1. Office of Management and Budget, "Federal Government Finances: 1985 Budget Data," typescript, February 1984, p. 99. This is an unpublished but available to the public summary of historical statistics produced to supplement each year's budget. It has since been replaced by a published volume, Historical Statistics. [BACK]

2. Ibid., pp. 97-99. Estimated as "relatively uncontrollable under present law: open-ended programs and fiscal costs." [BACK]

3. Donald Axelrod, Budgeting for Modern Government (New York: St. Martin's Press, 1988). [BACK]

4. No. 58, The Federalist Papers (New York: New American Library, 1961), p. 359. [BACK]

5. In the cases the president cited, according to the report on the Agriculture appropriation, the research was in New Jersey, Michigan, Louisiana, and New Mexico. [BACK]

6. The American revolutionaries insisted on the absolute nature of the power of the purse because they had seen how George III used his personal wealth and patronage to buy members of Parliament, thus corrupting and dominating the legislature. Modern members of Congress may not be aware of that history, but they are well aware of the uses of patronage in state and local political machines, such as Mayor Daley's Chicago. The power of the purse is therefore inextricably mixed with the everyday struggles of low politics. In a talk at the Brookings Institution in 1986, one leader of House liberals, David Obey (D-Wis.), quoted a leading conservative, Mickey Edwards (R-Okla.), on the nonpartisan subject of presidential discretion. "Imagine," Obey quoted Representative Edwards, "Lyndon Johnson with an item veto!" Obey then recounted an imaginary conversation: LBJ explained how thoroughly he understood Obey's desire for a community health clinic in a small northern Wisconsin town and how much that town needed the clinic but how badly he needed Obey's support for administration policy in Vietnam. Most legislators would like to avoid such situations, or at least have the upper hand. [BACK]

7. The new Gramm-Rudman requires an earlier release, but the earlier release of the budget hasn't happened. [BACK]

8. Frederick C. Mosher, A Tale of Two Agencies (Baton Rouge: Louisiana State University Press, 1984), p. 25. [BACK]

9. Ibid., pp. 27-32; esp. p. 28. [BACK]

10. The appropriations committees stayed within the president's totals partly because of a strong norm of economy—if they weren't there to make cuts, why have committees? Richard Fenno's The Power of the Purse (Boston: Little, Brown, 1966) is the classic work on appropriations norms. But one also must suspect more informal coordination than was visible—or so veteran staff and members report today. [BACK]

11. Fenno, Power of the Purse. Joseph White's research on the House committee confirms this picture. [BACK]

12. The foreign aid bill, Foreign Operations, is the exception that proves the rule of legislation passage: it often has to be packaged with something more popular. Nobody outside D.C. cares much about either the District of Columbia or legislative branch bills, but Congress, of course, does. [BACK]

13. See Aaron Wildavsky, The Politics of the Budgetary Process, 1st ed. (Boston: Little, Brown, 1964); the revolution that has overtaken budgeting is described in a successor volume, The New Politics of the Budgetary Process (Glenview, Ill.: Scott, Foresman/Little, Brown, 1988). [BACK]

14. "FY71." The federal government, like many businesses, operates on a fiscal year that differs from the calendar year. Until the Budget Act was passed, the fiscal year ran from July 1 through June 30; that is, fiscal 1971 began on July 1, 1970. The Budget Act began the year three months later, giving Congress and the president three more months to pass the necessary legislation before the year began. Thus, in 1988 they were considering the budget for FY89, beginning October 1, 1988. [BACK]

15. See, in particular, Allen Schick, Congress and Money (Washington, D.C.: Urban Institute, 1980); and Gary Orfield, Congressional Power: Congress and Social Change (New York: Harcourt Brace Jovanovich, 1975). [BACK]

16. Schick, Congress and Money, p. 48. [BACK]

17. Ibid. [BACK]

18. The new budget process worked as described here until the Supreme Court, in the Chadha decision, outlawed the legislative veto mechanism at its heart. If the president wished not to spend appropriated funds, he could propose a rescission; if he wished only to delay the spending, he had to propose a deferral. For a rescission to take effect, both houses had to pass a bill approving the change within forty-five legislative days of its proposal. If they did not do so, the money would be spent as appropriated. A deferral would take effect automatically, but it would last no longer than through the end of the fiscal year. Either house could reject the deferral with a vote specifically disapproving it. The procedure exploited the difficulty of congressional action. Rescission, the more serious policy change, was made highly unlikely by requiring positive action by both houses; deferral, the lesser change, was allowed to occur, but either house could choose by majority vote to enforce the appropriation legislation. Thus impoundment could be used when the need for spending had disappeared or been delayed, but the president could not use it to challenge Congress's priorities. [BACK]

19. The first year of the new budget process, 1975 for FY76, formally a dry run, was taken surprisingly seriously. [BACK]

1. Timothy B. Clark, "Carter's Election-Year Budget—Something for Practically Everyone," National Journal, February 2, 1980, p. 187. [BACK]

2. See Council of Economic Advisers, Economic Indicators, February 1981 (Washington, D.C.: U.S. Government Printing Office, 1981). [BACK]

3. George H. Gallup, The Gallup Poll: Public Opinion 1979 (Wilmington, Dela.: Scholarly Resources, 1980), pp. 278-79. Gallup publishes a volume each year that summarizes major survey results in chronological order. This was Survey #141-G, reported November 15, 1979. [BACK]

4. There is no other way to make sense of his choices. For his own testimony, see Jimmy Carter, Keeping Faith (New York: Bantam Books, 1982), pp. 21, 73, 77, in which he mentions how he disagreed with liberals when he took office. Also see Steven R. Weisman, "With New Budget Due Today, McIntyre Gains as a Carter Aide," New York Times, January 28, 1980, pp. A1, D11. [BACK]

5. "Post Interviews Kennedy, Brown," Washington Post, January 20, 1980, pp. A1, A8. [BACK]

6. George H. Gallup, The Gallup Poll: Public Opinion l980 (Wilmington, Delaware: Scholarly Resources, 1981), Survey #150-G, Reported March 30, 1980, pp. 72-79. [BACK]

7. Gallup Poll, 1979, Survey #142-G, Reported December 16, 1979, pp. 289-90. [BACK]

8. James Fallows, "Is It All Carter's Fault?" Atlantic Monthly, October 1980, p. 47. [BACK]

9. Albert R. Hunt, "Do Pollsters—and Iowa—Confirm a GOP Tide?" Wall Street Journal, January 24, 1980, p. 20. [BACK]

10. President's message, excerpted in New York Times, January 29, 1980, p. B9. [BACK]

11. Timothy B. Clark, "Carter's Election-Year Budget—Something for Practically Everyone," National Journal, February 2, 1980, p. 176; "Learning to Love Stagflation?" p. 16, and "It's a long way to October," pp. 29-30, in The Economist, February 2, 1980. [BACK]

12. John M. Berry, "Creating Economic Slack Cornerstone of Policy," Washington Post, January 31, 1980, pp. D9-D10. [BACK]

13. Robert J. Samuelson, "The CEA's Economic Report Is Filled with Uncertainties," National Journal, February 2, 1980, p. 182. See also Berry, "Creating Economic Slack," Washington Post, January 31, 1980; and Steven Rattner, "The Risky Politics of Recession," New York Times Magazine, May 11, 1980, pp. 20-23, 28, 78-79, 82-83. [BACK]

14. "Learning to Love Stagflation?" The Economist, February 2, 1980, p. 16. [BACK]

15. "A Budget of Two Big——," Time, February 4, 1980, pp. 66-67. [BACK]

16. "The Unbalanced Budget," Newsweek, February 4, 1980, pp. 59-60. [BACK]

17. "Imprudent and Irresponsible," editorial, Wall Street Journal, January 29, 1980, p. 18 (emphasis added). [BACK]

18. Harry Anderson, with Rich Thomas, "No Economic Miracles," Newsweek, February 11, 1980, p. 75. [BACK]

19. Steven Rattner, "Economists Say Carter's Budget Plans Are Unrealistic," New York Times, February 25, 1980, p. A15. Also "The Hesitant Recession," Time, February 28, 1980, pp. 76-78. [BACK]

20. "America's bond market crash," The Economist, March 8, 1980, pp. 12-13 [BACK]

21. Lindley B. Richert, "Yields for Long-Term Obligations of U.S. Rise Decidedly Above 11% for the First Time," Wall Street Journal, January 30, 1980, p. 33. [BACK]

22. "The world feels worse after Doctor Volcker's physic," The Economist, February 23, 1980, p. 89. [BACK]

23. Daniel Hertzberg, "Troubled Houses," Wall Street Journal, February 22, 1980, p. 1. [BACK]

24. Isadore Barmash, "Economists Back Fed's Rate Rise, But Some Worry That Inflation Won't Respond," New York Times, February 18, 1980, pp. D1, D3. [BACK]

25. Steven Rattner, "Volcker Discloses Goals for 1980 Money Growth," New York Times, February 20, 1980, pp. D1, D9. [BACK]

26. Art Pine, "White House Aides Debate Budget Cuts In War on Inflation," Washington Post, February 26, 1980, p. A5. [BACK]

27. Ibid. [BACK]

28. "A Lever Against Inflation," editorial, Washington Post, February 24, 1980, p. B6. [BACK]

29. "The Case For a New, and Balanced, Budget," editorial, New York Times, February 28, 1980, A22. [BACK]

30. Harry Anderson et al., "Fighting the Inflation 'Crisis,'" Newsweek, March 10, 1980, pp. 24-26. [BACK]

31. Ibid. [BACK]

32. Steven Rattner, "Anti-Inflation Plan Aims at Psychology," New York Times, March 2, 1980, p. L29. [BACK]

33. Art Pine and John M. Berry, "Carter's Economists Seeking To Balance Budget for 1981," Washington Post, March 4, 1980, pp. A1, A4. [BACK]

34. Richard J. Levine and Robert W. Merry, "Carter's Plan May Calm Markets but Won't Be Quick Fix for Inflation," Wall Street Journal, March 10, 1980, p. 1. [BACK]

35. Ibid., p. 19. [BACK]

36. Jerry Knight, "U.S. Won't Pay Farmers To Plant Smaller Crops," Washington Post, March 1, 1980, p. A6. [BACK]

37. Harry Anderson et al., "Carter's Attack on Inflation," Newsweek, March 24, 1980, pp. 24-30. [BACK]

38. Steven Rattner, "Carter's Proposal to Curb Inflation Accepts Increase in Rate of Jobless," New York Times, March 9, 1980, pp. 1, 31. [BACK]

39. Martin Tolchin, "Budget Conferees in a Balancing Act," New York Times, March 12, 1980, p. A11. [BACK]

40. Our discussion of these negotiations is based on interviews and articles. See Art Pine, "$11 Billion in Cuts Is Agreed On," March 11, 1980, and "Options Narrowed as Time to Unveil Inflation Plan Nears," March 12, 1980, Washington Post; Steven Rattner, "U.S. Weighs Oil Fee as Aid for Budget," March 11, 1980, and "Group in Congress Hears Budget Cuts of Over $11 Billion," March 13, 1980, New York Times; and Martin Tolchin, "Budget Conferees in a Balancing Act," New York Times, March 12, 1980, p. A11 [BACK]

41. Art Pine, "Hill Office Estimates '81 Budget Deficit of $24 Billion or More," Washington Post, March 6, 1980, p. A8. [BACK]

42. Steven Rattner, "Carter Plan is Due Today on Economy; 10¢ Gas Rise Likely," New York Times, March 14, 1980, p. A1. [BACK]

43. See, for example, John Osborne, "Your Friendly Budget," The New Republic, February 2, 1980, pp. 7-9; "It's a long way to October," The Economist, February 2, 1980, pp. 29-30. [BACK]

44. See articles by George C. Wilson, "President Sparing the Pentagon From Budget Scissors," March 5, 1980, p. A4, and "Pentagon Budget Is Stretched Out," March 15, 1980, p. A13, Washington Post. [BACK]

45. Martin Tolchin, "Caution in Congress," New York Times, March 15, 1980, p. A1, A35. [BACK]

46. William Greider, Secrets of the Temple: How the Federal Reserve Runs the Country (New York: Simon and Schuster, 1987), p. 183. [BACK]

47. Ibid., p. 185. [BACK]

1. See Martin Tolchin, "O'Neill Attacks Balanced Budget As Other Democrats Pursue Cuts," New York Times, March 6, 1980, pp. A1, A17. [BACK]

2. Timothy B. Clark, "Carter takes aim at deeper cuts in '81 budget," National Journal, March 8, 1980, pp. 409-10. [BACK]

3. Timothy B. Clark, "Defense Spending: Something Has to Give," National Journal, May 17, 1980, p. 805. According to former Defense Secretary Melvin Laird, 60 percent of army recruits in 1979 fell below the national average for intelligence. Moreover, the number of noncommissioned officers who remained in the services plummeted. [BACK]

4. Timothy Clark and Richard E. Cohen, "Balancing the Budget a Test for Congress—Can It Resist the Pressures to Spend?" National Journal, April 12, 1980, pp. 588—91, 593—94; Congressional Quarterly Almanac 1980, Vol. 36, 1980 (Washington, D.C.: Congressional Quarterly Inc., 1981), p. 111 (hereafter CQA 1980). [BACK]

5. Giaimo had become very worried about the deficit. After he retired, he founded a lobbying group, the Committee for a Responsible Federal Budget, and throughout 1980 took a hard line against social spending. [BACK]

6. See Barbara Sinclair, Majority Leadership in the U.S. House of Representatives (Baltimore: Johns Hopkins University Press, 1981), p. 182. [BACK]

7. Clark and Cohen, "Balancing the Budget a Test for Congress," National Journal, April 12, 1980. [BACK]

8. CQA 1980, p. 111; Art Pine and Peter Behr, "House Unit Votes To Slash Budget By $16.4 Billion," Washington Post, March 21, 1980, pp. A1, A2. [BACK]

9. CQA 1980, p. 110. [BACK]

10. Ibid., p. 111. [BACK]

11. Art Pine, "Republicans Seek Sharper Spending Cuts," Washington Post, March 30, 1980, p. A7. [BACK]

12. See Sinclair, Majority Leadership, esp. p. 184; CQA 1980, p. 114; and Merrill Sheils et al., "Heading for a Classic Bust?" Newsweek, April 14, 1980, pp. 77, 83. [BACK]

13. Sinclair, Majority Leadership, p. 184; CQA 1980, p. 114. [BACK]

14. Ibid. [BACK]

15. CQA 1980, pp. 112-14; Helen Dewar, "Price Support for Tobacco Feeds Sacred Senate Cow," April 3, 1980, p. A4, and "Budget Panel Would Slash Bureaucracy," April 4, 1980, pp. A1, A4, Washington Post. [BACK]

16. CQA 1980, pp. 108-19. [BACK]

17. CQA 1980, p. 118. [BACK]

18. Sinclair, Majority Leadership, p. 185; CQA 1980, p. 118. We will never know whether the contradictory votes occurred because some Democrats went home after the budget resolution was defeated or because members really did not support any resolution. If everybody had been there, the vote on Latta's motion should have been very close; fifty-eight Democrats supported Latta as it was, so he had to have a good chance of winning. [BACK]

19. Allen Schick, Reconciliation and the Congressional Budget Process (Washington, D.C.: American Enterprise Institute, 1981), p. 7. [BACK]

20. Congressional Budget and Impoundment Control Act of 1974, Section 301(b)(2), as amended. [BACK]

21. Congressional Quarterly Almanac 1979, Vol. 35 (Washington, D.C.: Congressional Quarterly Inc., 1980), p. 181 (hereafter CQA 1979). [BACK]

22. Congressional Record, May 7, 1980, p. HR10159. [BACK]

23. Ibid., pp. HR10157-58. [BACK]

24. Ibid., p. HR10173. [BACK]

25. Ibid. [BACK]

26. Ibid., p. HR10165. [BACK]

27. Ibid., p. HR10167. [BACK]

28. Ibid., p. HR10168. [BACK]

29. Ibid., p. HR10174. [BACK]

30. Ibid. [BACK]

31. Ibid., p. HR10176. David Obey argued they should reconcile to call the budget balancers' bluff, showing by example that balance wouldn't help. [BACK]

32. Sheils, "Heading for a Classic Bust?" [BACK]

33. "Turmoil on the Money Front," Time, March 31, 1980, p. 48. [BACK]

34. David Pauly et al., "The Credit Crunch Is On," Newsweek, March 31, 1980, pp. 52-56. See also "American Cars: Carter's No Help," The Economist, July 12, 1980, pp. 70-71. [BACK]

35. Ibid. [BACK]

36. Harry Anderson et al., "Gauging the Depth of the Slump," Newsweek, May 5, 1980, pp. 75, 77. [BACK]

37. Ibid. [BACK]

38. Helen Dewar, "Senate Opens Debate on '81 Spending," Washington Post, May 6, 1980, p. A16. [BACK]

39. "Budget Boilerplate and Restraint," editorial, Washington Post, May 5, 1980, p. A20. [BACK]

40. Joanne Omang, "Welfare Plans in Danger in 1981, Byrd Predicts," Washington Post, May 4, 1980, p. A18. [BACK]

41. Richard J. Levine, Robert W. Merry, and Brooks Jackson, "Slump's Shadow," Wall Street Journal, May 2, 1980, pp. 1, 25. [BACK]

42. Gallup Poll, 1980, Survey #151-G, Reported April 8 and April 10, 1980, pp. 83-95. [BACK]

43. Ibid.; and Allan Mayer et al., "Reagan's Crossovers," Newsweek, April 14, 1980, p. 27. [BACK]

44. Gallup Poll, 1980, Chronology Section, pp. l-liii. [BACK]

45. "The Bad News Gets Worse," Time, June 16, 1980, pp. 64-65. [BACK]

46. Ibid. [BACK]

47. Helen Dewar, "Recession May Unravel the Budget Congress Forged, Causing New Woes," Washington Post, June 15, 1980, p. A14. [BACK]

48. Time, June 16, 1980, p. 18, "Yahoo! Congress bars a gas tax." [BACK]

49. See Nelson Polsby and Aaron Wildavsky, Presidential Elections, 7th ed. (New York: Free Press, 1988). [BACK]

50. Edwin Warner, "Marketable Baskets of Issues," Time, August 25, 1980, pp. 28-29. [BACK]

51. See Bernard Asbell, The Senate Nobody Knows (Baltimore: Johns Hopkins University Press, 1978), various passages, on how Senator Muskie came to oppose jobs spending. [BACK]

52. "An Unemployment Wallop," Time, May 12, 1980, pp. 54-55. See also Asbell, Senate Nobody Knows; Harry Anderson et al., "Out of Work: Who's Next?" Newsweek, June 16, 1980, pp. 66-70; "The Budget Resolution," editorial, Washington Post, June 13, 1980, p. A18 (among many); and the comments of Carter's supposedly most liberal adviser, Stuart Eisenstadt, National Journal, May 17, 1980, p. 805. [BACK]

53. Sinclair, Majority Leadership, p. 187. [BACK]

54. Allan Mayer et al., "Reagan's Tax-Cut Ploy," Newsweek, July 7, 1980, p. 20. [BACK]

55. Art Pine, "Jittery Senate Democrats Rush Own Tax Cut," Washington Post, June 27, 1980, pp. A1, A4. [BACK]

56. Ibid. [BACK]

57. Ibid. [BACK]

58. "Opening the Tax Battle," Time, July 7, 1980, pp. 8-9. [BACK]

59. Walter Heller, "Piercing the Budgetary Fog," Wall Street Journal, June 30, 1980, p. 12. [BACK]

60. "Two for the Tax Cut Seesaw," editorial, Washington Post, June 7, 1980, p. A14. [BACK]

61. "Opening the Tax Battle," Time, July 7, 1980. [BACK]

62. Carter, Keeping Faith, p. 539. [BACK]

63. Ibid., pp. 540, 541. [BACK]

64. John M. Berry, "Surplus Evaporates—$25-30 Billion Deficit Seen," Washington Post, July 15, 1980, pp. A1, A6. [BACK]

65. Carter, Keeping Faith, pp. 540-41. [BACK]

66. John M. Berry, "Recession, Defense Seen Widening '80 Deficit to $61 billion," Washington Post, July 22, 1980, pp. F1, F5. [BACK]

67. Gallup Poll, 1980, p. 159. [BACK]

68. David S. Broder, "A Bleak Projection for the President," Washington Post, August 9, 1980, p. A5. [BACK]

69. Kenneth H. Bacon, "Carter's Programs," Wall Street Journal, August 29, 1980, p. 1. [BACK]

70. Kenneth H. Bacon, "A Big Role for Uncle Sam," Wall Street Journal, September 3, 1980, p. 22. [BACK]

71. See ibid.; "An Economic Dream in Peril," Newsweek, September 8, 1980, pp. 50-52; and Herbert Stein, "Beyond the Reagan Tax Cut," Wall Street Journal, November 25, 1980, p. 22. [BACK]

72. Helen Dewar, "Senate Budget Unit Rejects Tax Cut in 1981 Spending Plan," Washington Post, August 22, 1980, p. A5. Also, interviews. [BACK]

73. CQA 1980, p. 120. [BACK]

74. Lindley H. Clarke, Jr., "Recession's End?" Wall Street Journal, September 15, 1980, pp. 1, 18. [BACK]

75. Christopher Byron, "Slow Rebound from Recession," Time, Sept. 29, 1980, pp. 56-58. [BACK]

76. Greider, Secrets of the Temple, p. 194. [BACK]

77. Ibid., p. 204. [BACK]

78. Ibid., pp. 193-213. [BACK]

79. "Cautious Optimism: Many Executives Say Slump Is Over, but See Only a Slow Recovery," Wall Street Journal, October 22, 1980, pp. 1, 24. [BACK]

80. Greider, Secrets of the Temple, pp. 214-18; and Kenneth H. Bacon, "Ready Reserve: Fed Vowing to Retain 'Tight Money' Policies, Prepares for Criticism," Wall Street Journal, August 4, 1980, pp. 1, 11. [BACK]

81. Kenneth H. Bacon, "Reducing the Heat: Better Economic News Helps Smother Flames of Fed-Carter Dispute," Wall Street Journal, October 6, 1980, pp. 1, 17. [BACK]

82. CQA 1980, p. 90. [BACK]

83. Helen Dewar, "Hill May Put Off Voting On Money Till After Election," Washington Post, September 18, 1980, p. A15; and CQA 1980, pp. 170-71. [BACK]

84. Previously the government let employees work and then passed appropriations in time for their payday. Civiletti ruled that work created an obligation and thus spending, before the outlay; hence, appropriations had to precede employment. But he let this new rule slide in areas where immediate consequences might be truly dire (e.g., the military). [BACK]

85. Helen Dewar, "Abortion Compromise Leads to Restoration of U.S. Spending," Washington Post, October 2, 1980, p. A2; and Dewar, "Senate Moving Sluggishly Toward Stop-Gap Funding," Washington Post, September 27, 1980, p. A12. [BACK]

86. Helen Dewar, "Lame-Duck Session on Budget Foreseen," Washington Post, August 1, 1980, p. A11. CQA 1980, pp. 124-30, tells the reconciliation story in detail. [BACK]

87. See Helen Dewar, "House Panel Sets Spending Ceiling, Brushes Aside Protests by Republicans," Washington Post, November 12, 1980, p. A2; and Dewar, "Tax Cut Bill Squelched," Washington Post, November 13, 1980, pp. A1, A2. [BACK]

88. Robert W. Merry, "GOP Swings Wild In Initial Bout With Budget Champ," Wall Street Journal, November 14, 1980, p. 28. [BACK]

89. Dewar, "Tax Cut Bill Squelched," Washington Post, November 13, 1980; CQA 1980, p. 123; and Dewar, "$632.4 Billion Budget Cleared," Washington Post, November 20, 1980, pp. A1, A17. [BACK]

90. Helen Dewar, "Hill's Budget Process Grows Stronger With Every Passing Deficit," Washington Post, November 23, 1980, p. A6; Richard L. Lyons, "On Capitol Hill: Congress Passes Hastily Drawn Fiscal '81 Budget," Washington Post, November 21, 1980, p. A18; and CQA 1980, p. 123. [BACK]

91. Lyons, "On Capitol Hill"; and CQA 1980, p. 123. [BACK]

92. CQA 1980, p. 130. [BACK]

93. Ibid., p. 124. [BACK]

94. "Reagan Would Hike Arms Funds 7%," Washington Post, October 28, 1980, p. A2. [BACK]

95. CQA 1980, pp. 185-97. [BACK]

96. Ibid., pp. 210-17. [BACK]

97. Ibid., pp. 220-21. [BACK]

98. See Helen Dewar, "Senate Retreats on Pay, Busing," Washington Post, December 11, 1980, pp. A1, A4; and CQA 1980, pp. 220-21. [BACK]

99. Helen Dewar and Richard L. Lyons, "U.S. Agencies Run Out of Money as Spending Bill is Deadlocked," Washington Post, December 16, 1980, p. A8. [BACK]

100. CQA 1980, p. 222. [BACK]

101. Dewar and Lyons, "U.S. Agencies Run Out of Money," Washington Post, December 16, 1980. [BACK]

102. George C. Wilson, "Carter, Cutting Pentagon's Budget Request, Grants Extra $6.2 Billion," Washinton Post, December 27, 1980, p. A7. [BACK]

103. The memo, which we discuss in the next chapter, is included as an appendix to William Greider, The Education of David Stockman and Other Americans (New York: Dutton, 1982). [BACK]

104. Kenneth H. Bacon, "Fast Start: Reagan Economic Blitz to Get High Priority Despite Stiff Obstacles," Wall Street Journal, November 26, 1980, p. 1. [BACK]

105. Alexander Taylor, "Waiting for Reaganomics," Time, November 24, 1980, pp. 84-85. [BACK]

1. V. O. Key, Politics, Parties and Pressure Groups, 4th ed. (New York: Thomas Y. Crowell, 1958), pp. 568-69. [BACK]

2. See Robert A. Dahl, A Preface to Democratic Theory (Chicago: University of Chicago Press, 1956). [BACK]

3. "Tip: 'Give 'Em Enough Rope,'" Newsweek, November 24, 1980, p. 47. [BACK]

4. Charles L. Heatherly, ed., Mandate for Leadership: Policy Management in a Conservative Administration (Washington, D.C.: Heritage Foundation, 1982). [BACK]

5. Neal R. Pierce and Jerry Hagstrom, "The Voters Send Carter a Message: Time For a Change—to Reagan," National Journal, November 8, 1980, pp. 1876-78. [BACK]

6. William Schneider, "The November 4 Vote for President: What Did It Mean," in Austin Ranney, ed., The American Elections of 1980 (Washington, D.C.: American Enterprise Institute, 1981), p. 230. [BACK]

7. Hedrick Smith, Adam Clymer, Leonard Silk, Robert Lindsey, and Richard Burt, Reagan the Man, the President (New York: Macmillan, 1980), p. 59. [BACK]

8. Nov. 22, 1980, p. 34. [BACK]

9. Smith et al., Reagan the Man, p. 60. [BACK]

10. Kathleen A. Frankovic, "Public Opinion Trends," in Gerald Pomper with Colleagues, The Election of 1980 (Chatham, N.J.: Chatham House, 1981), p. 107. [BACK]

11. See Chapter 1, "Rival Theories and a Method for Choosing Among Them," in Aaron Wildavsky, Leadership in a Small Town (Totowa, N.J.: Bedminster Press, 1964), pp. 1-13. [BACK]

12. Laurence I. Barrett, Gambling with History (Garden City, N.Y.: Doubleday, 1983), p. 48. [BACK]

13. Schneider, "November 4 Vote for President," pp. 242-43. [BACK]

14. Ibid., p. 241. [BACK]

15. See J. Merrill Shanks and Warren E. Miller, "Policy Direction and Performance Evaluation: Complementary Explanations of the Reagan Elections," Prepared for 1985 Annual Meeting of the American Political Science Association, August 29-Sept. 1, 1985, New Orleans. [BACK]

16. See Thomas E. Mann and Norman J. Ornstein, "The Republican Surge in Congress," in Austin Ranney, ed., The American Elections of 1980 (Washington, D.C.: American Enterprise Institute, 1981), pp. 263-302; and Charles E. Jacob, "The Congressional Elections," in Gerald Pomper with Colleagues, The Election of 1980, pp. 119-41. [BACK]

17. Jacob, "The Congressional Elections," p. 132. [BACK]

18. Smith et al., Reagan the Man, p. 4. [BACK]

19. Barrett, Gambling with History, p. 55. [BACK]

20. Ibid., p. 59. [BACK]

21. Ibid., p. 24. [BACK]

22. For a good example, Paul McCracken editorialized in the Wall Street Journal that the tax cut first strategy should be tried; an excerpt was used by Martin Anderson, August 22, 1980, Memorandum for Governor Reagan; also in Fact Sheet for September 9 speech. [BACK]

23. That was not so easy; he was brought into the 1976 Reagan challenge to Gerald Ford when Reagan got in trouble for proposing a shift of $90 billion per year in federal programs to the states—without saying how the states would pay for them. One Reagan aide commented of Anderson's performance that "he could unscramble an egg." Jules Witcover, Marathon: The Pursuit of the Presidency 1972-76 (New York: Signet/New American Library, 1978), p. 408. [BACK]

24. As George Shultz reported to Leonard Silk of the New York Times, in Smith et al., Reagan the Man, p. 56. [BACK]

25. Fact Sheet for September 9 speech. [BACK]

26. Barrett, Gambling with History, p. 133. [BACK]

27. Herbert Stein, Presidential Economics: The Making of Economic Policy from Roosevelt to Reagan and Beyond (New York: Simon and Schuster, 1984), pp. 259-60. [BACK]

28. Spending Control, Caspar Weinberger; Tax Policy, Charles E. Walker; Regulatory Reform, Murray Weidenbaum; Inflation Policy, Paul McCracken; International Money Policy, Arthur F. Burns; Budget, Alan Greenspan; Economic Policy Coordinating Committee, chaired by George Shultz, included Milton Friedman, Jack Kemp, Michael Halburton (an energy specialist), James T. Lynn, William Simon, and Walter Winston. [BACK]

29. Steven R. Weisman, "Reaganomics and the President's Men," New York Times Magazine, October 24, 1982, pp. 26-29, 82-85, 89-92, 109. [BACK]

30. Text of Reagan's February 5, 1981, speech in New York Times, February 6, 1981, p. A12. [BACK]

31. Reagan's theory was not as unusual as it may appear. The sense that the availability of funds causes them to be spent was old; in the early 1950s the Republicans in Congress had proposed replacing the social security dedicated tax with general revenue funding, precisely because they believed that having its own trust fund was an invitation to program growth. See Martha Derthick, Policymaking for Social Security (Washington, D.C.: Brookings Institution, 1979). [BACK]

32. David A. Stockman, The Triumph of Politics: How the Reagan Revolution Failed (New York: Harper & Row, 1986), p. 35. [BACK]

33. Michael Barone, Grant Ujifusa, and Douglas Mathews, Almanac of American Politics 1980 (New York: E. P. Dutton, 1979), p. 426. [BACK]

