon proclaimed in his second Inaugural speech a determination to end "condescending policies of paternalism." The budget proves, in hard money terms, that he means it. He proposes the slaughter of a whole herd of formerly sacred cows--abolition or deep cutting of more than 100 federal grant programs that have benefited the unemployed, students, farmers, veterans, small businessmen, the mentally ill and tenants in federally aided housing. Estimated saving: $17 billion next year, $22 billion in fiscal 1975. In his budget message, Nixon referred contemptuously to these programs as products of the "do something, do anything" philosophy of the 1960s, but some of the programs date back to the desperate days of the early 1930s. Among the notable cuts:

-- The Office of Economic Opportunity, the keystone agency of L.B.J.'s War on Poverty, will be chopped up among other agencies. Many of its programs will be ended. No longer will the Government help organize the poor into neighborhood action groups that could fight landlords and employers.

-- A $1 billion-a-year program to hire the hard-core unemployed for public-service jobs will be dropped.

-- Few new students will be enrolled in federally assisted job-training programs, pending transfer of these programs to the states and cities, which will have to decide which ones to keep going. In other words, such programs as the Job Corps and Neighborhood Youth Corps face a most uncertain future.

-- Urban renewal and the Model Cities program will be phased out. Model Cities has erected showcase projects that demonstrated ways to revitalize blighted communities; it has aided the construction of schools, apartments, and even prenatal-care clinics.

-- Nixon's family-assistance plan to provide a minimum income of $2,400 for a family of four is abandoned; no money for it is included in the budget. The Administration will also try to prod local communities into pruning relief rolls. The budget projects a saving of $592 million from stopping payments to "ineligibles."

-- Farm-price supports will be cut by $1.2 billion, to a total $2.7 billion, and borrowers will have to pay 5% interest on loans from the Rural Electrification Administration instead of the present giveaway 2%.

Among the myriad other cutbacks are reductions in programs to provide inexpensive milk to schoolchildren and to upgrade the teaching of foreign languages in schools. Federal aid for hospital construction will be ended, on the grounds that the U.S. now has as many hospital beds as it needs. The Office of Consumer Affairs, the federal consumer-protection agency, will be moved out of the White House into the Department of Health, Education and Welfare, where it will cease to be an independent agency and come under the jurisdiction of the future Secretary, Caspar W. ("Cap the Knife") Weinberger. As outgoing budget chief, Weinberger zealously helped Nixon look for programs to ax. Now he will turn over much of the job of defending those cuts on Capitol Hill to his successor, Roy Ash.

One thing Ash will have to explain is that many effects of the "program reductions and terminations" proposed by the President will not show up until fiscal 1975 or later. For instance, some 250,000 federally subsidized apartments and houses for low-and middle-income tenants will be finished this year, about the same number as last year, but they will include only those for which commitments have been made; no new projects will be approved. Government outlays to support community mental health centers will rise sharply in fiscal 1974. But that is for the purpose of paying off accumulated debts in order to wind up federal participation in the program; after next year, no new money will be sought. The rationale is that local communities can then support the centers on their own.

A few programs will be allowed to grow smartly. Military spending will rise from $74.8 billion this fiscal year to $79 billion next, an increase certain to provoke liberal outrage in view of the end of the Viet Nam War and the proposed cuts in spending for hospital construction, public-service employment and the antipoverty programs. The Pentagon's new money will go largely for research and development of new weapons and military pay raises to support the proposed all-volunteer armed forces. The work-incentive program, which trains relief recipients for jobs, will be expanded by $145 million --but as part of a work-or-else policy. Welfare clients who refuse to register for it will be dropped from the relief rolls. The only substantial new initiative in the budget is a plan for tax deductions of unspecified size for parents who send their children to private or parochial schools.

Ongoing programs will keep the individual budgets of most Government departments and agencies rising. HEW, despite all the cuts in social programs, will spend $93.8 billion next fiscal year, or $10.2 billion more than now. Two reasons: a $6 billion increase in Social Security benefits and a $3 billion rise in Medicare payments. But some departments are being trimmed. Labor Department outlays will fall $1.5 billion, or more than 15%. Some agencies will lose employees as well as money. Total federal civilian employment is supposed to decline by 46,000 people, or about 1.9%, during fiscal 1974, to a year-end total of 2,438,600.

