Not Much Cheer for Liberals

During the campaign, and even after he entered the White House, Jimmy Carter kept people guessing as to whether he was at heart a liberal or a conservative. There was ample evidence to support either view. But last week, over breakfast at the White House, many liberal Democrats feared they had glimpsed the real Carter--and the sight struck them as unnervingly conservative.

Carter left top congressional Democrats stunned by announcing that he meant what he had been saying about balancing the federal budget by the end of his first term. New spending programs would have to be scrapped; some existing ones would probably be cut back.

Carter's chief economic adviser, Charles Schultze, a longtime liberal, detailed the case for restraint. Pinning his projections mainly on expansion in that old Republican ward, the private sector, Schultze projected economic growth totaling 22% over a five-year period, creating 9.7 million jobs and reducing unemployment from its current level of 7% to 4.3% by 1981. At the same time, the inflation rate (now above 6%) would be pared to just over 4%. Growth alone, said Schultze, would allow Carter to balance the budget, but federal spending could not be permitted to increase much more than 1% a year beyond the cost of inflation. Said Schultze: "We're betting very heavily on business investment" to sustain growth.

No Budging. Schultze portrayed this penny-pinching future with such flair that even Federal Reserve Chairman Arthur Burns rose to congratulate him--a solid indication that the Administration had come around to Burns' conservative viewpoint. Said one congressional Democrat afterward: "This was a watershed. It's classic trickle-down economics. This guy doesn't want to do anything." Said G.O.P. House Leader John Rhodes happily: "That sounds so Republican I'm overwhelmed."

At a subsequent White House breakfast meeting the next day, House Speaker Thomas ("Tip") O'Neill reminded Carter that the Democratic Party had historically been the "champion of the poor and the indigent." There are 12 million people still on welfare, said O'Neill, 7 million of them children. There was no consensus among Democrats on the Hill to cut back existing programs or give up new ones. "I can read this Congress," he told Carter. "If there is no move to serve those who need compassion, we'll run into a bag of troubles." Carter replied that he may have emphasized restraint too much, but he refused to budge on the balanced budget.

That attitude was underscored by a surprise decision on welfare reform. Although Carter had made a major campaign point of prompt reform, he dashed that prospect with the curious explanation that the welfare mess "is worse than we thought." Several options for revamping welfare had been prepared by HEW Secretary Joseph Califano and debated in five White House meetings over the past month, but none of them was acceptable to Carter essentially because they all cost too much money.

Will Carter's stand against increased federal spending lead to serious problems with Congress? Some Capitol Hill Democrats are willing to live with Carter's fiscal policies, and some are even pleased. Notes Thomas Foley, a Democrat from Washington: "It took a Nixon to go to China, and it may take a Democrat to balance the budget." Adds Democrat Lindy Boggs of Louisiana: "The theme I hear from Democrats over and over again is that they're looking for Carter's type of fiscal responsibility."

But that does not go for many liberal members of the Democratic Party. They are frustrated and disappointed. Says Douglas Fraser, who is slated to become president of the United Auto Workers this week: "What's the purpose of winning elections? We were voting for change because we were unhappy with the status quo. If all we are going to get is the status quo, we obviously are going to be very unhappy." California Assemblyman Willie Brown, a black, complains: "Liberals are beginning to look at Jimmy Carter the way liberals in California look at Jerry Brown. He's long on liberal rhetoric but short on liberal performance." Percy Sutton, a New York City black leader who is running for mayor, is grudgingly willing to give the new President more time: "But six months from now, if he has not addressed himself to welfare, I shall be outraged." Welfare reform, if it means increased federal assistance, is especially sought by the nation's hard-pressed cities. The Democratic mayors stand to be alienated by any lengthy delay.

In perhaps the strongest public blast at Carter's policies to date. Senator George McGovern told a meeting of the Americans for Democratic Action last weekend: "Last year Jimmy Carter said that full employment was his first priority. Then it should not be postponed for a second term. Let us insist that we not balance the federal budget on the backs of the poor, the hungry and the jobless." Added McGovern: "It sometimes seems difficult to remember who won last fall."

A Step Ahead. But liberal Democrats may have nowhere to turn. They have lost stature in the party, and they are on the defensive. Sums up one of them, Economist Robert Lekachman: "It may be that the country is in a fairly conservative mood. It may be that Carter is reading the mood not of the 7% to 8% without jobs or the 20% below the poverty line, but rather the more affluent of his constituency. Look, Ford almost got elected."

Carter's apparent conservatism is not all-embracing. Indeed, he is likely to please liberals more than conservatives in his plans for reforming the Social Security system (see following story). His liberal credentials, moreover, are not in doubt in many areas. Indeed, he may be a step ahead of left-wing Democrats in adjusting to new political realities. Says James Wall, Carter's Illinois campaign chairman: "I expected him to be very cautious in solving social problems with government money. Yet on environment and humanitarian concerns, I knew him to be very liberal. I think Carter is redefining what it means to be a liberal." Which means that over the next four--or eight--years, many liberals will be redefining what they are, or what it means to be a Democrat.

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