Reagan: The Life (71 page)

Reagan gave greater thought to attending Chernenko’s funeral than he had given to going to Brezhnev’s or Andropov’s. But again he decided not to risk appearing too eager. He again sent George Bush, accompanied by George Shultz, in his place.

Bush was used to the routine by now. “
I think it was Jim Baker who came up with the slogan for me, ‘You die, I’ll fly,’ ” Bush recounted later. He and Shultz attended Chernenko’s funeral and then a state reception at which Gorbachev greeted them. Shultz was impressed at once. “
Gorbachev started with a grace note, thanking us for ‘paying our respects to General Secretary Chernenko,’ and then launched into the most far-ranging statement on foreign policy that I had heard from a Soviet leader,” Shultz recalled. “ ‘It is natural,’ he began, ‘to wonder what might change with the departure of one general secretary and the appointment of a new one. The United States should proceed from the premise that there will be continuity in both the domestic and foreign policy of the U.S.S.R.’ Then he noted the chimes of an antique clock in the room and said, with a smile, that the clock was old and was not intended to serve as any kind of signal.”

Gorbachev had come to the meeting prepared. A thick sheaf of papers apparently outlined what he intended to say. But he put it aside. “He was articulate and spontaneous,” Shultz said. “He seemed to be thinking out loud. Perhaps he was.” Bush outranked Shultz, and the vice president did the initial talking for the American side, leaving Shultz to take mental notes. “I could listen intently and watch Gorbachev, trying to size up what kind of a person he was,” Shultz recalled. “Gorbachev later told me he had noticed me watching him in this first meeting and wondered what I was thinking.”

The general secretary toured the horizon of international affairs. He cited the emergence of scores of newly independent countries since the 1950s, each having its own interests and agenda. “No one, not even the U.S.S.R. and the United States, can fail to take this into account,” he said. “We have to learn to base our relations on these realities.” Gorbachev mentioned statements by persons he called “very highly placed U.S. officials” that seemed to ascribe all the problems of the emerging world to
Soviet mischief. “Moscow would seem to be almighty,” he said ironically. He continued seriously, “The U.S.S.R. has no expansionist ambitions. It has all the resources it will need for centuries, be it in terms of manpower, natural resources, or territory.” He added, with a lighter touch, “We have no territorial claims against the United States, not even with respect to Alaska or Russian Hill in San Francisco.” He pointed to past cooperation, particularly during World War II—“a bright page in the history of Soviet-U.S. relations”—and again during the era of détente.

He looked directly at Bush to make a statement he obviously considered very important. “The U.S.S.R. has never intended to fight the United States and does not have such intentions now,” he said. “There have never been such madmen within the Soviet leadership, and there are none now. The Soviets respect your right to run your country the way you see fit. In the same way, it is up to the Soviet people to make such decisions on behalf of the U.S.S.R. And the U.S.S.R. will never permit anyone to teach it how to govern itself.” He paused. “As to the question of which is the better system, this is something for history to judge.”

He turned to the arms race and arms control. “The two countries have now reached a point in their arms buildup when any new breakthroughs resulting from the scientific and technological revolution—not to mention shifting the arms race to space—could set in motion irreversible and uncontrollable processes.” He questioned the seriousness of the American side, asking why people in the Reagan administration often sounded so skeptical about arms talks. “These negotiations are being depicted as requiring years and years. Is the U.S. side really interested in these negotiations? Is it interested in achieving results? Or does the United States find these negotiations necessary in order to pursue its programs for continuing the arms race, for developing ever new types of arms?”

Shultz was more impressed than ever. “Gorbachev’s free-flowing monologue showed a mind working at high intensity, even at the end of a long, hard day,” he wrote. “He displayed a breadth of view and vigor, I thought.” All the same, the positions Gorbachev described were nothing new.

Bush answered for the United States and for Reagan. “We have no aspirations of dictating how to administer the Soviet Union,” the vice president said. “This is the farthest thing from our thoughts.” Yet he proceeded to explain that respect for
human rights was central to America’s view of the world. “This issue is extremely important to the president and the American people.” Harsh treatment of Soviet political dissidents and
the denial of exit visas to Soviet
Jews were matters America could not overlook.

Gorbachev shot back that the United States was in no position to lecture the Soviet Union on human rights. “The United States violates human rights not only on its own territory but also beyond its border,” he said. America oppressed its black population and supported dictators abroad. “It disregards the human rights not only of individuals but of entire nations and countries. It brutally represses human rights.” He nonetheless agreed that the subject might be discussed by the diplomats. But then he backtracked, saying internal affairs were inappropriate for negotiations between the two governments. Americans seemed to raise them to stall or block meaningful negotiations. “Every time there is a meeting involving our two countries, the United States proceeds to raise these questions.” He wasn’t going to apologize for the accomplishments of
socialism. “Thank God there is socialism, because with socialism the people of former capitalist countries have gained more rights.”

R
EAGAN HAD WRITTEN
a letter to Gorbachev for Bush and Shultz to deliver. “
As you assume your new responsibilities, I would like to take this opportunity to underscore that we can in the months and years ahead develop a more stable and constructive relationship between our two countries,” Reagan said. He didn’t underestimate the challenge involved. “Our differences are many, and we will need to proceed in a way that takes both differences and common interests into account.” But the two leaders bore heavy responsibility for maintaining the peace. “The international situation demands that we redouble our efforts to find political solutions to the problems we face.” Reagan pledged his personal commitment to engage Gorbachev in serious negotiations. “In that spirit, I would like to invite you to visit me in Washington at your earliest convenient opportunity.”

