Nixon: Boss in a Bad Year

RICHARD NIXON predicted it months ago: 1970, he told his aides, would be the Administration's time of trouble and testing. He was only too prescient. Indochina, the Middle East, the economy, the students, the Senate have taken turns showing their immunity to presidential will. The resulting image of lapsed Executive control has greatly added to White House problems. But bad news often feeds as much on itself as on events. Despite his difficulties in a number of areas, the President has vigorously begun to assert his leadership in one of the most crucial areas of all, the running of the U.S. Government.

Rapidly following up on his transfer of Robert Finch from the Department of Health, Education and Welfare to the White House, Nixon last week drafted another Cabinet officer, Labor Secretary George Shultz, to head the Office of Management and Budget, which comes to life in the White House on July 1. The creation of the OMB, together with a new Domestic Affairs Council, had been announced in March. Now Nixon's choice of Shultz to head the OMB, together with his transfer of Finch, makes the organizational changes more important than they appeared to be at first. The other personnel shifts: CASPAR WEINBERGER, chairman of the Federal Trade Commission and former state finance director of California, joins the OMB as Shultz's deputy. JOHN EHRLICHMAN, Assistant to the President for Domestic Affairs, becomes executive director of the Domestic Affairs Council.

ROBERT MAYO, Director of the Budget Bureau, moves to the White House staff as a Counsellor to the President, which could be a way station to a Cabinet post if more changes are yet to come. JAMES HODGSON, now Shultz's Under Secretary and a former vice president of Lockheed Aircraft Corp., succeeds Shultz as Secretary of Labor.

Counterweight. The key to last week's changes is Shultz. who has risen from his peers on the Cabinet to gain Nixon's total confidence as both an adviser and a doer (see box, following page). A Republican moderate who is liberal by this Administration's standards, Shultz is both a friend and potential ally of Finch's. Together they seem likely to introduce a new element within the White House, a counterweight to the relatively narrow conservatism of a number of the present top White House staffers.*Their recruitment in tandem indicates Nixon's realization that he has not been as well served by his immediate aides as he might have been [TIME cover, June 8]. One of the most frequent criticisms of the White House recently has been that the President has become insulated from independent viewpoints and wide-angle advice.

As Director of the Office of Management and Budget, Shultz and his staff will be expected to superintend overall execution of Government programs. Besides hunting down superfluous activities, OMB will assume the staff and functions of the present Bureau of the Budget, including its efficiency-expert role. Mayo had been expected to head the enlarged operation. The fact that he was bypassed is significant. Mayo, a skilled economist with nearly 20 years of federal service, is not an innovator, a policymaker or an advocate who can fight effectively for his point of view. Shultz is all three. Further, Mayo has not had a private conversation with Nixon for several months; Shultz has had ready access to the President.

What v. How. Thus it is doubtful that Mayo could have mustered the weight to hold his own against men like Ehrlichman and H.R. Haldeman, two of the aides closest to Nixon. Shultz is expected to have that clout. Moreover, Shultz's new deputy, Weinberger, though on the FTC for only six months, has fast established a reputation as a tough, reform-minded administrator. Like Shultz, Weinberger owes his selection to merit and performance rather than long personal service to the President. He too may bring a new viewpoint to White House deliberations.

The big question is how power will be divided in the new lineup. The choice of Ehrlichman to head the Domestic Affairs Council, a body that is to rank with the National Security Council, was a foregone conclusion. DAC replaces three existing bodies--the Urban Affairs Council, the Rural Affairs Council and the Cabinet Committee on Environment. Ehrlichman's present staff of 30 may be doubled. As Nixon explained it: "The Domestic Council will be primarily concerned with what we do. The Office of Management and Budget will be primarily concerned with how we do it and how well we do it."

Whole Passel. Nixon observed that he was "finally bringing real business management at the very highest level into the Executive Branch of Government." But separating goals from their execution may be more difficult than it sounds. On paper, Ehrlichman and Shultz will be equals, each with his own staff, each with his own line of communication to the President. Haldeman will continue as overall coordinator of White House activities. How the setup works out will depend on the durability and chemistry of the individuals involved. It will be Ehrlichman's task to pull together and reconcile the aspirations of the individual operating such departments as HEW, Transportation, and Housing and Urban Development. After the President decides what should be done, it will be up to Shultz's office to police the execution.

