The Importance of Being Arthur

By Hugh Sidey

In the pin-stripe halls of the Federal Reserve Building, appropriately located on Constitution Avenue and just a shadow's length from the Lincoln Memorial, the phones jangled incessantly last Wednesday evening. Aides to Chairman Arthur Burns listened, amazed and amused.

Arthur was going to make it -- he would be reappointed next day by Jimmy Carter, whispered the first caller. Ring, ring. Another voice. Sorry, it was all off. The President was dropping Burns as chairman. The negative word from the White House would soon be public. Jangle, jangle. New rumor running through the city. In just a few minutes Carter would speak in the Mayflower Hotel to the Business Council, a group of high-powered corporate chiefs, and drop his bombshell: Burns would have another four-year term as Fed chairman. Carter indeed met with the council, but he never mentioned Burns.

It is a commentary on our times that Arthur Burns, the conservative, grandfatherly economist of 73, has be come a national folk hero. Barbara Walters nags him for an interview. He twinkles, touches another match to one of his hundred or so pipes, and declines. International bankers claim, perhaps extravagantly, that his reappointment is needed to steady the stumbling dollar. American businessmen have raised him to near sainthood, even those who do not necessarily agree with all of Burns' tactics but want him to stay. Housewives, engineers and preachers write Burns that the nation needs him. He has become a soft-voiced beguiling problem for Carter.

Burns reads his Bible every night (about the same time that Jimmy Carter does) and he plots his genial strategy of survival. He wants another term as Fed chairman, and not because he likes to go to capital par ties and enjoys the aroma of power (which he does). But he thinks he is doing right by the nation to restrain the money sup ply, to preach a little caution, to stand immune from White House blandishments and politics. Burns views his ideas as good for the country's soul -- and its pocketbook.

"He is Mr. Check and Balance," says New York's ad miring Republican Congressman Barber Conable, suggesting further that this country has developed a sound understanding and appreciation of the counterforces needed within the Government to constrain careless or inexperienced power. "Arthur is a great politician," adds Conable. "He is a master of the pregnant pause. He knows when to clean his pipe. He can answer the most complicated questions with 'I doubt it,' and the world is thunderstruck with his wisdom. When he comes to testify before any committee, the whole committee shows up. He has the same effect on the members that Henry Kissinger had. He seems to be right."

Arthur Burns may not be right. In fact, his record is open to many questions. The money supply has often jumped and fallen erratically; sometimes it seems that the Fed has lost control. But Burns has become more than the country's chief central banker. Part of the reason for that is a growing public appreciation of, and sympathy can business. Since the spring of 1975, Burns calculates that the private sector of the economy has added between 7 million and 8 million new jobs. Not even the most grandiose Government employment schemes could touch that achievement. It now is plain to most people that if the private sector falters, the unemployment problem will become monstrous, beyond Government's power to cope. Burns' tactics of restraint are designed to cool inflation, which he feels is the basic cause of unemployment.

Another thing: Burns runs, in his own words, "a house of integrity." Respect for integrity is not lost in this age. So what counts now is not so much Arthur Burns' record as his aura. It may be that his qualities of character and conservatism have been around so long that they have re-emerged as the future -- whether he is reappointed or not.

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