34. Ibid., pp. 49-50. [BACK]

35. Theodore Lowi, The End of Liberalism (New York: Norton, 1969), p. 289. [BACK]

36. Ibid., p. 72. [BACK]

37. Stockman, Triumph of Politics, p. 33. [BACK]

38. David A. Stockman, "The Social Pork Barrel," The Public Interest, No. 39 (Spring 1975), pp. 3-30. [BACK]

39. Stockman and Reagan had already met in an unusual way. John Anderson, Stockman's mentor, had run for president as an independent, seeking a constituency that would reject both Carter's performance and Reagan's beliefs. After Carter refused to include Anderson in debates, Reagan and Anderson were to debate alone. Reagan's people asked Stockman to play Anderson in mock debates to help prepare their candidate. He did so well that James Baker asked Stockman to play the same role when Reagan debated Carter. Reagan, too, was impressed. When Reagan offered Stockman the job, Stockman reports that Reagan said, "Dave, I've been thinking about how to get even with you for that thrashing you gave me in the debate rehearsals. So I'm going to send you to OMB." Stockman, Triumph of Politics, p. 77. [BACK]

40. David A. Stockman, "Avoiding a GOP Economic Dunkirk," in Greider, The Education of David Stockman, pp. 142, 144. [BACK]

41. Stein, Presidential Economics, p. 266. [BACK]

42. Timothy B. Clark, "Economic Events May Have Overtaken Reagan's 1981 Budget-Cutting Goals," pp. 2152-57; Michael R. Gordon, "Don't Expect Business as Usual From Reagan's Businesslike Cabinet," pp. 2175-79, National Journal, December 20, 1980. [BACK]

43. Dan Rodrigues, "Tanks, Brifts, and Bulls that Quack," typescript, seminar paper, University of California, Berkeley, 1981. [BACK]

44. Kenneth H. Bacon, "Economic Broker: Donald Regan Will Sell Both Tax, Budget Cuts as Treasury Secretary," Wall Street Journal, December 12, 1980, pp. 1, 20. [BACK]

45. Barrett, Gambling with History, p. 140. A spending increase here, a tax increase there, in the service of maintaining employment, was not what the Reagan administration wanted. They didn't believe in demand management. Microeconomics, based on price theory, is concerned with resource allocation in markets and, in some cases, as with Weidenbaum, in bureaucracies. Thus, microeconomists think in terms of departures from "efficient" markets and distortions caused by interfering with them. Macroeconomists are more likely to view the economy as a system to be manipulated, so on average, "macro" means more and "micro" means less intervention in the economy by government. [BACK]

46. Weisman, "Reaganomics and the President's Men," p. 85. [BACK]

47. See the profile in Barrett, Gambling with History, pp. 252-61. [BACK]

48. Ibid., p. 392. [BACK]

49. Source for the above description of staff is ibid., chapters on Baker, Darman, Meese, Deaver, Gergen; also National Journal, special issue, April 25, 1981, "The Decision Makers." [BACK]

50. Darman made the point strongly in a February 21, 1981, memo to Baker. Barrett, Gambling with History, p. 84. [BACK]

51. Timothy B. Clark, "Economic Events May Have Overtaken Reagan's 1981 Budget-Cutting Goals," National Journal, December 20, 1980, pp. 2152-55. [BACK]

52. Ibid., p. 2152. [BACK]

53. Albert R. Hunt, "Stockman's Hour," Wall Street Journal, February 19, 1981, pp. 1, 18. [BACK]

54. Dick Kirschten, "Reagan: 'No More Business As Usual,'" National Journal, February 21, 1981, pp. 300, 302-3. [BACK]

55. Elizabeth Drew, "A Reporter at Large: Early Days," New Yorker, March 16, 1981, pp. 84-99. [BACK]

56. Kenneth H. Bacon and Timothy D. Schellhardt, "Reagan Promises His Tax, Spending Cuts Will Reduce Inflation and Increase Growth," Wall Street Journal, February 19, 1981, pp. 3-5; and Dick Kirschten, "White House Strategy," pp. 300, 302-3; Linda E. Demkovich, "Assault on Food Stamps," pp. 301, 308-11; and Robert J. Samuelson, "Reagan's Bet," pp. 301, 304-6, all in National Journal, February 21, 1981. [BACK]

57. Barrett, Gambling with History, p. 144. [BACK]

58. Martin Tolchin, "Democrats and the Budget: Liberals as well as Republicans in Congress are Gripped by Fervor to Achieve Balanced Package," New York Times, March 10, 1981, p. D8. [BACK]

59. Gramm was careful to phrase his written promises in a manner that gave him an out. Wright seems to have indulged in some wishful thinking. If he had been really suspicious, he would have noticed Gramm's hedged language. [BACK]

60. Richard E. Cohen, "They're Still a Majority in the House, But are Democrats Really in Control?" National Journal, January 31, 1981, pp. 189-91; and Richard E. Cohen, "Will the Democrats and Republicans Find Happiness in Their New Roles?" National Journal, December 6, 1980, pp. 2064-67. [BACK]

61. Richard E. Cohen, "In the Conservative Politics of the '80s, the South Is Rising Once Again," National Journal, February 28, 1981, pp. 350-54. [BACK]

62. Barrett, Gambling with History, p. 168. [BACK]

63. "The New House Leaders: bipartisan compromisers," National Journal, December 13, 1980, pp. 2136-37; Richard E. Cohen, "For the Congressional Budget Process, 1981 Could Be the Make or Break Year," pp. 59-63; and "The House's Budget 'Compromiser,'" p. 61, National Journal, January 10, 1981. [BACK]

64. Richard Cohen, "Will the Democrats and Republicans Find Happiness," National Journal, December 6, 1980, pp. 2064-67. [BACK]

65. Peter Goldman et al., "Bracing for Reagan's Cuts," Newsweek, February 23, 1981, pp. 18-20. [BACK]

66. Cohen, "Will the Democrats and Republicans Find Happiness." [BACK]

1. Harry Anderson et al., "The U.S. Economy in Crisis," Newsweek, January 19, 1981, pp. 30-34. [BACK]

2. Elizabeth Drew, "Reporter At Large: 1980: Reagan," New Yorker, March 24, 1980, pp. 49-74 passim. [BACK]

3. "Reagan Readies the Ax," Newsweek, February 16, 1981, p. 20. [BACK]

4. Text of Reagan's February 5, 1981, speech, New York Times, February 6, 1981, p. A12. [BACK]

5. Barrett, Gambling with History, pp. 148-49. [BACK]

6. Steven Rattner, "Treasury Secretary Rejects Linking Tax Cuts to Budgetary Reductions," New York Times, February 4, 1981, p. 1. [BACK]

7. Stockman, Triumph of Politics, p. 164. [BACK]

8. Thomas C. O'Donnell, "Backing away from the cut that kills," Forbes Magazine, February 16, 1981, pp. 31-32. [BACK]

9. Stockman, Triumph of Politics, p. 93. [BACK]

10. "Carter's Farewell Budget," Newsweek, January 26, 1981, pp. 64-65. [BACK]

11. Harry Anderson, "Stockman's Ladder," Newsweek, February 9, 1981, p. 66; Barrett, Gambling with History, pp. 139-43. [BACK]

12. Stockman, Triumph of Politics, p. 96. [BACK]

13. Office of Management and Budget, Fiscal Year 1982 Budget Revisions (March 1981), Table 6, p. 13. [BACK]

14. Barrett, Gambling with History, p. 140. [BACK]

15. Stein, Presidential Economics, pp. 269-70. [BACK]

16. Barrett, Gambling with History, p. 141. [BACK]

17. Paul Craig Roberts, "'The Stockman Revolution': A Reaganite's Account," Fortune, February 22, 1982, pp. 56-58, 62-70. [BACK]

18. Greider, Education of David Stockman, p. 35. [BACK]

19. Martin Tolchin, "Budget Conferees in a Balancing Act," New York Times, March 12, 1980, p. A11. [BACK]

20. Stockman, Triumph of Politics, pp. 116-19. [BACK]

21. Ibid., pp. 112-13. [BACK]

22. Greider, Education of David Stockman, p. 13. See also Barrett, Gambling with History, pp. 196-97. [BACK]

23. David S. Broder, "Hill, Reagan Aides Eye Painful Cuts," Washington Post, January 2, 1981, pp. A1, A3. [BACK]

24. Pete V. Domenici, "The Ghosts of Deficit Forever," Washington Post, January 21, 1986, p. A15. [BACK]

25. Stockman, Triumph of Politics, p. 181. [BACK]

26. "I do not need a fight with 35 million Americans right off the bat," Stockman commented. "That would be the litmus of political stupidity." Newsweek, January 19, 1981, p. 39. [BACK]

27. "Bracing for Reagan's Cuts," Newsweek, February 23, 1981, pp. 18-20. [BACK]

28. See Robert G. Kaiser, "Deep Budget Cuts Urged for Popular Federal Programs," Washington Post, February 4, 1981, pp. A1, A4. [BACK]

29. Greider, Education of David Stockman, p. 22. [BACK]

30. Among many studies of the package's tilt, particularly good ones are: Gregory B. Mills, "The Budget: A Failure of Discipline," in John L. Palmer and Isabel V. Sawhill, eds., The Reagan Record: An Assessment of America's Changing Domestic Priorities (Cambridge, Mass.: Ballinger, 1984), pp. 107-39; Palmer and Sawhill, eds., The Reagan Experiment (Washington, D.C.: Urban Institute Press, 1982); Jack A. Meyer, "Budget Cuts in the Reagan Administration: A Question of Fairness," and Timothy M. Sneeding, "Is the Safety Net Still Intact," in D. Lee Bawden, ed., The Social Contract Revisited (Washington, D.C.: Urban Institute Press, 1984); John C. Weicher, "The Reagan Domestic Budget Cuts: Proposals, Outcomes, and Effects," in Phillip Cagan, ed., The Impact of the Reagan Program (Washington, D.C.: American Enterprise Institute, 1986). We base our estimate on the proposals as described in the Office of Management and Budget, Additional Details on Budget Savings (Washington, D.C.: U.S. Government Printing Office, April 1981), and Congressional Budget Office, An Analysis of President Reagan's Budget Revisions for Fiscal Year 1982 (Washington, D.C.: U.S. Government Printing Office, March 1981), Staff Working Paper. [BACK]

31. See Jane Bryant Quinn, "A Middle Class Deal," Newsweek, March 2, 1981, p. 66, as one example. [BACK]

32. George J. Church, "Are There Limits to Compassion?" Time, April 6, 1981, pp. 12, 17. The "notch effect," well known to students of poverty programs, is unavoidable no matter where the line is drawn; whether benefits are changed or not, someone out of the program always seems disadvantaged compared to those just below him who get into the program. A good summary of effects and sources is Wendell E. Primus, "Legislative Impact of Poverty Statistics," paper prepared for the annual meeting of the Association for Public Policy Analysis and Management, October 18-20, 1984, New Orleans. [BACK]

33. Adam Clymer, "Rise in U.S. Optimism on Economy Bolsters Reagan Support, Poll Hints," New York Times, April 30, 1981, pp. A1, B10. [BACK]

34. Darman made the point concerning the benefits distribution in a February 10 memo to the troika; Barrett, Gambling with History, p. 143. Meese took the issue so seriously that he opposed reduction of the top tax rate on unearned income (dividends, rents, interest) from 70 to 50 percent; Stockman, Triumph of Politics, p. 130. [BACK]

35. Stockman, Triumph of Politics, p. 130. [BACK]

36. Ibid. [BACK]

37. Martin Anderson, "The Objectives of the Reagan Administration's Social Welfare Policy," in D. Lee Bauden, ed., The Social Contract Revisited (Washington, D.C.: Urban Institute Press, 1984), p. 17. [BACK]

38. "Budget Reform Plan," in America's New Beginning: A Program for Economic Recovery (Washington, D.C.: U.S. Government Printing Office, February 18, 1981), p. 13. Also page 10 of "A White House Report" in the same document. [BACK]

39. See Stockman, Triumph of Politics, p. 124. [BACK]

40. Why were these "Chapter Two" proposals, in particular, dredged up at the end? Stockman doesn't tell us, and some sources don't remember the proposals brought to the cabinet on February 7 as conceptually separate. Most likely these proposals were more from OMB staff work (the "C" list) than from transition teams; because they obviously could meet stiff resistance from business constituencies, Stockman hesitated to present them. Naturally when Stockman was working from his and Gramm's list and those of Weinberger and the Senate Budget staff, the emphasis was more on social spending for Democratic constituencies; OMB staff, looking for additions, was more likely to look on the tax side because its biases were different and the other stuff had been done. [BACK]

41. Stockman, Triumph of Politics, p. 127. [BACK]

42. Ibid., p. 131. [BACK]

43. Greider, Education of David Stockman, p. 24. [BACK]

44. Drew, "Reporter at Large: 1980: Reagan," New Yorker, March 24, 1980, p. 71. [BACK]

45. Richard Halloran, "Carter Seeks $180 Billion For 1982 Military Budget," New York Times, January 16, 1981, p. B7. [BACK]

46. Congressional Budget Office, An Analysis of President Reagan's Budget Revisions for Fiscal Year 1982, Staff Working Paper (Washington, D.C.: U.S. Government Printing Office, March 1981), p. 74. [BACK]

47. Richard Halloran, "Weinberger Begins Drive for Big Rise in Defense Budget," New York Times, March 5, 1981, pp. A1, B1O. [BACK]

48. Budget documents; "Hitting the Jackpot," The Economist, March 14, 1981, pp. 24, 27-28. [BACK]

49. "Reagan's Defense Buildup," Newsweek, March 16, 1981, p. 22. [BACK]

50. Stockman, Triumph of Politics, pp. 106-9. [BACK]

51. Ibid., pp. 132-33. [BACK]

52. Greider, Education of David Stockman, p. 36. [BACK]

53. Office of Management and Budget, Fiscal Year 1982 Budget Revisions, March 10, 1981 (Washington, D.C.: U.S. Government Printing Office), p. 3. [BACK]

54. Stockman, Triumph of Politics, p. 125. [BACK]

55. Ibid., p. 128. [BACK]

56. Reestimates of the current policy base to a higher level of spending later forced Stockman to find another $7.1 billion by March 10 in order to attain the proposed spending ceiling of $695.5 billion in outlays. Text of Reagan's February 18, 1981, speech, and accompanying proposals, were published as America's New Beginning: A Program for Economic Recovery (Washington, D.C.: U.S. Government Printing Office, February 18, 1981). [BACK]

1. Phillip Shabecoff, "Economic Plan Rejected by Labor Chiefs as Unfair," and Bernard Weinraub, "Coalition to Oppose Cuts in Aid to Poor," New York Times, February 20, 1981, p. A10. [BACK]

2. "Labor Department: It's in Business's Hands Now," National Journal, April 25, 1981, pp. 726-28. [BACK]

3. "The Budget-Cutters' Ball," New Republic, February 28, 1981, pp. 5-8. [BACK]

4. George J. Church, "The Unkindest Cuts of All," Time, February 23, 1981, pp. 12-14. [BACK]

5. Judith Miller, "A Liberal Democrat Finds Constituents Demanding Budget Cuts," New York Times, February 17, 1981, p. A14. [BACK]

6. Martin Tolchin, "Democrats to Seek Significant Changes in Tax-Cut Proposal," New York Times, February 21, 1981, p. A1. [BACK]

7. Ibid. [BACK]

8. Ed Magnuson, "A Bonanza for Defense," Time, March 16, 1981, pp. 26, 31. [BACK]

9. Elizabeth Drew, "A Reporter at Large: The Democrats," New Yorker, March 22, 1982, pp. 130-45. For the basic story on Senate reconciliation, see Congressional Quarterly Almanac 1981, Vol. 37 (Washington, D.C.: Congressional Quarterly, Inc., 1982), pp. 250-51 (hereafter CQA 1981); on Republican unity, see Allen Schick, "How the Budget Was Won and Lost," in Norman J. Ornstein, ed., President and Congress: Assessing Reagan's First Year (Washington, D.C.: American Enterprise Institute, 1982), pp. 14-43. [BACK]

10. Greider, Education of David Stockman, pp. 32-33. [BACK]

11. Richard E. Cohen, "Budget Battle Takes to the Trenches—But Who Ever Said It Would Be Easy?" National Journal, April 18, 1981, pp. 645-48. [BACK]

12. "New Beginnings, Old Anxieties," Time, February 2, 1981, pp. 22-23; Adam Clymer, "Public Prefers a Balanced Budget to Large Cut in Taxes, Poll Shows," New York Times, February 3, 1981, p. A1. [BACK]

13. "The Budget: Bumps Ahead," Newsweek, March 30, 1981, pp. 23-24. [BACK]

14. Quoted by Steven S. Smith, "The Congress: Budget Battles of 1981: The Role of the Majority Party Leadership," in Allan P. Sindler, ed., American Politics and Public Policy (Washington, D.C.: Congressional Quarterly Press, 1982), pp. 43-78. [BACK]

15. Steven V. Roberts, "Critical Approach to Reagan's Budget is Urged by Wright," New York Times, March 13, 1981, p. A1. [BACK]

16. Text in New York Times, April 9, 1981, p. B12. [BACK]

17. Smith, "The Congress," p. 54. [BACK]

18. See Barrett, Gambling with History, pp. 107-25. [BACK]

19. Ed Magnuson, "Six Shots at Nation's Heart," Time, April 13, 1981, pp. 14-38; and Barrett, Gambling with History, p. 121. [BACK]

20. Ibid. [BACK]

21. Barrett, Gambling with History, p. 124; also Peter Goldman, "The First Hundred Days," Newsweek, May 4, 1981, pp. 22-23. [BACK]

22. Peter Behr and Caroline Atkinson, "Economic Advisers Set to Give Reagan Grim Projections," Washington Post, January 6, 1981, pp. 1A, 4A. See also Albert R. Hunt, "Stockman's Hour," Wall Street Journal, February 19, 1981, pp. 1, 18; and Robert W. Merry, "Changing Ways," Wall Street Journal, February 4, 1981, p. 1. [BACK]

23. Hunt, "Stockman's Hour," Wall Street Journal. [BACK]

24. Robert J. Samuelson, "Reagan's Tax Package—Is a Bill in the Hand Worth Two in the Bush?" National Journal, February 28, 1981, pp. 340-45. [BACK]

25. Barrett, Gambling with History, p. 132. [BACK]

26. Hobart Rowen, "Put Budget-Cutting First, Burns Urges Committee," Washington Post, January 22, 1981, pp. B1, B6. [BACK]

27. Stein, Presidential Economics, p. 269. [BACK]

28. Steven R. Weisman, "Reaganomics and the President's Men," New York Times, October 24, 1982, p. 28. See also Elizabeth Drew, "Reporter at Large: First Year," New Yorker, January 4, 1982, pp. 38-62. [BACK]

29. Weisman, "Reaganomics and the President's Men," New York Times. [BACK]

30. Richard E. Cohen, "The Senator from Tennessee May Hold the Key to Reagan's Economic Plans," National Journal, April 11, 1981, pp. 596-600. [BACK]

31. Ibid. [BACK]

32. "The Democrats Begin to Regroup," Newsweek, March 9, 1981, p. 29; Albert R. Hunt and Dennis Farney, "A Consensus to Cut: Budget Paring Mood Spreads on Capitol Hill, Bodes Well for Reagan," Wall Street Journal, March 10, 1981, pp. 1, 16. [BACK]

33. Stockman, Triumph of Politics, p. 161. [BACK]

34. Ibid., p. 162. Our sources convince us that Stockman misunderstood Howard Baker's position. [BACK]

35. Ibid. [BACK]

36. Greider, Education of David Stockman, pp. 30-31. [BACK]

37. Martin Tolchin, "Senate Rejects Bid to Restore Welfare Funds," New York Times, April 1, 1981, p. A24. [BACK]

38. Martin Tolchin, "Democrats, Eying Elections, Maneuver on Budget Cuts," New York Times, April 2, 1981, p. B1. [BACK]

39. Daniel Elazar, American Federalism: A View from the States, 2d ed. (New York: Crowell, 1972). [BACK]

40. Louis Dumont, Homo Hierarchicus: The Caste System and Its Implications (Chicago: University of Chicago Press, 1980). [BACK]

41. For a description of the administration's oil policy, see CQA 1981, pp. 248-50; Martin Tolchin, "Democrats' Budget Tops Reagan Figure on Social Programs," April 7, 1981, pp. Al, B8; and "Democratic Budget Proposal," April 8, 1981, p. A24, New York Times. [BACK]

42. Harry Anderson et al., "The Remaking of a Budget," Newsweek, April 20, 1981, p. 39. [BACK]

43. Budget Committee Democrats claimed a new technique, Deferred Enrollment, would enforce the reductions on appropriations. The administration was properly skeptical. Robert Reischauer, "The Congressional Budget Process," in Gregory Mills and John Palmer, eds., Federal Budget Policy in the 1980s (Washington, D.C.: Urban Institute, 1984), pp. 385-413. [BACK]

44. Richard E. Cohen, "Democratic Dilemma—No Credit If They Work With Reagan, Blame If They Don't," National Journal, March 21, 1981, pp. 482-86; "What `Reconciliation' Means," Newsweek, March 2, 1981, p. 32. [BACK]

45. Reischauer, "Congressional Budget Process," p. 399. [BACK]

46. In April, ninety-one-day T-bills were running about 13.6 percent; for the year to average out at 8.9 percent would require some heroic assumptions, such as an average rate of about 5 percent for the second half of the year. Actually, the final figure was just over 14 percent. [BACK]

47. Martin Tolchin, "Senate Panel, 12-8, Rejects Own Plan for Budget in 1982," New York Times, April 10, 1981, pp. Al, D3; Tolchin, "Facing Up to Budget Reality," New York Times, April 11, 1981, pp. 1, 12; Anderson et al., "The Remaking of a Budget." [BACK]

48. Editorial pages, New York Times, April 16, 1981. [BACK]

49. Stockman, Triumph of Politics, p. 166. [BACK]

50. Martin Tolchin, "Democrats in Congress Weighing a Proposal to Balance the Budget," New York Times, April 29, 1981, pp. Al, A23; CQA 1981, pp. 249, 252. [BACK]

51. Greider, Education of David Stockman, p. 34; Steven R. Weisman, "Reagan Backs Plan on Budget By Group of House Democrats," New York Times, April 22, 1981, p. Al. [BACK]

52. S. William Green, "In Search of Fairness," reprint from Congressional Record, Vol. 128, no. 90, July 14, 1982. [BACK]

53. Martin Tolchin, "Democrats in House Add Military Funds to Proposed Budget," New York Times, April 30, 1981, pp. Al, A26. [BACK]

54. Steven V. Roberts, "Some Democrats Accuse O'Neill of a Lack of Strong Leadership," New York Times, April 30, 1981, p. A26. [BACK]

55. Ed Magnuson, "Reagan's Big Win," Time, May 18, 1981, pp. 14-16; Peter Goldman, "The Second Hundred Days," Newsweek, May 11, 1981, pp. 22-24; Barrett, Gambling with History, pp. 153-54; and Paul Craig Roberts, "Making Deficits a Scapegoat for Inflation," New York Times, p. A31. [BACK]

56. See Steven V. Roberts, "Congressmen Hear Voters, But Message Is Not Clear," New York Times, April 26, 1981, p. 18; and other stories on Jones and Shannon during the month. [BACK]

57. Adam Clymer, "Rise in U.S. Optimism on Economy Bolsters Reagan Support, Poll Hints," April 30, 1981, pp. A1, B10. [BACK]

58. "Majority in Poll Support Reagan on Economic Package," New York Times, April 25, 1981, Associated Press wire story, p. A6. [BACK]

59. Steven V. Roberts, "44 Democrats Are Objects of White House Attentions," New York Times, May 1, 1981, p. A19. [BACK]

60. Ibid. [BACK]

61. Kenneth H. Bacon, "Reagan's Regan," Wall Street Journal, April 30, 1981, pp. 1, 17. [BACK]

62. Barrett, Gambling with History, pp. 153-54; Greider, Education of David Stockman, p. 36. [BACK]

63. Green, "In Search of Fairness." [BACK]

64. Stockman, Triumph of Politics, p. 176. [BACK]

65. Hedrick Smith, "Second Honeymoon," New York Times, April 29, 1981, p. A22. [BACK]

66. Ibid. [BACK]

67. Ed Magnuson, "Reagan's Budget Battle," Time, May 11, 1981, pp. 16-18; speech transcript, New York Times, April 29, 1981, p. A22. [BACK]

68. Martin Tolchin, "Democrats in House Add Military Funds to Proposed Budget," New York Times, April 30, 1981, pp. Al, A26. [BACK]

69. Terence Smith, "Despite Doubts, Byrd Will Back Reagan's Budget," New York Times, May 3, 1981, p. Al; James Kelly, "Now Comes the Hard Part," Time, May 4, 1981, pp. 17-18; and George J. Church, "Flying into Trouble," Time, May 4, 1981, pp. 14-16. [BACK]

70. CQA 1981, p. 253. [BACK]

71. Peter Goldman, "The Reagan Steamroller," Newsweek, May 18, 1981, p. 39. [BACK]

72. Peter Goldman, "The Second Hundred Days," Newsweek, May 11, 1981, pp. 22-24. [BACK]

73. Greider, Education of David Stockman, p. 35. [BACK]

74. Kenneth H. Bacon, "Strange Welcome: Wall Street is Greeting President's Program with Jitters, Turmoil," Wall Street Journal, May 7, 1981, pp. 1, 13. See also Lindley H. Clark, Jr., "Slowing Down: Analysts See Economy Flattening Out Now, Expanding in 2nd Half," Wall Street Journal, April 16, 1981, pp. 1, 19; and Council of Economic Advisers, Economic Indicators, various months in 1981. [BACK]

75. Stockman, Triumph of Politics, p. 181. [BACK]

76. Ibid., pp. 184-85. [BACK]

77. Ibid., pp. 187-88. [BACK]

78. In his book, Stockman says the real problem with altering social security policy was making the change effective immediately. He says that "detail got lost in the shuffle." Yet, all the budget-savings figures depended on when that change began; Stockman had long wanted to make it immediate; by his own report, he objected to other packages that did not yield savings fast enough. In short, Stockman is fudging. If he didn't know the exact date of the change, as he insists, he knew that he wanted it soon. Stockman, Triumph of Politics, p. 188. [BACK]

79. Barrett, Gambling with History, p. 157. [BACK]

80. Stockman, Triumph of Politics, p. 189. [BACK]

81. Barrett, Gambling with History, p. 157. [BACK]

82. See Stockman, Triumph of Politics, pp. 190-93. [BACK]

83. James Kelly, "A Slash at Social Security," Time, May 25, 1981, pp. 24-25. [BACK]

84. Tom Morganthau, "The Gipper Loses One," Newsweek, June 1, 1981, pp. 22-23. [BACK]

1. Stuart Eizenstat, "The Hill's Budget Stampede," Washington Post, June 21, 1981, pp. C1, C3. [BACK]

2. CQA 1981, pp. 257-58. [BACK]

3. "Crocodile Tears," editorial, Washington Post, January 25, 1988, p. A12. [BACK]

4. Richard E. Cohen, "Democratic Dilemma—No Credit If They Work with Reagan, Blame If They Don't," National Journal, March 21, 1981, pp. 482-86. [BACK]

5. Robert Reischauer, "The Congressional Budget Process," in Gregory B. Mills and John L. Palmer, eds., Federal Budget Policy in the 1980s (Washington, D.C.: Urban Institute, 1984), pp. pp. 397-98. [BACK]

6. Richard E. Cohen, "For the Congressional Budget Process, 1981 Could Be the Make or Break Year," National Journal, January 10, 1981, pp. 59-63. [BACK]

7. See Hugh Heclo and Aaron Wildavsky, The Private Government of Public Money, 2d ed. (London: Macmillan, 1981). [BACK]

8. Greider, Education of David Stockman, p. 57. [BACK]

9. Morganthau, "The Gipper Loses One," Newsweek, June 1, 1981, pp. 22- 23. [BACK]

10. Stockman, Triumph of Politics, p. 195. [BACK]

11. Ibid. [BACK]

12. The budget resolution's reconciliation instructions to the Committee on Ways and Means read as follows:

(15)(A) the House Committee on Ways and Means shall report changes in laws within the jurisdiction of that committee which provide spending authority as defined in section 401(c)(2)(C) of Public Law 93-344 sufficient to reduce budget authority by $3,699,000,000 and outlays by $8,247,000,000 in fiscal year 1982; to reduce budget authority by $3,660,000,000 and outlays by $9,247,000,000 in fiscal year 1983; and to reduce budget authority by $3,511,000,000 and outlays by $9,573,000,000 in fiscal year 1984; and

(B) the House Committee on Ways and Means shall also report changes in laws within the jurisdiction of that committee sufficient to reduce appropriations for programs authorized by that committee so as to achieve savings in budget authority and outlays as follows: $978,000,000 in budget authority and $994,000,000 in outlays for fiscal year 1982; $1,294,000,000 in budget authority and $1,312,000,000 in outlays for fiscal year 1983; and $1,647,000,000 in budget authority and $1,675,000,000 in outlays for fiscal year 1984. (United States Statutes At Large, 1981, p. 1754)

13. The classic case is the Park Service, faced with a cut, declaring it had to cut the hours for tours at the Washington Monument—the most visible cut imaginable. In 1986 the Library of Congress managed a nice version of this: responding to the Gramm-Rudman sequester, it closed its main reading room at 5:00 p.m. instead of 9:00 p.m.; it got more money. [BACK]

14. For detailed descriptions of these proposals, see Timothy B. Clark, Linda E. Demkovich, Robert J. Samuelson, and others, "Congress Works a Minor Revolution—Making Cuts to Meet Its Budget Goals," National Journal, June 20, 1981, pp. 114-25; Helen Dewar, "Hill Panels Meet or Exceed '82 Budget Cut Goals, Estimates Show," Washington Post, June 13, 1981, pp. A1, A5; and Dewar, "OMB `Indicts' Democrats," Washington Post, June 15, 1981, pp. A1, A13. [BACK]

15. Clark et al., "Congress Works a Minor Revolution"; Helen Dewar and Robert G. Kaiser, "Reagan Allies Ready Budget Alternative," Washington Post, June 12, 1981, pp. A1, A5. [BACK]

16. Stockman, Triumph of Politics, p. 200. [BACK]

17. Ibid., p. 203. [BACK]

18. Ibid., pp. 204-5. [BACK]

19. Clark et al., "Congress Works a Minor Revolution"; Helen Dewar, "House Democrats Hunker Down For Next Fight on Budget Cuts," Washington Post, June 16, 1981, p. A2. [BACK]

20. Smith, "The Congress," p. 62. [BACK]

21. Helen Dewar, "House Democrats Try to Cut Losses on Social Programs," Washington Post, June 17, 1981, p. A2. [BACK]

22. CQA 1981, p. 262. [BACK]

23. Barrett, Gambling with History, p. 160. [BACK]

24. Jane Seabury, "Republicans Criticize Democrats' Slow Pace on Budget Legislation," Washington Post, June 22, 1981, p. A2. [BACK]

25. Robert G. Kaiser, "Budget Warriors Improvised, Coddled," Washington Post, July 4, 1981, pp. A1, A2. [BACK]

26. Peter Goldman, "Reagan's Sweet Triumph," Newsweek, July 6, 1981, pp. 18-20. [BACK]

27. "Unfinished Business," National Journal, July 11, 1981, p. 1266. [BACK]

28. Peter Goldman, "The Honeymoon Is Over," Newsweek, June 29, 1982, pp. 36-37; and Art Pine, "Whistling Dixie on Tax Bill: Can GOP Rise Again?" Washington Post, June 21, 1981, pp. G1, G6. [BACK]

29. Pine, "Whistling Dixie on Tax Bill," p. G6. [BACK]

30. Stockman, Triumph of Politics, p. 208. [BACK]

31. S. William Green, "In Search of Fairness," Congressional Record, Vol. 128, no. 90, July 14, 1982. [BACK]

32. Goldman, "The Honeymoon Is Over"; and Kaiser, "Budget Warriors Improvised." [BACK]

33. Calculations from National Journal, July 4, 1981, p. 1218. [BACK]

34. CQA 1981, p. 259. [BACK]

35. Smith, "The Congress," p. 64. [BACK]

36. Stockman, Triumph of Politics, p. 218. [BACK]

37. Barrett, Gambling with History, p. 160. [BACK]

38. Lou Cannon and Dan Balz, "Reagan Taking His Economic Plan on Road, Flays Democrats," Washington Post, June 25, 1981, p. A3; and CQA 1981, pp. 262-63. [BACK]

39. Ward Sinclair, "Powerhouse," Washington Post, June 26, 1981, p. A1. [BACK]

40. Ward Sinclair and Peter Behr, "Horse Trading," Washington Post, June 27, 1981, p. A1. [BACK]

41. Ibid. [BACK]

42. Ibid. [BACK]

43. According to S. William Green (R-N.Y.), ibid. [BACK]

44. Richard E. Cohen, "Small But Influential," National Journal, July 11, 1981, p. 1260. [BACK]

45. Peter Goldman, "Reagan's Sweet Triumph," Newsweek, July 6, 1981, pp. 18-19. [BACK]

46. Ibid. [BACK]

47. Dennis Farney, "President's Budget Wins Vote in House on Rules Question, Stunning Democrats," Wall Street Journal, June 26, 1981, pp. 3, 14. [BACK]

48. Ibid. [BACK]

49. Stockman, Triumph of Politics, pp. 221-22. [BACK]

50. Smith, "The Congress," p. 66. [BACK]

51. Barrett, Gambling with History, p. 163; see also CQA 1981, p. 264; Richard A. Cohen, "Reagan's House victory lightens burden for budget conferees," National Journal, July 4, 1981, pp. 1218-19; and Cohen, "Small But Influential." [BACK]

52. CQA 1981, pp. 263, 265. [BACK]

53. Democrats had, at the time, a 242 to 191 margin; 21 of the 242 had opposed the party on both Republican substitute first resolutions in 1980, so might be expected to defect in 1981. Of this group, 3 (Marty Russo, Ill.; Doug Applegate, Ohio; and Bill Boner, Tenn.) were loyal on Gramm-Latta 1. Each was no conservative and, having made his seat safe in 1980, had few electoral worries. Jack Brinkley and Elliot Levitas of Georgia defected on all other budget votes but supported their party on reconciliation, leaving 16 whom, we may safely say, the Democrats had little chance to win. Another 12 Democrats had defected on one of the 1980 Republican substitutes. Of these, Bill Nichols (Ala.), Andy Ireland (Fla.), Bill Lee Evans and Ed Jenkins (Ga.), Eugene Atkinson, and Kent Hance (Tex.) were all pretty conservative. Only Jenkins, whose anger at Gramm was noted above, resisted Reagan's courtship. The other 6 were moderates with histories of party loyalty. There were, therefore, 24 Democrats whose previous budget votes and ideology made them prime suspects to defect. The Democratic leaders'success in holding the three Georgians—Brinkley, Levitas, and Jenkins—was probably the best that could be expected within that group, bringing the basic margin to 221 to 212, if everyone else voted with their party. [BACK]

54. James A. Miller and James D. Range, "Reconciling An Irreconcilable Budget: The New Politics of the Budget Process," Harvard Journal of Legislation 20, no. 4 (1983), pp. 4-30; quote on p. 25. [BACK]

55. Ibid. [BACK]

56. Helen Dewar, "Senators Will Prune Budget-Slashing Bill," Washington Post, June 23, 1981, p. A5. [BACK]

57. Reischauer, "The Congressional Budget Process," p. 389. [BACK]

58. CQA 1981, p. 264. [BACK]

59. Dewar, in the Post, wrote that:

The leaders agreed to strip out provisions to do such things as permit wider trucks on interstate highways, deregulate the amateur radio industry, allow Western Union to enter international telecommunications markets, reauthorize the Older Americans Act and create a new program sponsored by Senator Jeremiah Denton (R-Ala.) to promote adolescent chastity, sources said.

