Suffering From Ticker Shock

By WALTER SHAPIRO

Shortly before the stock market opened on Meltdown Monday, Albert Gore was on the phone to a broker. The long-shot Democratic contender was not selling short in anticipation of the wake on Wall Street. Rather, Gore was searching for political portfolio insurance: reliable information about the direction of the markets. All presidential candidates were similarly affected by ticker shock during a dizzying week in which requests for quotes sent aides scurrying after the Dow Jones industrial average rather than Bartlett's.

The bearish rout on the stock exchange turned facile assumptions about the 1988 race into so much bull. It silenced complaints that the campaign was devoid of cutting issues and dashed Republican hopes of an election predicated on the Reaganite themes of stability and prosperity. The political futures index tilted toward the Democrats, as mayhem in the markets revived fears of recession. Four times in this century the Democrats have regained the White House following a Republican incumbency, each time against the backdrop of a sharp economic downturn.

Every presidential election is shaped by a handful of events that resonate with the electorate. Last week's wild-on-the-Street gyrations of the stock market are likely to become just such a political symbol, playing on voter fears that the economy has been held aloft by illusion. As Democratic Pollster Geoffrey Garin puts it, "We've seen over and over again in focus groups that people have had a sense of huge bills coming due, with no one knowing how to pay them." The market collapse, he argues, "becomes a defining event for 1988, because the potential for tragedy, which was abstract a month or two ago, has now become real."

Amid these concerns, there is a striking consensus in the political community over the extent to which the stocks of individual candidates rose and fell with the oscillations on the Big Board. Here is how political traders assess the current market prospects for some 1988 contenders:

Bush Enterprises. This blue-chip White House subsidiary plunged in heavy trading, owing to qualms about Reaganomics and the quality of hands-on management at the parent company.

Dole Family Industries. Had a banner week in an otherwise depressed G.O.P. market, as investors were attracted to its financial independence and its record of consistent political earnings in the area of deficit reduction.

Kemp Concepts. This speculative security was buffeted by market worries about the value of its supply-side patents.

Du Pont. As investors turn away from a free market, this stock lacks the chemistry of its corporate namesake.

Dukakis Systems. The company's strong management record in Massachusetts appealed to those seeking safety, although the firm's still vague economic plans may stifle future growth.

Gephardt International. Another firm strengthened by the move toward technocratic competence, but its heavy exposure in protectionist trade issues could backfire.

Same Old Simon. Despite the unorthodox look of the management, this stock continues to gain, especially among investors who remember the Depression.

Gore Southern. Trading was mixed, amid concerns that the company may have invested too heavily in national security issues.

Monday's frightening plunge in stock prices posed an immediate dilemma for the candidates: what to say and when to say it. Most Democrats erred on the side of caution, preferring not to be seen as gloating over the partisan advantage to be reaped from the economy's distress. The economic crisis seemed a tonic to Michael Dukakis; he projected a confidence rarely seen in the weeks since his campaign was rocked by disclosure of its role in leaking a tape that helped sabotage the candidacy of Joseph Biden. Dukakis' public words were a careful mixture of reassurance and assault, as he reserved his fire for safe targets like the Reagan deficit. "We cannot operate as a country by continuing to borrow billions and billions of dollars," he declared in Hartford.

Richard Gephardt displayed his mastery of the intricacies of the market crash in almost textbook fashion: he lectured a sleepy high school class in Sioux City, Iowa, on the global economy, complete with chalk diagrams. Gore jettisoned his standard text and went after the President with lines like "What crashed on Monday was not only the stock market but Reaganomics as well." Still, Bruce Babbitt remains the only Democrat to confront the deficit boldly, especially with his underdog challenge to middle-class entitlement programs.

On the Republican side, Robert Dole displayed artful footwork in distancing himself from the Administration, while George Bush thrashed about, entangled in voodoo economics. Highly visible as Senate minority leader, Dole projected the image of a concerned legislator ready to negotiate on the deficit. While skirting talk of a tax increase, Dole deftly tossed darts at the White House, describing himself as a "hands-on person. I don't let anything happen in my office that I don't know about."

For the first three days of the crisis, Bush was the invisible figure of a Doonesbury cartoon, failing even to play a behind-the-scenes role in White House meetings. On Thursday, when he finally surfaced to address a campaign rally in Miami, the Vice President found himself trapped by his official role. Denied permission to say anything that would preview the President's press conference, Bush was reduced to banalities. "I still believe the solution is not to go rushing out to raise taxes," he declared, staking out a position that Reagan seemed about to abandon. The next day in Iowa, the Vice President reaped further confusion by reframing his position on taxes. "I'll support the Administration, and I won't change," Bush promised. "But now I'm a candidate, and when I become President, there won't be any tax increases."

In any event, Iowa voters were in no mood to be patronized on the economy, as Pete du Pont learned to his mild distress. Visiting a weekly newspaper in Onawa, du Pont depicted the stock market crash as a "vote of no confidence" by millions of small investors who did not like the presidential front runners in either party. Loren Sawyer, 27, whose mother publishes the paper, was not about to let that comment pass unchallenged. "I didn't know small, grass- roots investors pulled out," said Sawyer. "I thought it was the investment banks and large firms that panicked." Du Pont smiled uncertainly at the young man and wisely changed the subject. It was a tactic that few candidates were able to emulate during a cataclysmic week that took the bloom off the economic boom.

With reporting by Laurence I. Barrett/Washington, with other bureaus