Heading for a Policy Clash

The separate economy and energy programs proposed last week by President Ford and the Democratic majority in Congress reflect important philosophical divisions that presage a knockdown fight over the future direction of national policy. A comparison of the main points in each program:

INDIVIDUAL INCOME TAX CUTS

Ford: A one-time 12% rebate on all individual taxes owed for 1974, up to $1,000 per return.

Democrats: Quick relief to low-and middle-income taxpayers through higher personal exemptions than at present, as well as increased standard deductions and reduced payroll levies. House Speaker Carl Albert put the size of the cut at between $10 billion and $20 billion.

CORPORATE TAX CUTS

Ford: Increase of the investment tax credit to 12%, up from 7% for most industries and from 4% for utilities.

Beginning this year, a decrease in corporate tax rates from 48% to 42%.

Democrats: No mention.

TAX "LOOPHOLES"

Ford: No specifics.

Democrats: A proposal to make up revenues lost through tax reductions by closing 'loopholes that now enable large corporations and wealthy individuals to pay little or no taxes at all."

AID TO THE POOR

Ford: Direct federal payment of $80 a year to each adult earning too little to pay income taxes.

Democrats: "Realistic help" for the needy, the aged, the blind, the disabled, and legislation to block any effort by the Administration to raise the price of food stamps.

ENERGY CONSERVATION

Ford: Higher taxes and tariffs on imported and domestic crude oil, natural gas and imported petroleum products. In addition, all domestic oil and gas would be freed of price controls, and Congress would be asked to approve an excess-profits tax on windfall earnings of oil and gas companies. Clean-air laws would also be weakened to permit more coal to be burned, especially by electric utilities.

Democrats: Either outright gasoline rationing or a gasoline tax increase of up to 100 per gal. or mandatory allocation of oil and other sources of energy--or some combination of those options. Also, fatter excise taxes on big cars.

REVENUE SHARING

Ford: An increase of $2 billion for state and local governments to help pay for higher energy costs.

Democrats: No mention.

FEDERAL SPENDING

Ford: A one-year moratorium on all new spending except in the energy field. Also a 5% limit for 1975 on federal pay raises and cost of living increases for Government workers, retired military personnel and Americans on Social Security.

Democrats: An unspecified further increase in public service jobs, public works projects and Social Security payments.

WAGE-PRICE CONTROLS

Ford: No mention.

Democrats: A recommendation to empower the Administration to delay or roll back certain price increases, but no mention of limiting wages.

POLLUTION CONTROLS

Ford: A five-year deferral, to 1982, of standards limiting auto pollution; in a tradeoff, automakers have pledged to improve average gas mileage by 40% by 1980.

Democrats: No mention.

INTEREST RATES

Ford: No mention.

Democrats: A recommendation that the Federal Reserve Board expand the money supply by 6% or more in order to make more credit available and quickly bring down borrowing costs. (The rate grew by 4% in the past quarter.) The proposal also calls for the Fed to prod banks to allocate credit to housing, farming and electric-power producers, and away from "speculative and inflationary uses."

HOUSING

Ford: No specifics.

Democrats: A fuzzy proposal to help savings and loan associations get more mortgage money. The plan would also provide interest rate subsidies for low-and moderately-priced houses and temporary Government assistance for out-of-work homeowners who are unable to make home-loan payments.

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