Sen. Levin Is Finding the 'Peace Dividend' to Be a Tough Act to Follow : Politics: Constituents demand to know how the money saved from defense cuts will be spent. The renewed attention to domestic issues is likely to influence Congress.

THE WASHINGTON POST

When Sen. Carl Levin (D-Mich.) stopped by the Modern Medical Pharmacy recently to ask directions to a nearby television station, proprietor Joseph Grimaudo took advantage of his captive audience.

"We're really seeing history change," the exuberant pharmacist told Levin as he trailed the senator out the front door. "Take some of the money from armaments and give it to the people. . . . There are people (on Medicare and Medicaid) who gotta have oxygen and they can't get it."

When Levin finished a meeting on school drug problems with local officials the next morning in Allen Park, south of Detroit, a radio reporter asked if the improvement in U.S.-Soviet relations means that the American military can now help more with interdiction of drug smugglers.

At his next stop, Levin chatted with a group of fifth-graders in nearby South Rockwood and picked up on the theme, suggesting that an easing of international tensions may mean that the United States can use some of its defense dollars for other purposes. Teachers standing in the back of the room did not miss a beat in letting him know where they thought the money should go. "Education," they shouted.

Nearly everywhere he went in dawn-to-dusk travels around largely blue-collar, ethnic communities outside Detroit, Levin was peppered with questions about the waning of the Cold War and its implications for the United States.

With family ties stretching back into Eastern and Central Europe, many of Levin's Detroit-area constituents, who include thousands of Democrats who voted for Ronald Reagan in 1980 and 1984 and George Bush last year, remained skeptical about Soviet intentions and apprehensive about continued upheaval in their ancestral homelands.

But visions of sugar plums were already dancing in many heads. Even among the skeptics, the dominant mood was one of hope and rising expectations, tempered by a concern over U.S. economic and fiscal problems that is deepened by shakiness in Michigan's auto industry.

Some saw investment and trade opportunities for the United States, even for themselves. But most, like Grimaudo, saw opportunities for expansion of domestic initiatives, ranging from schools to environmental protection, that had been starved for funds during the military buildup of the early 1980s. Few appeared to heed the warnings of President Bush and others that it is far too early to start spending the so-called "peace dividend."

Judging by Levin's trip home, the unleashing of a pent-up demand for attention to domestic needs, which for some included reduction of the nation's budget deficit, appears likely to influence Congress as it heads into its 1990 election-year session. It also holds out the possibility of a profound change in the political direction of the country as it heads into a markedly different decade.

"I think it's going to change politics down to the grass-roots level," said Carl Marlinga, the Democratic prosecutor of Macomb County. "We're going to think of the world in a different way . . . without a military nuance to everything we talk about . . . . No longer are we going to have to sacrifice everything to prepare for war."

But Michigan Republican Party Chairman Spencer Abraham cautioned that foreign affairs is usually a cutting issue only in times of crisis and that candidates who seek to exploit the issue are usually hurt more than they are helped. "Take an extreme position either way and you're likely to be hurt," he said.

The sword's double edge is apparent in the case of Levin, a senior member of the Senate Armed Services Committee and an ardent foe of moves to expand the nation's nuclear weapons arsenal. Levin, who won his two previous races by narrow margins, has been targeted by Republicans as a top prospect for an upset next year.

While Levin drew nods in the Detroit area for his suggestions that some defense money can now be channeled to deficit reduction or domestic needs, he is getting "beat up like hell," according to an aide in his state office, in communities around Wurtsmith Air Force Base in northern Michigan, which was just chosen as one of seven sites for the new rail-based system for the MX missile.

Levin opposes the 10-warhead nuclear missile and its new rail-garrison basing mode, while Rep. Bill Schuette (R-Mich.), the leading contender for the GOP Senate nomination, is trumpeting his support for the program and welcoming the missiles to Michigan.

Levin's weaponry problems do not end with the MX, however. As chairman of the Armed Services subcommittee on conventional forces and as an advocate of strengthening these forces as opposed to nuclear weaponry, Levin has championed the M-1 tank, Michigan's single largest defense project. It accounts for thousands of jobs at its Warren, Mich., assembly plant and at other production and engineering facilities across the state. But to Levin's dismay, the M-1 appears a more likely casualty of Pentagon-planned military cutbacks than does the MX.

Only days after the Defense Department designated Wurtsmith for the MX-on-rails, word leaked from the Pentagon that the Army had proposed to end production of the tank after fiscal 1991 as part of its contribution to savings mandated by budget cutters.

For others here, the defense spending issue is broader than any single weapons system, touching off a re-examination of priorities in a world in which tanks as well as missiles appear to be headed for the arms-control bargaining table.

Take Henry J. Luks, for example.

Luks, grandson of Polish immigrants, runs a small alarm systems business in East Detroit. At a luncheon in Mt. Clemens, he asked Levin about the implications of the East-West thaw for the U.S. and Michigan economies.

"If we can reduce some of the defense burden we've had to carry" and use the money for education and other endeavors that will enhance the nation's productivity, the United States will benefit greatly, Levin responded cautiously.

Luks seemed a little disappointed and said later that he felt more exhilaration than he detected in Levin.

"I may be wrong, but it just seems (like) such a golden opportunity out there for everyone . . . a great big pipeline for U.S. products," he said.

Does this mean he believes the United States can start turning its swords into plowshares? "We can cut nuclear weapons that can already blow up the world a hundred times over," said Luks, "but until we see a little more good faith (from the Soviets), I don't think we should start pulling out troops. I guess I'm not ready to run up and give them a kiss and a hug, not yet, anyway."

But he would like to do business with them, Luks said. "Think they'd like to buy some alarm systems?" he asked.

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