The Presidency

By Hugh Sidey

Lyndon Johnson could smell trouble coming a year away. Then he would tell one of his favorite yarns from the Texas hill country about the Army recruiter who went out to scare up some new boys during World War II. He found one big fellow, pronounced him physically fit and submitted him to the mental test.

Suppose he was standing beside the town's lone rail track and saw a train coming from the north at 80 m.p.h. and on the same track another train roaring toward him from the south at equal speed. What would he do? The recruit, said Johnson, thought a few seconds, then brightened and responded, "I'd run home and get my brother." The recruiter had never heard that answer, and asked what for. Said the young man: "My brother's never seen a train wreck."

There is a feeling in Washington that we are gathering at the side of the track to watch a gigantic economic train wreck one of these days, and nobody seems inclined to do much but ask his brother along for the spectacle. The dismal economic reports this week -- slow growth, housing starts down, deficits unabated -- heightened the foreboding even while the politicians celebrated tax reform and Reagan rode horses at his ranch.

Horace Busby, a political analyst who got his start under Johnson and who has been as right as anybody in this town about long-range prospects, takes a decidedly pessimistic view. "Washington has retreated into a surreal world where values are so reversed that fantasy is fact, evasion is honesty and irresponsibility is a cause for pride," he says.

While professing a horror of deficits, Washington has made them mountainous. While trumpeting tax cuts, the Federal Government last year took 19% more from the private sector than it did in 1982. Last year's farm bill, advertised as a cost saver by Democrats and Republicans, will triple (yes, triple), to $25.5 billion, the cost of supporting crops over what we paid just two years ago.

Military spending, supposed target of budget cutters, always goes up after every legislator takes care of his home project. "It results from the continuing flight from reality," says Busby, who remembers the horrified & exclamations when it was first announced that the nation would run deficits at the rate of $200 billion a year. "We've lived with that four years now, and those deficits no longer have any effect at all. Nobody pays any attention. We are numb."

Within a few feet of Ronald Reagan's White House office a high official said worriedly, "It could take a crisis before this country comes to grips with the economic problem it faces." And on Capitol Hill, one of the handful of men who run the place mused, "Democracies don't do what they ought to do until events leave them no choice." The White House blames Congress for not cutting spending, and Congress blames the White House for not raising revenues. With that kind of talk, you can hear the locomotives gaining speed.

A growing number of Government experts suggest that if the American economy fails now, the consequences may be more disastrous than at any other time in our history. "Reagan could go from the most popular President of these times to the most reviled," says Busby. "A crisis now is apt to go beyond just economics. We would have a nation in social upheaval."

That is strong stuff, even if it does come from outside the Administration. And there are indications from inside that some of Reagan's Cabinet have got a whiff of the same fear. Labor Secretary William Brock, Trade Ambassador Clayton Yeutter, Commerce Secretary Malcolm Baldrige, Treasury Secretary James Baker and Secretary of State George Shultz now form an informal consortium alarmed about the ominous debt and convinced there must be a major new effort to bring spending and revenue more in line. The U.S. economy is not strong enough to carry the twin burdens of defense and social spending heaped so high, these men believe. They have not begun to meet as a group, but their views are joined. Maybe they have heard the trains coming.