But they disagreed over other items in such areas as further radio deregulation, television licensing, federal controls over community development grants and curtailment of subsidized housing for cities like Washington that practice rent control. ("Senators Will Prune Budget-Slashing Bill")

60. John L. Palmer and Gregory B. Mills, "Budget Policy," in John L. Palmer and Isabel V. Sawhill, eds., The Reagan Experiment (Washington, D.C.: Urban Institute Press, 1982), pp. 59-96; quote on p. 78. [BACK]

1. Steven R. Weisman, "Reaganomics and the President's Men," New York Times Magazine, October 24, 1982, pp. 26-29, 82-85, 89-92, 109. [BACK]

2. Howell Raines, "Reagan Orders Staff to Repudiate Report of Compromise on Tax Cut," New York Times, April 14, 1981, pp. A1, D13. [BACK]

3. For detailed tables, see National Journal, July 25, 1981, p. 1349, and August 8, 1981, p. 1410. [BACK]

4. Inflation was also driving poor people into brackets where they would be taxed when they had not been taxed before. [BACK]

5. Robert W. Merry, "Rostenkowski and the Tax Bill," Wall Street Journal, March 97, 1981, p. 26. [BACK]

6. Ibid. [BACK]

7. Robert W. Merry and Burt Schorr, "Pension Pains: Congress, Reagan See Need to Cut Benefits Paid by Social Security," Wall Street Journal, May 10, 1981, pp. 1, 12. [BACK]

8. Peter Goldman, "The Reagan Steamroller," Newsweek, May 18, 1981, pp. 38-40. [BACK]

9. Robert W. Merry, "Mr. Chairman: Senator Robert Dole Plays Major Role in Future of Reagan Tax Bill," Wall Street Journal, July 14, 1981, pp. 1, 15. [BACK]

10. Barrett, Gambling with History, pp. 166-67; Stockman, Triumph of Politics, pp. 238-40; and Walter Isaacson, "A Less Than Perfect' 10-10-10,"' Time, June 1, 1981, p. 16, 21. [BACK]

11. "The Best-Laid Plans ...: Negotiations toward a bipartisan tax cut go astray," Time, June 8, 1981, p. 19. [BACK]

12. Ibid. [BACK]

13. Martin Schram, "Leading the Democrats: Rostenkowski Plays 'Palm' to O'Neill's 'Oak,'" Washington Post, June 8, 1981, pp. A1, A2. [BACK]

14. On Rostenkowski, see ibid.; "The Sultan of Swap," Time, June 1, 1981, p. 21. [BACK]

15. Peter Goldman, "Tax Cuts: Reagan, Digs In," Newsweek, June 15, 1981, pp. 26-27. [BACK]

16. Ibid. [BACK]

17. Richard E. Cohen, "A Reagan Victory on His Tax Package Could Be a Costly One Politically," National Journal, June 13, 1981, pp. 1058-62. [BACK]

18. Art Pine and Lou Cannon, "Reagan, Democrats Unable to Agree on Terms for Tax Cut," June 2, 1981, pp. A1, A3; Art Pine and Lee Lescaze, "Democrats Ease Stand On Tax Cut," June 3, 1981, pp. A1, A4; and Art Pine, "Reagan Rejects Plan By Hill Democrats for 15% Tax Cut," June 4, 1981, pp. A1, A4; all in Washington Post. [BACK]

19. Stockman, Triumph of Politics, p. 249. [BACK]

20. Ibid., p. 247. [BACK]

21. A tax credit allows the payer to deduct from taxes, not from income, some portion of the cost of an investment. A 10 percent credit on a million dollar item is worth $100,000. At a tax rate of 40 percent, a 10 percent deduction would be worth 40 percent of that, or $40,000. The combination of tax credits up front with 10-5-3 depreciation is what gave the Reagan plan its negative rates. [BACK]

22. Caroline Atkinson, "Argument for Tax Cut to Aid Business Weakened by New Statistics," Washington Post, February 5, 1981, p. A2. [BACK]

23. Ibid; Robert R. Samuelson, "Business Tax Cuts—Needed Stimulant or Poorly Conceived Boondoggle?" National Journal, April 4, 1981, pp. 556-61. For the pro-10-5-3, see various Martin Feldstein Wall Street Journal articles, including July 15, 1981. Details in CQA 1981, p. 96. [BACK]

24. See Lee Lescaze and Art Pine, "President Challenges Democrats," June 5, 1981, pp. A1, A7; John Berry, "Business Tax Break Cut 33% In Revised Depreciation Plan," June 5, 1981, pp. C8, C9; and Art Pine, "Tax Relief Restoration Is Proposed," June 9, 1981, pp. D6, D8; all in Washington Post. [BACK]

25. Cohen, "A Reagan Victory on his Tax Package Could Be a Costly One Politically." [BACK]

26. Steven R. Weisman, "Reaganomics and the President's Men," New York Times Magazine, October 24, 1982, pp. 26-29, 82—85, 89—92, 109; Barrett, Gambling with History, pp. 164-65. [BACK]

27. Barrett, Gambling with History, pp. 171-72. Also see Greider, Education of David Stockman. [BACK]

28. Art Pine, "'Bidding War' Is Seen During Markup of Bills," Washington Post, June 6, 1981, pp. A1, A4. [BACK]

29. Stockman describes both Baker and Regan as deferring to the president's preferences on the tax bill, and our interviews confirm that judgment. See Triumph of Politics, pp. 245-46. [BACK]

30. Peter Goldman, "Tax Cuts: Reagan Digs In," Newsweek, June 15, 1981, pp. 26-27; John Berry, "Revised Proposal Offers Lower Federal Deficits," Washington Post, June 6, 1981, pp. A1, A4; Pine, "'Bidding War' Is Seen During Markup of Bills"; Lou Cannon, "White House Expects Long Tax Cut Battle, Readies the 'Hard Sell,'" Washington Post, June 7, 1981, p. A5; Peter Behr, "Compromising on Taxes," Washington Post, June 8, 1981, pp. A1, A2; Pine, "Tax Relief Restoration Is Proposed"; Art Pine, "Some Hill Democrats Switch on Tax Relief," Washington Post, June 10, 1981, p. A3; Art Pine, "Reagan's Tax Plan Gets a Mixed Reception," Washington Post, June 11, 1981, p. A6; and Claudia Wallis, "The Marine Has Landed: As the tax-cut battle heats up, Donald Regan warms to his task," Time, June 22, 1981, p. 13. [BACK]

31. Martin Schram, "Leading the Democrats: Rostenkowski Plays 'Palm' to O'Neill's 'Oak,'" Washington Post, June 8, 1981, pp. A1, A2. [BACK]

32. Art Pine, "In Tax Debate, the Democrats Are Where the GOP Used to Be," Washington Post, June 12, 1981, p. A3. [BACK]

33. Michael Kinsley, "Compromising Positions," New Republic, June 2O, l981, pp. 9-10. [BACK]

34. Caroline Atkinson and John Berry, "Senate Panel Backs Reagan Tax Plan," Washington Post, June 19, 1981, pp. A1, A5. [BACK]

35. The details were fuzzy because the committee was in the early stages of designing a proposal, not in formal markup. Reports were slightly contradictory, e.g., over the timing of various proposals. See CQA 1981, pp. 9899; John W. Berry, "Basic Shift on Business Taxes Gains," Washington Post, June 18, 1981, pp. A1, A5; "Rival business tax cuts would cost the same," National Journal, June 27, 1981, pp. 1174-75. [BACK]

36. Atkinson and Berry, "Senate Panel Backs Reagan Tax Plan." [BACK]

37. See ibid.; and John Berry, "Tax-Cut Debate No Longer Over 'Whether' But 'How,'" Washington Post, June 21, 1981, p. GI. [BACK]

38. Peter Behr, "Reagan's Advisers 'Puzzled' by High Rates' Persistence," Washington Post, July 15, 1981, p. E1. [BACK]

39. CQA 1981, p. 101. [BACK]

40. See, for example, the Congressional Record for June 23, 1981, pp. S13249-64, in which the Democrats made a record of their support on the floor. [BACK]

41. Stockman, Triumph of Politics, p. 253. See also CQA 1981, pp. 97-98; Robert J. Samuelson, "Death and Taxes—An Instructive Tale About How Congress Makes Tax Policy," National Journal, July 4, 1981, pp. 1192-96. [BACK]

42. Congressional Record 1980, p. S17138, and comments of Mr. Armstrong, June 26, 1980, p. S17161, pp. S17164-66. [BACK]

43. Ibid., pp. S17164—65. [BACK]

44. Stockman, Triumph of Politics, p. 254. [BACK]

45. Congressional Record, July 16, 1981, p. S1612. [BACK]

46. See Tables V-1 and V-3 in "General Explanation of the Economic Recovery Tax Act of 1981," Staff of the United States Congress Joint Committee on Taxation, Committee Print (Washington, D.C.: U.S. Government Printing Office, 1981). Indexing was not as important as the estimates suggested, for inflation turned out to be lower than anyone had anticipated. [BACK]

47. Walter Isaacson, "Big Battles on Two Fronts," Time, June 29, 1981, p. 21. [BACK]

48. Caroline Atkinson, "Dole Hopes to Pass Tax Bill in 2 Weeks, Beating the House," Washington Post,. July 3, 1981, p. A7; Caroline Atkinson and Lou Cannon, "White House Quickly Squelches GOP Talk of Tax Compromise," Washington Post, July 10, 1981, pp. A1, A7. [BACK]

49. CQA 1981, pp. 98-99. [BACK]

50. Peter Behr, "Limited Straddle Curbs Voted," Washington Post, July 11, 1981, p. D7; Thomas Edsall, "Reagan Goes To the Hill On Tax Bill," Washington Post, July 25, 1981, pp. A1, A10. [BACK]

51. See Robert Prinsky, "Industry Pushes to Persuade Congress To Accept Its Tax-Straddle Proposals," Wall Street Journal, July 31, 1981, p. 32, for the industry's side. [BACK]

52. Margot Hornblower, "A Boll Weevil," Washington Post, July 27, 1981, p. A5. [BACK]

53. Sources for numbers here, which are, as usual, a bit fuzzy, include Samuelson, "Death and Taxes—An Instructive Tale About How Congress Makes Tax Policy"; "Congress Decorates the Christmas Tree a Little Early," National Journal, July 4, 1981, p. 1194; CQA 1981, pp. 98, 100-2; Robert W. Merry, "Congress Clears Reagan's Tax-Cut Plan, Rejecting Traditional Economic Policies," Wall Street Journal, July 30, 1981, pp. 3, 12, 14, 16; Thomas B. Edsall, "Republicans Control Tax Legislation," Washington Post, July 26, 1981, p. A10; Thomas B. Edsall and Caroline Atkinson, "Ways and Means Democrats Bend a Bit on Tax Trims," Washington Post, July 22, 1981, p. A2; and Edsall, "Reagan Goes To the Hill On Tax Bill." [BACK]

54. Who's to say what a windfall profit is? Presumably, if prices and profits plummeted, no one would suggest a subsidy to make up the difference. [BACK]

55. Thomas B. Edsall and Edward Walsh, "Senate Bargaining on Tax Cut Bill Chokes Oil Bonanza, Ends Filibuster," Washington Post, July 23, 1981, p. A4; Thomas B. Edsall, "Oil Is the Issue Snagging House and Senate Tax Bills," Washington Post, July 21, 1981, p. A6; Edsall and Atkinson, "Ways and Means Democrats Bend a Bit on Tax Trims"; CQA 1981, pp. 101-2. [BACK]

56. Thomas B. Edsall and Lou Cannon, "Reagan Opens Tax Bill in Bid for House Votes," Washington Post, July 24, 1981, pp. A1, A2. [BACK]

57. Stockman, Triumph of Politics, p. 257. [BACK]

58. Edsall, "Reagan Goes To the Hill On Tax Bill." [BACK]

59. Ibid. [BACK]

60. CQA 1981, pp. 102-3. [BACK]

61. Edsall, "Reagan Goes To the Hill On Tax Bill." [BACK]

62. Ibid. [BACK]

63. "Christmastime on Capitol Hill," Time, July 27, 1981, p. 25. [BACK]

64. Stockman, Triumph of Politics, p. 262. [BACK]

65. Ibid., pp. 262-63. Barrett, Gambling with History, pp. 164-65, tells the same story but dates it to June 4, which seems less likely. [BACK]

66. "Cutting Loose on Taxes," Editorial, Washington Post, July 22, 1981, p. A20. [BACK]

67. Thomas B. Edsall, "Rostenkowski Aside, House Likes Indexing," Washington Post, July 18, 1981, p. A2. [BACK]

68. "A Wealth of Tax Objections," Time, July 20, 1981, p. 23. [BACK]

69. Thomas B. Edsall, "Panel Democrats Targeting Tax Cuts at Income Below $50,000," Washington Post, July 14, 1981, p. A4. [BACK]

70. Peter Goldman, "Hanging Tough on Taxes," Newsweek, July 27, 1981, pp. 22-23. [BACK]

71. David Broder, "The Gypsy Moths," Washington Post, July 27, 1981, pp. A1, A4. [BACK]

72. David Broder, "Reagan Backs Off Televised Speech on Social Security," Washington Post, July 26, 1981, pp. A1, A5. [BACK]

73. George H. Gallup, The Gallup Poll: Public Opinion 1981 (Wilmington, Dela.: Scholarly Resources Inc., 1982), pp. 118-19; Survey #173-G. [BACK]

74. John F. Stacks, "It's Rightward On," Time, June 1, 1981, pp. 12-13. [BACK]

75. Gallup Poll, 1981, No. 191, p. 18. [BACK]

76. Broder, "Reagan Backs Off Televised Speech on Social Security." [BACK]

77. Barrett, Gambling with History, p. 169. [BACK]

78. Lou Cannon and Thomas B. Edsall, "Reagan Makes Appeal To Voters for Tax Bill," Washington Post, July 28, 1981, pp. A1, A6; Barrett, Gambling with History, pp. 169-70. [BACK]

79. Dennis Farney, "Reagan's Mastery of Economic Policies In Congress May Sag on Social Issues," Wall Street Journal, July 30, 1981, p. 14. [BACK]

80. CQA 1981, p. 103. [BACK]

81. Lou Cannon and Kathy Sawyer, "President's Speech Has Hill Switch boards Ablaze," Washington Post, July 29, 1981, pp. A1, A2. [BACK]

82. Ellie McGrath, "Tracking the Great Persuader," Time, August 10, 1981, p. 14. [BACK]

83. Barrett, Gambling with History, p. 170. [BACK]

84. McGrath, "Tracking the Great Persuader"; Cannon and Sawyer, "President's Speech Has Hill Switchboards Ablaze." [BACK]

85. Ward Sinclair and Richard L. Lyons, "Tactics That Won," Washington Post, July 30,1981, pp. A1, A8; Thomas B. Edsall, "Reagan Triumphant on Tax Cut Bill," Washington Post, July 30, 1981, pp. A1, A9. [BACK]

86. McGrath, "Tracking the Great Persuader"; Stockman, Triumph of Politics, p. 266. [BACK]

87. Stockman, Triumph of Politics, pp. 264-65. [BACK]

88. Robert W. Merry, "Congress Clears Reagan's Tax Cut Plan, Rejecting Traditional Economic Policies," Wall Street Journal, July 30, 1981, p. 3. [BACK]

89. Ibid. [BACK]

90. "Seizing the Helm," National Journal, August 8, 1981, p. 1404. [BACK]

91. See Ward Sinclair and Richard L. Lyons, "Tactics That Won," Washington Post, July 30, 1981, pp. A1, A8. [BACK]

92. Gallup Poll, 1981, No. 191, p. 20. [BACK]

93. Walter Isaacson, "Yeas 238—Nays 195," Time, August 10, 1981, p. 12. [BACK]

94. Sinclair and Lyons, "Tactics That Won"; and Edsall, "Reagan Triumphant on Tax-Cut Bill." [BACK]

95. Broder, "The Gypsy Moths." [BACK]

96. Greider, Education of David Stockman, pp. 59-60 [BACK]

97. Ibid. [BACK]

98. See "A White House Report," Program for Economic Recovery (Washington, D.C.: U.S. Government Printing Office, February 18, 1981), p. 16; and Joint Committee on Taxation, General Explanation of the Economic Recovery Tax Act Of 1981 (Washington, D.C.: U.S. Government Printing Office, 1981), Tables V-1, V-3. [BACK]

99. Isaacson, "Yeas 238—Nays 195." [BACK]

1. Charles Alexander, "Making It Work," Time, September 21, 1981, pp. 38—40, 45-47, 50-51. [BACK]

2. See Robert J. Samuelson, "For the Economy, Unanswered Questions," National Journal, August 8, 1981, pp. 1405-10; News Roundup, in Wall Street Journal, July 31, 1981, p. 1. [BACK]

3. See John S. DeMott, "Sky-High Interest Rates," Time, May 18, 1981, pp. 64-65; Council of Economic Advisers, "Economic Indicators," various months; and Greider, Secrets of the Temple, pp. 381-93. [BACK]

4. See Lindley H. Clark, Jr., "Mixed Picture: Inflation Slows Down, But So Does Economy; Joblessness May Grow," Wall Street Journal, July 1, 1981, pp. 1, 20. [BACK]

5. Ibid. [BACK]

6. John M. Berry, "Fed Decides to Lower Key Money-Growth Target," Washington Post, July 14, 1981, p. E1. [BACK]

7. Ibid. [BACK]

8. Ibid. [BACK]

9. John M. Berry, "Banking Panel Attacks Volcker on Tight Money," Washington Post, July 22, 1981, p. E1; Robert J. Samuelson, "The Narrow Presidency," National Journal, August 1, 1981, p. 1387. [BACK]

10. Stockman, Triumph of Politics, p. 272; interviews. [BACK]

11. Ibid., p. 269; and Barrett, Gambling with History, p. 172. [BACK]

12. Barrett, Gambling with History, p. 172, 340. [BACK]

13. Ibid., pp. 170-72; Peter Goldman, "Budget-Cut Blues Ahead," Newsweek, August 17, 1981, p. 28. [BACK]

14. Stockman, Triumph of Politics, p. 277-78. [BACK]

15. See description in ibid., pp. 279-81. [BACK]

16. Peter Goldman, "An Ax Over the Pentagon," Newsweek, August 31, 1981, pp. 19-20; Kenneth H. Bacon, "Budget Blight," Wall Street Journal, August 12, 1981, p. 1. [BACK]

17. With only a 5 percent tax cut, scheduled payroll tax increases coming on line in January, and the spending cuts, policy was going to be no more stimulative in either a supply- or demand-side sense than in 1981. [BACK]

18. Barrett, Gambling with History, pp. 176-77; Goldman, "An Ax Over the Pentagon"; Stockman, Triumph of Politics, pp. 282-88. Our account of most of these internal debates relies heavily on Stockman. Barrett, however, tells essentially the same story, and this was confirmed in our interviews. The reader who would like an extremely vivid account should see Triumph of Politics. [BACK]

19. Barrett, Gambling with History, pp. 177-78; Tom Morganthau et al., "Reagan's Confidence Gap," Newsweek, September 21, 1981, p. 27. [BACK]

20. Morganthau et al., "Reagan's Confidence Gap"; Albert R. Hunt and Dennis Farney, "GOP, Upset by High Interest Fees, Returns to Congress with Talk of Credit Controls," Wall Street Journal, September 10, 1981, p. 3. [BACK]

21. Harry Anderson, "Reagan's Ailing Economy," Newsweek, September 7, 1981, pp. 18-20. [BACK]

22. Greider, Secrets of the Temple, chap. 11, pp. 351-404; also 405-31. [BACK]

23. Stockman, Triumph of Politics, p. 291. [BACK]

24. Ibid., pp. 290-92. [BACK]

25. Barrett, Gambling with History, pp. 178-80; "Snipped," The Economist, September 19, 1981, p. 21; Morganthau et al., "Reagan's Confidence Gap"; Stockman, Triumph of Politics, pp. 295-99. [BACK]

26. Stockman, Triumph of Politics, p. 299. [BACK]

27. Ibid., pp. 304-6. [BACK]

28. Ibid. [BACK]

29. Ibid., p. 316. [BACK]

30. Ibid. [BACK]

31. Ibid., p. 323; Barrett, Gambling with History, pp. 182-83. [BACK]

32. Timothy B. Clark, "Reagan's Balanced Budget—One Step Closer, One Step Further Away," National Journal, September 26, 1981, pp. 1712-16; "Reagan's budget plans generate tepid support, plenty of confusion," National Journal, October 3, 1981, pp. 1751, 1778-89. [BACK]

33. Tom Morganthau et al., "Running to Stay in Place," Newsweek, October 5, 1981, pp. 24-26. [BACK]

34. "Reagan's budget plans generate tepid support." [BACK]

35. "A Reagan Retreat," Time, October 5, 1981, p. 10. [BACK]

36. "Things That Go Bump," The Economist, October 3, 1981, pp. 11-13. [BACK]

37. For a good description of gypsy moths at this time, see Richard E. Cohen, "For the Gypsy Moths, the Goal Is to Change GOP Policy, Not Bolt the Party," National Journal, October 31, 1981, pp. 1946-49. [BACK]

38. CQA 1981, pp. 332-33, 338-39; Richard E. Cohen, "Reagan's budget plan faces high hurdles, shortage of time," National Journal, October 24, 1981, pp. 1887, 1915. [BACK]

39. These decreases included $40 billion in entitlement cuts, and $30 billion from reductions in other spending and, because of less borrowing, in interest payments. "You Pay Your Money, You Take Your Pick," p. 1997; and Richard E. Cohen, "Lots of Movement, Little Action on Closing the Deficit," pp. 1971, 1997, National Journal, November 7, 1981. [BACK]

40. Michael Reese, "Goodbye Balanced Budget," Newsweek, November 16, 1981, p. 34. Time reported this as "I didn't come here to balance the budget. I was elected to reduce Government intrusion in the economy." Ed Magnuson, "Bye, Bye, Balanced Budget," Time, November 16, 1981, pp. 26, 31. [BACK]

41. Barrett, Gambling with History, p. 185; Magnuson, "Bye, Bye, Balanced Budget." [BACK]

42. Timothy B. Clark, "The GOP Is Looking Over Its Shoulder At the Specter of High Interest Rates," National Journal, November 7, 1981, pp. 1972-77; Kenneth H. Bacon and Dennis Farney, "Embattled GOP: Reagan's Vow To Stick To Economic Program Saps Base in Congress," Wall Street Journal, November 17, 1981, pp. 1, 19. [BACK]

43. Stockman, Triumph of Politics, p. 351. [BACK]

44. We quote Greider's Education of David Stockman and Other Americans liberally in our history; it contains the original article plus Greider's description and interpretation of the flap that followed. [BACK]

45. Tom Morganthau et al., "Et Tu, David Stockman?" Newsweek, November 23, 1981, p. 40. [BACK]

46. For a similar judgment, see "Mr. Stockman's Future," editorial, Wall Street Journal, November 16, 1981, p. 22. [BACK]

47. Stockman, Triumph of Politics, p. 5. For the cartoon, see Pat Oliphant, Ban This Book! (Kansas City: Andrews and McMeel, 1982), p. 71. [BACK]

48. Stockman, Triumph of Politics, pp. 1-3. [BACK]

49. Barrett, Gambling with History, p. 189. [BACK]

50. Ed Magnuson, "A Visit to the Woodshed," Time, November 23, 1981, pp. 10-13. [BACK]

51. The bill funded the legislative branch for the entire year. [BACK]

52. The Defense Department appropriation to be reported by the House Appropriations Committee; conference reports on the Interior, HUD, and Agriculture appropriations; House-passed bills for Military Construction and Energy and Water; House-passed bills or fiscal 1981 levels, whichever was less, for Commerce, Justice, State and Judiciary, for Transportation, the District of Columbia, and for Labor, Health and Human Services—Education; the House-passed or Senate-reported bill, whichever was less, for Treasury, Postal Service; the fiscal 1981 or budget request levels, whichever was less, for foreign aid. CQA 1981, p. 295. [BACK]

53. Ibid. [BACK]

54. Ed Magnuson, "After the Lost Weekend," Time, December 7, 1981, pp. 16-19. [BACK]

55. CQA 1981, p. 297. [BACK]

56. "For taxonomy freaks," an OMB official commented on reviewing our manuscript, this "was called a four percent cut with a Baker floor. Our inability to price out this very amendment was the initial impulse leading to the development" of a new OMB budget scorekeeping system. [BACK]

57. Magnuson, "After the Lost Weekend." [BACK]

58. CQA 1981, pp. 300-301. [BACK]

59. Magnuson, "After the Lost Weekend." [BACK]

60. CQA 1981,p. 301. Pages 294-301 are the major source of this story. [BACK]

1. John F. Stacks, "America's Fretful Mood," Time, December 28, 1981, pp. 22-23. [BACK]

2. David M. Alpern, "Polarizing the Nation?" Newsweek, February 8, 1982, pp. 33-34. [BACK]

3. Ibid.; and Stacks, "America's Fretful Mood." [BACK]

4. Data from Council of Economic Advisers, "Economic Indicators," various dates. [BACK]

5. Yankelovich poll, Time, April 5, 1982, pp. 10-12. [BACK]

6. Adam Clymer, "Reagan Evoking Rising Concern, New Poll Shows," New York Times, March 19, 1981, pp. A1, A20. [BACK]

7. James Kelly, "Challenging the Red Sea," Time, February 22, 1982, p. 14. [BACK]

8. Walter Isaacson, "Caught in the Riptide of Red Ink," Time, December 21, 1981, p. 28. [BACK]

9. Ibid. [BACK]

10. Harry Anderson et al., "Reagan's Busted Budget," Newsweek, December 21, 1981, pp. 63-64. [BACK]

11. "End of a Jam Session," The Economist, December 26, 1981, pp. 18-19. [BACK]

12. On the economy, Anderson, "Reagan's Busted Budget," and Isaacson, "Caught in the Riptide of Red Ink" provide good summaries. [BACK]

13. See Allen Schick, Congress and the President: Reagan's First Year (Washington, D.C.: American Enterprise Institute, 1982). [BACK]

14. John Gilmour's forthcoming book manuscript, "A Most Bizarre Way to Legislate: Reconciliation and the Congressional Budget Process," discusses this in depth. [BACK]

15. See "Meanwhile, Back in the 1981 Budget, Another Reagan Victory," National Journal, May 9, 1981, p. 846; and CQA 1981, pp. 281-85. [BACK]

16. Melinda Beck and Howard Fineman, "The Farm Bloc Tastes Defeat," Newsweek, September 28, 1981, pp. 29-30. [BACK]

17. Ibid. [BACK]

18. Walter Isaacson, "Mixing Politics with Parity," Time, November 2, 1981, p. 22. [BACK]

19. See "Farm bill conference a test of Reagan's control of spending," National Journal, October 31, 1981, pp. 1931, 1957; Isaacson, "Mixing Politics with Parity"; and Beck and Fineman, "Farm Bloc Tastes Defeat." [BACK]

20. House Budget Committee, "A Review of President Reagan's Budget Recommendations, 1981-85," August 2, 1984, pp. 133-39; Congressional Budget Office, "An Analysis of Congressional Budget Estimates for Fiscal Years 1980-82," June 1984, p. 65. [BACK]

21. CQA 1981, p. 318. [BACK]

22. Ibid., p. 269. [BACK]

23. Ibid., pp. 267-70. [BACK]

24. Congressional Budget Office, "An Analysis of Congressional Budget Estimates," June 1984, pp. 38-39. [BACK]

25. "'A Hell of a Crunch' in '82," Newsweek, December 28, 1981, between pp. 20-40. [BACK]

