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The United States will not follow Western Europe into an unbearable overcommitment to social spending. Reagan, while employing his emollient political techniques to moderate the public climate, has effectively polarized the country between those who would accept less from their government as long as they paid less for it, and those who wanted more, as long as the first group paid for it.
Without ever wavering in his commitment to a substantial safety net for the genuinely needy, Reagan has politically divided the productive from the less-productive elements of U.S. society, without the vicious antagonisms that could have arisen in such a process (antagonisms of the kind that Franklin Roosevelt sometimes deliberately encouraged).
The Democratic Party, host and author of the grand coalitions of yesteryear, has been confined, at the presidential level, to a catchment for the exotic, the disadvantaged, the overwrought and a few nostalgic careerists such as Jesse Jackson and Lane Kirkland, the president of the American Federation of Labour.
The President has coopted the vast functioning and governing mass of America and confined his opponents to clangorous and often single-issue fringes.
The economic, or Reaganomic, record is less conclusive than the ample evidence of the President's political acumen and the resurgence of his country's strategic strength and will.
The emphasis he has placed on the spontaneous activity of the private sector over the comparative inefficacies of governmental intervention will undoubtedly prove to be positive, and in some measure already has. Here, as elsewhere, his opponents have squandered their political capital by continuous unfulfilled prophecies of gloom--"the successful prediction of eight of the last two recessions," in the words of one of the President's partisans.
The reduction of inflation, interest rates, unemployment and taxes from the levels that prevailed at his first inauguration have obviously pleased the electorate, but the budgetary and foreign trade deficits are intolerable.
Reagan has played a daring game in promoting productivity and competitive ness. Although a former union leader himself (a union of Hollywood film actors), he evidently believes that organized labor has become a moribund force in opposition to the improvements in efficiency and quality that alone will assure the competitiveness of U.S. manufacturing.
While amplifying the free trade rhetoric of Commerce Secretary Malcolm Baldridge and U.S. Trade Representative William Brock, Reagan has calculatedly encouraged an overvalued dollar with his policy of high interest rates and public-sector pressure on the financial markets. He has permitted an inordinate amount of dumping of European and Japanese finished goods and raw materials, with the result that about two million U.S. jobs have been lost to overseas workers while there is a speculative over-investment of about 60 billion foreign dollars in the United States.
The resulting pressure for wage restraint in most areas of U.S. primary and secondary industry has anesthetized once militant unions, almost wiped out traditional cost-push inflation and sharply reduced industrial work stoppages.
It is a testimony to Reagan's political sagacity that despite his discrimination against important elements of organized labor, whose leadership has been generally hostile to him, his personal popularity and less permissive foreign and social policies have won him an enormous harvest of working class votes.
The Reagan Administration's economic record will depend on the unravelling of the artificial overseas transfer of U.S. jobs for foreign-currency deposits. if, as I anticipate and as rational and responsible public policy requires, the U.S. federal deficit is seriously addressed by a combination of spending reductions and "revenue enhancements," the United States should make a relatively effortless transition from an economic recovery led by consumer demand and based on somewhat Keynesian federal deficits and capital imports to a second phase built on job creation and private-sector capital spending. In any case, a resumption of inflation is unlikely.
In fiscal policy and in arms control, Reagan's claim to statesmanship will reside in his ability to build upon years of stubborn, sometimes demagogic, sometimes courageous, championship of controversial positions, and to close his spectacular public career by showing an aptitude to negotiate from strength toward compromise solutions.
It would be a mistake to underestimate again a man who has been so consistently successful, a man who has shrugged off a bullet in his lung, smilingly informed fired air controllers that they have quit and known instinctively that the American people did not want journalists to accompany U.S. soldiers into Grenada.
It is disappointing to note that most Canadian commentators, who should know better, are still on that subject afflicted by the pandemic of international snobbery and incomprehension that Reagan, an authentic American nationalist with a healthy ego, has serenely ignored.
As Gore Vidal, a Reagan critic who formerly harped with ingenious tenacity on some of the President's less edifying screen roles, recently told Canada's excellent ambassador to Washington, Allan Gotlieb, "It is one of the great slanders of contemporary American affairs to call Ronald Reagan a grade-B film actor. He is one of the great actors of world history, who has had the misfortune to play in a lot of grade-B movies."