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The air of restraint succeeded only in making Reagan look as if he had lost his old enthusiasm—because of his age, some voters uncharitably suspected—and the strategy collapsed in the Jan. 21 Iowa caucuses. Out of that defeat charged the Reagan of yore, campaigning full time across New Hampshire and banging away again at all his old targets with stimulating vigor: "There is enough fat in the Federal Government that if you rendered it, there would be enough soap to wash the whole world." Some 22 position papers designed to portray Reagan as a positive thinker were filed and forgotten. Instead, Reagan presented once again his nostalgic vision of a day still to be recaptured, when the individual was great and the Government small, the U.S. flag and dollar respected everywhere.
The key to Reagan's popular appeal is his genuine belief that "there are simple answers" to the most complex problems. Some examples:
> Inflation. "Government causes inflation, and Government can make it go away." How? By cutting income taxes 30% over the next three years. That, in Reagan's view, would pep up the economy and produce enough new revenue to balance the budget of a Government that he would significantly reduce in size. First step: turning over all welfare administration and funding to states and localities, which in compensation would be allowed to keep what he vaguely calls "X%" of all the federal taxes collected within their borders.
> Energy. "The energy industry today is virtually nationalized." If all Government controls on energy and agriculture are ended, Reagan says, and "if we turn both of them loose in the marketplace, they will produce the food and fuel we need." No special effort to conserve energy is necessary: "We are energy rich."
> Foreign Affairs. The Soviet Union has not changed since Stalin's time. "It has one course and one course only. It is dedicated to the belief that it is going to take over the world." Moreover, the Soviets have been winning everywhere for 25 years because of a U.S. "foreign policy bordering on appeasement." Washington has seriously weakened U.S. defenses, and what is needed is a rapid buildup in all types of arms. "Tune out those cynics, pacifists and appeasers who tell us the Army and Navy of this country are nothing but extensions of some malevolent military-industrial complex. There is only one military-industrial complex whose operations should concern us, and it is not located in Arlington, Va., but in Moscow." He fervently believes that the Soviet Union will back down in any confrontation with the U.S. One passage that never fails to win loud applause: "The President said we must ratify the SALT H treaty because no one will like us if we don't. He said he should give away the Panama Canal because no one would like us if he didn't. It is time to tell the President, 'We don't care if they like us or not. We intend to be respected throughout the world.' "