26. "Playing Both Santa and Scrooge," Time, December 28, 1981, p. 24. [BACK]

27. "'A Hell of a Crunch' in '82," Newsweek. [BACK]

28. Walter Isaacson, "'The Floor Is My Domain,'" Time, April 26, 1982. [BACK]

29. Michael Barone and Grant Ujifusa, Almanac of American Politics 1984 (Washington, D.C.: Barone & Co., 1983), p. 430. [BACK]

30. Barrett, Gambling with History, p. 341. [BACK]

31. Kenneth H. Bacon, "Advice Gap: Reagan Aides Dispute How to Cut Deficit—and How Harmful It Is," Wall Street Journal, December 10, 1981, pp. 1, 18. [BACK]

32. Timothy B. Clark, "A Divided Administration Wonders Whether It's Time for More Taxes," National Journal, January 16, 1982, pp. 113-18. [BACK]

33. Office of Management and Budget, The President's Budget for Fiscal Year 1983 (Washington, D.C.: U.S. Government Printing Office, 1982), pp. 2-11 to 2-16. [BACK]

34. Congressional Budget Office, "An Analysis of the President's Budgetary Proposals for Fiscal Year 1983," February 1982, pp. 33-42. [BACK]

35. Clark, "A Divided Administration Wonders Whether It's Time for More Taxes." See Paul Craig Roberts, The Supply-Side Revolution: An Insider's Account of Policymaking in Washington (Cambridge, Mass.: Harvard University Press, 1984). [BACK]

36. Michael Reese et al., "The Hard Times of Ronald Reagan," Newsweek, February 1, 1982, pp. 17-19. [BACK]

37. Rochelle L. Stanfield, "Turning Back '61 Programs: A Radical Shift of Power," National Journal, February 27, 1982, p. 369. [BACK]

38. For extensive discussion of the federalism plan, see Rochelle L. Stanfield, "New Federalism: A Neatly Wrapped Package with Explosives Inside," National Journal, February 27, 1982, pp. 356-83. [BACK]

39. Peter Goldman, "Reagan's Taxing Problem," Newsweek, January 11, 1982, pp. 18-19. The story is repeated in various forms frequently. Barrett has it as "the papers are right. You are plotting against me" (Gambling with History, p. 343). [BACK]

40. Clark, "A Divided Administration Wonders Whether It's Time for More Taxes"; Barrett, Gambling with History, p. 344. [BACK]

41. Peter Goldman, "Reagan's New Excise Taxes," Newsweek, January 25, 1982, pp. 28-29. [BACK]

42. Steven R. Weisman, "GOP Senators Bid Reagan Lift Taxes," New York Times, January 16, 1982, p. 36; Barrett, Gambling with History, p. 344. [BACK]

43. Barrett, Gambling with History, p. 345. [BACK]

44. Walter Isaacson, "States of the Union," Time, February 8, 1982, pp. 16-18; Peter Goldman, "The Reagan Gamble," Newsweek, February 8, 1982, pp. 24-27. [BACK]

45. See Aaron Wildavsky, "Birthday Cake Federalism," in Robert B. Hawkins, Jr., ed., American Federalism: A New Partnership for the Republic (San Francisco: Institute for Contemporary Studies, 1982), pp. 181-92; Richard Nathan, "Toward a Theory of Federal Grants," typescript, 1982; and Richard Nathan and Fred C. Doolittle, "The Untold Story of Reagan's 'New Federalism,'" The Public Interest, No. 77 (Fall 1984), pp. 96-105. [BACK]

46. See Karl Weick, The Social Psychology of Organizing (Reading, Mass.: Addison Wesley, 1979). [BACK]

47. In the early days of the Republic, "corruption" was used by Jeffersonians not to mean stealing but rather debt and other legal devices they believed undermined principles of political equality. See James Savage, Balanced Budgets and American Politics (Ithaca, N.Y.: Cornell University Press, 1988). [BACK]

48. Jonathan Fuerbringer, "Volcker Cautions That Big Deficits Imperil Recovery," New York Times, January 27, 1981, p. A1. [BACK]

49. Goldman, "The Reagan Gamble." [BACK]

50. "'A Hell of a Crunch' in '82." [BACK]

1. The Congressional Budget Office projected a FY83 deficit, under current policies, of $157 billion, total spending at $809 billion, and spending on programs other than defense, interest, and social security totaling $318 billion. See CBO, "Baseline Budget Projections for Fiscal Years 1983-87," February 1982, pp. 40, 45. For deficit projections, see CBO, "An Analysis of the President's Budgetary Proposals for Fiscal Year 1983," February 1982, p. xiv. [BACK]

2. Stockman, Triumph of Politics, p. 353. [BACK]

3. Jonathan Fuerbringer, "Stockman Defends Reagan's Proposal and Size of Deficit," New York Times, February 8, 1982, pp. A1, B13. [BACK]

4. Executive Office of the President, Office of Management and Budget, Budget of the United States Government Fiscal Year 1983 (Washington, D.C.: U.S. Government Printing Office, 1982), pp. 3-4. [BACK]

5. Ibid., pp. 3-14. [BACK]

6. Ibid., pp. 3-12. [BACK]

7. Congressional Budget Office, "An Analysis of the President's Budgetary Proposals for Fiscal Year 1983," p. 7. [BACK]

8. Martin Tolchin, "Budget Brings Attacks in Congress From Republicans and Democrats," New York Times, February 7, 1982, p. 28. [BACK]

9. Martin Tolchin, "Baker Tries to Quiet Storm Raised by GOP on Deficit," New York Times, February 9, 1982, p. B14. [BACK]

10. Edward Cowan, "Economists Voice Doubts on Budget," New York Times, February 9, 1982, p. B14. [BACK]

11. Charles Alexander, "Roadblocks to Recovery," Time, February 22, 1982, pp. 36-38. [BACK]

12. Peter McGrath et al., "The Deficit Rebellion," Newsweek, February 22, 1982, pp. 22-24. [BACK]

13. Alexander, "Roadblocks to Recovery"; McGrath et al., "Deficit Rebellion"; Martin Tolchin, "Reagan Aides Hear Budget Attacked From Both Parties," New York Times, February 10, 1982, p. A1. [BACK]

14. Steven V. Roberts, "Voters Reported Less Confident of Reagan Plan," New York Times, February 21, 1982, p. A1. [BACK]

15. Social psychologists Daniel Kahneman and Amos Tversky provide two good examples. First, "most respondents in a sample of undergraduates refused to stake $10 on the toss of a coin if they stood to win less than $30." Second, in "a situation in which an individual is forced to choose between an 85 percent chance to lose $1,000 ... and a sure loss of $800, a large majority of people express a preference for the gamble over the sure loss." Even though, on average, they will do worse that way. See their "Choices, Values, and Frames," American Psychologist 39, no. 4 (April 1984), pp. 341-50; quote on p. 342. [BACK]

16. Seth S. King, "Labor Challenges Reagan on Budget," New York Times, February 16, 1982, p. A1. [BACK]

17. Edward Cowan, "Business Leaders Object to Deficits in Reagan Budget," New York Times, March 4, 1982, pp. A1, D15; "Euphoria Ends," Time, May 17, 1982, p. 56. [BACK]

18. "Bubbles in the Red Ink," Time, March 8, 1982, p. 17; Martin Tolchin, "G.O.P. Leaders Tell President His Plan on Budget is Dead," New York Times, February 24, 1982, pp. A1, A14. [BACK]

19. James Kelly, "The Zigzag Art of Politics," Time, March 15, 1982, pp. 15-16; Barrett, Gambling with History, pp. 349-50. [BACK]

20. Ed Magnuson, "Playing It Cool or Frozen in Ice?" Time, March 22, 1982, p. 34. [BACK]

21. George J. Church, "A Season of Scare Talk," Time, March 15, 1982, pp. 12-14. [BACK]

22. Jane Bryant Quinn, "Reagan Against Himself," Newsweek, March 1, 1982, p. 66. [BACK]

23. See Martin Anderson, Revolution (San Diego: Harcourt Brace Jovanovich, 1988), p. 211. [BACK]

24. Barrett, Gambling with History, p. 351. [BACK]

25. Ibid., pp. 348-53. [BACK]

26. George J. Church, "Trying to Be Mr. Nice Guy," Time, April 5, 1982, pp. 13-14. [BACK]

27. Descriptions of the "Gang" are based on interviews and on documents made available by staff for a participant, who kept a notebook on these events. [BACK]

28. COLAs would be limited to 4 percent and occur every fifteen months instead of every twelve. These provisions, according to the estimates used, would yield a 7.5 percent cut in the benefits received by an individual over the period from July 1, 1982, through December 31, 1985. [BACK]

29. "Domenici Calls Budget Pact Task of O'Neill and Reagan," Associated Press Wire Service, New York Times, April 9, 1982, p. A15. [BACK]

30. Martin Tolchin, "A Month's Budget Talks Finally Came to Naught," New York Times, April 30, 1982, p. A17. [BACK]

31. Howell Raines, "Reagan Optimistic That Budget Talks Will End Impasse," New York Times, April 6, 1982, pp. A1, A17. [BACK]

32. Howell Raines, "White House Hints Accord on Budget by Tax Surcharge," New York Times, April 15, 1982, pp. A1, D20; Kenneth Nobel, "Baker Voices Hope of Gaining Accord on Tax Surcharge," New York Times, April 19, 1982, pp. A1, A19; Ed Magnuson, "Stumbling to a Showdown," Time, April 26, 1982, pp. 10-14; "Nudging the Budget," Newsweek, April 26, 1982, p. 35. [BACK]

33. Transcript, New York Times, April 17, 1982, p. A9. [BACK]

34. Peter McGrath et al., "In Quest of a Pax Reaganomica," Newsweek, May 3, 1982, pp. 20-21; Barrett, Gambling with History, p. 361. [BACK]

35. Martin Tolchin, "Reagan to Enter Talks on Budget as Negotiators Reach an Impasse," New York Times, April 28, 1982, p. A1; Barrett, Gambling with History, pp. 358-61. [BACK]

36. These numbers are derived from worksheets of participants. [BACK]

37. Jerry Adler et al., "The 'Extra Mile' to Nowhere," Newsweek, May 10, 1982, pp. 38-42. [BACK]

38. Tolchin, "A Month's Budget Talks Finally Came to Naught." [BACK]

39. Transcript, New York Times, April 30, 1982, p. A16. [BACK]

40. Transcript of Bolling's reply to Reagan on behalf of Democrats in Congress, New York Times, April 30, 1982, p. A18. [BACK]

41. Steven V. Roberts, "Senate Unit Begins Drafting a Budget," New York Times, April 30, 1982, p. A18. [BACK]

42. Steven V. Roberts, "House Democrats Emphasizing Unity," New York Times, May 2, 1982, p. 26. [BACK]

43. Martin Tolchin, "Domenici Presents Own Budget Plan," New York Times, May 5, 1982, Section 2, p. 11. [BACK]

44. Martin Tolchin, "White House and GOP Leaders Agree on Budget Proposal for '83," New York Times, May 6, 1982, pp. A1, B13. [BACK]

45. Ibid. [BACK]

46. Martin Tolchin, "President Pledges to Push Campaign for Budget Plan," New York Times, May 7, 1982, pp. A1, D18. [BACK]

47. Ibid. [BACK]

48. Adam Clymer, "Talk of Social Security Cutbacks Causes Alarm in Ranks of G.O.P.,"New York Times, May 8, 1982, p. A10; Martin Tolchin, "Social Security Issue Causing Problems for New Budget," New York Times, May 8, 1982, pp. A1, A9. [BACK]

49. Martin Tolchin, "G.O.P. in House Opposes Budget of Senate Panel," New York Times, May 12, 1982, pp. A1, A24. [BACK]

50. Congressional Quarterly Almanac 1982, Vol. 38 (Washington, D.C.: Congressional Quarterly, Inc., 1983), p. 187 (hereafter CQA 1982). [BACK]

51. Tom Morganthau et al., "The Third Rail of Politics," Newsweek, May 24, 1982, pp. 24-26. [BACK]

52. CQA 1982, pp. 191-92. [BACK]

53. "GOP puts aside bipartisan stance on 1983 budget," National Journal, May 8, 1982, pp. 799, 826. [BACK]

54. Jane Perlez, "Moderate Republicans Feel They Control House Passage of Budget," New York Times, May 11, 1982, p. A17. [BACK]

55. CQA 1982, pp. 190-91. [BACK]

56. Richard S. Cohen, "The Fiscal 1983 Budget Equation: Election + Recession = Frustration," National Journal, May 29, 1982, pp. 944-48. [BACK]

57. CQA 1982, pp. 192-93. [BACK]

58. "House Raising on the Hill," Time, May 31, 1982, p. 16. [BACK]

59. George J. Church, "Chaos Aplenty, but No Budget," Time, June 7, 1982, p. 18; Tom Morganthau and Gloria Borger, "Anyone for a Budget?" Newsweek, June 7, 1982, pp. 31-32. [BACK]

60. CQA 1982, pp. 192-93. [BACK]

61. "GOP in Best Position to Win on 1983 Budget," National Journal, June 5, 1982, p. 1021. [BACK]

62. CQA 1982, p. 193. [BACK]

63. Church, "Chaos Aplenty." [BACK]

64. John Herbers, "President Denounces Budget Process," New York Times, May 29, 1982, p. 44. [BACK]

65. See comments by Senator Bill Bradley, Newsweek, May 3, 1982, p. 21; comments of Peter G. Peterson and five former secretaries of the Treasury in Time, June 7, 1982, p. 18. [BACK]

66. See Robert J. Samuelson, "The Interest in Rates," National Journal, June 5, 1982, p. 1015. [BACK]

67. Steven V. Roberts, "President Rejects Bipartisan Budget," New York Times, June 3, 1982, Section 2, p. 15. [BACK]

68. Ibid. [BACK]

69. Martin Tolchin, "GOP Budget Wins Approval in House by Vote of 219-206," New York Times, June 11, 1982, p. A1. [BACK]

70. Ibid. [BACK]

71. Ibid., and CQA 1982, pp. 195-96. [BACK]

72. Walter Isaacson, "Breaking the Budget Logjam," Time, June 21, 1982, p. 37 [BACK]

73. Martin Tolchin, "Conferees Agree on Budget for '83 Along GOP Lines," New York Times, June 18, 1982, pp. A1, D17. For conference details, see CQA 1982, pp. 196-99; and Richard E. Cohen, "Congress's 'House of Cards' Budget May Be Constructed on Quicksand," National Journal, June 26, 1982, pp. 1120-26. [BACK]

74. Steven R. Weisman, "Reagan's Risky Decision," New York Times, February 7, 1982, pp. 1, 30. [BACK]

75. "Business may be victim of congressional drive to increase taxes," National Journal, February 27, 1982, pp. 355, 389. [BACK]

76. Ibid. [BACK]

77. Timothy B. Clark, "Lobbyists at Work: Tax Lobbyists Scrambling in the Dark to Fight Taxes That Hit Their Clients," National Journal, May 22, 1982, pp. 896-901. [BACK]

78. Ibid.; and Timothy B. Clark, "Tax-Raising Proposals Off and Running But Few Generate Strong Support," National Journal, April 3, 1982, pp. 576-80. [BACK]

79. See Economist, "Back on the Ground," April 3, 1982, pp. 79-80. [BACK]

80. Clark, "Tax-Raising Proposals Off and Running." [BACK]

81. Ibid.; and CQA 1982, p. 34. [BACK]

82. Clark, "Lobbyists at Work: Tax Lobbyists Scrambling in the Dark." [BACK]

83. Richard E. Cohen, "Dole's Toughest Test as Finance Chief—Pushing a Tax Hike Through the Senate," National Journal, June 19, 1982, pp. 1089-93. [BACK]

84. The surcharge idea that arose in the Gang of 17 negotiations had been abandoned. [BACK]

85. CQA 1982, pp. 34-35; "GOP tax hike package takes edge off Democrats' thunder," National Journal, July 3, 1982, pp. 1203, 1229. [BACK]

86. Peter McGrath et al., "A No-Fingerprints Tax Bill," Newsweek, August 9, 1982, pp. 16-17. [BACK]

87. See, e.g., Stockman, Triumph of Politics, p. 356. [BACK]

88. See, for example, Donald Regan, For the Record (New York: Harcourt, Brace, Jovanovich, 1988), pp. 182-84. [BACK]

89. Steven R. Weisman, "Reagan Presses for Tax Increase in Western Trip," New York Times, August 12, 1982, p. A1. [BACK]

90. CQA 1982, pp. 37-38. [BACK]

91. Rich Thomas, "Why Reagan Switched," Newsweek, August 23, 1982, p. 27. [BACK]

92. Karen W. Arenson, "Measure Is Reformers' Delight," New York Times, August 17, 1982, Section 4, p. 17. [BACK]

93. "Transcript of the President's Televised Speech on Tax Policy," New York Times, August 17, 1982, Section 4, p. 16. [BACK]

94. Walter Isaacson, "Scoring on a Reverse," Time, August 30, 1982, pp. 14-18. [BACK]

95. Ibid. provides a good summary. The administration and Chamber virtually went to war. Other business lobbyists described the Chamber's anti-TEFRA campaign as "really vicious," while some in the Chamber who opposed TEFRA claim that the administration tried to get the Chamber's board to fire its president. [BACK]

96. CQA 1982, p. 39. [BACK]

97. See CQA 1982, pp. 29-39; Isaacson, "Scoring on a Reverse"; Melinda Beck et al., "Winning One for the Gipper," Newsweek, August 30, 1982, pp. 24-28; Karen Arenson, "Congress Approves Bill to Raise $983 Billion in Taxes," pp. A1, D14; Hedrich Smith, "Reagan's Big Victory: Passage of the Tax-Rise Bill Vindicates Major Political Gamble by President," p. D14; and David Shribman, "How Bill's Momentum Swept House," p. D14; all in New York Times, August 20, 1982. [BACK]

1. We remember a dinner with Frank Levy, professor at the University of Maryland and author of Dollars and Dreams: The Changing American Income Distribution (New York: Russell Sage Foundation, 1987), at which he pointed out that, when "productivity" became a big issue in the late 1970s, many causes of slow productivity growth were suggested. They included OPEC, a younger and thus less productive work force as the baby boom entered it, greater government regulation, the uncertainties created by inflation, and many other suspects. By 1985, trends on virtually all the supposed causes were much better, but productivity growth had not improved. [BACK]

2. Charles Alexander, "Oh, What a Beautiful Rally!" Time, August 30, 1982, pp. 19-20. [BACK]

3. Ibid., and Charles Alexander, "Wall Street's Super Streak," Time, September 6, 1982, pp. 38-41, provided good, if rather breathless, accounts of the rally. Basic statistics can be found in the Council of Economic Advisers, Economic Indicators, monthly summary of economic statistics. [BACK]

4. Alexander, "Wall Street's Super Streak." [BACK]

5. Alexander, "Oh, What a Beautiful Rally!" [BACK]

6. Ibid. [BACK]

7. Merrill Shiels et al., "A Break in Interest Rates," Newsweek, August 30, 1982, pp. 16-19; John Greenwald, "Spotlight on the Consumer," Time, June 7, 1982, pp. 54-56; and John Greenwald, "Come On Big Spender," Time, June 28, 1982, pp. 48-49. [BACK]

8. On July 6 the Organisation for Economic Co-Operation and Development "sharply scaled back its forecast for the world economy" and predicted unemployment in the world's major industrialized nations would reach nine percent in 1983, with U.S. unemployment at 10.25 percent. Steven Rattner, "O.E.C.D. Is Gloomier on Growth," New York Times, July 7, 1982, pp. D1, D13. [BACK]

9. "Executives are fearful of renewed inflation," Business Week, August 9, 1982, p. 10. [BACK]

10. "Adam Smith," Paper Money (New York: Dell Publishing, 1982), p. 206. "Smith," George J. W. Goodman, in a highly readable style, provides an extensive recounting of much of the history that follows. By now the international debt crisis may have generated as much literature as the American budget travails. [BACK]

11. Alexander L. Taylor III, "The Wobbly World of Banking," Time, September 6, 1982, pp. 52-53. [BACK]

12. The growing liquidity and debt worries had already begun to affect the economy. They contributed, for example, to the strength of the dollar relative to the German mark. See Treasury and Federal Reserve Exchange Operations, in Federal Reserve Bulletin 68, no. 10 (October 1982), p. 585. [BACK]

13. Smith, Paper Money, pp. 310-11. [BACK]

14. In testimony to Congress July 28, 1982; March 8, 1983, and as reported in the minutes of the meeting of the Federal Open Market Committee held on July 2, 1982. [BACK]

15. Alexander, "Oh, What a Beautiful Rally!" [BACK]

16. Testimony before the House Budget Committee, March 8, 1983, pp. 86-87. [BACK]

17. Paul Blustein, "Monetary Zeal: How Federal Reserve Under Volcker Finally Slowed Down Inflation," Wall Street Journal, December 7, 1982, pp. 1, 16-17. [BACK]

18. Data from Council of Economic Advisers, Economic Indicators, various months. [BACK]

19. H. Erich Heinemann, "Record U.S. Borrowing Raising Fears on Credit," New York Times, Dec. 7, 1982, pp. D1, D4. [BACK]

20. Greider's reporting in Secrets of the Temple documents the Fed's actions and intentions thoroughly. [BACK]

21. Federal Reserve Bulletin 69, no. 3 (March 1983), p. 132. [BACK]

22. House Budget Committee hearing, March 8, 1983, pp. 117-18. [BACK]

23. David Vogel, "Why Businessmen Distrust Their State: The Political Consciousness of American Corporate Executives," British Journal of Political Science 8, Part 1 (January 1978), pp. 45-78. [BACK]

24. "'No Confidence' for Reaganomics," March 29, 1982, p. 40; "Support erodes for the business tax cuts," April 12, 1982, p. 18; and "Executives are fearful of renewed inflation," August 9, 1982, p. 10; all in Business Week. [BACK]

25. Alexander L. Taylor III, "The Long Gray Line," Time, May 17, 1982, pp. 54-55. [BACK]

26. "Washington Outlook: Why the GOP is Wooing Labor," edited by Lee Walczak, Business Week, April 26, 1982, p. 139. [BACK]

27. Stockman, Triumph of Politics, pp. 131, 382-83, 145-47, 155. [BACK]

28. Transcript in New York Times, July 29, 1982, p. A18. [BACK]

29. See, for instance, Daniel Walker Howe, The Political Culture of the American Whigs (Chicago: University of Chicago Press, 1979). [BACK]

30. See Aaron Wildavsky, "The Runaway Convention, or Proving a Preposterous Negative," paper prepared for the Taxpayers' Foundation, 1983. [BACK]

31. See U.S. Congress. House. Committee on Rules."Item Veto: State Experience and Its Application to the Federal Situation." 99th Cong., 2d sess., 1986. Committee Print. [BACK]

32. Congressional Record, October 1, 1982, H8264, quoted by Representative Peter Rodino (D-N.J.). [BACK]

33. Mark Starr et al., "Business vs. Reagan," Newsweek, March 29, 1982, p. 21. [BACK]

34. "Making Amends," Time, April 12, 1982, p. 19. [BACK]

35. Transcript in New York Times, April 30, 1982, p. A16. [BACK]

36. "Amendment Drive Now in High Gear," New York Times, July 13, 1982, p. A17. [BACK]

37. James R. Jones, "A Cowardly Out for Reaganomics," editorial, New York Times, August 8, 1982, Section 3, p. 2. [BACK]

38. The president's endorsement, and Alaska's support, changed the stakes at the state level. A convention might actually happen, so doubts about its wisdom suddenly became relevant. State legislators also had to consider what the federal government would cut if the amendment were passed; grants to state governments clearly would be high on the list. Missouri legislators adjourned on May 2 without considering the call for a convention. Legislators in Iowa began an attempt to reverse that state's endorsements. New York Times, May 3, 1982, p. A16; and Howell Raines, "President Seeking Counties' Support," July 14, 1982, p. A18. [BACK]

39. CQA 1982, p. 394. [BACK]

40. Congressional Record, October 1, 1982, pp. H8256-7. [BACK]

41. Ibid., p. H8257. [BACK]

42. Ibid., p. H8262. [BACK]

43. Ibid., p. H8263. [BACK]

44. Ibid., p. H8265. [BACK]

45. Ibid., p. H8266. [BACK]

46. Ibid., pp. H8271-72. [BACK]

47. Ibid., p. H8329. [BACK]

48. Edward Cowan, "Washington Watch," New York Times, November 18, 1982, p. D2. [BACK]

1. David Mathiasen, "Recent Developments in the Composition and Formulation of the United States Federal Budget," Public Budgeting and Finance 3, no. 3 (Autumn 1983), pp. 103-15; quote on p. 107. [BACK]

2. Hale Champion, "Comments," in Gregory Mills and John Palmer, eds., Federal Budget Policy in the 1980s (Washington, D.C.: Urban Institute, 1984), p. 292; Champion's comments on Hugh Heclo, "Executive Budget Making," pp. 255-91. [BACK]

3. U.S. Congress. Senate. Subcommittee of the Committee on Appropriations. Hearings on Departments of Labor, Health and Human Services Education, and Related Agencies Appropriations for Fiscal Year 1983. 97th Cong., 2d sess., part 4, pp. 142-43. [BACK]

4. "House Raising on the Hill," Time, May 31, 1982, p. 16. [BACK]

5. David Pauley et al., "Battles Over Bailouts," Newsweek, June 21, 1982, pp. 53-54. [BACK]

6. Martin Tolchin, "House in Quandary as Senate Passes New Version of Spending Bill," New York Times, June 30, 1982, p. D22. [BACK]

7. David R. Mayhew, Congress: The Electoral Connection (New Haven, Conn.: Yale University Press, 1974), pp. 117-18. [BACK]

8. See Richard Neustadt, Presidential Power (New York: John Wiley & Sons, 1980). [BACK]

9. Martin Tolchin, "House and Senate Pass $5.5 Billion Spending Bill," New York Times, July 16, 1982, p. A16. [BACK]

10. U.S. Congress. Senate. Subcommittee of the Committee on Appropriations. Hearings. 97th Cong., 2d sess., pp. 100, 105. [BACK]

11. Ibid., pp. 176-81. [BACK]

12. U.S. Congress. House. Committee on Appropriations. Hearings on Departmentof the Interior and Related Agencies Appropriations for 1983. 97th Cong., 2d sess., part 2, p. 817. [BACK]

13. CQA 1982, p. ,224. [BACK]

14. Congressional Record, September 9, 1982, pp. S11249-50. [BACK]

15. Quoted by Gary Hart in ibid., p. S11252; the Senate debate is on pp. S11249-67. [BACK]

16. See Senate Appropriations' report on its 302(B) allocations. S Rept. 97571, July 29, 1982. [BACK]

17. The dairy portion of the committee's proposal was written by the National Milk Producers Federation. CQA 1982, pp. 358-61. [BACK]

18. CQA 1982, [BACK]

19. Leonard M. Apcar, "House Refuses To Limit Climb In Retirees' Pay," Wall Street Journal, August 4, 1982, p. 3. [BACK]

20. See CQA 1982, Reconciliation section, also pp. 515-16; and David Shribman, "Conferrees Meet Impasse on Plan to Cut Spending," New York Times, August 14, 1982, p. A28. [BACK]

21. Martin Tolchin, "Congress Leaders Yield to President on Special Session: Budget Will be the Topic," New York Times, September 17, 1982, pp. Al, A20. [BACK]

22. CQA 1982, p. 228. [BACK]

23. On gerrymanders see William Safire, Safire's Political Dictionary (New York: Ballantine Books, 1980), pp. 255-56. On California, see Michael Barone and Grant Ujifusa, The Almanac of American Politics 1984 (Washington, D.C.: National Journal, 1983), pp. 73-74. Hoping to cut their own deal with Mexican-Americans, California Republicans rejected overtures for a bipartisan effort. They thus put themselves at the mercies of Representative Phil Burton of San Francisco, a political gut fighter of the first order, who knew his state inside and out. He took care of the Hispanics and every Democrat is sight, devising a plan that, through some very strangely shaped districts, both met all legal requirements and gave his party a huge advantage. In the 1982 election Democrats won twenty-eight of the forty-five California seats. On Indiana see ibid., p. 382. [BACK]

24. Mark Shields, "Learning From the Lame Ducks," Washington Post, December 24, 1982, p. A13. [BACK]

25. "Transcript of Reagan's Speech to Nation on G.O.P. Policy and the Economy," p. B14; "Transcript of Riegle's Reply for Democrats to President's Talk on Economy," p. B14, New York Times, October 14, 1982. [BACK]

26. For polls, see George L. Church, "Facing the Jobs Issue," Time, October 28, 1982, pp. 18-19. The president's pollster, Richard Wirthlin, reported similar results, Newsweek, November 15, 1982, p. 14. [BACK]

27. Church, "Facing the Jobs Issue"; William Schneider, "Reaganomics Was on the Voters' Minds, But Their Verdict Was Far From Clear," National Journal, November 6, 1982, pp. 1892-93; and table on p. 1893. [BACK]

28. Ed Magnuson, "Interpreting the New Moderation," Time, November 22, 1982, p. 74. [BACK]

29. Walter Isaacson, "Trimming the Sails," Time, November 15, 1982, pp. 12-16, 21. [BACK]

30. CQA 1982, p. 321. [BACK]

31. William F. Clinger (R-Pa.), editorial, New York Times, February 4, 1982. [BACK]

32. Melinda Beck et al., "The Decaying of America," Newsweek, August 2, 1982, pp. 12-18. [BACK]

33. CQA 1982, p. 322. [BACK]

34. Rochelle L. Stanfield, "Jobs Gain Momentum in Wake of Election Returns," National Journal, November 20, 1982, p. 1999. [BACK]

35. Martin Tolchin, "Jobs Legislation is Gaining Support," New York Times, November 11, 1982, pp. A1, A19; also Ed Cowan, "Gas Tax Rise Urged by Rostenkowski for Road Repairs," New York Times, November 10, 1982, pp. A1, D14. [BACK]

36. Howell Raines, "G.O.P. Lacks Votes on Early Tax Cut, President is Told," New York Times, November 19, 1982, p. A1. [BACK]

37. CQA 1982, p. 322. [BACK]

38. Stanfield, "Jobs Gain Momentum in Wake of Election Returns." [BACK]

39. George J. Church, "How to be Santa Claus," Time, December 20, 1982, pp. 18, 21. [BACK]

40. Susan Tifft, "New Roads for the Unemployed," Time, December 6, 1982, p. 23; Kenneth Gilpin, "Spending Proposals Criticized," New York Times, November 22, 1982, pp. D1, D7. [BACK]

41. Walter Isaacson, "Lame Ducks Lay An Egg," Time, December 27, 1982, pp. 12-14. [BACK]

42. CQA 1982, p. 285. [BACK]

43. Ibid.; and Walter S. Mosberg, "Congress Deletes MX Production Funds But Fine Print Will Allow Five to Be Built," Wall Street Journal, December 21, 1982, p. 6. [BACK]

44. CQA 1982, p. 547; see also Mike Causey, "The Federal Diary: Top U.S. Aides Get More Pay: Most Live Here," Washington Post, December 22, 1982, p. B2. [BACK]