Arbiter's End. To be sure, overall federal spending will rise. By Nixon's estimates, it will go up from $249.8 billion in the fiscal year that ends this June to $268.7 billion in fiscal 1974, and to $288 billion in 1975. Expenditures, however, will be propelled upward mostly by the automatic increases that come from population growth and a relatively modest amount of inflation --and they will not rise as rapidly as revenues. Government receipts are expected to increase from $225 billion this fiscal year to $256 billion in 1974. Consequently, the deficit will be cut almost in half, from $24.8 billion in 1973 to $ 12.7 billion next year.

More important than the numbers is the political philosophy that went into calculating them. What Nixon proposes is nothing less than an end to Washington's role as an arbiter of national social goals. Since the New Deal, the prevailing liberal ideology has been that the Federal Government should determine the most pressing U.S. social needs and ladle out money to meet them, in the form of grants for specific purposes such as slum clearance and vocational education.

Nixon would replace most of these specific grants with $6.9 billion of "special revenue-sharing" money given to states and cities for four very broad purposes: manpower training, education, law enforcement and "urban community development." If the President has his way, Federal Government officials will no longer decide whether the building of low-cost housing or the opening of sewage-treatment plants has the greater claim on public funds--or even whether any tax money should be spent for either. State and local officials could continue the programs if they wished, but probably with less federal money. For example, the proposed $2.5 billion revenue-sharing grant for education appears to be at least $280 million below the total that the Government is spending this year on a variety of specific programs--from vocational education to school-library aid--that are to be replaced. Moreover, says Weinberger, "the proposal is that if special revenue sharing is not passed, we do not fund the [old] programs"--meaning that the flow of money out of Washington would be shut off completely.

Nixon is determined to get his way.

In his mind, all the cutbacks are necessary to serve an overriding national priority: avoiding tax increases and holding down inflation. The fiscal 1974 budget will be balanced in the most important sense; outlays will about equal the revenue that the Government would collect if the nation were enjoying what economists call "full employment" (that is, a jobless rate no higher than 4%). The shift from the full-employment deficits of recent years should slightly moderate the growing boom in the economy and, it is hoped, restrain inflation. Thus the budget is economically conservative in the terms used by modern scholars, whatever Herbert Hoover might have thought of it.

Mayors' Woe. Late last week Nixon managed to make his plans to hold down spending sound almost equal in importance to the ending of the Viet Nam War. Greeting families of prisoners of war on Friday, he told them: "Now we are engaged in a new battle, the battle of the budget." Briefing congressional leaders the same day, he asserted: "For my part, I ran on a platform of no higher taxes. If we cannot hold this budget, one of two things will happen. I am ready, willing and able to veto [appropriations bills that push spending higher]. Or there will be higher taxes. Unless you want Congress to be known as a group of big spenders, you'd better study this budget."

Then Nixon took his case directly to the people. In a radio speech Sunday, he called the budget "one of the most important documents I will sign as President" and asserted that "it is time to get big Government off your back and out of your pocket." In the budget message, he proclaimed "total determination to identify and reform or eliminate programs that have not worked." For good measure, lest any Congressman forget how many votes Nixon won last November, he added that "the expressed will of the people will not be denied."

The battle for which the President is girding himself will surely erupt, and promptly. His spending hold-downs, by their very diversity, promise to unite against his policy a startlingly broad coalition of interest groups. They range from the unemployed poor to school librarians, and from farmers to executives of construction firms that will get less business building subsidized housing and hospitals. Members of the Senate Republican Policy Committee met with Vice President Agnew last week and voiced loud protests against the withholding of funds for programs that benefit the traditionally Republican farmers.

Big-city mayors, too, are upset.

