New President Will Face Old Woes

Robert Lekachman is a professor of economics at Lehman College of the City University of New York and author of "Visions and Nightmares: America After Reagan."

For practical purposes, the Reagan Administration's domestic agenda is finished. Dear as they are to the President's heart, the balanced-budget amendment and the line-item veto arouse approximately the same violent, public emotion as Rear Adm. John M. Poindexter's soporific speaking style.

The current Congress, under complete Democratic control, is even less likely to cut domestic programs than its half-Democratic, half-Republican predecessor. Reagan appears to be consoling himself with threats to veto "budget busting" bills and speeches to friendly audiences boosting his so-called Economic Bill of Rights. It is, therefore, none too soon to speculate about the shape of the next President's agenda.

The person who inherits the White House in 1989 will confront, at worst, severe recession and, at best, a sluggish economy beset by lingering trade and budgetary deficits and the simmering Third World debt crisis. In this inconvenient context, the new Chief Executive also will have to tackle at least four expensive problems that have been substantially neglected during the Reagan era.

One is welfare dependency. Something like a national consensus seems to have emerged that the women who head the bulk of long-term welfare families should be educated, trained and prodded into gainful private sector jobs.

There is general agreement that substantial success requires adequate day-care facilities and extension of Medicaid for some period after a welfare client finds employment. Here the consensus ends.

Liberals insist on public jobs whenever a shortage of private sector alternatives renders training and education useless. Their definition of adequate day-care is more generous than conservative interpretations. Sharp differences exist over coverage for intact families and attempts to set minimum benefit levels. Whether or not this Congress enacts legislation, issues of cost and design will persist. Whatever the ultimate benefits of welfare reform, even a frugal effort will be expensive.

Our health non-system is a costly mess. Although we spend nearly 11% of our gross national product on assorted medical services, 37 million Americans, most of them employed at low-wage jobs, lack any health protection, public or private. For the elderly, Medicare covers less than 40% of their expenses. On average, senior citizens must pay as large a fraction of their income for health care as they did before Medicare came into operation.

AIDS threatens huge bills into the foreseeable future. Thus far, political responses have been piecemeal. Insurance protection against catastrophic illness in either White House or congressional versions assists a tiny fraction of the elderly and does little to alleviate the burdens of long-term nursing home care. The Medicaid component of a welfare program will at best cover relatively few people for short periods.

Our Canadian neighbors devote 8.5% of their smaller per-capita GNP to the health sector, but cover all residents and even tourists struck down by medical emergencies. A relative of mine on a business trip to British Columbia was hospitalized and died in an utterly un-American fashion. Before admission, no one asked about his health insurance or net worth. He received skilled nursing and medical care. No bill was presented to his widow, and his body was shipped to Maine at government expense.

It may be that comprehensive health insurance, even in free enterprise America, will rise from the dead as an issue of the 1990s. But again, short-term costs increase even if, ultimately, universal coverage reduces the health sector's share of the GNP.

The scandal of homelessness highlights a third issue, the enormous shortage of affordable housing for low- and moderate-income families. Gentrification, the spread of financial companies' offices into residential areas, the virtual cessation during the Reagan Administration of federal grants to low-income families and construction subsidies to builders have combined to shrink the stock of housing for poor families during a period when the number of such families has risen. As usual, the price tag for a decent program is high.

Falling bridges and an epidemic of airport delays have reminded us of our deteriorating infrastructure, which also includes roads, mass transit and water purification facilities. Huge sums must be appropriated merely for maintenance, not to mention essential extensions. In the next decade, a healthy economy will require, in the interests of efficiency as well as equity, not only decent housing and health protection for average working families but also the buses, subways and light-rail facilities needed to move them from homes to jobs.

Should time on weekends hang heavy on the Chief Executive's hands, he or she can ponder acid rain, ozone depletion, worker health and safety and, of course, a politically feasible method of raising the tens of billions of dollars required to address, even minimally, these essential and unavoidable national needs. Is it any wonder that such political heavyweights as New Jersey Sen. Bill Bradley and New York Gov. Mario M. Cuomo have refused to enter the wide-open competition for the Democratic presidential nomination?

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