45. Martin Tolchin, "House Allocates $5 Billion to Jobs," New York Times, December 15, 1982, pp. A1, A28. [BACK]

46. Martin Tolchin, "How Gas Tax Lost in Senate," New York Times, December 18, 1982, pp. A1, A13. [BACK]

47. Ibid. [BACK]

48. Steven V. Roberts, "Filibuster Stalls Key Money Bill on Senate Floor," New York Times, December 19, 1982, pp. A1, A26; Steven V. Roberts, "Congress Drops Jobs Program and MX from Funding Measure In Compromise to Avoid a Veto," New York Times, December 20, 1982, pp. A1, D11. [BACK]

49. Roberts, "Congress Drops Jobs Program"; Mosberg, "Congress Deletes MX Production Funds But Fine Print Will Allow Five to be Built"; and Margot Hornblower, "232 Billion Voted for Defense; Reagan Rebuffed on MX Funds," Washington Post, December 21, 1982, p. A4. [BACK]

50. Steven V. Roberts, "President Decides to Sign Funds Bill Despite Loss of MX," New York Times, December 21, 1982, pp. A1, D29. [BACK]

51. Hornblower, "232 Billion Voted for Defense." [BACK]

52. Helen Dewar, "Congress Sends Spending Bill to the President: U.S. Employees Told To Come In," Washington Post, December 21, 1982, pp. A1, A7. [BACK]

53. Juan Williams, "Funding Measure Signed," Washington Post, December 22, 1982, pp. A1, A5. [BACK]

54. Uncited details on this and the entire appropriations battle are from CQA1982, Budget and Appropriations. Numbers used in making judgments are from ibid. and from the "Brown Book," Senate Document No. 40, 97th Cong., 2d sess., esp. Tables IV, IVA, V, VIII, VIIIa. [BACK]

55. Douglas B. Feaver and David Maraniss, "Reagan Lobbies For Senate Votes on Gasoline Tax," Washington Post, December 23, 1982, pp. A1, A7. [BACK]

56. David Maraniss, "Senate Passes Gas-Tax Bill, Closes the 97th," Washington Post, December 24, 1982, pp. A1, A4. [BACK]

1. Thus, the full social security system is OASDHI: Old Age, Survivors, Disability and Hospital Insurance. [BACK]

2. Paul Light, Artful Work: The Politics of Social Security Reform (New York: Random House, 1985), pp. 136-37. [BACK]

3. George J. Church, "A Debt-Threatened Dream," Time, May 24, 1982, pp. 16-27. [BACK]

4. Ibid. [BACK]

5. Light, Artful Work, p. 160, and chap. 13, pp. 152-62. [BACK]

6. A larger explanation of the politics of assumptions may be found in ibid., pp. 45-57. The economic forecasts determined not only the dimension of the problem but also the size of some solutions. Thus, a projection of high inflation meant that freezing or postponing the COLAs would save more money than if inflation were actually low. [BACK]

7. Ibid., p. 171. [BACK]

8. Report of the National Commission on Social Security Reform (Washington, D.C.: U.S. Government Printing Office, January 1983), Appendix K, Tables 5A, 5D, 13. [BACK]

9. Ibid., Table 3A. [BACK]

10. Ibid., Appendix K, Tables 7C and 11. [BACK]

11. Peter G. Peterson, "The Salvation of Social Security," New York Review of Books, December 16, 1982, pp. 50-57. [BACK]

12. Quoted in Eric F. Kingson, "Financing Social Security," Policy Studies Journal 13, no. 1 (September 1984), p. 139. [BACK]

13. Harry Anderson, "The Crisis in Social Security," Newsweek, June 1, 1981, pp. 25-27. [BACK]

14. Light, Artful Work, p. 66. [BACK]

15. Harry Anderson et al., "The Social Security Crisis," pp. 18-23; and Tom Morganthau, "Legions of the Old," Newsweek, January 24, 1983, p. 23. [BACK]

16. Out of average costs of 14.09 percent, taxes would exceed benefits into the second decade of the new century. See Table 5 in Appendix J, National Commission on Social Security; and Light, Artful Work, p. 171. [BACK]

17. These OASDI figures are calculated under 2B assumptions. National Commission on Social Security, Appendix K, Table 9B. [BACK]

18. The percentage of taxable payroll poses a whole different set of questions: If wages constitute a lesser proportion of GNP, what is the balance? Are profits and rentier income higher than before? Why? How are workers talked into that? [BACK]

19. National Commission on Social Security, Appendix K, Tables 7B, 9B. [BACK]

20. Kingson, "Financing Social Security," p. 145. [BACK]

21. Light, Artful Work, p. 169. [BACK]

22. Ibid., p. 172. Only newly hired federal employees or those with less than five years service would be included. [BACK]

23. Because a mere ten years' employment entitles a person to full social security benefits, some people combined thirty-year careers in federal service with ten outside and thus achieved double pensions. Those who advocated including federal employees argued also that the survivors and disability provisions of social security were desirable and that a combination of social security with a supplementary annuity would provide employees much more flexibility in leaving government. Employee unions, however, believed that CSR gave them a better deal. They also preferred to keep policy within a pond—the House Post Office and Civil Service and Senate Government Affairs committees—in which they were the big fish; the social security ocean seemed big and very risky. Finally, CSR, based on the contributions of current employees, was no more self-financing than OASDI; it had big deficits. If new employees did not contribute to the old CSR system, where would benefits come from? The government, of course, but the numbers would be big, and there might be pressure for cuts. The unions' position made sense—so long as the issue was CSR. When the issue became the health of OASDI, however, they got rolled. [BACK]

24. National Commission on Social Security, Appendix K, p. 21. [BACK]

25. Light, Artful Work, p. 173. [BACK]

26. Ibid., pp. 173-74. [BACK]

27. Ibid., p. 179. Why the number for coverage expansions doesn't fit Light's other figures, we cannot say. [BACK]

28. Ibid., p. 186. [BACK]

29. Ibid., pp. 184-85. [BACK]

30. Ibid., p. 187. [BACK]

31. National Commission on Social Security, pp. 2-10. [BACK]

32. See Kingson, "Financing Social Security," pp. 149-50. [BACK]

33. Compare the $18 billion figure to the National Commission's report, Appendix K, sum of Tables C-8 through C-11, to get a sense of why one would be skeptical of the figures. [BACK]

34. National Commission on Social Security, pp. 2-12 to 2-13. [BACK]

35. Light, Artful Work, pp. 198-99. [BACK]

36. Susan Tifft, "Assaulted from All Sides," Time, January 31, 1983, p. 28. [BACK]

37. Susan Tifft, "Taking Two Aspirin Won't Do," Time, February 28, 1983, p. 21. [BACK]

38. Congressional Quarterly Almanac 1983, Vol. 39 (Washington, D.C.: Congressional Quarterly Inc., 1984), p. 222 (hereafter CQA 1983). [BACK]

39. Light, Artful Work, pp. 209-11; CQA 1983, p. 223. [BACK]

40. Light, Artful Work, pp. 213-14; and CQA 1983, p. 225. [BACK]

41. Light, Artful Work, p. 217. [BACK]

42. "Congress Acts on Jobs and Social Security," Newsweek, April 4, 1983, pp. 22-23. [BACK]

43. See Light, Artful Work, pp. 225-26. [BACK]

44. Peter J. Ferrara, Social Security: The Inherent Contradiction (San Francisco: Cato Institute, 1980). His latest statement is "Social Security Prospects for Real Reform," a paper delivered to the Pacific Forum, Pacific Research Institute for Public Policy, April 29, 1988. [BACK]

1. Charles P. Alexander, "That Monster Deficit," Time, March 5, 1984, p. 60. [BACK]

2. Congressional Budget Office, "Reducing the Deficit: Spending and Revenue Options," A Report to the Senate and House Committees on the Budget—Part III, February 1983, p. 1. [BACK]

3. Congressional Budget Office, "The Economic and Budget Outlook: Fiscal Years 1986-1990," A Report to the Senate and House Committees on the Budget—Part I (Washington, D.C.: U.S. Government Printing Office, February 1985), p. 162. [BACK]

4. Gregory B. Mills and John L. Palmer, The Deficit Dilemma (Washington, D.C.: Urban Institute, 1983), pp. 8-10, give a short summary of the tax increases. [BACK]

5. For extensive discussion of entitlements, see Jack A. Meyer, "Budget Cuts in the Reagan Administration: A Question of Fairness," in D. Lee Bauden, ed., The Social Contract Revisited (Washington, D.C.: Urban Institute, 1984), pp. 33-64. [BACK]

6. See Congressional Budget Office, "Reducing the Deficit," pp. 98-99. [BACK]

7. See Congressional Budget Office, "The Economic and Budget Outlook," p. 153. [BACK]

8. Peter W. Bernstein, "David Stockman: No More Big Budget Cuts," Fortune, February 6, 1984, pp. 53-56. [BACK]

9. Executive Office of the President, Office of Management and Budget, Budget of the United States Government Fiscal Year 1984 (Washington, D.C.: U.S. Government Printing Office, 1983), pp. 3-9. [BACK]

10. U.S. Congress. House. Committee on Ways and Means. Background Material and Data on Program Within the Jurisdiction of the Committee on Ways and Means. 99th Cong., 1st sess., February 22, 1985, pp. 55-56. Committee Print. [BACK]

11. Martha Derthick, Policymaking for Social Security (Washington, D.C.: Brookings Institution, 1979), p. 357. [BACK]

12. The term is Frank Levy's. See his Dollars and Dreams: The Changing American Income Distribution (New York: Russell Sage Foundation, 1987). [BACK]

13. Congressional Budget Office, "The Economic and Budget Outlook," p. 162. [BACK]

14. Office of Management and Budget, Budget of the U.S. Government, pp. 14-16. [BACK]

15. Ibid. [BACK]

16. Stockman, Triumph of Politics, p. 399. [BACK]

17. Ibid. [BACK]

18. Table from Mills and Palmer, Deficit Dilemma, p. 22. Any particular snap shot will provide a slightly different picture, due to changes in experienced and projected economic performance and in congressional action. But this table is close enough to others for our purposes. For comparison, the 1985 CBO Appendix D and its baseline, including indexing of tax rates in 1981, is particularly reasonable. Blaming Reagan for deficits "caused" by not allowing taxes to rise above the level which helped defeat Jimmy Carter seems unreasonable. [BACK]

19. See Levy, Dollars and Dreams, for a splendid analysis on how demography affects outcomes. [BACK]

20. Charles P. Alexander, "The Elusive Recovery," Time, December 27, 1982, pp. 60-62. [BACK]

21. "A Slow-Motion Recovery May Speed Up Toward Year End," Business Week, December 27, 1982, pp. 54-57. [BACK]

22. Office of Management and Budget, Budget of the U.S. Government, pp. 2-9. [BACK]

23. Stephen B. Shepard, Robert E. Farrell, and Lee Walczak, "Interview with President Reagan," Business Week, February 14, 1983, p. 119. [BACK]

24. Melinda Beck et al., "Playing Politics with Jobs," Newsweek, February 14, 1983, p. 20. [BACK]

25. Charles P. Alexander, "Here Comes the Recovery," Time, February 28, 1983, pp. 42-44. [BACK]

26. Harry Anderson et al., "A Forecast of Sunshine," Newsweek, July 4, 1983, p. 40. [BACK]

27. Charles P. Alexander, "Showing Some Real Muscle," Time, July 4, 1983, pp. 40-41. [BACK]

28. George J. Church, "Going Back to Work," Time, August 15, 1983, p. 12. [BACK]

29. Council of Economic Advisers, Economic Report of the President 1985 (Washington, D.C.: U.S. Government Printing Office, 1985), pp. 266-67. [BACK]

30. Ibid., p. 269. [BACK]

31. Ibid., p. 277. [BACK]

32. Ibid., pp. 328-29. [BACK]

33. Ibid., pp. 258-59. [BACK]

34. U.S. Congress. House. Committee on the Budget. A Review of President Reagan's Budget Recommendations, 1981-85. 98th Cong., 2d sess., August 2, 1984, pp. 37-41. Committee Print. [BACK]

35. Council of Economic Advisers, Economic Report of the President, pp. 32-33. [BACK]

36. Ibid., p. 35. [BACK]

37. See Kim Foltz et al., "Economic Theory in Reverse," Newsweek, July 16, 1984, pp. 47-48. [BACK]

38. House Budget Committee, Review of President Reagan's Budget Recommendations, p. 13. [BACK]

39. Greider's Secrets of the Temple tells the story of Fed policy. A good indicator of Fed policy is its purchases of federal debt. The Fed increased its holding by more than 20 percent from June 1982 through September 1983. Over the next year its holdings didn't grow at all. [BACK]

40. John Greenwald, "Topic A in the Money World," Time, April 25, 1983, pp. 96-97. [BACK]

41. Harry Anderson et al., "Voting for Volcker to Stay," Newsweek, June 20, 1983, pp. 53-54. [BACK]

42. Greenwald, "Topic A in the Money World"; John S. DeMott, "Down to the Finish Line," Time, June 21, 1983, pp. 58-59; Maureen Dowd, "Chairman Volcker Keeps His Job," Time, June 27, 1983, pp. 16, 19; Anderson, "Voting for Volcker to Stay"; Harry Anderson et al., "Volcker: Man for the Moment," Newsweek, June 27, 1983, pp. 66-68. [BACK]

43. Walter Isaacson, "Untamed Monster," Time, May 23, 1983, pp. 14-15. [BACK]

44. Richard I. Kirkland, Jr., "The Reaganites' Civil War Over Deficits," Fortune, October 17, 1983, pp. 74-80. [BACK]

45. Ibid., p. 74. [BACK]

46. Alexander L. Taylor III, "The Administration's Dr. Gloom," Time, November 7, 1983, p. 78. [BACK]

47. Barry Bosworth, "Statement Before the Joint Economic Committee, United States Congress," September 17, 1985, typescript, p. 5. [BACK]

48. Walter W. Heller and George L. Perry, "U.S. Economic Policy and Outlook," National City Bank of Minneapolis report, October 18, 1985, typescript. [BACK]

49. Greider, Secrets of the Temple; and Thomas B. Edsall, The New Politics of Inequality (New York: W. W. Norton, 1984) are good examples of the critique. [BACK]

50. Joseph Schumpeter, Capitalism, Socialism, and Democracy (London: Allen & Unwin, 1976). [BACK]

51. "Grumbling About Deficits," Time, August 15, 1983, p. 13; and Charles P. Alexander, "Surging Up from the Depths," Time, September 26, 1983, pp. 50-51. [BACK]

52. Harry Anderson et al., "Congress: Ducking the Deficits," Newsweek, September 26, 1983, pp. 19, 77. [BACK]

53. Alexander L. Taylor III, "Labor gets a working over," Time, December 19, 1983, pp. 48-49. [BACK]

54. Congressional Budget Office, "The Economic Outlook," A Report to the Senate and House Committees on the Budget, Part 1 (Washington, D.C.: U.S. Government Printing Office, February 1984), p. xxii. [BACK]

55. Stein, Presidential Economics, p. 290. [BACK]

56. The validity of this analysis depends on the volume of private saving and the extent to which the government itself is performing constructive investment. Thus, cross-national comparisons, e.g., to Japan, might seem to invalidate the argument but do not. Within a given economy, a shift to higher deficits should favor consumption over investment. [BACK]

57. Savage, Balanced Budgets. [BACK]

1. See Savage, Balanced Budgets, appendix, p. 266. [BACK]

2. Ibid. [BACK]

3. George J. Church, "How Reagan Decides," Time, December 13, 1982, pp. 12-17. [BACK]

4. Ibid. [BACK]

5. "Interview with President Reagan: 'The recovery may just be better than we think,'" Business Week, February 14, 1983, pp. 119, 121-122. [BACK]

6. Ibid. [BACK]

7. Soma Golden, "Superstar of the New Economists," New York Times Magazine, March 23, 1980, pp. 30-33, 91-95. [BACK]

8. Ibid. [BACK]

9. Stockman, Triumph of Politics, pp. 356-57. [BACK]

10. Ibid., p. 358. The joke involves a boy who on Christmas morning receives as a present a gigantic pile of horse manure. Rather than being upset, he immediately sets to digging through the pile. Asked why, he replies, "With all this horse manure, there has to be a pony in here somewhere!" Reagan expressed his skepticism of projections publicly many times. That is a convenient stance; therefore reports of private discussions are better evidence of his position. [BACK]

11. Ibid., pp. 358-60. [BACK]

12. See George Reedy, The Twilight of the Presidency (New York: New American Library, 1987) for a description of the dynamic under a very different president, Lyndon Baines Johnson. [BACK]

13. Stockman, Triumph of Politics, p. 362. [BACK]

14. Ibid., pp. 362-64. [BACK]

15. John Berry, "Interest Rates Are Still the Key," Washington Post, January 9, 1983, pp. G1, G17; David Hoffman, "Reagan Advisers Consider Tax Rises in Future Budgets," Washington Post, January 9, 1983, pp. A1, A9. [BACK]

16. See "A Bi-Partisan Appeal To Resolve the Budget Crisis," Washington Post, January 20, 1983, pp. A14-15. [BACK]

17. Table 11, for example, shows only a $39 billion increase in the deficit from policy in FY84, while the Bi-Partisan Appeal required around $100 billion in FY84 contraction. Table from Mills and Palmer, Deficit Dilemma, p. 22. [BACK]

18. George J. Church, "'A Little Terrifying,'" Time, January 17, 1983, p. 10. Ross K. Baker, "Institutional Norms or Party Discipline?: The Punishment of Phil Gramm," typescript, emphasizes the violation of House norms based on interviews with fourteen members of the House Democratic Steering and Policy Committee. [BACK]

19. Helen Dewar, "Reagan's Program Attacked," Washington Post, January 27, 1983, pp. A1, A7. [BACK]

20. Walter Isaacson, "Mending and Bending," Time, February 7, 1983, pp. 12-14. [BACK]

21. Walter Isaacson, "Clashes and Compromises," Time, February 14, 1983, pp. 13-14. [BACK]

22. "A Newsweek Poll: Arms Wrestling," Newsweek, January 31, 1983, p. 17. [BACK]

23. "Why some executives are cooling on Reagan," Business Week, February 21, 1983, p. 19. [BACK]

24. Thomas Edsall and Spencer Rich, "Conable, Dole Oppose Tax Hike Plan," Washington Post, January 19, 1983, pp. A1, A4. [BACK]

25. Thomas Edsall, "Rostenkowski Asks Tax Freeze," Washington Post, February 9, 1983, pp. A1, A6; Thomas Edsall, "Rostenkowski Enrages O'Neill on Tax Stance," Washington Post, February 10, 1983, p. A4. [BACK]

26. CQA 1983, pp. 261-64; Harry Anderson et al., "The Push for a Jobs Program," Newsweek, January 17, 1983, p. 53. [BACK]

27. Walter Isaacson, "Searching for the Recovery," Time, February 21, 1983, pp. 16-17 [BACK]

28. They reasoned that a separate bill for these would allow the House to attach yet another "jobs" package. [BACK]

29. The Treasury claimed that the banks wanted to hold onto the money for their own use. [BACK]

30. Paul Taylor, "Banks Use Psychology to Stoke Savers' Rebellion," Washington Post, March 20, 1983, pp. A1, A6. [BACK]

31. Helen Dewar, "Jobs Bill Imperiled in Senate," Washington Post, March 11, 1983, p. A1. [BACK]

32. Thomas Edsall, "Demos Boost Banks in Tax Battle With Dole," Washington Post, March 12, 1983, p. A8. [BACK]

33. Helen Dewar, "President———Bank Tax Lobbying," Washington Post, March 12, 1983, pp. A1, A8; "On and Off," Time, March 21, 1983, p. 18. [BACK]

34. "No Line of Credit," Time, March 28, 1983, p. 19; CQA 1983, pp. 261-64. [BACK]

35. CQA 1983, pp. 261-64. [BACK]

36. Jonathan Alter et al., "Behind the Banks' Victory," Newsweek, May 2, 1983, p. 28. [BACK]

37. "Voting the Bankers' Way," Time, May 30, 1983, pp. 12-13. [BACK]

38. Thomas B. Edsall, "Senate Panel Approves Withholding Repeal," Washington Post, May 26, 1983, p. A9. [BACK]

39. "Exercises in Make-Believe," Time, June 27, 1983, p. 19. [BACK]

40. See CQA 1983, pp. 435-37; Richard E. Cohen, "What a Difference a Year—and an Election—Make in Producing a Budget," National Journal, April 2, 1983, pp. 696-99. [BACK]

41. Ed Magnuson, "Uproar Over Arms Control," Time, January 24, 1983, pp. 16-18. [BACK]

42. Walter Isaacson, "The Winds of Reform," Time, March 7, 1983, pp. 12-16, 23, 26-30. Unattributed quotes below are from that report. See James Fallows, The National Defense (New York: Random House, 1981), for the basic critique. [BACK]

43. Barton Gellman, "Saga of the World's Costliest Plastic Cap," Washington Post, August 21, 1983, pp. A1, A6. [BACK]

44. See Aaron Wildavsky, The New Politics of the Budgetary Process (Glenview, Ill./Boston: Scott, Foresman/Little Brown, 1987), chap. 6, for different sides of the story. [BACK]

45. Walter Isaacson, "Reagan for the Defense," Time, April 4, 1983, pp. 8-19. [BACK]

46. Michael Reese et al., "Reagan on the Defense," Newsweek, April 18, 1983, pp. 22-24. [BACK]

47. Stockman, Triumph of Politics, pp. 369-70; CQA 1983, p. 439. [BACK]

48. Reese et al., "Reagan on the Defense." [BACK]

49. Helen Dewar, "Stockman Issues Blunt Warning: Budget Agreement Called Vital," Washington Post, April 19, 1983, pp. A1, A6. [BACK]

50. Ibid.; Ed Magnuson, "Feuding in the Family," Time, May 2, 1983, pp. 12-14. [BACK]

51. Helen Dewar, "Conservatives Rebuff Reagan on Budget Counter-Offer," Washington Post, April 21, 1983, p. A4. [BACK]

52. Helen Dewar, "Senate Panel Defies Reagan," Washington Post, April 22, 1983, pp. A1, A7; Richard E. Cohen, "Political and Fiscal Blood May Flow Before Battle of 1984 Budget Is Over," National Journal, April 30, 1983, pp. 898-900; Magnuson, "Feuding in the Family." [BACK]

53. Howard H. Baker, Jr., "We Will Pass a Budget Resolution," Washington Post, May 15, 1983, p. B8; and Scott Matheson and Jim Thompson, "The States Need a Resolution Now," Washington Post, May 15, 1983, p. B8. [BACK]

54. Helen Dewar, "House GOP Vows Help for Reagan's Tax Cuts," Washington Post, April 29, 1983, p. A4. [BACK]

55. Ed Magnuson, "Going Into the Trenches," Time, May 30, 1983, pp. 12-14. [BACK]

56. Votes are all from Congressional Record, May 19, 1983. [BACK]

57. Mark Starr et al., "Congress: Falling on Its Face?" Newsweek, June 20, 1983, p. 23. [BACK]

58. "Budget Deal," Time, July 4, 1983, p. 19. [BACK]

59. CQA 1983, p. 447. [BACK]

60. "Tough Talk from Dole," Time, August 15, 1983, p. 13. [BACK]

61. Timothy B. Clark and Richard E. Cohen, "Coming Up Empty-Handed, National Journal, November 26, 1983, pp. 2460-69. [BACK]

62. Stockman, Triumph of Politics, pp. 371-73. [BACK]

63. Helen Dewar, "Democrats' Tight-Fisted Spending Bill Snags Their Welfare Aims," September 22, 1983, p. A3; Dewar, "Senate Votes to Cut U. N. Contribution," September 23, 1983, pp. A1, A4; Dewar, "Stopgap Funding Bill Is Put on Fast Track," September 28, 1983, P. A4; and Dewar, "Senate, Wooing Reagan, Votes Against More Education Spending," October 5, 1983, p. A2; all in Washington Post. [BACK]

64. Richard E. Cohen, "Plan to curb deficits by capping COLAs could set off a battle royal," National Journal, August 13, 1983, pp. 1671, 1699. [BACK]

65. Starr et al., "Congress: Failing on Its Face?" [BACK]

66. Thomas W. Lippman, "Regan Says President Would Veto a Reduction of July 1 Tax Cut," Washington Post, June 15, 1983, p. A3. [BACK]

67. Richard E. Cohen, "Senate Republican Control May Be Put to Test by Tough Issues this Fall," National Journal, September 10, 1983, pp. 1824-29. [BACK]

68. Timothy B. Clark, "Cracks Appear in Business's United Front in Opposition to Tax Boosts," National Journal, July 16, 1983, pp. 1493-96. [BACK]

69. Mark Starr, "Doing Nothing About Deficits," Newsweek, August 15, 1983, pp. 20-22. [BACK]

70. Ibid. [BACK]

71. Richard E. Cohen, "Choosing Their Poison," National Journal, October 15, 1983, p. 2121. [BACK]

72. CQA 1983, p. 233. [BACK]

73. Cohen, "Choosing Their Poison." [BACK]

74. Ibid.; and Cohen and Clark, "Coming Up Empty-Handed." [BACK]

75. CQA 1983, pp. 235-36. [BACK]

76. Ibid., pp. 529-30; Clark and Cohen, "Coming Up Empty-Handed"; T. R. Reid, "Leaders Spurned As House Defeats Spending Measure," Washington Post, November 9, 1983, p. A8; Susan Tifft, "Cowering Before the Deficit," Time, November 21, 1983, pp. 23, 26. [BACK]

77. Clark and Cohen, "Coming Up Empty-Handed." [BACK]

78. Helen Dewar and Martha M. Hamilton, "House Refuses to Consider a Tax Increase," Washington Post, November 18, 1983, pp. A1, A4; Ed Magnuson, "'We're Unable to Act,'" Time, November 28, 1983, pp. 18-20; Clark and Cohen, "Coming Up Empty-Handed"; CQA 1983, p. 236. [BACK]

79. Clark and Cohen, "Coming Up Empty-Handed." [BACK]

80. Helen Dewar, "Senate Marks Time As Debt Deadline Nears," Washington Post, October 30, 1983, p. A4. [BACK]

81. Helen Dewar, "Reagan Threatens Veto In Debt Ceiling Battle," Washington Post, November 2, 1983, p. A6. [BACK]

82. Ibid. [BACK]

83. Helen Dewar, "Deficit-Reduction Plan Torpedoed by Reagan," Washington Post, November 4, 1983, p. A2. [BACK]

84. Helen Dewar, "Senate Presses On in Quest to Cut Deficit," Washington Post, November 5, 1983, p. A4. [BACK]

85. Ibid. [BACK]

86. Dewar, "Deficit Reduction Plan Torpedoed by Reagan." [BACK]

87. Harry Anderson et al., "Congress Fiddles, The Deficits Burn," Newsweek, November 21, 1983, pp. 81-82. [BACK]

88. Dewar and Hamilton, "House Refuses to Consider a Tax Increase"; Helen Dewar and David Hoffman, "Deficit-Cutting Drive Resumes," Washington Post, November 16, 1983, pp. A1, A10; Magnuson, "'We're Unable to Act'"; Clark and Cohen, "Coming Up Empty-Handed"; CQA 1983, p. 287. [BACK]

89. CQA 1983, p. 241. [BACK]

90. Magnuson, "'We're Unable to Act.'" [BACK]

1. Susan Dentzer et al., "A Budget for the Election," Newsweek, February 13, 1984 pp. 67-68. [BACK]

2. Juan Williams, "Reagan Defends Plan To Live With Deficit, Without Tax Increase," Washington Post, January 22, 1984, p. A4. [BACK]

3. T. R. Reid and Juan Williams, "Democrats Considering Veto Right," Washington Post, January 28, 1984, pp. A1, A8. [BACK]

4. Eloise Salholz, "Periscope," Newsweek, March 5, 1984, p. 19. [BACK]

5. Walter Shapiro et al., "The Deficit: Out of Control?" Newsweek, December 12, 1983, pp. 36-38. [BACK]

6. George J. Church, "Reagan Gets Ready," Time, January 23, 1984, pp. 10-11. [BACK]

7. Jane Seabury and Martha M. Hamilton, "'85 Budget To Include Tax Plan," Washington Post, December 13, 1983, pp. A1, A8. [BACK]

8. Stockman, Triumph of Politics, p. 374; other such quotes following are from this source. [BACK]

9. Ibid. [BACK]

10. Shapiro et al., "The Deficit: Out of Control?" [BACK]

11. On the Grace Commission, see Steve Kelman, "The Grace Commission: How Much Waste in Government?" The Public Interest, No. 78 (Winter 1985), pp. 62-82. Most experienced analysts concluded that the Grace Commission revealed that at least one group of private sector experts knew little about government. For Reagan on entitlements, see interview with Lou Cannon, David Hoffman, and Juan Williams, Washington Post, January 22, 1984, p. A9. [BACK]

12. T. R. Reid and Margaret Shapiro, "Reagan Hails Recovery, Pledges Peace Efforts: Wary Response By Democrats," Washington Post, January 26, 1984, pp. A1, A17. [BACK]

13. Dick Kirschten, "Blueprint for a Campaign," National Journal, February 4, 1984, pp. 215-18. [BACK]

14. Dentzer et al., "A Budget for the Election." [BACK]

15. Text of President Reagan's State of the Union address, Washington Post, January 26, 1984, pp. A16-17. [BACK]

16. Kirschten, "Blueprint for a Campaign." [BACK]

17. Helen Dewar, "Reagan Seeks Talks, Vetoes, Tax Changes In Attacking Deficits," Washington Post, January 26, 1984, p. A15; Kirschten, "Blueprint for a Campaign." [BACK]

18. Congressional Quarterly Almanac 1984, Vol. 40 (Washington, D.C.: Congressional Quarterly Inc., 1985), p. 131 (hereafter CQA 1984). [BACK]

19. Stockman, Triumph of Politics, p. 375. [BACK]

20. Peter W. Bernstein, "David Stockman: No More Big Budget Cuts," Fortune, February 6, 1984, pp. 53-56. [BACK]

21. For the politics of the analysis, see Timothy B. Clark, "Stiff Tax Hikes Will be Key to Future Efforts to Close the Budget Deficit," National Journal, April 21, 1984, pp. 752-57. [BACK]

22. Susan Tifft, "Playing For Time," Time, February 13, 1984, pp. 10-13. [BACK]

23. CQA 1984, p. 131. [BACK]

24. See John M. Berry, "Bush Denies Staff Disarray Over Deficits," Washington Post, February 6, 1984, p. A1. [BACK]

25. Reid and Shapiro, "Reagan Hails Recovery, Pledges Peace Efforts." [BACK]

26. Reid and Williams, "Democrats Considering Veto Right." [BACK]

27. Jeffrey H. Birnbaum, "Some See Budget Gap Shrinking," Wall Street Journal, February 14, 1984, p. 56. [BACK]

28. CQA 1984, p. 149. [BACK]

29. David Hoffman, "Reagan, GOP Senators Converging on Budgets," Washington Post, March 10, 1984, p. A8. [BACK]

30. Helen Dewar, "New Deficit Measures Would Lose Revenue," Washington Post, March 15, 1984, pp. B1, B4. [BACK]

31. As always, there were technical questions. Some proponents of the plan claimed defense growth would be only 5.1 percent, using the FY84 budget resolution defense total as the baseline instead of actual appropriated spending. See "Glimmers of Hope on the Deficit," Business Week, April 2, 1984, pp. 26-27. [BACK]

32. Jeffrey H. Birnbaum, "GOP's Deficit Plan Faces Hurdles in the Senate but Is Likely to Win," Wall Street Journal, March 29, 1984, p. 2A. [BACK]

