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Reagan has been much less willing to back off from his "10-10-10" tax cut plan. First proposed by Congressman Jack Kemp of New York and Senator William Roth of Delaware, that scheme would reduce taxes by 30% over three years. Says one top White House aide: "I can't stress enough that the President is adamant in his belief that he was elected on the basis of a certain program. If he has to, he will make a fight out of it. He will go to the country." Still, most White House aides, including Chief of Staff James Baker, feel that winning "10-10-10" would be extremely tough, and acknowledge that politics is the art of the possible. They hope that Rostenkowski will produce a plan close enough to what the White House wants so that everyone can declare victory and avoid a battle that could damage both sides.
The Illinois Democrat, however, has been slow to accept the invitation to dance, particularly if he has to take the lead. He has had trouble forging a consensus among divided Democrats, who are reluctant to support higher deficits or place their faith in the Reaganites' theory of supply-side economics. Should no compromise be reached, the Democrats could simply allow a straight up-or-down vote on Kemp-Roth, a roll call that the Administration would probably lose. Speaker Tip O'Neill and other liberal Democrats said that putting the Republicans on the spot with Kemp-Roth might be better than talking compromise. But Rostenkowski was well aware of the President's popularity and the possibility that some conservative Democrats might break party ranks. He and Majority Leader Jim Wright of Texas felt there was little to be gained by a bitter congressional struggle over Kemp-Roth and that even a victory might come back to haunt them in 1982, when voters decide how to assess credit and blame for the economic situation. The stakes were high, and each side knew that a short-term victory could turn out to be a defeat in the long run.
Last Monday, Senator Robert Dole of Kansas, chairman of the Senate Finance Committee, began to play matchmaker. He invited the three other top congressional tax writers—Rostenkowski, Senate Finance Committee Ranking Democrat Russell Long of Louisiana and House Ways and Means Committee Ranking Republican Barber Conable of New York—to an intimate luncheon in an ornate hideaway office next to the Senate chamber long favored for bourbon and branch-water sessions. Democrats and Republicans often meet to iron out differences in legislation already passed. Rarely, however, do they assemble to work out joint legislation in advance of any vote, as they did last week.