Gossipy Lament

By GEORGE J. CHURCH

David Stockman's kiss-and-tell memoir seems headed for a quick public success --it will be No. 1 on the New York Times best-seller list and No. 2 on TIME's list next week--rivaling the succes de scandale it is enjoying in / Washington. The former head of the Office of Management and Budget has set tongues wagging with his contemptuous descriptions of his former colleagues and his odd self-portrait. Stockman, according to Stockman, was at once an arrogant ideologue and "a veritable incubator of shortcuts, schemes and devices to overcome the truth"--the truth in this case being that his program could not balance the budget.

But beyond the titillating personal tidbits, Stockman is arguing a serious point, as indicated by his title, The Triumph of Politics: Why the Reagan Revolution Failed. The revolution, in his view, was intended to dismantle the welfare state and replace it with a minimalist Government that would do little more than keep law-and-order. Capitalism, freed of wasteful spending schemes and pepped up by tax cuts, would go on to produce prosperity for all. But his colleagues, up to and including the President, had only the dimmest idea of what it was they were supposed to be doing. They would never let Stockman fashion a program that would actually produce those results.

Stockman tells some appalling tales about the haphazard way the actual Reagan economic program of 1981 was shaped. On one occasion, he and Secretary of Defense Caspar Weinberger casually agreed to split the difference between various military-spending proposals and came up with a figure of 7% real growth in the Pentagon budget. Stockman paid little attention to the base figure on which the Pentagon proposed to calculate that 7%. When he saw the actual numbers pointing to military spending of $1.46 trillion over the next five years, Stockman writes, he "nearly had a heart attack." Later the OMB boss came to the gloomy conclusion that even the most severe cuts in nonmilitary spending would fall $44 billion short of balancing the budget by 1984 (the actual gap, of course, turned out to be vastly greater). His simple solution: slap a "magic asterisk" on the $44 billion figure and call it "future savings to be identified."

The "politicians" in both the Administration and Congress then joined in an endless series of deals and compromises that drastically watered down even the inadequate spending cuts Stockman was able to propose. Worse, they began a bidding war that turned the later tax cut into a gargantuan giveaway of federal revenues. Result: the welfare state survives in all fundamental respects, and the economy has been saddled with mammoth deficits that in Stockman's view are leading "inexorably" to doom.

As a gossipy inside account of how the Reagan program was shaped, Stockman's tale has both fascination and merit. It shows how Reagan's detached management style allowed the federal deficit to explode, and perhaps inadvertently it shows how this style was a key to Reagan's immunity to the political fallout from his policies. But as analysis, the book seems seriously flawed. Stockman writes as if it were self-evident that the economy has descended into fiscal hell. He pays scant attention to the increases in output, employment and income of the past few years and to the virtual disappearance of inflation. To Stockman, all this is a kind of illusion: "If we stay the course we are now on, the decade will end with a worse hyperinflation than the one with which it began." Perhaps. But would reducing Social Security benefits and raising taxes, a heresy Stockman eventually advocated, have made matters much better? Maybe so. Stockman, however, does little more than assume that this is obvious.

In addition to downplaying the marked improvements in today's economy, Stockman slights other Reagan accomplishments. If the Administration did not smash the welfare state, it did engineer a fundamental change in the direction of Government policy. That probably was the most that could have been done--a point Stockman grudgingly winds up conceding--and it could be done only through a triumph of politics. After hundreds of pages in which he condemns politicians who will not eviscerate "statist" spending schemes, he suddenly concludes that they are only representing the will of the people. "The American electorate wants a moderate social democracy to shield it from capitalism's rougher edges," and ideologues disregard that demand at their own and the nation's peril. One wonders why so obvious a conclusion took so long to enter his head. After all, it seems to have been exactly the point that was intuitively grasped by the politicians, Ronald Reagan foremost among them.