33. Martha M. Hamilton and Helen Dewar, "Cutting the Budget Not as Easy as It Sounds," Washington Post, February 28, 1984, p. A15. [BACK]

34. Helen Dewar, "Senate Democrats Propose Budget Deferring Income Tax Indexing," Washington Post, March 23, 1984, p. A3. [BACK]

35. CQA 1984, p. 156. [BACK]

36. Details can be found in CQA 1984, pp. 155-56. [BACK]

37. Richard E. Cohen and Timothy B. Clark, "Congress Is Trying to Convince the Voters It Is Really Worried About the Deficit," National Journal, April 21, 1984, pp. 758-62. [BACK]

38. Helen Dewar, "House Votes Plan to Reduce Deficit By $182 Billion," Washington Post, April 6, 1984, pp. A1, A9. [BACK]

39. CQA 1984, p. 156. [BACK]

40. See Dewar, "House Votes Plan to Reduce Deficit"; CQA 1984, pp. 155-56; Cohen and Clark, "Congress Is Trying to Convince the Voters." [BACK]

41. "What Bob Dole's Tax Bill Would Cost Business," Business Week, April 9, 1984, p. 29. [BACK]

42. Jeffrey H. Birnbaum, "Panel Completes Plan to Cut Deficit, Setting Stage for Debate on House Floor," Wall Street Journal, March 29, 1984, p. 2. [BACK]

43. Federal Budget Report, April 2, 1984 (a bimonthly report published by Pasha Publications Inc., Arlington, Virginia). [BACK]

44. Melinda Beck et al., "Deficit Politics: An Election-Year Frenzy," Newsweek, April 16, 1984, pp. 31-32. [BACK]

45. Cohen and Clark, "Congress Is Trying to Convince the Voters." [BACK]

46. Beck et al., "Deficit Politics." [BACK]

47. Cohen and Clark, "Congress Is Trying to Convince the Voters." [BACK]

48. Nancy Landon Kassebaum (R-Kan.), Joseph R. Biden, Jr. (D-Dela.), Charles E. Grassley (R-Iowa), and Max Baucus (D-Mont.), "Freeze Everything," Washington Post, April 27, 1984, p. A23. [BACK]

49. Cohen and Clark, "Congress Is Trying to Convince the Voters." [BACK]

50. Ibid. [BACK]

51. Ibid.; CQA 1984, pp. 156-57. [BACK]

52. Dale Tate, "Part of Deficit-Reduction Package Effort to Pass Spending Cuts Off to Torpid Start in Senate," Congressional Quarterly Weekly Report, April 28, 1984, p. 951. [BACK]

53. Helen Dewar, "Senate Nears Showdown on Proposal to Freeze Federal Outlays for Year," Washington Post, May 2, 1984, p. A3. [BACK]

54. Dale Tate, "Two Alternatives Defeated: Senate Poised for Showdown on GOP Deficit-Cutting Plan," Congressional Quarterly Weekly Report, May 5, 1984, p. 1005. [BACK]

55. CQA 1984, p. 152. [BACK]

56. "GOP Moderates Key to Deficit-Cutting Plan," Congressional Quarterly Weekly Report, May 19, 1984, p. 1164. [BACK]

57. CQA 1984, p. 158. [BACK]

58. Ibid., p. 165. [BACK]

59. Martha M. Hamilton, "Conferees Continue Standoff on Spending Reductions," Washington Post, June 15, 1984, p. A5. [BACK]

60. Federal Budget Report, June 25, 1984. [BACK]

61. Hamilton, "Conferees Continue Standoff." [BACK]

62. George J. Church, "Slowing the Surge of Red Ink," Time, July 9, 1984, pp. 20-21. [BACK]

63. DEFRA details are from CQA 1984, pp. 145-47. In February 1985, CBO estimated the extra DEFRA revenues at $9 billion in FY85, $16 billion in FY86, $22 billion in FY87, rising to $30 billion in FY90. Congressional Budget Office, The Economic and Budget Outlook: Fiscal Years 1986-1990, A report to the Senate and House Committees on the Budget—Part 1, February 1985 (Washington, D.C.: U.S. Government Printing Office), Table D-3, p. 154. [BACK]

64. Linda E. Demkovich, "For Poor and Elderly, Congress's Cuts In Health Budgets Have Silver Lining," National Journal, July 7, 1984, pp. 1309-11. [BACK]

65. This account is from ibid.; CQA 1984, pp. 147-49; Martha M. Hamilton, "Hill Conferees Agree to Trim $11 Billion," Washington Post, June 22, 1984, p. A3; Hamilton, "Conferees Strive for Accord on Taxes, Spending," Washington Post, June 23, 1984, p. A1; Hamilton, "Conferees Vote $61 Billion in Deficit Reductions," Washington Post, June 24, 1984, p. A1; and interviews. [BACK]

66. CQA 1984, p. 155. [BACK]

67. Helen Dewar, "Senator Stevens Says Administration Can Expect Defense Rise of 5%," Washington Post, August 4, 1984, p. A3. [BACK]

68. CQA 1984, pp. 158-60; Helen Dewar, "Accord Ends Hill Logjam on Defense Funds," Washington Post, September 21, 1984, pp. A1, A6. [BACK]

69. Helen Dewar, "House Vote Adds Crime Package to Spending Bill," Washington Post, September 26, 1984, pp. A1, A4. [BACK]

70. Helen Dewar, "Senate Votes to End Rights Debate," Washington Post, September 30, 1984, pp. A1, A14. [BACK]

71. See CQA 1984, p. 446; Helen Dewar, "Fractious Legislators Stall Action on Rights Spending Bills," Washington Post, September 22, 1984, p. A4; Dewar, "House Vote Adds Crime Package"; Dewar, "Senate Votes to End Rights Debate"; Helen Dewar and Margaret Shapiro, "Hill Votes Stopgap Funds Bill," Washington Post, October 2, 1984, pp. A1, A4; Helen Dewar, "Rights Bill is Shelved In Senate," Washington Post, October 3, 1984, pp. A1, A4; Helen Dewar, "Federal Shutdown Readied as Senate Works on Funding," Washington Post, October 4, 1984, pp. A1, A4. [BACK]

72. David Hoffman and Keith B. Richbury, "Government Shut Down By Reagan," Washington Post, October 5, 1984, pp. A1, A14. [BACK]

73. The big crime bill, supported by both Senator Thurmond and Senator Kennedy—which is another story—was not in dispute. [BACK]

74. Helen Dewar, "Deadlock Continues on the Hill," Washington Post, October 10, 1984, pp. A1, A12. [BACK]

75. Helen Dewar, "Conferees Approve '85 Funds," Washington Post, October 11, 1984, pp. A1, A4; Helen Dewar and Margaret Shapiro, "Congress Finishing Session," Washington Post, October 12, 1984, pp. A1, A4. [BACK]

76. See CQA 1984, pp. 421-25. [BACK]

77. CQA 1984, p. 167; Helen Dewar, "51 Senators Press Measure For Trial of Line-Item Veto," Washington Post, September 27, 1984, p. A6. [BACK]

78. Helen Dewar, "With Eyes on Deficits, GOP Starts New Drive To Amend Constitution," Washington Post, August 2, 1984, p. A3; Helen Dewar, "Balanced-Budget Proposal Suffers Pair of Setbacks," Washington Post, September 14, 1984, pp. A1, A7; Kevin Klose, "Michigan Lawmaker Stalls Budget-Amendment Drive," Washington Post, September 14, 1984, p. A7. [BACK]

79. David Hoffman and Ward Sinclair, "Reagan, On Eve of Midwest Trip, Unveils Farm Aid," Washington Post, September 19, 1984, pp. A1, A8. [BACK]

1. Dennis Farney, "Democratic Study Unit in Ferment," Wall Street Journal, April 25, 1984, p. 54. [BACK]

2. Economic arguments about growth could, however, be made. Defense spending can be alleged to be unproductive, with a smaller multiplier than domestic spending, while much spending by the wealthy could be said to be much better spent by the government. If businesses were more interested in paper profits than in productive investment, then raising their taxes would be little loss. And, because a mass productive capitalist economy needs wide markets but tends to create inequality, government efforts to redistribute income add to growth. There are arguments for anything. [BACK]

3. Timothy B. Clark, "Promises, Promises—the Presidential Candidates and Their Budget Plans," National Journal, March 10, 1984, p. 452-57. [BACK]

4. Special Task Force on Long-Term Economic Policy, Democratic Caucus/ United States House of Representatives, Rebuilding the Road to Opportunity: Turning Point for America's Economy, September 1982, p. III. Produced by the House Democratic Caucus, this was known as the Yellow Book because of its cover. It was succeeded by the National-House Democratic Caucus, Renewing America's Promise: A Democratic Blueprint for Our Nation's Future, January 1984. Published by the National-House Democratic Caucus, this was known as the Blue Book because of its cover. [BACK]

5. Yellow Book, p. 1. [BACK]

6. Ibid., p. 9. [BACK]

7. Ibid. [BACK]

8. Blue Book, p. 3. [BACK]

9. Ibid., pp. 12-13. [BACK]

10. Ibid., p. 13. [BACK]

11. Ibid., p. 10. [BACK]

12. David S. Broder, "Mondale Says He'd Increase Business Taxes," Washington Post, September 16, 1983, p. A1. [BACK]

13. Mark Starr with Howard Freeman, "An Early Labor Endorsement?", Newsweek, August 15, 1983, p. 21; Tom Morganthau et al., "Fritz Mondale's Triple Play," Newsweek, October 10, 1983, p. 28. [BACK]

14. The best coverage of labor's problems can be found in The Economist, for example, "A harvest of trouble in California," August 27, 1983, pp. 15-16; "The de-unionization of America," October 29, 1983, p. 71; "Economy expands, jobs contract," August 25, 1984, p. 57; "Secure our jobs, and the rise can come later," September 22, 1984, pp. 25-26. For a discussion of the various political considerations, see Don Bonafede, "Labor's Early Endorsement Will Prove a Psychological Boost and Then Some," National Journal, September 24, 1983, pp. 1938-41. [BACK]

15. Clark. "Promises, Promises." [BACK]

16. David Broder, "Democrats Exchange Brickbats," Washington Post, January 16, 1984, pp. A1, A4. [BACK]

17. Thomas B. Edsall, "'84 Politics: 'New Patriotism' vs. New Class Allegiances," Washington Post, February 5, 1984, pp. D1, D4. [BACK]

18. Dan Balz and Milton Coleman, "Accepting Nomination, Mondale Offers Voters Era of 'New Realism,'" Washington Post, July 20, 1984, pp. A1, A15. [BACK]

19. Walter Bagehot, "Introduction to the Second Edition," The English Constitution (Ithaca, N.Y.: Cornell Paperbacks, 1966), p. 276. [BACK]

20. William Schneider, "Mondale's Gamble on Tax Increase Could Pay Off If Fairness Becomes the Issue," National Journal, August 4, 1984, pp. 1494-95. [BACK]

21. David Alpern, "Jousting Over a Tax Increase," Newsweek, August 6, 1984, p. 16; Kurt Andersen, "Scoring Points with Candor," Time, August 20, 1984, pp. 20-21; Lou Cannon and David Hoffman, "'I Have No Plans to Raise Taxes,' President Says," Washington Post, July 25, 1984, pp. A 1, A11; David Hoffman and John M. Berry, "Reagan, Mondale Tax Brawl Defies Political Convention," Washington Post, July 29, 1984, pp. A1, A8; Tom Morganthau et al., "How Good a President?" Newsweek, August 27, 1984, pp. 28-31. [BACK]

22. George F. Will, "The Economy of Leadership," Newsweek, August 27, 1984, p. 84. [BACK]

23. Robert Dole, editorial, Washington Post, August 5, 1984, p. C8. [BACK]

24. See, for instance, Thomas E. Cavanagh and James L. Sundquist, "The New Two-Party System," in John E. Chubb and Paul E. Peterson, The New Direction in American Politics (Washington, D.C.: Brookings Institution, 1985), pp. 33-67. [BACK]

25. Ibid., pp. 43-48; The Gallup Report, No. 223, April 1984, p. 18. [BACK]

26. J. Merrill Shanks and Warren E. Miller, "Policy Direction and Performance Evaluation: Complementary Explanations of the Reagan Elections," paper delivered at the Annual Meeting of The American Political Science Association, New Orleans, August 29-September 1, 1985. [BACK]

27. David S. Broder and George Lardner, Jr., "Democrats Challenge President's Landslide as Mandate," Washington Post, November 8, 1984, pp. A1, A49. [BACK]

28. Interview with Thomas M. DeFrank and Eleanor Clift, "To Finish What Is Well Started," Newsweek, February 6, 1984, pp. 18-19. [BACK]

29. Authors' calculations from CQA 1984. [BACK]

30. An extensive literature has documented the incumbency advantages in congressional elections. [BACK]

31. John A. Ferejohn and Morris P. Fiorina, "Incumbency and Realignment in Congressional Elections," in Chubb and Peterson, New Direction, pp. 91-115; quote on pp. 114-15. [BACK]

32. William Schneider, "Mondale's Gamble on Tax Increase Could Pay Off If Fairness Becomes the Issue," National Journal, August 4, 1984, pp. 1494-95. [BACK]

33. George H. Gallup, The Gallup Poll: Public Opinion 1983 (Wilmington, Dela.: Scholarly Resources, 1984), Survey #207-G, Interviewing date January 14-17, 1983, reported February 13, pp. 25-30. [BACK]

34. George H. Gallup, The Gallup Poll: Public Opinion 1984 (Wilmington, Dela.: Scholarly Resources, 1985), Survey #243-G, Interviewing date September 28-October 1, 1984, reported November 18, pp. 243-45. [BACK]

35. Scott Keeter, "Public Opinion in 1984," in Gerald Pomper with Colleagues, The Election of 1984: Reports and Interpretations (Chatham, N.J.: Chatham House, 1985), pp. 91-111. [BACK]

36. Ibid., p. 99. See also D. Roderick Kiewiet and Douglas Rivers, "The Economic Basis of Reagan's Appeal," in Chubb and Peterson, New Direction, pp. 69-90. [BACK]

37. See William Schneider, "An Uncertain Consensus," National Journal, November 10, 1984, pp. 2130-32; Keeter, "Public Opinion in 1984," pp. 98-99. [BACK]

38. Keeter, "Public Opinion in 1984," p. 95. [BACK]

39. Helen Dewar, "Legislators See Paradox In Voters' View of Reagan," Washington Post, February 21, 1984, pp. A1, A4. [BACK]

40. Evan Thomas, "The Goal: A Landslide," Time, November 5, 1984, pp. 18-20. [BACK]

41. One reason Reagan had different opinions was that he listened to different voices. In his memoir Donald Regan remarked that the president was most likely to quote from a story in the morning's Washington Times, unlike Vice President Bush who, like most Washingtonians, would refer to the New York Times; Regan, For the Record, p. 275. [BACK]

1. Undue process," The Economist, November 9, 1985, p. 32. [BACK]

2. Pat Towell, "Pentagon Asks $313.7 Billion for Defense Buildup," Congressional Quarterly Weekly Report, February 9, 1985, pp. 229-35. [BACK]

3. Elizabeth Wehr, "Reagan, Senate GOP Reach '86 Budget Accord," Congressional Quarterly Weekly Report, April 6, 1985, pp. 627-28. [BACK]

4. Ibid. [BACK]

5. Elizabeth Wehr, "FY '86 Budget Struggle Moves to Senate Floor," Congressional Quarterly Weekly Report, April 20, 1985, pp. 717-19. [BACK]

6. Ibid. [BACK]

7. Ibid. [BACK]

8. Jacqueline Calmes and Pamela Fessler, "Response Uneven to President's TV Appeal," Congressional Quarterly Weekly Report, April 27, 1985, p. 769. [BACK]

9. Elizabeth Wehr, with Jacqueline Calmes and Pamela Fessler, "'86 Budget Hung Up in Senate Floor Squabble," Congressional Quarterly Weekly Report, April 27, 1985, pp. 768-69, 771. [BACK]

10. Elizabeth Wehr, "Defense Cut, Social Security Boosted: Republican Budget Package Picked Apart on Senate Floor," Congressional Quarterly Weekly Report, May 4, 1985, pp. 815, 817-18. [BACK]

11. Ibid. [BACK]

12. Elizabeth Wehr, "Budget Speaks Through Senate Floor Vote," Congressional Quarterly Weekly Report, May 11, 1985, pp. 871-74. [BACK]

13. "Undue process," The Economist, November 9, 1985, p. 32. [BACK]

14. Jacqueline Calmes, "House Panel Gives Quick OK to '86 Budget," Congressional Quarterly Weekly Report, May 18, 1985, p. 915. [BACK]

15. Jacqueline Calmes, "House, With Little Difficulty, Passes '86 Budget Resolution," Congressional Quarterly Weekly Report, May 25, 1985, p. 975. [BACK]

16. Elizabeth Wehr, "House Centrist Bloc: Still Waiting to Happen," Congressional Quarterly Weekly Report, May 25, 1985, p. 972. [BACK]

17. Elizabeth Wehr, "Tough Task: Reaching An '86 Budget Accord," Congressional Quarterly Weekly Report, June 1, 1985, pp. 1044-45. [BACK]

18. Jacqueline Calmes, "Budget Negotiations Resume as Senators Offer New Plan," Congressional Quarterly Weekly Report, June 29, 1985, p. 1258. [BACK]

19. Ibid. [BACK]

20. Ibid. [BACK]

21. Jacqueline Calmes, "President Fails to Unsnarl Budget Deadlock," Congressional Quarterly Weekly Report, July 13, 1985, pp. 1355-58; "Budget is Settled With President, Leaders Declare," New York Times, July 10, 1985, pp. A1, A14. [BACK]

22. Ibid. [BACK]

23. Jonathan Fuerbringer, "G.O.P. Rift Widens as Dole Criticizes Reagan and House," New York Times, July 13, 1985, p. 1. [BACK]

24. Ibid.; Calmes, "President Fails to Unsnarl Budget Deadlock." [BACK]

25. Calmes, "President Fails to Unsnarl Budget Deadlock." [BACK]

26. Jacqueline Calmes, "Budget Negotiations Collapse for Second Time," Congressional Quarterly Weekly Report, July 20, 1985, pp. 1413-15. [BACK]

27. Ibid. [BACK]

28. Ibid. [BACK]

29. Ibid. [BACK]

30. David Rogers, "Talks on Fiscal 1986 Budget Collapse; Agreement This Summer Seems Unlikely," Wall Street Journal, July 18, 1985, p. 48. [BACK]

31. Calmes, "Budget Negotiations Collapse for Second Time." [BACK]

32. Jonathan Fuerbringer, "New Senate Budget Plan Proposes Oil Import Fee," New York Times, July 26, 1985, p. B5. [BACK]

33. Pamela Fessler, "Filibuster Keeps Item Veto Off Senate Floor," Congressional Quarterly Weekly Report, July 20, 1985, p. 1415. [BACK]

34. Elizabeth Wehr, "Senate Budgeteers Tie Tax Hike to COLA Delay," Congressional Quarterly Weekly Report, July 27, 1985, pp. 1467-69. [BACK]

35. Jonathan Fuerbringer, "Senate Republicans Consider Dropping Attempt at Compromise on Budget," New York Times, July 24, 1985, p. A17. [BACK]

36. Ibid. [BACK]

37. Ibid. [BACK]

38. Janet Hook, "Medicare Savings Approved: $19 Billion Deficit-Reduction Package Wins Committee OK," Congressional Quarterly Weekly Report, July 27, 1985, pp. 1483-85. [BACK]

39. Fuerbringer, "New Senate Budget Plan"; Wehr, "Senate Budgeteers Tie Tax Hike to COLA Delay." [BACK]

40. Robert Pear, "Spending Freeze Gaining in House Despite Deadlock," New York Times, July 28, 1985, pp. A1, A25. [BACK]

41. Ibid. [BACK]

42. Jonathan Fuerbringer, "Reagan Rebuffs Senate on Budget," New York Times, July 30, 1985, pp. A1, A17. [BACK]

43. Gerald M. Boyd, "Republicans' Ties to Reagan Frayed by Budget Rebuff," New York Times, July 31, 1985, pp. A1, A13. [BACK]

44. Jacqueline Calmes, "Angry Senate Republicans Bear No Grudges," Congressional Quarterly Weekly Report, August 3, 1985, p. 1522. [BACK]

45. Ibid. [BACK]

46. Elizabeth Wehr, "Congress Cuts Budget by More Than $55 Billion," Congressional Quarterly Weekly Report, August 3, 1985, pp. 1520, 1523-24. [BACK]

47. Warren Rudman prepared a carefully crafted speech explaining his reasoning, on the Senate floor, August 2, 1986. [BACK]

48. Jonathan Fuerbringer, "Deficit Forecast Too Optimistic, Leaders Report," New York Times, August 3, 1985, pp. A1, A8. [BACK]

49. Elizabeth Wehr, "CBO Sees Hopeful Signs in Deficit Reduction," Congressional Quarterly Weekly Report, August 17, 1985, p. 1651. [BACK]

50. Steven V. Roberts, "Phil Gramm's Crusade Against the Deficit," New York Times Magazine, March 30, 1986, pp. 20-23, 40, 57, 60. [BACK]

51. Ibid. [BACK]

52. Jacqueline Calmes, "Gramm: Making Waves, Enemies, and History," Congressional Quarterly Weekly Report, March 15, 1986, p. 611-15. [BACK]

53. Ibid., p. 614. [BACK]

54. Allen Schick, Congress and Money (Washington, D. C.: Urban Institute, 1980), pp. 36-43. [BACK]

55. "The Senate's Anti-Deficit Duo," U.S. News and World Report, November 11, 1985, p. 15. [BACK]

56. Ibid. [BACK]

57. Interview with Senator Warren Rudman, April 14, 1986, Washington, D.C. [BACK]

58. Ibid. [BACK]

59. Dick Kirschten and Jonathan Rauch, "Political Poker Game Over Deficit Bill Calls Bluff of Reagan and Congress," National Journal, December 14, 1985, pp. 2857-58. [BACK]

60. Interviews with Thomas Dawson, Dennis Thomas, and Donald Regan at the White House, March 14 and July 15, 1986. See also Kirschten and Rauch, "Political Poker Game." [BACK]

61. Interviews with Dawson, Thomas, and Regan. [BACK]

62. Kirschten and Rauch, "Political Poker Game." [BACK]

63. "Symposium on Budget Balance: Do Deficits Matter?" New York City, January 9-11, 1986, sponsored by American Association of Retired Persons, American Stock Exchange, Avon Corporation, The Business Roundtable, Committee for a Responsible Federal Budget, General Foods Corporation, GTE Corporation, and the Kerr Foundation. Quote is on p. V-28; reporter Owen Ullman's remarks were made during Session VI discussion. [BACK]

64. Kirschten and Rauch, "Political Poker Game." [BACK]

65. Dick Kirschten, "White House Tests Legislative Flair on Risky Deficit-Reduction Measure," National Journal, October 19, 1985, pp. 2380-81. [BACK]

66. Congressional Quarterly Almanac 1985, Vol. 41 (Washington, D.C.: Congressional Quarterly Inc., 1986), p. 459 (hereafter CQA 1985). [BACK]

67. Elizabeth Wehr, "Support Grows for Balancing Federal Budget," Congressional Quarterly Weekly Report, October 5, 1985, p. 1977. [BACK]

68. Jonathan Fuerbringer, "Plan to Balance U.S. Budget by '91 Delayed in Senate," New York Times, October 5, 1985, pp. 1, 3. [BACK]

69. Ibid. [BACK]

70. Ibid. [BACK]

71. Jonathan Fuerbringer, "Senate Seeks Bar to Deficits By '91 in Bipartisan Vote," New York Times, October 10, 1985, pp. A1, B19. [BACK]

72. Ibid. [BACK]

73. Ibid. [BACK]

74. Jonathan Fuerbringer, "Leaders in Senate Reach Compromise On U.S. Debt Limit," New York Times, October 9, 1985, p. A1. [BACK]

75. Jacqueline Calmes, "Senate's Initiative Leaves Democrats Frustrated at Leadership, Republicans," Congressional Quarterly Weekly Report, October 12, 1985, pp. 2036-37. [BACK]

76. Interview in Washington, D.C., April 14, 1986. [BACK]

77. We wonder what would happen without informed staff! [BACK]

78. CQA 1985, p. 457. [BACK]

79. New York Times, October 24, 1985, p. 14. [BACK]

80. Calmes, "Gramm: Making Waves, Enemies, and History." [BACK]

81. Let us say that some authority (GAO?) calculated that outlays were too high and should be cut 5 percent. If 5 percent of new budget authority were sequestered for each program, project, or activity, the resulting outlay cuts would be very small for any slow-spend program (say buying aircraft carriers), and the total outlay cut for that year (though not over time) would be far below target. Alternatively, average translation of budget authority to outlays could be calculated. About two dollars of new budget authority creates one dollar in outlays each year. So 10 percent of all new budget authority could be sequestered, thereby saving the needed 5 percent of outlays. Here there are two problems: the budget authority cut is huge, and it hurts fast-spend programs such as personnel (and what use are tanks without someone to drive them?). That could be avoided by sequestering exactly enough in new budget authority for each account (or P/P/A) to meet the 5 percent outlay reduction target for that account. In personnel, that would be 5 percent of the budget authority, sensible enough. But in a procurement account most of that year's outlays derive from prior contracts. If these are protected on constitutional and practical grounds, saving 5 percent of outlays that year might require eliminating all new budget authority. [BACK]

82. Richard E. Cohen, "Balanced Budget Plan Forces House Democrats to Get Their Act Together," National Journal, November 16, 1985, pp. 2586-88. [BACK]

83. Jonathan Fuerbringer, "Democrats Would Exempt the Poor From Budget Ax," New York Times, October 30, 1985, p. B6. [BACK]

84. Steven V. Roberts, "Budget Battle: Democrats United Behind Party Plan," New York Times, November 2, 1985, p. 9; Cohen, "Balanced Budget Plan Forces House Democrats." [BACK]

85. Ibid. [BACK]

86. The most active were Representatives Aspin, Foley, Gephardt, Obey, Panetta, and Republican Trent Lott, together with Senators Chiles, Domenici, Gramm, Packwood, and Rudman. [BACK]

87. Elizabeth Wehr, "Gramm-Rudman Both Disappoints and Succeeds," Congressional Quarterly Weekly Report, November 15, 1987, pp. 2879-82. [BACK]

88. Elizabeth Wehr, "Bipartisan Budget Agreement Now Seems Likely," Congressional Quarterly Weekly Report, May 17, 1986, p. 1082. [BACK]

89. Elizabeth Wehr, "Bipartisanship vs. Election-Year Politics: Senate Restlessness May Signal Unique Cooperation on Budget," Congressional Quarterly Weekly Report, February 22, 1986, pp. 443-45. [BACK]

90. Ibid. [BACK]

91. Kirschten and Rauch, "Political Poker Game." [BACK]

92. The conference agreement explained it very differently: as a $20 billion maximum prorated for the fact that, as of March 1, 1986, only seven months remained in the fiscal year—thus seven-twelfths of $20 billion equals $11.7 billion. [BACK]

93. The deficit reduction timetable is slightly altered from Alice C. Maroni and Robert E. Foelber, "The Gramm-Rudman-Hollings Deficit Reduction Process (P.L. 99-177) and the Department of Defense: A Summary Review," Report No. 86-7, Congressional Research Service, January 6, 1986. [BACK]

94. Even more important to the tactics of GRH, appropriations for the coming year might not have been passed. So what do you sequester from? Essentially, from last year's levels; subsequent additions supposedly would be inhibited by points of order. [BACK]

95. Two complications in sequestration appear: the reductions in health programs were taken off the top (if, in our example, they were $2 billion, other defense and domestic would be cut $17 billion each, or $34 billion total). COLAs for federal retirement could be sequestered (though existing benefits could not), but it was hard to tell whether they were defense or domestic because they consisted of military, Pentagon civilian, and civilian agency retirees. Therefore, they credited any retirement COLA cuts half to the defense and half to the domestic sequester targets. [BACK]

96. As for the sources of spending, in any year the defense function (050) has at its disposal (1) new budget authority and old budget authority that (2) is obligated and (3) unobligated to be spent. The outlay base consists of outlays from new budget authority due to be spent that year, plus outlays generated from the prior year's obligated balances, plus new spending from previously unobligated balances. Conferees decided to sequester a new category called "budgetary resources"—all new budget authority, together with unobligated balances. (Obligated balances were left out because the government had already signed contracts to spend them.) This meant that all new budget authority (NBA) and unobligated balances would be sequestered, whether or not they caused outlays in that year. The percentage reduction for outlays is calculated as the amount needed, divided by the definition of the outlay base. That percentage is then applied to the budgetary resources, which are what is sequestered. So, in a personnel account, maybe $1.03 billion in budgetary resources exists with $1 billion in projected outlays. If a 10 percent outlay cut were needed, $103 million in resources would be cut. A procurement account with much greater BA than outlays would have a much larger difference between the BA sequestered and the outlay target, but the savings, though spread over a number of years, might well be less than the outlay target in the first year. [BACK]

97. After sequestration, however, presidents would retain whatever reprograming authority they had been able to exercise in the past, a practice based mostly on informal understandings with Congress. Gramm-Rudman-Hollings did nothing to change that whole gray area of appropriations law, in which the obligation of the executive to conform to any congressional instructions not engraved in law was very dubious. It remained to be seen whether GRH would drive Congress and the president into battle over a set of old understandings based largely on custom and without legal force. To continue describing the close monitoring of presidential performance: on September 5 the chief executive would submit a list of proposed changes in contracts to the Armed Services and Appropriations committees. At the end of the month, GAO would certify that savings stemming from sequestration of contracts were correct—if they were. [BACK]

98. Representative Mike Synar, who brought the suit, and his legal advisers, apparently guessed right in accepting the Senate's terms, hoping the district court rulings on which Senate staff relied would not hold. [BACK]

99. Elizabeth Wehr, "Ways and Means Bill Blocked: Trouble Brewing as Congress Moves to Reduce Spending," Congressional Quarterly Weekly Report, September 21, 1985, p. 1863. [BACK]

100. Stephen Gettinger, "Budget Leaders Force Cuts in Spending Bills," Congressional Quarterly Weekly Reports, October 5, 1985, p. 1984. [BACK]

101. Jonathan Fuerbringer, "Senate Approves Measure on Budget," New York Times, September 26, 1985, p. B10. [BACK]

102. Warren Weaver, "$100 Billion Tax Rise is Urged by Stockman," New York Times, September 30, 1985, p. D7. [BACK]

103. "Undue Process," The Economist, November 9, 1985, p. 32. [BACK]

104. "Conferees OK Legislative Spending," p. 2172; and Stephen Gettinger, "Senate Votes $9.9 Billion Transportation Bill," pp. 2172-73, Congressional Quarterly Weekly Report, October 26, 1985. [BACK]

105. Jacqueline Calmes, "House Passes, Senate Defers Major Deficit-Cutting Bills," Congressional Quarterly Weekly Report, October 26, 1985, pp. 2142-43, 2145-46. [BACK]

106. Jacqueline Calmes, "House Panels Surpass Deficit-Reduction Target," Congressional Quarterly Weekly Report, October 5, 1985, p. 1979; Calmes, "House Passes, Senate Defers." [BACK]

107. Federal Budget Report, October 29, 1985, p. 3. [BACK]

108. "Undue process." [BACK]

109. Diane Granat, "Adjournment Date Slips: Congress Hung Up on Deficit as Fiscal Crisis Week Arrives," Congressional Quarterly Weekly Report, November 9, 1985, pp. 2263-65. [BACK]

110. Jacqueline Calmes, "Up to $85 Billion in Savings Projected: Conferees Begin to Reconcile Versions of Deficit-Cutting Bill," Congressional Quarterly Weekly Report, December 7, 1985, pp. 2550-51. [BACK]

111. Jonathan Fuerbringer, "Congress Adopts Stopgap Measure on U.S. Spending," New York Times, December 13, 1985, pp. 1, B8; Elizabeth Wehr, "Congress Enacts Far-Reaching Budget Measure," Congressional Quarterly Weekly Report, December 14, 1985, p. 2604. [BACK]

112. Jonathan Fuerbringer, "'86 Spending Act Rejected in House," New York Times, December 17, 1985, p. B11. [BACK]

113. Ibid. [BACK]

114. Jonathan Fuerbringer, "Conferees Compromise on an '86 Spending Bill," New York Times, December 19, 1985, p. B22; Pat Towell, "Despite Decline in the Budget, Defense Programs Will Survive," Congressional Quarterly Weekly Report, December 28, 1985, pp. 2748-50. [BACK]

115. Fuerbringer, "Conferees Compromise on an '86 Spending Bill"; Jonathan Fuerbringer, "Congress Reaches Impasse on Plan to Reduce Deficit," New York Times, December 20, 1985, pp. 1, D6. [BACK]

116. Here is a brief listing of some of the hundreds of subjects—some controversial and others mundane—the bill addressed, many of which had little to do with deficit reduction; because the House amended the bill and returned it to the Senate, it is technically still alive though perhaps brain-dead.

