President Depending More on Regan Since His Surgery

Ronald Reagan, a more ideological and less flexible President since his cancer surgery last month, is depending more than ever on his powerful and controversial chief of staff, Donald T. Regan, as he struggles to salvage the goals of his second term.

Regan, a former Wall Street broker and Marine colonel, has arguably emerged as the strongest chief of staff since Sherman Adams, President Dwight D. Eisenhower’s alter ego in the 1950s. But in the process, he has irritated some of Reagan’s closest advisers and strongest supporters in Congress, who give him most of the blame for the rocky start of the President’s second term. Hanging in the balance are the President’s proposed tax overhaul, the completion of his military buildup and his continuing effort to reduce the government’s domestic programs.

An ‘Undermining’ Influence

A longtime Reagan adviser who asked not to be identified by name said of the chief of staff: “He’s undermining the presidency and (Reagan’s) ability to govern.”

It was Regan, for example, who recommended that the President reject a deficit reduction proposal by Senate Republicans that would have increased taxes and trimmed Social Security benefits. Without presidential backing for tougher measures, Congress on Thursday adopted a watered-down budget that achieves much of its deficit reduction by limiting defense spending--the one part of the budget where Reagan is seeking more growth.

During Reagan’s convalescence from cancer surgery, he is likely to be more dependent than ever on his chief of staff. Despite the friction that Regan has generated in Congress and even with his own subordinates in the White House, the personal chemistry between Reagan and his chief of staff is described by associates as “great.”

The rapport began developing while the irreverent, tough-talking Regan served as Treasury secretary during Reagan’s first term. And it has blossomed at the White House, where Regan has exercised tight control over access to the President, especially since the cancer surgery. A joke among some longtime Reagan advisers is that the chief of staff has a constituency of one, but it’s the one who counts--the President.

Regan has assumed an uncompromising stance in pressing for Reagan’s programs. But the combination of two unbending personalities--together with Regan’s abrasive and confrontational style--has created serious friction with Congress and mounting political problems for the convalescing President.

Since Regan swapped jobs with former Chief of Staff James A. Baker III last January, he has repeatedly stressed the credo often voiced by the President’s most conservative followers: “Let Reagan be Reagan.”

Less Likely to Compromise

Recently, for example, Regan predicted that the President’s cancer surgery would make him less likely to compromise to achieve his second-term goals. “I think, if anything, it has reinforced Reagan wanting to be Reagan,” he said.

Some of Reagan’s longtime advisers both in the White House and out say the President has become isolated from them. They criticize the chief of staff for reinforcing his boss’s most rigid views instead of offering him a variety of viewpoints and advice. That approach may be more efficient, they say, but it also tends to lead Reagan toward confrontation more often than compromise.

The chief of staff’s intransigence, they say, contributed substantially to the Administration’s failure to come to terms with Congress over a deficit reduction package. And the President’s longtime associates complain that Regan, by letting the federal budget distract congressional attention from the White House’s proposed tax overhaul, is responsible for Congress’s mounting opposition to the tax package.

Aides’ Dissatisfaction

Even the chief of staff’s own aides express dissatisfaction about the way he has handled both the budget and tax reform. While Senate Majority Leader Bob Dole of Kansas and other Republican senators have openly criticized Regan for the way he has dealt with Congress on the budget, most critics interviewed by The Times insisted on anonymity.

Despite the criticism, the President is apparently pleased with Regan’s performance. In a recent Time magazine interview, Reagan said his chief of staff is functioning as he should.

“Don’s carrying out the things that I have said,” Reagan said. “I’ve witnessed no grabs for power on the part of anyone. There seems to be a concerted effort, and has been for the last 4 1/2 years, to try and build feuds within the Administration. There just isn’t anything to it.”

Indeed, Regan’s streamlined corporate management style has stopped the high-level feuding that repeatedly broke out within the White House during Reagan’s first term, when Baker shared power with two and sometimes three other top presidential aides. But it has also focused attention--often not very flattering--on his own powerful role.

Lawmaker Is ‘Envious’

“I’m envious of the amount of power he’s been able to acquire in terms of being able to manage the White House,” said Rep. Dick Cheney (R-Wyo.), who served President Gerald R. Ford as chief of staff. “But that carries with it the responsibility for whatever goes wrong. There isn’t anybody else except the President to blame. . . .”

