Election Fiasco Over Budget Feared by GOP

For most Americans, the impending last act of the battle of the budget may mean relief, but for Republicans the dominant feeling is dread: They fear that the spectacle on Capitol Hill could prove to be the prelude to a political debacle.

Twelve days before voters go to the polls, Republicans find themselves bitterly divided, confronted with the challenge of closing ranks behind a President whose once-vaunted personal prestige has been battered and whose policies have been clouded by the prolonged and frustrating fiscal struggle.

“They seem to have lost the political high ground on taxes and spending that Republicans have held for years,” said John Petrocik, a UCLA specialist on political parties and a sometime Republican consultant.

Instead of the starring role as the friend of the average taxpayer that they assigned to themselves during the Ronald Reagan presidency, Republicans now find themselves cast as the heavy in the American political melodrama--the accomplice of the wealthy and privileged.

“Bush is the loser and, therefore, his party is the loser,” said David Keene, chairman of the American Conservative Union and director of Bush’s first presidential campaign in 1980. “As his popularity has fallen, so have the poll ratings for a lot of Republican candidates.”

More fundamentally, other polling data suggests that the political landscape is undergoing a seismic change on the pocketbook issues, which are crucial in deciding most elections--and which generally have gone the GOP’s way since the dawn of the Reagan era.

By a 31%-30% margin, Americans interviewed in a Wall Street Journal-NBC News poll published Thursday believe that Democrats would do a better job than Republicans in dealing with the economy--a 15-percentage-point shift in the Democrats’ favor since November, 1989.

In addition, the poll gave the Democrats a 13-point lead on public confidence in their ability to deal with the tax issue--a 20-point turnaround.

And on the bottom-line question of voting preference for Congress, Democrats had a 9-point margin--up 10 points from a 1-point deficit last May.

As for the Democrats, they declared victory on the budget and contended that they could transform that success into votes on the hustings.

Among their successes were to force President Bush to agree to a tax increase--despite his “read-my-lips” campaign pledge to avoid any new taxes--and to discard his cherished proposal for a cut in tax rates on capital gains.

More important in the long run, during the fiscal skirmishing on Capitol Hill the Democrats managed to shift the focus of the debate away from ways to cut taxes and spending to their own favorite theme of economic fairness, exemplified by making higher-bracket taxpayers pay more in taxes.

Indeed, Democratic strategists believe that the party has moved forward amid the budget crisis. “We have put something down in terms of where we stand on policy,” said Douglas Sosnick, political director of the Democratic House Campaign Committee.

Bush himself sought to lead a GOP counteroffensive--heading out today on a four-day sweep that will take him to the Pacific shore and Hawaii--and Republican Party spokesman Charles Black vowed that the President will be swinging from the heels.

“We are going to have a bit of sharp debate on how this happened and why it happened,” Black said. “And I think you are going to see this put in partisan terms as to who is at fault for taking so long to get a significant long-term budget deficit-reduction agreement.”

But, in fact, some Republican strategists, notably Edward J. Rollins, co-chairman of the National Republican Congressional Committee, are decidedly skeptical about how much help Bush and his policies can be to GOP candidates.

In an Oct. 15 memo to House Republicans, Rollins warned: “Clearly, base-Republican voters are confused about mixed signals coming from Republicans in Washington.” To reassure these voters, Rollins counseled: “Do not hesitate to oppose either the President or proposals as being advanced in Congress.”

Disclosure of the memo this week drew an angry response from White House Press Secretary Marlin Fitzwater and led White House officials to push for Rollins’ resignation.

But it is doubtful that forcing Rollins out will eliminate misgivings about Bush that are evident among the candidates he sought to support.

As late as last Tuesday, the campaigning President was confronted in Vermont by Republican Rep. Peter Smith, who made a point of declaring that he, unlike Bush, favored higher taxes for the rich. Also, he took the occasion to remind the audience that Bush had broken his campaign pledge not to raise taxes.

At Bush’s next stop, in New Hampshire, Republican Rep. Robert C. Smith did not even appear at a fund-raiser in his behalf at which Bush was the main attraction, leaving it to his wife to explain that her husband had been detained in Washington by key votes.

And last week, when Sen. Jesse Helms (R-N. C.) was asked whether the President would make a return appearance to help his hard-pressed candidacy, he responded: “He offered to come but apparently--it may be an aberration--the President has pulled down . . . all Republican candidates.”

Later, in addressing a rally of his supporters, Helms emphasized his continued opposition to tax increases and made a point of asserting: “The President of the United States in my judgment . . . made a bad mistake when he retreated from that position.” Added Helms: “I’ll bet he’ll remember that for a long time.”

That view is shared by many Republicans who believe, as chief House campaign strategist Rollins told an audience of Washington lobbyists last week, that, by retracting his no-new-tax pledge last June, the President locked himself and his party into a defensive stance, at least for the duration of the campaign.

Bush’s shift cleared the way for the Democrats to change the parameters of political debate from raising taxes versus cutting spending to who should bear the burden of increased taxes.

To drive that point home, rank-and-file House Democrats earlier this month rejected the deficit-cutting proposal advanced after months of talks by White House officials and congressional leaders--including GOP leaders--because it leaned heavily on gasoline taxes and Medicare cuts.

They endorsed instead proposals that shifted more of the deficit-reduction burden to wealthy Americans.

“Some political leaders in the Democratic Party think that it is helping them politically to raise taxes on wealthy people,” Black complained hours before the final language of the budget proposal was settled.

Indeed that is exactly what Democrats do believe.

Moreover, they contend that this old populist formula is already working, spurring the return to the fold of two key constituency groups--senior citizens and blue-collar workers, whose ties, forged during New Deal days, have been frayed in recent years.

Democrats say that the “economic fairness” theme has been particularly effective in states with a populist tradition such as North Carolina, where it is aiding Harvey Gantt, the black former mayor of Charlotte, in his challenge to Helms.

Also benefiting, they say, are Democratic House candidates in economically hard-hit New England states and Democratic Senate candidates in states with heavy percentages of older voters.

These include Minnesota, where Democrat Paul Wellstone has narrowed the lead of Republican incumbent Rudy Boschwitz; Iowa, where Democrat Tom Harkin has been gaining on his Republican challenger, Rep. Tom Tauke; and Massachusetts, where Democrat John Kerry has widened his lead over Republican senatorial candidate Jim Rappaport.

Democrats acknowledge that they did not get everything they sought in the budget negotiations--most notably their demand for a surtax on millionaires.

But Paul Tully, political director of the Democratic National Committee, sees a bright side to that concession. “This means we have something left over for next year,” he said. “And that gives us another reason to get voters to elect more Democrats to Congress.”