Now, Back to Face the Music

A host of issues confront a President who has yet to get his job in focus

From the scabrous slums of New Delhi to the gilded grandeur of Versailles, Jimmy Carter absorbed a hefty chunk of the world in his grinding nine-day tour of seven countries. It was a trip compounded of princes and paupers, of weighty talk and lighthearted banter, of solemn ceremony and hilarious, sometimes embarrassing slipups. The down-to-earth couple from Plains greeted the New Year by joining the royal couple of Iran in the fairyland setting of the Shah's palace, amid a whirl of dancing, conviviality and caviar. Then last week it was back to the burdens of reality in the White House, where accumulating problems are closing in on the President. During the campaign, Carter said that he wanted to be tested to the utmost. In 1978 he will get his wish.

Perhaps the biggest challenge of all for Carter is how to manage the presidency and exercise power. For much of his first year in office, his Administration has remained strangely out of focus, suggesting that Carter may not be sure what he wants to do. The powerful interest groups that make up the Democratic Party are urging him to be a big-spending, activist President, yet the country is growing more conservative and resentful of interference from Washington. To escape this dilemma would require transcendental leadership of a kind that Carter has not yet demonstrated.

Some of the problems confronting him are old and only partially under his control; others are more of his own making. In a free system, no President can control the $2 trillion U.S. economy, but it can be guided and nudged. To date, Carter has been inconsistent on a number of issues; his on-again, off-again proposals for tax rebates and "reform," for example, have eroded business confidence. Both the Panama Canal treaty and the SALT talks have inched fitfully along under previous Administrations; Carter has pushed them hard but has sometimes acted prematurely, failing to soften up opponents in Congress--or the Kremlin.

The major issues confronting the President as he enters his second year:

The Economy With unemployment high, the dollar low and the stock market in distress, the economy will be Carter's sternest trial and the main focus of his policies this year. The $25 billion tax cut that he will propose this month is designed to revive business confidence, spark more spending on plant and equipment and head off a slowdown in growth that many economists expect late in 1978. Meanwhile, inflation shows signs of moving up again, fueled partly by measures that Carter either initiated or supported, including higher farm price supports and a steeper minimum wage.

The Budget Trying to control inflation, the President on Jan. 23 will offer a relatively austere budget for fiscal 1979. He is expected to ask for slightly less than $500 billion, a 2% increase over the current year once allowance has been made for inflation. Only $10 billion will be available for new or expanded social programs. But there is scarcely enough money for such ambitious programs as welfare reform, national health insurance and a new urban policy; all of these have had to be postponed, perhaps into the distant future. The 1979 deficit is forecast at $60 billion, the same as this year, making it extremely tough for Carter to attain his promised goal of a balanced budget by 1981.

Defense The President will request that defense spending rise from $ 117 billion to $126 billion, a 2% increase in real dollars. Speaking to NATO chiefs in Brussels last week, he promised to lift U.S. troop strength in Europe by 8,000 men, not cut it as he had said he would previously. Arguments will rise over his proposals for a reduction in construction of naval warships from 19 to 15, the cutback in the purchase of F-14 fighters from 36 to 24 and the slowdown in the development of the mobile M-X missile, the most destructive American ICBM yet to be designed. At least in part, the missile is being delayed until the outcome of the Strategic Arms Limitation Talks. Though not significant from a military point of view, Carter's recommendation to close down some 50 military bases around the country should set off a storm of protest.

Energy The President's comprehensive energy program, his main legislative initiative, remains as uncertain as ever. The House-Senate conference committee, still deadlocked on the key issues of natural-gas prices and oil taxes, gets back to business next week. But members report little sense of urgency about energy in their districts. The White House fears that if a bill does not pass by mid-March, it may get lost in the shuffle of other legislation and the pressures of election year and not get through at all. Sooner or later, Congress is going to have to pass an energy conservation and development bill; the later it is, the more severe and coercive it will be. A bill now would remove the doubts of business about what to expect on energy policy. Says Energy Secretary James Schlesinger: "The economy could be far more robust if energy legislation were on the books. Uncertainty is the problem."

Panama Canal The sharpest foreign policy battle with Congress in early 1978 will be the Panama Canal treaty. With considerable resolve and ingenuity, the Republican right has mounted a nationwide mail campaign--based largely on emotion and nostalgia--against the pact, and has intimidated many Senators. Though Senate Minority Leader Howard Baker implied last week that he would support it, the fate of the treaty is in doubt.

SALT II If Carter manages to win the canal treaty, he will have more momentum to carry the SALT talks to success. Negotiations with the Soviets resume in Geneva this week, and the two superpowers remain at loggerheads over restrictions on the U.S. Cruise missile and the Soviet Backfire bomber. The State Department does not expect a treaty to be initialed much before summer, and then it will be scrutinized by Senators who fear that the U.S. has made too many concessions.

In all, Carter's problem has been to assert his leadership when it counts. Having tried to do too much too fast, he has ended up accomplishing too little. He failed to concentrate on a few key issues such as energy and the Panama Canal treaty, and thus dissipated much of his influence. He did not build the necessary crucial bridges to Capitol Hill; nor did he have the experienced staff to help. He often seemed to bog down in detail and yet to slight the routine requirements of the job, such as sometimes twisting congressional arms. He has not demonstrated quite the same ardor in the presidency that he did in the campaign.

Leadership, consistency, wise timing --these are qualities that characterize great Presidents in time of trial. They are also the characteristics that Carter must display if he is to succeed in his time of testing in 1978.

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