Ehrlichman is not primarily an idea man. Nor is he an expert in any one domestic field. He is likely, therefore, to have competition from both Shultz and Finch, each of whom has had more experience in Government than Lawyer Ehrlichman from Seattle. Finch notes that he will be involved with a "whole passel of things," including "what our agenda of social needs ought to be once we get the Viet Nam War out of the way." In establishing the two new bodies, Nixon was obviously trying to make the vast federal bureaucracy more responsive to White House policy. In choosing new White House talent, Nixon seemed to be saying that he wanted more vigorous intellects close by to help set that policy as well as to carry it out.

No Kind Words. Yet Nixon was not throwing open the doors to internal dissent. That the President is growing impatient with controversial subordinates was apparent in last week's sudden dismissal of James Allen as Commissioner of Education in HEW. A progressive Republican widely respected by fellow educators, Allen was ousted without any of the kind words that normally accompany separations from Government service. The White House insisted that Allen's public criticism of the Cambodian decision had nothing to do with his release; after all, Nixon on May 8 had said: "Everybody in this Administration should have the right, after considering all the factors, to speak out and express his views." But after Allen did speak out on May 21, his departure seemed to be only a matter of time. He had long been unhappy about the low level of education spending and the Administration's ambivalent attitude toward pressing to achieve genuine racial integration.

Adverse Ruling. Finch, Allen's boss, did not try to explain the dismissal, though he did attempt to take responsibility for it. White House Press Secretary Ron Ziegler made it appear that the President had been unhappy with Allen's performance as an administrator. Allen himself mildly observed that he had been unable to fill vital posts because of White House insistence that political patronage be a factor in appointments.

Interior Secretary Walter Hickel, whose leaked letter to the President helped make Nixon's isolation in the White House a byword, has been subjected to another kind of discipline. Nixon has decided to create two new bodies--a National Oceanographic and Atmospheric Administration in the Commerce Department and an independent Environmental Protection Administration--both of which will reduce Hickel's responsibilities in fighting pollution. Nixon called Hickel in to tell him, in effect, that he would not be Washington's Mr. Environment. Hickel's early departure from the Administration would not be surprising. When the Government disclosed last week that it wanted to cancel some federal oil leases in the befouled Santa Barbara Channel in order to create a marine-life sanctuary (see THE ENVIRONMENT), the word came from the White House, not Interior.

It is uncertain whether the decision about new agencies would have gone differently if Hickel had never written his letter. The upshot, however, was that the disturber of the peace got an adverse ruling and, as in the Shultz appointment, Nixon chose to go outside the established bureaucracy to get the arrangement he wanted.

While crises dominate the news, Nixon is quietly going ahead with the business at hand at his own pace. Still opposed to attacking de facto segregation with devices like mass busing, the Administration is proceeding with desegregation cases in the South. By this fall, it plans to have completed most of the pending cases. Nixon is thinking out a new, comprehensive statement on the economy, one that may signal a shift in his approach. The White House has renewed pressure on the Defense Department to control and even reduce expenses.

Willing to Fiddle. Amid the reorganization announcements last week, the Administration brought out its revised welfare reform program, which the Senate Finance Committee had sent back for improvement. The new version attempted to meet some of the committee's criticism by adding devices to ensure that Government assistance to impoverished families could not become an incentive for some of those families to refuse employment. Also, Nixon said that he would propose next year a new health-insurance program for the poor. Details have yet to be worked out, but the program would initially cover more than 25 million people and could set a precedent for a nationwide health-insurance plan.

The welfare scheme, like the White House reorganization and the personnel shifts, sounds both logical and promising. Nixon is trying to show his critics that he has not been cowed by adversity, that he is able to tinker with the mechanism, that he maintains more controls than his adversaries would have it seem. In the end, the approach could succeed. But for now, the big problems remain; the bad year is only half over.

*Daniel Patrick Moynihan, a liberal Democrat, has offered differing viewpoints. But Moynihan, never a Nixon intimate, plans to leave the Administration this year.

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