They fear a long interregnum between the time they start losing money under specific-program grants and the time some of the funds are returned under special revenue sharing. Also, the mayors knew pretty much what they would get under the grant programs, many of which were targeted at cities. Under special revenue sharing, they will have to fight suburban, small-town and state governments for the money. Indeed, with the pipeline to the Treasury being shut off for many programs, special revenue sharing could cause city and countryside to resume the acrimonious struggle for federal money that bedeviled U.S. society from the Civil War to the New Deal.

The congressional furor building against Nixon's policies is especially ominous. In his budget message, the President did not specifically threaten to impound funds that Congress might appropriate for the programs that he wants to eliminate. He did not have to; no Representative or Senator could be unaware that the President already has decided to impound roughly $4 billion that Congress wanted spent this fiscal year on highways, control of water pollution, and farm and other programs. His tactics have unified Congressmen of every ideology against what they consider a defiance of their constitutional power to control spending.

Two unlikely Democratic allies, Senator Sam Ervin of North Carolina, a fiscal conservative, and Representative Bella Abzug of New York City, an ultraliberal feminist, have prepared a bill that would turn any impoundments into a pitched battle with Congress. Ervin has already lined up 51 cosponsors, a majority of the Senate. The bill would require the President to submit to Congress each proposed impoundment. He could then withhold funds only if both houses within 60 days voted specifically to concur--in effect repealing their original appropriation.

White House aides will not say what the President will do if the Ervin-Abzug bill passes over his seemingly certain veto, but Nixon appears convinced that impounding funds is his constitutional right. At a White House session last week, Caspar Weinberger told Texas Representative George Mahon, chairman of the House Appropriations Committee, that every President since Thomas Jefferson has withheld funds appropriated by Congress. Nixon himself added: "George, do you remember when we were in Congress and President Truman decided there should be a 47-wing Air Force instead of a 70-wing Air Force? I was opposed to that, but he wouldn't spend it." If

Nixon follows this logic to the end, he will prepare the ground for what could become a grave constitutional crisis. A Congress insisting that the President cannot impound funds and a President maintaining that he can would create a Government deadlock that only the Supreme Court could break.

The confrontation is already under way, and is bound to get hotter. The question is whether either the President or the Congress will push the struggle to the extreme. Opportunities for backing off exist if either side loses its nerve. Nixon might grudgingly accept continued appropriations for some programs that he dislikes, then call for an income tax increase to finance them--and blame Congress for the raise. A more likely possibility is that Congress may bend to the President's pressure for budget hold-downs. Congress is by nature a house divided, and it is poorly organized to fight the President on this issue.

Room for Debate. Is the President doing right? Certainly Nixon deserves applause for finally trying to pare farm subsidies, which have contributed to driving up food prices. The social programs that he aims to ax are harder to appraise. They are a melange of good and bad, effective and ineffective, sound and scandal-racked. In Atlanta, for example, the Model Cities program has built only fancy quarters for its own staff--but in South Carolina, an anti-poverty program has erected day-care centers for 5,000 children, enabling their poor parents to take jobs. In Chicago, the Office of Economic Opportunity has chiefly occupied itself with grinding out program formulations, guidelines and deadlines. But it has also distributed to the poor birth-control pills that they could hardly afford to buy; Professor Donald Bogue of the University of Chicago notes that "birth rates in the slums have fallen faster than elsewhere."

The Government began its social programs in response to demands that the states and cities were not meeting. Surely Nixon is right in contending that just spending money does not solve social problems. But it is equally obvious that few if any social problems can be solved without spending money. For all their failings and abuses, the programs that Nixon now proposes to chop or conclude have helped millions of Americans acquire skills, jobs, housing, college degrees and medical care. Thus there is room for debate on whether the nation should give such high priority to avoiding tax increases. At best, the battle over Nixon's budget should give Congress the opportunity to conduct a long-overdue comprehensive review of the Government programs that have grown helter-skelter over the decades. Many of those programs richly deserve cutting, but that should be done only after considerable thought and study. Otherwise the danger is great that useful and necessary projects will be dropped along with inefficient and wasteful ones.

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