Climbing Out of the Trough

RICHARD NIXON at mid-term is a President whose capital has been beset by malaise and doubt from the shrill, divisive closing days of the election campaign to last week's brief but defiant railroad strike. Even loyal White House men speak of a "trough." Unemployment has climbed to 5.8% and inflation continues unchecked. A major national undertaking that has Nixon's backing -development of a supersonic transport plane -is in danger of being abandoned. Former Interior Secretary Walter Hickel. pink slip in hand, goes on television to attack the Republican posture in the election: "I think the American people want hope." A national poll shows Nixon severely slipping. Even the national Christmas tree is twice derailed on its train ride from the forest, and finally topples in Washington's winds.

The President needs a comeback to dispel an accumulation of woes that some are already describing as a "crisis of confidence" in his leadership. This is not the view at the White House. Instead, as one aide puts it. "there is a sense of changing gears; there is a considerable mood of turning." Is the President, after his private reading of the election returns, preparing to turn in a more liberal direction? Said one: "We think our domestic program is moderate already."

Yet there are signs that, as he looks forward to 1972, the President will hew to the idea that what is good for national reconciliation will be good for his reelection. He has already begun the realignment of the men who can make his presidency or break it.

>> Donald Rumsfeld, director of his embattled Office of Economic Opportunity, will become a White House Counsellor. The OEO job will be taken over by one of Rumsfeld's deputies. Frank Carlucci, who was in the State Department before joining the OEO.

>> Bryce Harlow is leaving the White House staff to return to private industry. He served as the President's liaison man with Congress, a sometimes thankless job in which his quick, self-deprecating wit served him well, but not well enough to ward off the criticism of some Congressmen who felt that they were being shut off from the White House. Harlow turned down an offer from Nixon to head the Republican National Committee.

>> George Bush, a Nixon favorite who lost a Senate race in Texas, will join the Administration as U.S. Ambassador to the United Nations. The new U.S. spokesman, who compiled a conservative-to-moderate record in the House of Representatives, has no record at all in diplomatic affairs. In the House, he generally supported the President's Viet Nam policy.

More important, the President and his men are putting together a progressive legislative package that they hope will permit them to revive a motto from the Administration's early days -"Watch what we do. not what we say." Its major elements:

REVENUE SHARING. Nixon told six Governors last week that the placing of larger shares of federal tax revenues in the hands of Governors and mayors will be "the centerpiece" of his program. The White House staff is already working on a repackaging of old and new programs to make it as attractive to Congress as it will be to the states and cities.

WELFARE REFORM. The White House is determined to renew the fight for Nixon's basic and far-reaching proposal to provide minimum incomes for the poor. At week's end it appeared to be hopelessly mired in the parliamentary maneuvering of a Congress confronting too many major issues and an inexorable calendar. Nixon has vowed to take personal charge of the fight for it next year, even if there is "blood all over the floor" when the battle is over.

HEALTH INSURANCE. The comeback Nixon needs could well begin in February, when he is expected to make public major new proposals for a health insurance program. The Democrats have already made clear that they view health care as a major political battlefield over the next two years: White House and HEW aides are now molding the proposals with which Nixon will arm himself. One key element of the program will be a family health insurance plan, intended to supplant much of the coverage now given low-income families under Medicaid. The Nixon plan will probably extend the coverage to lower-middle-income families: how far it will go beyond that is now a matter of Administration debate. Another likely aspect of the Nixon proposals -matching the intent, if not the scope, of Democratic plans -is an insurance scheme to cover the cost of "catastrophic" illness.

It is a substantial beginning toward a reversal of Administration fortunes. Yet one of Washington's highest officials, and one of its most politically astute, concedes that 1972 will bring deep trouble for Nixon unless he can deliver on the big issues of war and economy.

Probably Indiscreet. Those twin troubles were on public display last week when Nixon held his first press conference in over four months, and only the twelfth since he took office. Although he has succeeded in reducing American casualty rates in Viet Nam, he has felt it necessary to take a newly belligerent stance on the war (see following story). Questioned about the economy, he appeared to be claiming victory in the face of obvious setbacks. Where his economists had long spoken of a 4% unemployment rate as an acceptable target, he pointed to a figure close to 5% as reasonable under present circumstances. That 1% difference represents about 800,000 unemployed.

The war and the economy are the two big issues, but Nixon tried to stem the beginning of a third -his own and his Administration's credibility -by revising his earlier pronouncements on the election. Though he had just characterized the results as an ideological victory, Nixon passed up an opportunity to repeat that claim before a roomful of openly disbelieving newsmen. Instead, he described his campaigning as a normal presidential responsibility and stressed his desire to work in harmony with the incoming Congress. With a welcome lack of contentiousness, the President frankly conceded that as a lawyer, he had probably made indiscreet remarks assuming the guilt of two prominent criminal defendants, Charles Manson and Angela Davis. "I think sometimes we lawyers, even like doctors who try to prescribe for themselves, may make mistakes," he said.

The President admitted that while "divisions in this country are never going to end," progress toward muting those differences has been "not as much as I would like." He moved to patch up relations with dissident Republican liberals by assuring them that they are "welcome" in the G.O.P. -and that he will not repeat his 1970 purge of such anti-Administration Republicans as New York's Senator Charles Goodell. Already he is beginning to do a bit better with Congress: the Senate sustained his veto of a bill limiting television campaign spending, and last week a House-Senate conference restored most of the SST development funds that the Senate had earlier cut.

The President pleaded for renewed life for the SST, because abandoning it would mean that the U.S., "which has been first in the world in commercial aviation from the time of the Wright brothers, decides not just to be second, but not even to show." Whatever the specific merits of the SST, given the present mood of malaise -and the President's own stated priorities -it seemed more urgent for the nation to worry about being first in the vitality of the cities, in standards of education, in fighting pollution, in aiding the poor, in race relations -first in all the qualities of national life.

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