Scratches in the Teflon

By GEORGE J. CHURCH

It may have been Ronald Reagan's worst week in the Oval Office. His deft touch at manipulating political symbols faltered; the continuing storm over his planned visit to the German cemetery at Bitburg on Sunday put the President in a painful predicament with no graceful way out. His vaunted powers of persuasion could not avert a stinging defeat in the House, which killed all proposals for U.S. aid to the Nicaraguan contras for now. The Soviets turned more than normally truculent, and the U.S. economy developed some worrisome rumbles. Reagan's eternally sunny optimism for once clouded over. "He is in anguish over Bitburg, and he is bitter about the House vote," reported one senior adviser.

Even Reagan's fabled mastery of television was failing, at least temporarily, to work its accustomed magic. In a forceful speech to the nation on Wednesday night, the President summoned all his rhetorical resources to appeal for public support of the $52 billion in spending cuts in the fiscal 1986 budget plan. "The stakes are enormous," said Reagan. "Please tell your Senators and Representatives by phone, wire or Mailgram that our future hangs in the balance."

Some people responded, but not enough to sway the crucial votes immediately. The Republican leaders of the Senate had planned to call for a vote on the compromise budget package they had worked out with the White House on Thursday, to take advantage of the impetus they expected from Reagan's speech. But that day it was the Democrats who dared them to go ahead, while Reagan's G.O.P. allies repeatedly postponed a ballot that they knew they could not win.

A vote is now scheduled for this week, and it is entirely possible that Reagan can round up enough votes to pull out a narrow victory. But that certainly would not end the budget battle. Approval of the general outlines of a spending plan would still leave the details subject to a flock of amendments in the Senate, to say nothing of the antagonistic reception the budget resolution is sure to get in the Democratic-controlled House. Proposals to limit future cost of living increases in Social Security benefits, to abolish 17 federal programs and to increase military outlays 3% above the estimated rate of inflation will all come under fierce attack, which will be even sharper if the overall budget package cannot squeak through the G.O.P.-controlled Senate. "If we lose, we start the demolition derby," says Senate Majority Leader Robert Dole. Even if the broad budget package passes, he adds, "maybe it will be a demolition derby anyway."

Reagan's chances of winning the budget struggle have not been enhanced by last week's reverses. The uproar over Bitburg seems to be perceptibly, if perhaps temporarily, lowering the President's popularity. In a Washington Post-ABC News poll published last week, 52% of respondents wished Reagan would cancel his visit to the Bitburg cemetery, which contains the graves of 2,000 German soldiers, most of them killed during World War II, including 49 members of the Waffen SS, the combat branch of Hitler's murderous elite guard. Reagan's overall job-approval rating in the same poll dropped to 54%, from 60% in late March and a dazzling 68% in January.

Reagan's decision to add a visit Sunday to the site of the Bergen-Belsen concentration camp did not calm the storm. Vociferous critics, especially Jews, charged that the President was insensitively equating Nazis and their victims. Within the Administration, Charles Z. Wick, director of the U.S. Information Agency, told reporters apprehensively that Soviet propagandists will "have a field day" denouncing the visit. Such propaganda has started already: at a Communist bloc ceremony in Warsaw, Polish Premier Wojciech Jaruzelski stormed against Reagan's "pilgrimage to . . . the graves of SS criminals and butchers and hangmen." Wick gloomily predicted that Reagan would encounter demonstrations by "people from all over Western Europe, some of them wearing concentration-camp clothes."

Recognizing that Reagan feels obligated to fulfill a commitment to West German Chancellor Helmut Kohl, 257 Representatives, including 84 Republicans, signed a letter urging Kohl to withdraw his invitation. The Senate approved a resolution to the same effect by unanimous voice vote.

Kohl, however, views the ceremony at Bitburg as vital to German-American friendship. Said he in an interview with TIME: "I will not give up the idea. I suggested it. I stick to it" (see following story). For his part, Reagan confided to an acquaintance, "Everybody said after all this trouble I should have admitted the mistake and dropped the visit. But in my view, it boiled down to walking away from a true friend. If I did that, then there goes the friendship. Now I think we must go ahead or appear weak."

White House aides are trying only to minimize the damage. Though original plans called for Reagan to lay a wreath at the cemetery, aides say he might do something else; the form of the ceremony has not been settled. They voice a wan hope that the press and TV will not concentrate on the Bitburg ceremony to the exclusion of other events next Sunday, which include the visit to Bergen- Belsen and an appearance by the President at a picnic at a U.S. air base near Bitburg.

