For the Record

Vision of projected $91.5 billion deficit for fiscal year 1983 has rejuvenated House Majority Leader Tip O’Neill. “It’s going to be a more interesting year this year,” he says. “We’re going to have a lot of victories . . .” Congressional coalition that won for Reagan last year is coming apart. Rep. Kent Hance (D., Tex.), one of key conservative Southern Democrats in last year’s budget victory, says he can’t vote for a deficit that high. Rep. Phil Gramm (D., Tex.), another key conservative, says, “the clear consensus is that the deficit is too big, and something has to be done about it.” To the delight of Democratic leaders, Reagan budget has made many Boll Weevils, who had been talking of leaving the party, rethink their plans. . . . In response to hullabaloo over budget, Reagan recalled a remark by James Burnham, who noted that surgeons found it hard to operate on Democrats because it was so hard to “separate demagogic from solid tissue without causing the death of the patient.” . . . Supply-sider Craig Roberts, who recently left Treasury Department, says too much attention is being paid to size of the deficit. Deficits, he says, have to be measured in terms of the size of the economy and the savings available to finance them: “In 1976, the deficit was $66 billion in an economy of $1.7 trillion. In 1982, the deficit is about $100 billion in an economy of $3.1 trillion — a smaller deficit.” . . . Budget furor obscured some good economic news. Producer price index for finished goods in January increased by only 0.4 per cent. January rise, compounded, is equivalent to annual increase of 5.3 per cent.

Put a lid on it, Cap. That’s message of Western banking community to Defense Secretary Caspar Weinberger, who says Washington’s controversial decision to cover interest payments on guaranteed loans to Poland is under constant review. Weinberger opposed decision and is telling one and all that Polish default would hurt entire Soviet bloc’s effort to get credit from Western banks. A Treasury official has said that, because of federal loan guarantee agreement, Federal Government might have to pay U.S. banks close to $2 billion owed to banks by Poland over next two years. . . . Conservative Caucus, headed by Howard Phillips, has sent 220,000 letters asking supporters to urge U.S. banks to demand immediate repayment of loans. Phillips says group sent a special petition to David Rockefeller asking him to “be a leader in getting our money back home.” . . . Americans for Democratic Action has ratings out for 1981, and only two senators—Ted Kennedy and Carl Levin (D., Mich.)—got a perfect 100, while eight—Strom Thurmond, Barry Goldwater, Jeremiah Denton, John P. East, Jake Garn, Orrin Hatch, and Steve Symms —got perfect zeros. . . . Move over NCPAC, Democrats are getting their PACS together. PROPAC—Progressive Political Action Committee—has been formed to go after such dangers on the Right as Sens. Orrin Hatch (R., Utah) and Harrison Schmitt (R., N.M.). These men are targeted for ’82. In ’84, PROPAC will gun for “most dangerous man in American public life”—Jesse Helms (R., N.C.).

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Vision of projected $91.5 billion deficit for fiscal year 1983 has rejuvenated House Majority Leader Tip O’Neill. “It’s going to be a more interesting year this year,” he says. “We’re going to have a lot of victories . . .” Congressional coalition that won for Reagan last year is coming apart. Rep. Kent Hance (D., Tex.), one of key conservative Southern Democrats in last year’s budget victory, says he can’t vote for a deficit that high. Rep. Phil Gramm (D., Tex.), another key conservative, says, “the clear consensus is that the deficit is too big, and something has to be done about it.” To the delight of Democratic leaders, Reagan budget has made many Boll Weevils, who had been talking of leaving the party, rethink their plans. . . . In response to hullabaloo over budget, Reagan recalled a remark by James Burnham, who noted that surgeons found it hard to operate on Democrats because it was so hard to “separate demagogic from solid tissue without causing the death of the patient.” . . . Supply-sider Craig Roberts, who recently left Treasury Department, says too much attention is being paid to size of the deficit. Deficits, he says, have to be measured in terms of the size of the economy and the savings available to finance them: “In 1976, the deficit was $66 billion in an economy of $1.7 trillion. In 1982, the deficit is about $100 billion in an economy of $3.1 trillion — a smaller deficit.” . . . Budget furor obscured some good economic news. Producer price index for finished goods in January increased by only 0.4 per cent. January rise, compounded, is equivalent to annual increase of 5.3 per cent.

Put a lid on it, Cap. That’s message of Western banking community to Defense Secretary Caspar Weinberger, who says Washington’s controversial decision to cover interest payments on guaranteed loans to Poland is under constant review. Weinberger opposed decision and is telling one and all that Polish default would hurt entire Soviet bloc’s effort to get credit from Western banks. A Treasury official has said that, because of federal loan guarantee agreement, Federal Government might have to pay U.S. banks close to $2 billion owed to banks by Poland over next two years. . . . Conservative Caucus, headed by Howard Phillips, has sent 220,000 letters asking supporters to urge U.S. banks to demand immediate repayment of loans. Phillips says group sent a special petition to David Rockefeller asking him to “be a leader in getting our money back home.” . . . Americans for Democratic Action has ratings out for 1981, and only two senators—Ted Kennedy and Carl Levin (D., Mich.)—got a perfect 100, while eight—Strom Thurmond, Barry Goldwater, Jeremiah Denton, John P. East, Jake Garn, Orrin Hatch, and Steve Symms —got perfect zeros. . . . Move over NCPAC, Democrats are getting their PACS together. PROPAC—Progressive Political Action Committee—has been formed to go after such dangers on the Right as Sens. Orrin Hatch (R., Utah) and Harrison Schmitt (R., N.M.). These men are targeted for ’82. In ’84, PROPAC will gun for “most dangerous man in American public life”—Jesse Helms (R., N.C.).