Reagan Aides, Seeking Easier Credit With Low Inflation, Spark Confusion
WASHINGTON -- The Reagan administration is trying to have its cake and eat it too in its posture toward the Federal Reserve, and in the process it is creating confusion and controversy.</br></br>Two weeks ago, the White House and Treasury Department began blasting the Fed's tight credit grip. But amid howls of protest that the administration was turning to the printing press in an election year, President Reagan softened his aides' attacks with some soothing words about his resolve to keep inflation tamed.</br></br>Then late last week, the president's spokesman accused the president's budget director of leaking a story to the Washington Post that quoted anonymous officials as saying the president had muted the "Fed-bashing" because it had gotten "out of hand." the spokesman, Larry Speakes, later withdrew the accusation about Budget Director David Stockman.</br></br>Underlying all the attacks, counterattacks and modifications is an effort by some of Mr. Reagan's top aides to get the Fed to ease credit. They also want to pin the blame for high interest rates on the central bank, rather than on huge budget deficits.</br></br>But the administration has found it difficult to balance those aims against the conflicting goal of maintaining its anti-inflation credentials. At a deeper level, the administration has had trouble hewing to a consistent line because it is undertaking a somewhat ragged change from one theory of monetary policy to another.