But the substance of policy, as well as symbolism and politics, created troubles for Reagan last week:

-- The Geneva arms-control negotiations with the Soviet Union recessed until May 30 in a stony deadlock. The new Soviet leader, Mikhail Gorbachev, charged that the U.S. did not want a deal. The Soviets also repudiated an apparent agreement designed to prevent incidents like the fatal shooting of U.S. Major Arthur Nicholson outside Potsdam in March. Washington retaliated by expelling a military attache at the Soviet embassy. The hard Soviet line increased questioning by some Administration officials as to whether Reagan should continue to seek a meeting with Gorbachev. But the odds still favor a get- together of some kind, possibly when Gorbachev comes to New York City in September to address the United Nations General Assembly.

-- In Congress, Reagan had launched a hard-sell campaign to portray U.S. aid to the contra guerrillas battling the Sandinista government of Nicaragua as essential to stop the spread of Communism in Central America, and when he ran into trouble he agreed to several compromises, chiefly making the aid nonmilitary. But he compromised in vain: though the Senate approved $14 million, the House voted down not only military aid but even humanitarian aid to the contras. Angry Administration officials vowed a renewed attempt to win aid in the new fiscal year that begins Oct. 1, but their prospects seem dim. A majority of the House apparently does not trust Reagan to pursue a prudent policy in Central America.

-- Reagan's proudest achievement, the long-running and noninflationary U.S. economic expansion, showed signs of strain. Following a report that production of goods and services grew at an anemic annual rate of 1.3% in the first quarter, Preston Martin, vice chairman of the Federal Reserve Board, warned that the nation seemed to be "on the edge" of a so-called growth recession. That means growth too slow to prevent a possible rise in unemployment, which has held for eleven months at a bit more than 7%.

Most of these setbacks are retrievable, and Reagan is nothing if not resilient. Even as the Bitburg flap approaches its climax, the President will get a chance to score some success this week at the economic summit meeting in Bonn. The prime U.S. goal is to get the other six nations represented (Britain, Canada, France, Italy, Japan and West Germany) to accept a specific date in early 1986 to begin a new round of negotiations aimed at breaking down barriers to free trade. Reaganites view this as essential to head off a wave of protectionism in the U.S. and abroad that could gravely damage the world economy. Chances for agreement seem good; Treasury Secretary James Baker smoothed the way by dropping U.S. objections to discussions desired by France on reducing currency fluctuations.

There will be room for disagreement too. The participants concur that output in Europe and Japan must grow more rapidly to prevent the slowdown in the U.S. expansion from leading to a world recession, but Britain, West Germany and Japan are likely to resist suggestions that they pump up their economies. On political matters, the Europeans are increasingly uneasy about the deadlock at Geneva and skeptical of Reagan's Strategic Defense Initiative (Star Wars). Any hint of dissension, however, will be rigorously excluded from the final communique.

No amount of sweetness and light at the summit will by itself restore the momentum that has leaked away since Reagan's triumphant re-election. It seems clear that the White House coasted complacently in the belief that the 49- state "mandate" would sweep away most obstacles; for example, Reagan and his lieutenants waited too long before realizing they had to compromise on contra aid.

The President, who had vigorously controlled the agenda during most of his first term, stood by passively as his top advisers rearranged themselves. The reshaped White House staff, now headed by Donald Regan, has proved less adept at sniffing out and averting trouble than the first-term damage-control team of James Baker and Richard Darman, now the top men at Treasury. "Darman was very careful at keeping the President's rhetoric under control," says a high Administration official. The new staff, by contrast, favors a combative tone, and that tone has begun to backfire. White House Director of Communications Patrick Buchanan in particular has urged a confrontational style, and that approach has been accepted by Regan, who is not averse to confrontation himself. Said Regan after the contra vote: "We have an issue: Who is to blame for the spread of Communism in Central America? The Democrats are going to regret that."

The President, in his budget speech, showed some signs of greater realism. While remaining feisty, he for once made no reference to his re-election, apparently realizing that the mandate argument had worn thin. It has, and so has the first-term description of Reagan as the Teflon President, the man to whom no blunder would stick. Over time even Teflon can be scratched.

With reporting by Laurence I. Barrett/Washington and William McWhirter/Bonn