Simon Says Rivals Have Reagan Mind-Set

Sen. Paul Simon said Wednesday that his rivals for the Democratic presidential nomination have fallen under a Ronald Reagan mind-set that inhibits them from promising major health, education and jobs initiatives.

“Some people are so afraid of being labeled big spenders that they’re unwilling to make the investments that we absolutely have to make to move this country ahead,” Simon told a news conference.

Simon, under fire from his opponents for promising to both balance the budget and increase social spending, said, “That mind-set is: ‘We can’t do this. We can’t do that.’ They see all the obstacles.”

Chooses Manatt

“I recognize there are obstacles out there. But this country didn’t move ahead just focusing on the obstacles. We looked at our problems and then we moved, and we did the things that have to be done,” said the Illinois senator, who had just named former Democratic Party Chairman Charles T. Manatt as his national campaign chairman.

Manatt quipped, “It’s not every day you can get a balanced budget populist to support for President of the United States.” He called Simon “a man you can trust” and the most electable of the Democrats.

Simon appeared flustered in a televised debate on Dec. 1 when Rep. Richard A. Gephardt said, “Simonomics is really Reaganomics with a bow tie” and called Simon “a promise-as-you-go Democrat.”

“I wasn’t quite happy with my response. I had one minute to respond,” Simon said Wednesday.

Promises Balanced Budget

Taking 3 1/2 minutes, he gave this explanation of how he would balance the budget, barring a recession, in his third fiscal year in the White House:

--”You reduce Pentagon spending by about 6%. That’s a $20-billion cut. You can do it without impairing the defense of this country at all.

--”No. 2, you move on trade policy in very specific terms, in terms of tax breaks we now have (that) encourage industries to move outside of the United States, in terms of having one person in charge of trade instead of having 18 agencies in charge of trade; you move on some other private sector initiatives.”

--”Conservatively, you can reduce unemployment 1.5%. Each 1% you reduce unemployment, you save $30 billion. That’s a $45-billion reduction.

--”By showing that you’re in charge and moving on our fiscal problems, you no longer have fiscal and monetary policy in conflict, and the Federal Reserve will be able to accommodate and lower interest rates. Each 1% you lower interest rates, you save $24 billion. I think conservatively you could at the end of three years have interest rates down 2%; let’s be even more conservative and say your interest savings will be $30 billion.”

Would Increase Taxes

“Those three things together are $95 billion,” Simon said. “If those do not work, if for some reason this Administration has things so fouled up that the present projections don’t turn out to be accurate, then as a last resort I’m willing to increase taxes. But I don’t think it’s going to be necessary.”

Simon said neither his promise to spend several billion dollars more on education nor his public jobs bill, costing $5 billion the first year, was “a huge ticket item.”

Simon said he will find a way to help the elderly pay for long-term care, both in nursing homes and at home. But he said, “We have to have a paying mechanism with it; it has to be pay as you go.

“We can restructure that budget to take care of those things. There’s just no question about it,” he said.