—routine extension of several housing programs;

—a requirement that the Transportation secretary withhold 10 percent of highway funds starting in fiscal 1989 from states that have not set their minimum drinking age at 21;

—an instruction to build three highway bridges over the Ohio River between designated points in Ohio and Kentucky;

—a plan to allocate to Gulf Coast states billions of dollars from oil and gas drilling on the Outer Continental Shelf;

—extensive overhaul of medicare, including changes in the 1983 law that set up a new prospective reimbursement system for hospital fees to limit costs;

—extension of the right to social security benefits to children adopted by and living with their great-grandparents;

—eligibility of Connecticut state policy for social security;

—an increase in the federal excise tax on domestically mined coal to finance the black lung disability trust fund and a waiver for five years of interest payments on the funds' indebtedness.

Richard E. Cohen, "Congressional Focus," National Journal, January 11, 1986, p. 110. [BACK]

117. Jacqueline Calmes, "Deficit-Reduction Bill Goes Down to the Wire," Congressional Quarterly Weekly Report, December 21, 1985, pp. 2669, 2671-72. [BACK]

118. Steven V. Roberts, "Many in Congress Say Session of '85 Was Unproductive," New York Times, December 22, 1985, pp. 1, 26. [BACK]

119. Ibid. [BACK]

120. "President Bars a Tax Increase," New York Times, December 22, 1985, p. A34. [BACK]

121. Jonathan Rauch, "Politics of Deficit Reduction Remains Deadlocked Despite Balanced Budget Act," National Journal, January 4, 1986, pp. 15-21. [BACK]

122. Jeffrey L. Sheler, "Budget Skirmishing Begins," U.S. News and World Report, February 3, 1986, pp. 20-21. [BACK]

123. Jacqueline Calmes, "Congress May Revive Deficit-Reduction Bill," Congressional Quarterly Weekly Report, January 18, 1986, p. 106. [BACK]

124. Pat Towell, "Advisory Panel Backs Pentagon Reorganization," Congressional Quarterly Weekly Report, March 1, 1986, pp. 495-96. [BACK]

125. Stephen Gettinger and CQWR staff, "Deficit-Reduction Bill's Tortuous Journey Ends," Congressional Quarterly Weekly Report, April 5, 1986, pp. 751-68. [BACK]

126. Stephen Gettinger, "$18 Billion Deficit-Reduction Measure Clears," Congressional Quarterly Weekly Report, March 22, 1986, p. 682; Gettinger et al., "Deficit-Reduction Bill's Tortuous Journey Ends." [BACK]

127. "Inside Washington," National Journal, April 19, 1986, p. 923. [BACK]

128. Gettinger, "$18 Billion Deficit-Reduction Measure Clears." [BACK]

129. Gettinger et al., "Deficit-Reduction Bill's Tortuous Journey Ends." [BACK]

1. Numbers are from Tables 1.2 and 2.1 in Individual Income Tax Returns: 1984, Statistics of Income Division, Internal Revenue Service Publication 1304 (Rev. 11-86). These are estimates based on IRS surveys. [BACK]

2. Ibid. The cutoff line here is adjusted gross incomes of $40,000 or more, hardly a definition of great wealth. See also John Witte, The Politics and Development of the Federal Income Tax (Madison: University of Wisconsin Press, 1985). [BACK]

3. Barrett, Gambling with History, p. 55. [BACK]

4. Eileen Shanahan, "Senate Tax Debate Opens to Raves ... Mostly," Congressional Quarterly Weekly Report, June 7, 1986, p. 1255-57. [BACK]

5. Paul R. McDaniel and Stanley S. Surrey, International Aspects of Tax Expenditures: A Comparative Study (Deventer, The Netherlands: Kluwer Law and Taxation Publishers, 1985); and McDaniel and Surrey, Tax Expenditure (Cavibridge, Mass.: Harvard University Press, 1985). For opposing views, see Aaron Wildavsky, "Keeping Kosher: The Epistemology of Tax Expenditures," Journal of Public Policy 5, no. 3 (1986), pp. 413-31. [BACK]

6. Joseph Pechman, Henry J. Aaron, Harvey Galper, George L. Perry, Alice M. Rivlin, and Charles L. Schultze, Economic Choices 1987 (Washington, D.C.: Brookings Institution, 1986). [BACK]

7. Jeffrey Birnbaum, "Tax Bill Saga: How a Pre-Emptive Political Step Became a Plan to Restructure Taxation in the U.S.," Wall Street Journal, June 4, 1986, p. 56. Bill Veeck, the famed owner of baseball teams (Cleveland Indians, St. Louis Browns, Chicago White Sox) appears to be the person who dreamed up depreciating players. [BACK]

8. Timothy Clark, "Strange Bedfellows," National Journal, February 2, 1985, pp. 251-56. [BACK]

9. Ibid. [BACK]

10. Birnbaum, "Tax Bill Saga." [BACK]

11. For Roberts's view of the world, see his The Supply-Side Revolution (Cambridge, Mass.: Harvard University Press, 1984). [BACK]

12. Clark, "Strange Bedfellows." [BACK]

13. Jeffrey H. Birnbaum, "Senate Opens Debate on Tax Overhaul; Bill's Passage Expected Within 3 Weeks," Wall Street Journal, June 5, 1986, p. 3. [BACK]

14. Pamela Fessler, "Laying the Groundwork: Special Interests Now Working on Next Year's Tax Legislation," Congressional Quarterly Weekly Report, April 28, 1984, p. 953. [BACK]

15. The Kemp-Kasten 24 percent included an exclusion for 20 percent of wages subject to social security tax. For a comparison of proposals, see Ronald Brownstein, "Wagering on Tax Reform," National Journal, February 2, 1985, pp. 245-50. [BACK]

16. Robert Hall and Alvin Rabushka, Low Tax, Flat Tax (New York: McGraw-Hill, 1983). [BACK]

17. Clark, "Strange Bedfellows"; Timothy B. Clark, "GOP platform edges closer to pledging no increase in taxes," National Journal, August 18, 1984, p. 1555. [BACK]

18. Text of 1984 Democratic party platform, Congressional Quarterly Weekly Report, July 21, 1984, pp. 1747-80. [BACK]

19. Nadine Cohodas, "Solidly Conservative Platform Ready for Adoption By GOP," Congressional Quarterly Weekly Report, August 18, 1984, p. 2023. [BACK]

20. Text of 1984 Republican party platform, Congressional Quarterly Weekly Report, August 25, 1984, pp. 2096-2117. [BACK]

21. Clark, "Strange Bedfellows." [BACK]

22. Birnbaum, "Tax Bill Saga," p. 56. [BACK]

23. Clark, "Strange Bedfellows." [BACK]

24. Birnbaum, "Tax Bill Saga." [BACK]

25. Timothy Clark, "Business Hit Hardest Under Treasury Tax Plan," National Journal, December 1, 1984, p. 2312. [BACK]

26. Ronald Brownstein, "Wagering on Tax Reform," National Journal, February 2, 1985, p. 245; Clark, "Business Hit Hardest"; Pamela Fessler, "Members Await Details of Tax Code Revision," Congressional Quarterly Weekly Report, February 16, 1985, pp. 301-2. [BACK]

27. Jeffrey H. Birnbaum and Alan S. Murray, Showdown at Gucci Gulch: Law makers, Lobbyists, and the Unlikely Triumph of Tax Reform (New York: Random House, 1987), pp. 49-50. [BACK]

28. Ibid., pp. 48-54. [BACK]

29. Steven Pressman, "President Scores for Oratory, but Skepticism Remains on Hill," Congressional Quarterly Weekly Report, February 9, 1985, pp. 274-75. [BACK]

30. "Schedule Uncertain for Tax Reform," Congressional Quarterly Weekly Report, February 2, 1985, p. 168; Birnbaum, "Tax Bill Saga." [BACK]

31. "A Call for a 'Second American Revolution': President Reagan's State of the Union Address," Congressional Quarterly Weekly Report, February 9, 1985, pp. 267-70. [BACK]

32. Elder Witt, "Arguments Set for February 19," Congressional Quarterly Weekly Report, February 16, 1985, pp. 307, 309. [BACK]

33. Ibid. [BACK]

34. Pamela Fessler, "Key is Presidential Backing," Congressional Quarterly Weekly Report, October 27, 1984, p. 2788. [BACK]

35. William Schneider, "Public Reluctant to Drop 'Unfair' Income Tax in Favor of Unknown Remedy," National Journal, December 29, 1984, p. 2462. Other polls show that the public either supports a flat, broader based lower rate tax compared to the present system or opposes it by small margins. Polls taken late in 1984 revealed widespread belief that the rich always escaped their fair share of taxes, that the ordinary person paid too much, and that the system was far too complicated. [BACK]

36. John Witte, Federal Income Tax. [BACK]

37. Pamela Fessler, "Successful Tax Code Overhaul Dependent on Reagan's Pitch," Congressional Quarterly Weekly Report, May 25, 1985, pp. 980-81. Ladd did warn that, because many people (48 percent according to an ABC/Washington Post poll in January 1985) had not heard of the Treasury Department's original reform proposal at the time that the public was being asked about hypothetical changes, opinion might alter dramatically. [BACK]

38. Text of Reagan press conference, Congressional Quarterly Weekly Report, January 12, 1985, pp. 88-91. [BACK]

39. Steven Pressman, "Familiar Themes, Programs: President Scores for Oratory, But Skepticism Remains on Hill," Congressional Quarterly Weekly Report, February 9, 1985, pp. 273, 275, 277. [BACK]

40. Pamela Fessler, "Rostenkowski Makes Pitch for Tax Overhaul," Congressional Quarterly Weekly Report, March 2, 1985, p. 399. [BACK]

41. Pamela Fessler, "Tax Overhaulers' Next Chore is Generating Public Support," Congressional Quarterly Weekly Report, March 30, 1985, p. 604. [BACK]

42. Susan S. Rasky, "Reagan Postpones Tax Push to Focus on Deficit," New York Times, July 5, 1985, p. D6. [BACK]

43. Timothy B. Clark, "Real Estate Industry, Other Corporate Losers Open Fire on Tax Proposals," National Journal, December 8, 1984, p. 2333. [BACK]

44. Pamela Fessler, "Senior Staff Changes at Tax-Writing Committees," Congressional Quarterly Weekly Report, January 19, 1985, p. 111; Pamela Fessler, "Fight to Reap the Political Advantage: Successful Tax Code Overhaul Dependent on Reagan's Pitch," Congressional Quarterly Weekly Report, May 25, 1985, pp. 980-81. [BACK]

45. Fessler, "Successful Tax Code Overhaul Dependent on Reagan's Pitch." [BACK]

46. Elizabeth Wehr, "Rostenkowski: A Firm Grip on Ways and Means," Congressional Quarterly Weekly Report, July 6, 1985, p. 1317. [BACK]

47. Ronald Grover, "Why Rostenkowski and Reagan are Playing Footsie," Business Week, September 16, 1985, p. 31. [BACK]

48. "Reagan's May 28 Address on Tax Reform," Congressional Quarterly Weekly Report, June 1, 1985, p. 1074. [BACK]

49. Birnbaum and Murray, Showdown at Gucci Gulch, p. 99. [BACK]

50. Pamela Fessler, "Tax Bill Markup Schedule Seen as Ambitious," Congressional Quarterly Weekly Report, September 14, 1985, pp. 1796-97. [BACK]

51. Richard E. Cohen, "Despite Misgivings, Finance Committee May Be Forced to Tackle Tax Reform Bill," National Journal, October 19, 1985, p. 2360. [BACK]

52. Pamela Fessler, "Members Find Little Support for 'Reform': Tax Panel Postpones Markup, Still Hopes to Report This fall," Congressional Quarterly Weekly Report, September 7, 1985, pp. 1744-45. [BACK]

53. Pamela Fessler, "Panel Votes Breaks for Banks, Charitable Gifts," Congressional Quarterly Weekly Report, October 19, 1985, p. 2102. [BACK]

54. Ibid., p. 2103. [BACK]

55. We should point out that the amendment easily could be argued to have preserved the financial integrity of banks. See Birnbaum and Murray, Showdown at Gucci Gulch, pp. 127-28. [BACK]

56. Ibid., p. 127. [BACK]

57. Ibid., p. 126. [BACK]

58. Ibid., pp. 126-35. [BACK]

59. Pamela Fessler, "State, Local Tax Deduction Could Be Retained," Congressional Quarterly Weekly Report, October 26, 1985, pp. 2140-41; Fessler, "Markup Nearly Half Finished: Panel Confident of Reporting Tax-Overhaul Measure This Fall," Congressional Quarterly Weekly Report, November 2, 1985, pp. 2197-99. [BACK]

60. Charles P. Alexander, "Trying to Stage a Tax-Reform Rally," Time, November 11, 1985, p. 68. [BACK]

61. Pamela Fessler, "Ways and Means Finishes Tax Code Overhaul," Congressional Quarterly Weekly Report, November 30, 1985, pp. 2483, 2485. [BACK]

62. Pamela Fessler, "Reagan Criticizes 'Waterings Down': Tax Code Rewrite Continues; Panel OKs Pension Revisions," November 9, 1985, pp. 2276-77; Fessler, "Tax Overhaul Measure Faces an Uncertain Future in the House," November 23, 1985, p. 2417; Fessler, "Success of Tax Bill in Doubt Despite Mild Reagan Support," December 7, 1985, p. 2546; all in Congressional Quarterly Weekly Report. [BACK]

63. "At a Glance—A Weekly Checklist of Major Issues," National Journal, December 7, 1985, p. 2827. [BACK]

64. Pamela Fessler, "GOP Defeats Attempt to Consider Tax Bill," Congressional Quarterly Weekly Report, December 14, 1985, pp. 2613-16. [BACK]

65. Pamela Fessler, "GOP Is Opposed, Democrats Are Split: Success for Tax Bill in Doubt Despite Mild Reagan Support," Congressional Quarterly Weekly Report, December 7, 1985, pp. 2543-46. [BACK]

66. Birnbaum and Murray, Showdown at Gucci Gulch, p. 160. [BACK]

67. Fessler, "GOP Defeats Attempt to Consider Tax Bill"; Birnbaum and Murray, Showdown at Gucci Gulch, pp. 164-65. [BACK]

68. Ibid. [BACK]

69. Pamela Fessler, "House Reverses Self, Passes Major Tax Overhaul," Congressional Quarterly Weekly Report, December 21, 1985, p. 2705. [BACK]

70. "At a Glance—A Weekly Checklist of Major Issues," National Journal, December 21, 1985, p. 2935. [BACK]

71. Fessler, "House Reverses Self." [BACK]

72. Dick Kirschten, "Tax Reform Dodges Another Bullet, But May Have Winged the GOP," National Journal, December 21, 1985, pp. 2918-19. [BACK]

73. Ibid. [BACK]

74. Pamela Fessler, "Finance Panel Moves Toward Tax Bill Markup," Congressional Quarterly Weekly Report, March 8, 1986, p. 545; and Stephen Gettinger, "Measure's Savings Now $18.1 Billion: Deficit-Cutting Bill Amended, But Future Action is Uncertain," Congressional Quarterly Weekly Report, March 8, 1986, pp. 544-45. [BACK]

75. Elizabeth Wehr, "Budget Puts Congress in a Combative Mood," Congressional Quarterly Weekly Report, February 8, 1986, p. 219. [BACK]

76. David Rosenbaum, "Senate Puts Budget Effort Ahead of Tax Revision," New York Times, April 11, 1986, p. A1. [BACK]

77. David Rosenbaum, "The Senate Seems to be Going Along to Get Along," New York Times, February 2, 1986, p. A7. [BACK]

78. Pamela Fessler, "Finance Markup Completion Target Is May 1," Congressional Quarterly Weekly Report, January 25, 1986, pp. 142-44; Fessler, "Finance Panel Moves Toward Tax Bill Markup." [BACK]

79. Rosenbaum, "Senate Seems to be Going Along to Get Along." [BACK]

80. David Rosenbaum, "Panel Set to Defeat Bond Tax: Packwood's Plan Opposed by Senators," New York Times, March 21, 1986, pp. D1, D5. [BACK]

81. Timothy Clark, "Divided They Stand," National Journal, April 19, 1986, pp. 929-39. [BACK]

82. Pamela Fessler, "Finance Panel Suspends Markup of Tax Bill," Congressional Quarterly Weekly Report, April 19, 1986, p. 840. [BACK]

83. Ibid. [BACK]

84. Timothy Clark, "Forget Simplicity: Let's Make a Deal," National Journal, April 26, 1986, p. 1008. [BACK]

85. Jeffrey Birnbaum, "Packwood's Route to Triumph," Wall Street Journal, May 9, 1986, p. 54. [BACK]

86. Pamela Fessler, "Finance Committee Studies Two-Rate Tax Plan," Congressional Quarterly Weekly Report, April 26, 1986, p. 900. [BACK]

87. Daniel P. Moynihan, "Special Report" (newsletter to constituents), June 1986. [BACK]

88. Ibid. [BACK]

89. Jacqueline Calmes, "Bob Packwood: A Tax Reform Convert," Congressional Quarterly Weekly Report, May 10, 1986, p. 1011. [BACK]

90. Ibid. [BACK]

91. Birnbaum and Murray, Showdown at Gucci Gulch, p. 205. [BACK]

92. Ibid., p. 207. [BACK]

93. Packwood speech, Congressional Record, June 4, 1986, p. S6719. [BACK]

94. Moynihan, "Special Report." [BACK]

95. Packwood speech, Congressional Record, June 4, 1986, p. S6719. See also Robert D. Hershey, Jr., "Tax Bill's Key Numbers Man," New York Times, January 3, 1986, p. D1. [BACK]

96. Moynihan, "Special Report." [BACK]

97. Birnbaum, "Packwood's Route to Triumph." [BACK]

98. Packwood speech, Congressional Record, June 4, 1986, p. S6719. [BACK]

99. Moynihan, "Special Report." [BACK]

100. See Birnbaum and Murray, Showdown at Gucci Gulch, p. 219. [BACK]

101. Pamela Fessler, "Packwood Promises New Plan May 5: Tax Bill Consensus Claimed, But Some Members Skeptical," Congressional Quarterly Weekly Report, May 3, 1986, pp. 962-63. [BACK]

102. Calmes, "Bob Packwood." [BACK]

103. Eileen Shanahan, "Finance Panel OKs Radical Tax Overhaul Bill," Congressional Quarterly Weekly Report, May 10, 1986, p. 1007. [BACK]

104. Fessler, "Finance Committee Studies Two-Rate Plan." [BACK]

105. Birnbaum and Murray, Showdown at Gucci Gulch, pp. 227-28. [BACK]

106. Ibid., p. 230. [BACK]

107. Ibid., p. 129. [BACK]

108. Moynihan, "Special Report." [BACK]

109. Packwood speech, Congressional Record, June 4, 1986, p. 3. [BACK]

110. Jeffrey Birnbaum, "Radical Tax Overhaul Now Seems Probable," Wall Street Journal, May 8, 1986, pp. 1, 3. [BACK]

111. Ibid. [BACK]

112. Ibid. [BACK]

113. Elizabeth Wehr, "Tax Bill Could Face Procedural Hurdles on Senate Floor," p. 1013; Eileen Shanahan, "Finance Panel OKs Radical Tax Overhaul Bill," pp. 102-13, 1007-10. See also chart, "Evolution of Proposals to Overhaul the Tax Code," Congressional Quarterly Weekly Report, August 23, 1986, p. 1948. [BACK]

114. Eileen Shanahan, "Tax Debate Keys on Economic Consequences," Congressional Quarterly Weekly Report, May 17, 1986, pp. 1093, 1095. [BACK]

115. Timothy Clark and Richard Cohen, "Tax Reform Locomotive," National Journal, May 31, 1986, p. 1301. [BACK]

116. Jeffrey Schwartz, "NY Leaders Split on Tax Bill," New York Times, May 7, 1986, pp. 32, 37. [BACK]

117. David Rosenbaum, "A Linking of Tax Reform to Budget," New York Times, May 13, 1986, pp. D1, D11. [BACK]

118. Jeffrey H. Birnbaum, "Dole Asserts Tax Bill Is 'Unstoppable,' Will Be on Reagan's Desk by Labor Day," Wall Street Journal, June 3, 1986, p. 3. [BACK]

119. Eileen Shanahan, "Senate Nears Tax Bill Passage," Congresssional Quarterly Weekly Report, June 14, 1986, p. 1313. [BACK]

120. GRH said that any amendment to legislation on the floor of the Senate that would raise the deficit would be subject to a point of order. Because there was no budget resolution, there was no "deficit" number to be increased, so the provision was not technically in force. But the norm, far more important than the formal procedure, remained. [BACK]

121. Jeffrey H. Birnbaum, "Senate, Leaving Tax Plan Intact, Rejects Proposal to Retain Sales-Tax Deduction," Wall Street Journal, June 13, 1986, pp. 3, 5. [BACK]

122. Timothy B. Clark, "Bill's Biggest Boom is to Working Poor," National Journal, July 12, 1986, p. 1730. [BACK]

123. It "looks like a rich man's out," Speaker O'Neill complained. "It's a mighty loophole for the wealthy of America" (Birnbaum, "Senate, Leaving Tax Plan Intact"). [BACK]

124. Shanahan, "Senate Nears Tax Bill Passage"; Timothy B. Clark, "Taxation—Resolving the Differences," National Journal, July 5, 1986, pp. 1658-65. [BACK]

125. Shanahan, "Senate Nears Tax Bill Passage." [BACK]

126. Here, as elsewhere in matters not central to our story, we are barely able to hint at the complexity of the considerations. [BACK]

127. Birnbaum, "Senate Opens Debate on Tax Overhaul." [BACK]

128. David E. Rosenbaum, "Senate Rejects a Tax Amendment to Benefit Middle-Income People," New York Times, June 19, 1986, pp. A1, B8. [BACK]

129. Birnbaum and Murray, Showdown at Gucci Gulch, p. 246. [BACK]

130. Eileen Shanahan, "Christmas Presents Beginning to Pile Up: Panel's Tax Bill Largely Intact As Senate Nears Final Passage," Congressional Quarterly Weekly Report, June 21, 1986, pp. 1377-79; Birnbaum and Murray, Showdown at Gucci Gulch, p. 251. [BACK]

131. Timothy Clark and Richard E. Cohen, "Resolving the Differences," National Journal, July 5, 1986, p. 1662. [BACK]

132. Eileen Shanahan, "Tax Reform Warmup: Harmony on Some Points," Congressional Quarterly Weekly Report, July 12, 1986, pp. 1566-68. [BACK]

133. Birnbaum and Murray, Showdown at Gucci Gulch, p. 258. [BACK]

134. Ibid., p. 259. [BACK]

135. Shanahan, "Tax Reform Warmup"; David Rosenbaum, "A Tentative Tax-Rate Accord," New York Times, July 26, 1986, p. 35. [BACK]

136. Jeffrey H. Birnbaum, "Senate Tax Conferees React Negatively To House Plan to Lift Corporate Taxes," Wall Street Journal, August 1, 1986, p. 3. [BACK]

137. Eileen Shanahan, "Corporate Hit Could Sidetrack Tax Conference," Congressional Quarterly Weekly Report, November 2, 1986, p. 1228. [BACK]

138. David E. Rosenbaum, "House Team Sets Strategies for Bargaining," New York Times, July 31, 1986, p. D1. [BACK]

139. "Tax Reform, Last Lap or Last Legs," editorial, New York Times, August 8, 1986, p. A26. [BACK]

140. Birnbaum and Murray, Showdown at Gucci Gulch, pp. 264-67. [BACK]

141. Jeffrey H. Birnbaum, "Tax Conferees Reach Impasse on Overhaul," Wall Street Journal, August 13, 1986, pp. 3, 14. [BACK]

142. David Rosenbaum, "Tax Conferees Divided: Chairman Seeks Accord," New York Times, August 13, 1986, pp. D1, D6. [BACK]

143. David Rosenbaum, "Chairmen Hit a Snag on Tax Bill: Face Shortfall of $17 Billion Over 5 Years," New York Times, August 15, 1986, pp. D1, D2. [BACK]

144. Birnbaum and Murray, Showdown at Gucci Gulch, pp. 273-76. [BACK]

145. David Rosenbaum, "Accord on Taxes Has Been Reached, Packwood Says," New York Times, August 16, 1986, p. 1. [BACK]

146. Tom Redburn and Michael Wines, "Tax Accord Achieved, Top Conferee Declares," Los Angeles Times, August 16, 1986, pp. 1, 22. [BACK]

147. Rosenbaum, "Accord on Taxes Has Been Reached"; Redburn and Wines, "Tax Accord Achieved." [BACK]

148. Robin Toner, "Behind the Scenes in Tax Bill Drama," New York Times, August 16, 1986, pp. 35, 37. [BACK]

149. Jeffrey H. Birnbaum, "What's Next? In Turning to Deficit, Congress May Tinker With the Taxes Again," Wall Street Journal, August 18, 1986, pp. 1, 10. [BACK]

150. Ibid. [BACK]

151. E. J. Dionne, Jr., "Political Memo: For Richer, for Poorer, in Taxes and Ideology," New York Times, August 22, 1986, p. A10. [BACK]

152. Robin Toner, "Elation and Nostalgia on Capitol Hill," New York Times, August 18, 1986, p. B10. [BACK]

153. Peter J. Kilborn, "A Reagan-Style Bill," New York Times, August 18, 1986, p. A1. [BACK]

154. Albert Scardino, "Realty Woes Seen in Tax Bill," New York Times, August 26, 1986, p. D5. [BACK]

155. Leslie Maitland Werner, "Educators See Great Harm; Large Cut in Gifts Feared," New York Times, August 21, 1986, p. D15. [BACK]

156. Linda Greenhouse, "Danforth Promises Determined Battle," New York Times, August 20, 1986, p. D10. [BACK]

157. "U.S. Tax Bill May Force New York To Cut Housing and Public Works," Bruce Lambert, "Bond Costs Likely to Rise," and Eric N. Berg, "Entrepreneur Curb Seen," all in New York Times, August 20, 1986, p. 1. [BACK]

158. Jeffrey H. Birnbaum, "Tax-Overhaul Vote Represents Moment of Truth for GOP as It Tries to Shed Big Business Image," Wall Street Journal, September 12, 1986, p. 50; Eileen Shanahan, "Despite Skeptics, House Eases Way for Tax Bill," Congressional Quarterly Weekly Report, September 13, 1986, p. 2118. [BACK]

159. Eileen Shanahan, "Time and Numbers Work Against It: Discontent Grows Over Tax Bill as House Prepares for Final Vote," Congressional Quarterly Weekly Report, September 20, 1986, p. 2183. [BACK]

160. Douglas Harbrecht, "350 exemptions in final tax accord," San Francisco Examiner, September 19, 1986, p. A3. [BACK]

161. David Rosenbaum, "A G.O.P. Effort to Block Tax Bill Is Frustrated," New York Times, September 25, 1986, p. D1. [BACK]

162. Thomas Oliphant, "House passes tax revision bill," Boston Globe, September 26, 1986, pp. 1, 13. [BACK]

163. Ibid. [BACK]

164. Ann Swardson, "Senate OKs Tax Overhaul," Oakland Tribune, September 28, 1986, pp. 1, 8. [BACK]

165. National Journal, November 22, 1986, p. 2854. [BACK]

166. Swardson, "Senate OKs Tax Overhaul." [BACK]

167. Stephen V. Roberts, "How Tax Bill Breezed Past, Despite Wide Doubts," New York Times, September 26, 1986, p. A20. [BACK]

168. Eileen Shanahan, "It May Be Tax Reform, but Will It Last?" Congressional Quarterly Weekly Report, August 30, 1986, p. 2053. [BACK]

169. Julie Kostervitz, "Broad Coalition Prepares to Do Battle on Taxing Employee Fringe Benefits," National Journal, May 4, 1985, p. 956. [BACK]

170. Janet Hook, "Issue of Fringe-Benefit Taxes Only Partly Defused by Reagan," Congressional Quarterly Weekly Report, June 8, 1985, pp. 1099-1101. [BACK]

171. Pamela Fessler and Steven Pressman, "Tax Overhaul: The Crucial Lobby Fight of 1985," Congressional Quarterly Weekly Report, March 9, 1985, p. 450. [BACK]

172. Timothy Clark, "At Grass Roots, Not Much Groundswell of Support for Reagan's Tax Reform," National Journal, July 27, 1985, p. 1738. [BACK]

173. Nadine Cohodas, "Battle Looms Over State, Local Tax Issue," Congressional Quarterly Weekly Report, June 1, 1985, p. 1041. [BACK]

174. Robert Rothman, "Reagan Critics Praise Tax Cut for the Poor," Congressional Quarterly Weekly Report, July 6, 1985, p. 1323; Joann S. Lublin, "Amid Debates Over Tax Preferences for the Rich, Lawmakers Agree on Sweeping Relief for the Poor," Wall Street Journal, May 23, 1986, p. 40. [BACK]

175. A word of caution is in order. Most people of modest means pay not income but social security taxes. The percentage reduction in income tax under the tax reform passed by the Senate is substantially but by no means entirely reduced when combined into a grand total with social security. Thus, those who earn between $10,000 and $20,000 annually see their reduction lowered from 20.1 percent on income tax alone to 12.9 percent when social security is figured in. However, when the earned income tax credit is added in, many working poor will receive rebates that they can subtract from their social security payments. [BACK]

176. Timothy Clark, "How to Succeed Against Business," National Journal, May 3, 1986, p. 1059. [BACK]

177. Jeffrey H. Birnbaum, "Reborn Bill: Radical Tax Overhaul Now Seems Probable As Senate Panel Acts," Wall Street Journal, May 8, 1986, pp. 1, 22. [BACK]

178. Fessler and Pressman, "Tax Overhaul: The Crucial Lobby Fight of 1985." [BACK]

179. Inside the Administration, May 29, 1986. This weekly newspaper is an Inside Washington Publication. [BACK]

180. Robert Rothman, "Construction Down, Cost Up: Real Estate Industry Predicts Dire Harm From Reagan Plan," Congressional Quarterly Weekly Report, August 31, 1985, pp. 1707-10. [BACK]

