Calling Plays for the Gipper

By WALTER ISAACSON

Jim Baker's strategy group nudges policy toward the middle

In the eyes of right-wing critics, the eight or so aides who meet almost every day in the White House have diverted the President from his ideological principles and led him down the primrose path of moderation and compromise. To others, the ad hoc group is the dynamo behind Ronald Reagan's legislative successes and the key to the biggest challenge of his presidency, the proposed 1982 tax increase. "It is the driving force in the White House today," says a top Reagan loyalist. "It sets the agenda for what we're doing and where we're going."

Known by the misleadingly modest title of Legislative Strategy Group (L.S.G.), the brain trust that has coalesced around Chief of Staff James Baker, 54, has become the Tolkien ring of power in the White House. The group does not appear on any of the detailed charts drawn during the transition by Counsellor Edwin Meese, 50, to map the flow of White House authority. Rather, it was conceived shortly after the Inauguration by Baker's deputy, Richard Darman, 39, to coordinate the passage of Reagan's economic program. "It was important that everyone in the Administration knew there was a clearing house," explains Darman. Other core participants: Baker's partners in the White House top troika, Michael Deaver, 44, and Meese; Communications Director David Gergen, 40; Kenneth Duberstein, 38, the Administration's gregarious and highly effective lobbyist on Capitol Hill; Budget Director David Stockman, 35; and Craig Fuller, 31, who coordinates the work of the Cabinet.

By carefully choosing when to fight and when to compromise, the L.S.G. has scraped together enough votes to ensure victory in every major legislative battle this year: the final 1982 spending resolution, which passed the House by 13 votes; the balanced-budget amendment, which passed the Senate by two votes; and the substitute nuclear-freeze resolution, which passed the House by two votes. "They have had one hell of a record with Congress," says Robert Strauss, former chairman of the Democratic Party and a top troubleshooter for Jimmy Carter.

What has made the L.S.G. a lightning rod for the right is not its effectiveness in executing strategy but its success in moderating Reagan's policies. "A number of people thought there was a great distance between formulating policy and implementing it," says a key member of Baker's group. "That is a preposterous notion." In fact, most of the major initiatives of any Administration have to be modified and compromised as they are translated into legislation. Admits Meese's top deputy, James Jenkins: "The L.S.G. can make the work of the Cabinet councils unrecognizable." This is not necessarily a bad thing: in many cases the L.S.G. has blocked the excesses of overardent Reaganites.

Consequently, Reagan's programs depend to a large extent on the style and philosophy of Baker and Darman. Baker, a cautious buttoned-down Texas lawyer who worked in the presidential campaigns of Gerald Ford and George Bush, is guided by a belief that politics is the art of the possible. Says he: "Some claim it's better to fight and lose than to give 10% and get 90%. Well, they're wrong. Dead wrong." Even partial victories, Baker correctly argues, enhance the President's prestige. New-Right Leader Howard Phillips, who has bristled at Baker's rising influence, sees it differently: "Baker's group calls the plays, and Reagan runs with the ball. Baker only understands negotiating and compromise. What he is doing is destroying Reagan's reputation for integrity and principle." In fact, however, the group has ensured the success of some of the conservatives' pet projects, like the balanced-budget amendment.

Darman, Baker's alter ego, has a high-voltage, Harvard-honed intellect and an aggressive personality to match. Even more than Baker, he is associated with the Republican Party's moderate wing, having once been a protege of Elliot Richardson's. Says one wary colleague: "Darman is the brightest guy in the White House. Philosophically, he is not where the President is."

The L.S.G. derives part of its power from its ability to react quickly. The group is kept lean and usually includes no more members than can fit around Baker's small mahogany conference table. At times the L.S.G. may alter a decision made by a Cabinet group in order to accommodate political pressures. When a resolution calling for a freeze on the production of nuclear weapons seemed likely to pass in the House, the L.S.G. convinced Reagan that contrary to the policy pressed by the State Department, he must embrace an alternative resolution that included the word freeze. Another tactic of Baker's group, one that particularly irks right-wing activists, is to place on the back burner programs they are not anxious to pursue for political or ideological reasons. Among them: dismantling the Department of Education and passing a constitutional amendment to ban abortion.

By far the most important policy initiative shaped by the L.S.G. has been the tax increase that the House is scheduled to vote on this week. Baker and Darman, along with other key members of their clique, have always been wary of supply-side dogma and worried about looming budget deficits. They felt that without the $98.6 billion three-year tax increase fashioned in the Senate last month by Republican Robert Dole, Reagan's economic program would be doomed and his political popularity jeopardized. In presenting this argument to Reagan, the Baker-Darman group excluded from the meetings those who opposed the Dole tax bill, including Presidential Assistant Richard Williamson and key congressional conservatives.

Having set Reagan on a course of increasing taxes, the L.S.G. has put itself in an extremely vulnerable position. Some right-wing Congressmen, in fact, have labeled the tax-increase measure "the Baker-Darman-Stockman exit bill." Particularly if it fails, conservative ideologues may be able to convince Reagan that the power of the Baker-Darman dynamo should be curtailed.

--By Walter Isaacson.

Reported by Douglas Brew/ Washington

With reporting by Douglas Brew

This file is automatically generated by a robot program, so viewer discretion is required.