“There’s always grousing about the guy in the job, but you invite more when you amass power. And that’s part of the problem right there.”

Sherman Adams and other strong White House chiefs of staff of the past usually remained in the background as they carried out presidential directives. But Regan has been out front with his combative style, and critics complain that he has acted at times as though he occupied the Oval Office himself.

In a recent speech here to the U.S. Chamber of Commerce, for example, the chief of staff accused Congress of being “afraid to come to grips” with the federal deficit and added: “I’m challenging them to do it.”

One longtime Reagan adviser said: “He didn’t say the President or the Administration was challenging them. He said he was. I couldn’t believe it.”

Refused an Interview

Regan, who refused to be interviewed on the record for this article, makes no apologies for his confrontational style, which he feels worked for him on Wall Street and at the Treasury Department and will work for him at the White House. Although Regan has emphatically denied shutting out other advisers, he is concerned enough about the continuing criticism that he has told other White House officials he plans to keep a lower profile in the future.

The criticism has become so widespread, especially in Congress, that Sen. Paul Laxalt (R-Nev.), the President’s longtime friend and confidant, has privately told Regan of his concern and stressed the need for more political expertise in the White House.

But in the fall, the White House will lose a substantial part of its political expertise because two senior aides--political adviser Edward J. Rollins and congressional relations chief Max L. Friedersdorf--have announced their intention to resign. That will leave national security adviser Robert C. McFarlane as the only remaining senior White House aide from Reagan’s first term, and beyond that, many key mid-level White House positions remain vacant.

‘Situation Is a Mess’

“The good guys are leaving and the personnel situation is in a mess,” said a key Republican congressman and longtime Reagan supporter who asked not to be named. “You’ve got the budget problems, and the tax thing is coming unglued.

“The other morning a bunch of freshmen House Republicans met with Regan and Baker and beat up on them on tax reform. They told them they had been home and nobody wanted to know about tax reform, they wanted to know about the deficit. Getting that from junior House Republicans should give you a feel for the White House nowadays.”

Similarly, Reagan received a frosty reception last week when he arrived for a White House session with Republican leaders of Congress to explain his rejection of the deficit reduction package proposed by Senate Republicans.

“Ordinarily there would have been some applause when he entered the room--and you would have expected more than usual because it was the first time most of us had seen him since the surgery,” one Republican said. “But there was no applause, and it was one of the most tense meetings I’ve ever been to at the White House.”

Reagan Put on Notice

A Republican House leader said Senate Budget Committee Chairman Pete V. Domenici (R-N.M.), glancing at Regan as he addressed the President, put Reagan on notice that he will insist next year that the White House recognize the need for including taxes, benefit programs and the Defense Department in deficit reduction.

Domenici was quoted as saying: “I want you to know, Mr. President, it’s the last time I’ll do this. I want to make it clear to you and all your advisers in the room that I will not go through with this coverup again.”

Regan, though 66, is a newcomer to national politics. As he has told friends, the President did not know him “worth a damn” except as a campaign fund-raiser for the 1980 Reagan-Bush ticket when he tapped him to become Treasury secretary in 1980. Far-right Republicans tried to block his selection after learning that he had contributed in the past to political campaigns of liberal Democrats.

Made a Fortune

But Regan was well known on Wall Street, where he made a fortune as the hard-driving chairman of Merrill Lynch & Co., the big brokerage house. And he quickly established a reputation at Treasury as an outspoken official who viewed with contempt any criticism of the President’s economic programs--even from other Administration officials.

Early in the Administration, David A. Stockman, who left as Reagan’s budget director last week, angered Regan by discussing with reporters his views on tax policy, which Regan considered to be Treasury’s preserve. After discussing the matter with the President, Regan told reporters: “This is where you’ll hear Administration tax thinking. If you hear something different someplace else, then it’s wrong.”

Overshadowed at first by Stockman, a brilliant former congressman already well-known in Washington, Regan quickly emerged as the Administration’s chief economic spokesman and advocate for the tax cut that Congress enacted in 1981. Critics often derided Regan as an unquestioning cheerleader for Reagan’s economic policies.