181. Nadine Cohodas, "Other Justice-Related Spending Up Slightly; Law Enforcement Spending Remains Level," Congressional Quarterly Weekly Report, February 2, 1985, p. 250. [BACK]

182. Ann Cooper, "New Business Coalition Wants to Keep the Ball Rolling on Reagan's Tax Reform," National Journal, July 20, 1985, pp. 1675-79. [BACK]

183. Jeffrey Birnbaum, "Tax Bill Saga: How a Pre-Emptive Political Step Became a Plan to Restructure Taxation in the U.S.," Wall Street Journal, June 4, 1986, p. 56. [BACK]

184. Brooks Jackson and Monica Langley, "Lobbyists Take Aim at Conference Panel To Get Favors in Final Tax Overhaul Bill," Wall Street Journal, June 25, 1986, p. 24. [BACK]

185. Eileen Shanahan, "Tax Debate Keys on Economic Consequences," Congressional Quarterly Weekly Report, May 17, 1986, p. 1095. [BACK]

1. Congressional Budget Office, "Reducing the Deficit: Spending and Revenue Options," Report to the Senate and House Committees on the Budget—Part II, March 1986, pp. 4-7 [BACK]

2. Stephen Gettinger, "Reagan Budget Projects $143.6 Billion Deficit," Congressional Quarterly Weekly Report, February 8, 1985, p. 246. [BACK]

3. The Reagan administration wanted to eliminate or phase out the following programs: air service subsidies to communities for service lost through deregulation; Agency for International Development housing guarantees—phase out beginning in 1987; Agricultural Stabilization and Conservation Service cost-sharing; Amtrak—end in 1987; Appalachian Regional Commission; Carl Perkins scholarships for high school graduates interested in teaching; categorical aid to migrant health centers, black-lung clinics, and family-planning clinics, to be wrapped into a block grant program; coastal zone management state grant program; college housing loans—phase out beginning in 1987; commercial fishing industry assistance; Community Services Block Grant; crop insurance subsidies—phase out by 1991; Economic Development Administration; energy conservation grants and state energy planning and extension programs; Environmental Protection Agency loans for asbestos removal; Federal Housing Administration—develop proposals in 1987 to turn agency over to private sector; Farmers Home Administration housing and rural aid programs, wrapped into the Department of Housing and Urban Development (HUD); GI enhanced recruitment bill (PL 98-525); graduate education programs, including fellowships for women and minorities and for law and public service students; HUD grants for rental housing development and rehabilitation, rental rehabilitation loans, and new subsidized housing construction; immigrant education; Impact Aid Part B for schools serving U.S. employees' children; Interstate Commerce Commission; Legal Services Corporation; library aid, for public library research and librarian training; Justice Department grants for juvenile justice, state and local aid; Mariel Cubans and regional information sharing system programs—turned over to states to run with no federal funding; maritime subsidies—ship construction loan guarantees, aid to six state maritime schools, research and development (after 1987), and the cargo preference requirement included in the 1985 farm bill (PL 99-198); National Sea Grant college program; Postal Service subsidy; Public Health Service training grants; railroad rehabilitation loans—phase out beginning in 1987; rail service assistance to states; revenue sharing—end in 1987; Rural Electrification Administration; Soil Conservation Service programs on private lands, including the small watershed program; Small Business Administration credit assistance programs; State Student Incentive Grants; Tennessee Valley Authority regional economic programs; Urban Development Action Grants; U.S. Travel and Tourism Administration; waste treatment construction grants—phase out by 1990; Work Incentive Program (WIN) for adults receiving benefits under Aid to Families with Dependent Children. [BACK]

4. Stephen H. Wildstron, Richard Fly, and Ronald Grover, "The Budget Has a Fighting Chance," Business Week, February 17, 1986, pp. 30-32. [BACK]

5. Jonathan Rauch, "In Uncharted Waters," National Journal, February 8, 1986, pp. 312-17. [BACK]

6. Pamela Fessler, "Reagan's Economic Forecast Attacked as Excessively Rosy," Congressional Quarterly Weekly Report, February 8, 1986, p. 283. [BACK]

7. Jonathan Rauch, "Zero-Sum Budget Game," National Journal, May 10, 1986, p. 1099. [BACK]

8. Ibid., p. 1097. [BACK]

9. Ibid. [BACK]

10. Rauch, "In Uncharted Waters." [BACK]

11. Stephen Gettinger, "House OKs Democratic Budget for Fiscal 1987," Congressional Quarterly Weekly Report, May 17, 1986, pp. 1079-80. [BACK]

12. Lee Walczak, Stephen H. Wildstrom, Richard Fly et al., "Is a Tax Hike Coming?" Business Week, February 3, 1986, pp. 48-53. [BACK]

13. Stephen Gettinger, "Budget Panel Uses New Taxes to Cut Deficit," Congressional Quarterly Weekly Report, May 10, 1986, pp. 1061, 1063-64. [BACK]

14. "Senate, House Committee FY 1987 Budget Resolutions," Congressional Quarterly Weekly Report, May 10, 1986, p. 1062. [BACK]

15. Gettinger, "House OKs Democratic Budget"; Stephen Gettinger, "The Making of the Democrats' Budget: A New Conservative-Liberal Coalition," Congressional Quarterly Weekly Report, May 17, 1986, pp. 1080-81. [BACK]

16. Jeffrey H. Birnbaum, "Senate Tax Bill Is Seen Passing Before Friday," Wall Street Journal, June 17, 1986, p. 3. [BACK]

17. David Rogers, "Conferees May Limit Defense Outlays Until Revenues in '87 Budget Are Raised," Wall Street Journal, June 11, 1986, p. 22. [BACK]

18. David Shribman, "Conferees Consider New '87 Budget Plan Limiting Defense Cuts, Adding Revenues," Wall Street Journal, June 16, 1986, p. 41. [BACK]

19. Ronald Grover, "Showdown Time for Gramm-Rudman," Business Week, January 10, 1986, p. 22. [BACK]

20. Elizabeth Wehr, "Court Strikes Down Core of Gramm-Rudman," Congressional Quarterly Weekly Report, July 12, 1986, p. 1559, 1562-63. [BACK]

21. "Supreme Court's Gramm-Rudman Opinion," Congressional Quarterly Weekly Report, July 12, 1986, p. 1581-83. [BACK]

22. Elder Witt, "Court Sees Fatal Gramm-Rudman Flaw in Power Given to Comptroller General," Congressional Quarterly Weekly Report, July 12, 1986, pp. 1560-61. [BACK]

23. "Supreme Court's Gramm-Rudman Opinion." [BACK]

24. Jonathan Fuerbringer, "Congress Ratifies Spending Cuts," New York Times, July 18, 1986, p. A1. [BACK]

25. Paul Blustein, "White House Raises Deficit Projection For 1986 but Sees Improvement in 1987," Wall Street Journal, August 7, 1986, p. 3. [BACK]

26. Elizabeth Wehr, "Gramm-Rudman Repair Effort Stumbles on Mistrust of OMB," Congressional Quarterly Weekly Report, July 26, 1986, p. 1682. [BACK]

27. David Rogers, "Senate Acts to Change Gramm-Rudman Law to Allow Automatic Spending Cuts," Wall Street Journal, July 31, 1986, p. 12. [BACK]

28. Stephen Gettinger, "Gramm-Rudman Deficit Target Is in Sight," Congressional Quarterly Weekly Report, August 23, 1986, pp. 1943-46. [BACK]

29. Ibid. The major differences between CBO and OMB estimates came from accounting for pay raises and estimates of entitlements. OMB assumed that the Department of Agriculture would not make $5.1 billion of advance price supports in spring 1987 and that spend-out rates for defense would be $5.2 billion slower than CBO thought. [BACK]

30. Paul Blustein, "Report Shows 1987 Budget Must Shrink By $9.4 Billion to Avoid Automatic Cuts," Wall Street Journal, August 20, 1986, p. 5; Symposium on Budget Balance, discussion by Dr. Rudolph Penner, director of CBO, January 9-11, 1986, pp. 10-31. [BACK]

31. Richard E. Cohen, "Tax Plum Fueling Budget Fight," National Journal, August 30, 1986, pp. 2068-69. [BACK]

32. Inside the Administration, August 14, 1986, pp. 1-2. [BACK]

33. David Shribman, "Across-the-Board Cuts Called Unlikely As Gramm-Rudman Process Is Launched," Wall Street Journal, September 12, 1986, p. 21. [BACK]

34. Memo to Committee for a Responsible Federal Budget, as reported in that committee's memorandum/newsletter to board and members, September 19, 1986. This memorandum/newsletter is mailed periodically to Board and Members of the Committee. [BACK]

35. Presidential spokesman Larry Speakes quoted in Jonathan Fuerbringer, "Reagan Threatens Veto of Spending Bills for 1987," New York Times, September 17, 1986, p. A22. [BACK]

36. Jeffrey H. Birnbaum and John E. Yang, "Ways and Means Panel Balks at Raising Taxes to Meet Gramm-Rudman Targets," Wall Street Journal, September 17, 1986, p. 3. [BACK]

37. Federal Budget Report, September 9, 1986, pp. 3-4; Jonathan Fuerbringer, "Accord is Tentatively Reached on Cutting Deficit," New York Times, September 19, 1986, p. A30. [BACK]

38. Jonathan Fuerbringer, "Senate Approves $13.3 Billion Plan to Cut '87 Deficit," New York Times, September 20, 1986, p. 1. [BACK]

39. What Jack Brooks called "gimmickry of the worst kind" included a new $1.83 billion customs fee (illegal under the General Agreement on Tariff and Trade because it far exceeded the cost of collection), better enforcement by the IRS, and a $1 billion across-the-board cut to be taken equally from domestic and defense programs. These provisions were ostensibly large enough to compensate for expansion of medicaid coverage and a drop in the previously scheduled increase in medicare deductibles. Jonathan Fuerbringer, "House, 309 to 106, Votes Plan to Cut Deficit $15 Billion," New York Times, September 25, 1986, pp. 1, B11. [BACK]

40. David Rogers, "House Clears $562 Billion Spending Bill; Reagan's Budget for Military Is Slashed," Wall Street Journal, September 26, 1986, p. 16. [BACK]

41. Helen Dewar, "Big Agenda for Congress' Final Days," Oakland Tribune, October 12, 1986, p. A3. [BACK]

42. David Rogers, "House Votes $576 Billion Spending Bill To Fund U.S. for the Rest of Fiscal 1987," Wall Street Journal, October 16, 1986, pp. 2, 26; Inside the Administration, "Congress Gives Reagan Nearly All He Sought in Continuing Resolutions," October 23, 1986, p. 11. [BACK]

43. David Rogers, "Senate Votes $576 Billion Spending Bill But GOP Seeks to Strip Two Provisions," Wall Street Journal, October 17, 1986, p. 3. [BACK]

44. David Rogers, "Fiscal '87 Budget of $576 Billion Signed Into Law," Wall Street Journal, October 20, 1986, pp. 3, 14. [BACK]

45. David Rogers, "Senate Rejects Amendment Designating More Economic Aid for the Philippines," Wall Street Journal, September 30, 1986, p. 7. Eventually the Senate provided some aid; see Congressional Quarterly Almanac (Washington, D.C.: Congressional Quarterly, Inc. 1986), pp. 392-93. [BACK]

46. Jonathan Rauch, "Playing the Budget Game Under New Rules," National Journal, April 12, 1986, p. 898. [BACK]

47. "Budget Cutting is Still Lonely Work," Congressional Quarterly Weekly Report, August 16, 1986, p. 1933. [BACK]

48. Richard E. Cohen, "House Democracy," National Journal, October 18, 1986, p. 2532. Namely, the dismay at the resuscitation of revenue sharing by Gray and Domenici at a breakfast for The Committee for a Responsible Federal Budget, September 8, 1986. [BACK]

49. Inside the Administration, November 6, 1986, pp. 1, 7. [BACK]

50. Susan Bentzer et al., "Is the Party Almost Over?" Newsweek, October 26, 1987, p. 50. [BACK]

51. "Extraordinary Butchery," The Economist, October 24, 1987, pp. 75-76. [BACK]

52. "As Time Goes By," in ibid., p. 77. [BACK]

53. "When the bull turned," The Economist, October 24, 1987, pp. 11-12. For a typical menu of causes, see Larry Martz et al., "After the Meltdown of '87," Newsweek, November 2, 1987, pp. 14-20. [BACK]

54. "When the bull turned." [BACK]

55. Ibid. [BACK]

56. Martz et al., "After the Meltdown of '87." [BACK]

57. See Bill Powell et al., "Averting a Crisis: What Can Be Done?" Newsweek, November 9, 1987, pp. 32-37. [BACK]

58. Robert J. Samuelson, "The United States Can't Solve the Crisis By Itself," Newsweek, November 9, 1987, pp. 38-39. [BACK]

59. See Dick Kirschten, "White House Notebook," National Journal, November 28, 1987, pp. 3046-47. [BACK]

60. Elizabeth Wehr and John R. Crawford, "Cordial Talks on Deficit Belie Hardball Politics," Congressional Quarterly Weekly Report, October 31, 1987, p. 2652. [BACK]

61. "America's budget mouse," The Economist, November 28, 1987, p. 12. [BACK]

62. Lawrence J. Haas, "Chorus of Bronx Cheers for Budget Pact," National Journal, November 28, 1987, p. 3048. [BACK]

63. Conversations with Susan Rasky, reporter for the New York Times. [BACK]

64. Lawrence J. Haas, "Promises to Keep," National Journal, April 2, 1988, pp. 859-67. [BACK]

65. Congressional Budget Office, The Economic and Budget Outlook: Fiscal Years 1989-1993, A Report to the Senate and House Committees on the Budget (Washington, D.C.: U.S. Government Printing Office, February 1988), p. 50. [BACK]

66. Congressional Budget Office, Reducing the Deficit: Spending and Revenue Options, a Report to the Senate and House Committees on the Budget—Part II (Washington, D.C.: U.S. Government Printing Office, March 1988), pp. 44-45. [BACK]

67. Ibid., pp. 135-36. [BACK]

68. For discussion of the importance of VAT, see Harold Wilensky, The Welfare State and Inequality (Berkeley: University of California Press, 1975); Henry J. Aaron, "The Value-Added Tax, Sorting Through the Practical and Political Problem," The Brookings Review, Summer 1988, pp. 10-16; Aaron Wildavsky, "The Unanticipated Consequences of the 1984 Presidential Election," Tax Notes 24, no. 2 (July 9, 1984), pp. 193-200. [BACK]

69. Joseph J. Minarik and Rudolph G. Penner, "Fiscal Choices," in Isabel V. Sawhill, ed., Challenge to Leadership (Washington, D.C.: Urban Institute, 1988), pp. 279-316; quote on p. 290. [BACK]

70. The reader may consult the annual CBO baseline reports, and August/ September updates, for further data. [BACK]

71. Palmer did his calculations for "Should We Worry About the Deficit?" by John Palmer and Stephanie Gould, The Washington Monthly, May 1986, pp. 43-46. We are working from background tables and drafts that he kindly provided. [BACK]

72. Authors' estimates from John Palmer's work tables. [BACK]

73. Congressional Budget Office, Economic and Budget Outlook, Tables II-7 and G-5, G-6. [BACK]

74. Henry J. Aaron, Harvey Galper, Joseph A. Pechman, George L. Perry, Alice M. Rivlin, Charles L. Schultze, Economic Choices 1987 (Washington, D.C.: Brookings Institution, 1986), p. 4. [BACK]

75. Ibid., pp. 8-9. [BACK]

76. Minarik and Penner, "Fiscal Choices," p. 289. [BACK]

1. See James M. Buchanan and Richard E. Wagner, Democracy in Deficit: The Political Legacy of Keynes (New York: Academic Press, 1977). [BACK]

2. Sheldon S. Wolin, "The New Public Philosophy," Democracy (October 1981), pp. 23-36. [BACK]

3. Theodore J. Lowi, The End of Liberalism: The Second Republic of the United States, 2d ed. (New York: W. W. Norton, 1979). [BACK]

4. B. Jessop, The Capitalist State (London: Martin Robinson, 1982). [BACK]

5. Fred Block, "The Ruling Class Does Not Rule: Notes on the Marxist Theory of the State," Socialist Revolution, Number 33, Vol. 7, No. 3 (May-June 1977), pp. 6-28; quote on pages 7-8. [BACK]

6. Where Marx emphasized the causal force of the substructure of society as the relations engineered by ownership of production, holding the superstructure of ideas to be determined by it, the capitalist vanguard theory has it at least partly in reverse. What, then, following up the parallel to the proletarian vanguard as the Communist party, would prevent the state apparatus from subordinating industrialists to their own purposes? [BACK]

7. Stephen L. Elkin, "Between Liberalism and Capitalism: An Introduction to the Democratic State," in Roger Benjamin and Stephen L. Elkin, eds., The Democratic State (Lawrence: University Press of Kansas, 1985), p. 5. [BACK]

8. Block, "Ruling Class Does Not Rule," pp. 13-14. [BACK]

9. Ibid., pp. 23-24. See also Nicos Poulantzas on the relative autonomy of the state, arguing that the state cuts into the short-term economic advantages of business in order to secure its long-range political dominance. Contemporary Capitalism (London: New Left Books, 1974). [BACK]

10. See Ralph Miliband, The State in Capitalist Society (London: Weidenfeld Nicolson, 1969); and G. William Domhoff, "State Autonomy and the Privileged Position of Business: An Empirical Attack on a Theoretical Fantasy," Journal of Political and Military Sociology 14, no. 1 (Spring 1986), pp. 149-62. [BACK]

11. See Block, "Ruling Class Does Not Rule"; and Charles E. Lindblom, Politics and Markets (New York: Basic Books, 1977). [BACK]

12. Jon Elster, "Marxism, Functionalism, and Game Theory: The Case for Methodological Individualism," Theory and Society 11, no. 4 (July 1982), pp. 453-82. [BACK]

13. Claus Offe, "The Capitalist State and the Problem of Policy Formation," in Leon N. Lindberg, Robert Alford, Colin Crouch, and Claus Offe, eds., Stress and Contradiction in Modern Capitalism (Lexington, Mass.: D. C. Heath, 1973). [BACK]

14. Peter B. Evans, Dietrich Rueschemeyer, and Theda Skocpol, "On the Road Toward a More Adequate Understanding of the State," in Evans, Rueschemeyer, and Skocpol, eds., Bringing the State Back In (Cambridge: Cambridge University Press, 1985), pp. 347-66; quote on p. 354. [BACK]

15. In his The Fiscal Crisis of the State (New York: St. Martin's Press, 1975) James O'Conner argues that the government, unable to rely on the private sector create sufficient employment, subsidizes both worker and capital, thereby depleting its resources while providing insufficiently for each; he carries further the contention that the state has become the arena for class conflicts it cannot contain. Maybe. Just as (or more) likely, the expansion of resource mobilization into the furthest reaches of the population generates pressures to control state spending so as to alleviate taxation. Indeed, tax revolts skip a step by reducing revenue in order to place downward pressure on spending. [BACK]

16. Apparently the term "ungovernability" was coined by news commentator Eric Severeid in 1974. James Douglas, "Review Article: The Overloaded Crown," British Journal of Politics 6 (October 1976), pp. 483-505. [BACK]

17. Ibid., p. 493. [BACK]

18. Samuel Brittan, "The Economic Contradictions of Democracy," British Journal of Politics 5 (April 1975), pp. 129-59. [BACK]

19. Samuel P. Huntington, "Postindustrial Politics: How Benign Will It Be?" Comparative Politics 6, no. 2 (January 1974), p. 181. [BACK]

20. Douglas, "Overloaded Crown," p. 484. [BACK]

21. Quoted in Douglas, "Overloaded Crown," pp. 492-93. [BACK]

22. Huntington, "Postindustrial Politics," p. 177. [BACK]

23. Douglas, "Overloaded Crown," p. 494. [BACK]

24. Claus Offe, "New Social Movements as a Meta-Political Challenge," typescript, 1983, p. 4. [BACK]

25. Ibid., p. 4. [BACK]

26. Michel Crozier, Samuel Huntington, and Joji Watanuki, The Crisis of Democracy (New York: The Trilateral Commission and New York University Press, 1975). [BACK]

27. Huntington, "Postindustrial Politics," pp. 189-90ff. [BACK]

28. See Herb McClosky and John Zaller, The American Ethos: Public Attitudes toward Capitalism and Democracy (Cambridge, Mass.: Harvard University Press, 1984). [BACK]

29. Earl Latham, The Group Basis of Politics (Ithaca, N.Y.: Cornell University Press, 1952). [BACK]

30. Robert Dahl, Who Governs? (New Haven: Yale University Press, 1961); Raymond Bauer, Ithiel Poole, and Lewis Dexter, American Business and Public Policy (Hawthorne, N.Y.: Aldine Atherton de Gruyter, 1972); Theodore Lowi, "The Welfare State and the State of Welfare," typescript, n.d.; James Q. Wilson, ed., The Politics of Regulation (New York: Basic Books, 1980). [BACK]

31. See Carolyn Webber and Aaron Wildavsky, A History of Taxation and Expenditure in the Western World (New York: Simon & Schuster, 1986). [BACK]

32. See Aaron Wildavsky, "The Three-Party System—1980 and After," The Public Interest, No. 64 (Summer 1981), pp. 47-57. [BACK]

33. For discussion of these categories, see Aaron Wildavsky, "Choosing Preferences by Constructing Institutions: A Cultural Theory of Preference Formation," American Political Science Review 81, no. 1 (March 1987), pp. 3-21; Michael Thompson and Aaron Wildavsky, "A Poverty of Distinction: From economic homogeneity to cultural heterogeneity in the classification of poor people," Policy Sciences 19 (1986), pp. 163-99; and Mary Douglas, "Cultural Bias," in Douglas, In the Active Voice (London: Routledge & Kegan Paul, 1982). [BACK]

34. David Truman, Governmental Process (New York: A. A. Knopf, 1951), all quotes from pp. 512-15. [BACK]

35. Ibid., pp. 506-7. The battle of the budget can be described only partly in his terms because his book is about preferences, not effectiveness. The whole "nonpolitical" side of our story, the economic crisis and the difficulty of response, requires different terms and questions than Truman provides. He could say, of course, that resource constraints must exacerbate group conflict. But that does not tell us what kind of governance is possible and therefore how much we can demand of our governors. The cognitive difficulties of policymaking and the relationship between the financial markets and the politicians cannot be discussed only as attitudes. They constitute constraints of systematic importance. These resource constraints serve, in effect, as objectives that must be met to secure system maintenance. We judge our representatives, as David Mayhew points out, by whether they represent our preferences; see Mayhew, Congress: The Electoral Connection (New Haven, Conn.: Yale University Press, 1974). But we judge our government by its effects; in evaluating our political system and explaining its gyrations, therefore, we have to ask what it can do, not just what it wants to do. [BACK]

36. Murray Edelman, The Symbolic Uses of Politics (Urbana: University of Illinois Press, 1974). [BACK]

37. See C. E. Lindblom, Politics and Markets (New York: Basic Books, 1977); and David Vogel, "Why Businessmen Distrust Their State," British Journal of Political Science 8 (January 1978), pp. 45-78, as sources of further argument and evidence. [BACK]

38. Lowi, End of Liberalism, chap. 2. [BACK]

39. Ibid., p. 50. [BACK]

40. Charles W. Anderson, "Political Design and the Representation of Interest," Comparative Political Studies 10, no. 1 (April 1977), p. 139. [BACK]

41. Grant McConnell, Private Power and American Democracy (New York: Knopf, 1966), pp. 51-52. [BACK]

42. Lowi, End of Liberalism, pp. 50-51, 96-97. [BACK]

43. No one has ever put this better than John C. Calhoun in his Disquisition on Government (New York: Political Science Classics, 1947):

I have said—if it were possible for man to be so constituted, as to feel what affects others more strongly than what affects himself, or even as strongly—because, it may be well doubted, whether the stronger feeling or affection of individuals for themselves, combined with a feebler and subordinate feeling or affection for others, is not, in beings of limited reason and faculties, a constitution necessary to their preservation and existence. If reversed—if their feelings and affections were stronger for others than for themselves, or even as strong, the necessary result would seem to be, that all individuality would be lost; and boundless and remediless disorder and confusion would ensue. For each, at the same moment, intensely participating in all the conflicting emotions of those around him, would, of course, forget himself and all that concerned him immediately, in his officious intermeddling with the affairs of all others; which, from his limited reason and faculties, he could neither properly understand nor manage.... Government would be impossible; or, if it could by possibility exist, its object would be reversed. Selfishness would have to be encouraged and benevolence discouraged. Individuals would have to be encouraged, by rewards, to become more selfish, and deterred, by punishments, from being too benevolent; and this, too, by a government, administered by those who, on the supposition, would have the greatest aversion for selfishness and the highest admiration for benevolence.

To the Infinite Being, the Creator of all, belongs exclusively the care and superintendence of the whole. (pp. 5-6)

1. "Robust Economic Figures Indicate Threat of Inflation," Wall Street Journal, July 11, 1988, p. 22. [BACK]

2. Tom Kenworthy, "Hill Sees Opportunity for Progress on Deficit: Market's Dive Yields Wave of Responsibility," Washington Post, October 31, 1987, p. A9. [BACK]

3. Anne Swardson, "House Chaos Provided a Day to Remember," Washington Post, October 31, 1987, p. A9. [BACK]

4. Jeffrey H. Birnbaum, "White House, Top Capitol Hill Democrats Remain Far Apart on Deficit-Curb Plans," Wall Street Journal, October 29, 1987, p. 7. [BACK]

5. See Joseph White, "The Continuing Resolution: A Crazy Way to Govern?" Brookings Review 6, no. 3 (Summer 1988): 28-35. [BACK]

6. George Gallup, Jr., and Alec Gallup, "Deficit is top issue among the electorate," Oakland Tribune, November 6, 1988, p. A6. [BACK]

7. Paul Blustein, "Fractious budget commission at impasse as deadline nears," Oakland Tribune, November 6, 1988, p. A6. [BACK]

8. Report of the National Economic Commission (Washington, D.C.: U.S. Government Printing Office, March 1, 1989). The Republicans were joined by former Rep. Thomas Ashley (D-Ohio), one of President Bush's two appointees, who though he had a fairly liberal record in the House was a close friend of George Bush. Therefore, theirs constituted the Majority Report. [BACK]

9. Ibid., pp. 13, 36, 50, 56. [BACK]

10. David Rapp, "Negotiators Agree on Outlines of Fiscal 1990 Plan," Congressional Quarterly Weekly Report, April 15, 1989, pp. 804-5. See also Elizabeth Wehr, "Budget Plan Entails Tax Bill, but Details Are up in Air," in ibid., p. 806; David Rapp, "Bipartisan Pact Lets Everyone Be A Winner—For Now," Congressional Quarterly Weekly Report, April 22, 1989, pp. 880-82; and especially Democratic Study Group, "The FY 1990 Budget Resolution," Fact Sheet no. 101-3 (mimeo), May 1, 1989. The negotiators were Foley, Darman, Panetta, Sasser, Secretary of the Treasury Nicholas F. Brady, and the ranking minority members of the budget committees, Rep. Bill Frenzel and Sen. Pete Domenici. [BACK]

11. See the speech given by Representative Hamilton during debate on the budget resolution, Congressional Record, May 3, 1989, pp. H1553-H1556, especially H1553. [BACK]

12. Democratic Study Group, "FY1990 Budget Resolution," p. 4. [BACK]

13. $5.7 billion in asset sales, but specifically not President Bush's proposals to sell the Elk Hill Naval Petroleum Reserve and federal power marketing administrations; $1.2 billion in extra user fees and offsetting collections from administrative improvements and sale of the right to make chlorofluorocarbons; $850 million from paying some farm costs in FY89 instead of FY90; $477 million from writing off all food stamps not cashed in previous years as an outlay savings in FY90 (??); $496 million from legislation allowing sales of some VA loans; and $2,120 billion from taking the Post Office and a farm credit agency off budget. [BACK]

14. Maintaining Medicare Part B premiums at 25 percent of program cost; extending National Flood Insurance Fund and VA loan origination fees; and not providing the judicial and legislative branch pay raises that Congress had already rejected. [BACK]

15. Senator Bentsen didn't even attend the announcement of the agreement; see David Rapp, "Negotiators Agree." Representative Rostenkowski showed his skepticism on the House floor; see Congressional Record, May 3, 1989, p. 1533. [BACK]

16. David Rapp, "Negotiators Agree." [BACK]

17. Panetta in Congressional Record, May 3, 1989, pp. 1523-24. [BACK]

18. Congressional Record, May 3, 1989, p. H1519. [BACK]

19. This had become, by 1989, the major argument by academic economists for deficit reduction. Indeed, "the crisis," Charles Schultze of Brookings frequently remarked, "is that there is no crisis." He and others therefore feared politicians might ignore the costs to long-term growth from using national savings to finance government consumption. The difficulty is that the consequences of increased savings through reduced deficits are rather murky. CBO reported that running a 2 percent budget surplus after FY93, rather than a balanced budget, would reduce personal consumption for five to ten years, but by the year 2040 would raise personal consumption by between 2 and 14 percent. Neither the scale nor the certainty of benefit involved seems, to us, a convincing argument for an extra $100 billion in policy change now. See Congressional Budget Office, The Economic and Budget Outlook: Fiscal Years 1990-1994 (Washington, D.C.: U.S. Government Printing Office, January 1989), pp. 93-95. [BACK]

20. Ibid., pp. xv, 41, 57. [BACK]

21. This estimate is based on the figures in Table II-4 in ibid., p. 51, for the effect of one percentage-point less real growth. [BACK]

22. Ibid., Table II-3, p. 47. [BACK]

1. David Wessel and Gerald F. Seib, "Budget Negotiators Disagree on Target For Deficit Cuts Over Next Five Years," Wall Street Journal, May 25, 1990, p. A10. [BACK]

2. Quoted in David Wessel and Gerald F. Seib, "White House Says It's Sincere on Deficit Talks," Wall Street Journal, May 14, 1990, p. A3. [BACK]

3. John E. Yang and Steven Mufson, "Package Termed Best Circumstances Permit," Washington Post, October 29, 1990, pp. A1, A4. [BACK]

4. David E. Rosenbaum, "In Appeal for Support for Budget, President Calls Plan Best for Now," New York Times, October 3, 1990, pp. A1, D27. The quote is from the president's speech to the nation on October 2, 1990, in support of the summit deal, which was of the same size as the package eventually passed. [BACK]

5. Jeffrey H. Birnbaum and Jackie Calmes, "Wrenching Battle on Deficit Reduction Points to More Contests in Years Ahead," Wall Street Journal, October 29, 1990, p. A3. For other examples, see Richard E. Cohen, "Under the Hype, It's Just Stale Sushi," National Journal, November 3, 1990, p. 2674; Richard Lacayo, "Dose of Reality," Time, November 5, 1990, pp. 28-30; and editorial, "Congress Ducks the Dirty Work Again," Business Week, November 12, 1990. [BACK]

6. For the assumptions in the table, see the source document. For the alternative figures, see "Fiscal Year 1991 Budget Agreement Summary Materials," summary document, October 27, 1990, issued by House Budget Committee. [BACK]

7. Versions of figures may be found in the G. William Hoagland and House Budget Committee summaries cited op. cit.; but there are just too many questions for anyone to be sure. [BACK]