Shultz explained to Gorbachev that Reagan had briefed him before his departure on what to tell the general secretary as accompaniment to the president’s letter. “
President Reagan told me to look you squarely in the eyes and tell you: ‘Ronald Reagan believes that this is a very special moment in the history of mankind,’ ” Shultz said. The secretary of state continued in his own voice but reciting Reagan’s themes. “You are starting your term as general secretary. Ronald Reagan is starting his second term as president. Negotiations are beginning in Geneva. Over the past year we have found solutions to some problems, though not to the great problems,
and if it is at all possible, we must establish a more constructive relationship between the United States and the U.S.S.R. President Reagan knows he personally must work on this hard, and he is ready to do so.” Shultz said the president’s invitation to Gorbachev to visit Washington was evidence of his commitment. And there was no time to waste. “If important agreements can be found, the sooner the better.”

Gorbachev responded positively, though noncommittally. He agreed that the Soviet Union and the United States were at a “unique moment” that mustn’t be wasted. “I am ready to return Soviet-U.S. relations to a normal channel,” he said. “It is necessary to know each other, to find time for meetings to discuss outstanding problems, and to seek ways to bring the two countries closer together.”

After the meeting, Bush cabled Reagan an account of the exchange and offered his assessment of the Kremlin’s new leader. “
Gorbachev will package the Soviet line for Western consumption much more effectively than any (I repeat any) of his predecessors,” the vice president wrote. “He has a disarming smile, warm eyes, and an engaging way of making an unpleasant point and then bouncing back to establish real communication with his interlocutors. He can be very firm. Example: When I raised the
human rights question with specificity, he interrupted my presentation to come back with the same rhetorical excess we have heard before. Quote ‘Within the borders of the US you don’t respect human rights’ or (referring to African-Americans), ‘You brutally repress their rights.’ But along with this the following: ‘We will be prepared to think it over’ and ‘Let’s appoint rapporteurs and discuss it.’ The gist being as follows—‘Don’t lecture us on human rights, don’t attack
socialism but let’s each take our case to discussion.’ ”

S
ECOND-TERM PRESIDENTS BENEFIT
from the credibility that comes from having survived a referendum on their performance. In Reagan’s case the referendum was overwhelmingly positive, and on the basis of his historic triumph he should have rolled into his second term with powerful momentum. But second-term presidents labor under peculiar difficulties that offset some of their credibility. Not the least of the challenges is that second-term presidents typically lead second-string teams. On first election, presidents have their pick of the best people their party has to offer; they fill critical cabinet and White House positions with the party’s first-string team. But the first-stringers grow weary of the work, of politics, and of the comparatively low pay, and they often leave before a second term is well under way. Their replacements occasionally turn out to be stellar, but more frequently they lack something of the experience, the judgment, the temperament, or the talent that might have got them chosen in the first round. Good help is hard to find, and never harder than at the apex of government, where mistakes are scrutinized, magnified, and publicized.

Don Regan was one of the first stringers who became worn down by his job and all that went with it. The leaking and backbiting that had driven Al Haig from office vexed him almost as much. During 1984 he had followed the president’s directive and developed a proposal for tax reform. He tried as a tactical matter to keep the discussions secret, lest opponents of change mobilize against attacks on their pet programs before the proposal could be unveiled and defended as a whole. He was pleased to hand the president a comprehensive plan three weeks after the election. The plan wasn’t perfect, but it was an improvement, he judged.
“
I reflected, as I placed this weighty document in his hands on November 26, 1984, that our simplified plan was still far too long”—262 pages of text and 536 of appendixes—“but it was a hell of a lot shorter than the sixty-three feet of bookshelves required to accommodate the existing tax code and its concordances,” he observed.

To remind the president of the imperative for reform, Regan asked him an irreverently personal question. Had he ever made as much as $1 million a year before becoming president?

Reagan registered surprise. Not by a long shot, he said.

“Six figures, then?” Regan insisted.

Reagan nodded.

“Okay, how much did you pay in taxes?” Regan asked.

Reagan realized Regan was driving at something. He said he had paid about half his income in taxes.

“Sucker!” Regan pronounced. “With the right lawyer and the right accountant and the right tax shelters, you needn’t have paid a penny in taxes even if you made more than a million dollars a year—and it would have been perfectly legal and proper. The tax system we have now is designed to make the avoidance of taxes easy for the rich and has the effect of making it almost impossible for people who work for wages and salaries to do the same. As someone who has made a lot money and benefited from the system, I can tell you it’s a great thing for people with high incomes and good tax advisers. But as your secretary of the Treasury, I’m telling you that it ain’t fair and that it is undermining the morale of taxpayers and crippling the economy. Too many people are getting away with too much. You asked me for a plan to change all that, and that’s what I’ve brought you today.”

Regan proceeded to explain the plan at length. The briefing lasted an hour and forty minutes—“the longest encounter by far I had had with him to date,” Regan recalled. The essence of the plan was simplification. The fourteen brackets for personal taxes were reduced to three, with marginal rates of 15, 25, and 35 percent. Special deductions and preferences—“loopholes” to those who didn’t benefit from them—were sharply pared. The corporate tax rate was cut to 33 percent. Capital gains were no longer treated specially but were taxed as ordinary income.

Reagan liked what he heard and read, giving Regan hope that something might come of the exercise. “If the president acted on his principles, I was sanguine about the outcome,” Regan recounted. “I was under no illusion that we had produced an irresistible document, but I knew that
we were giving the president a powerful lever; if he stood his ground he might very well move this particular world.”

Y
ET STANDING HIS
ground proved a challenge. The numerous interest groups whose preferences were targeted for elimination besieged Congress, and senators and representatives on pertinent committees began to shake their heads in disapproval.

But what really annoyed Regan was the sabotage by those close to the president. “The ship of state began leaking like a sieve,” Regan wrote. “On the morning after I presented the plan to the president (and before I had given my own verbal summary to the press) the substance of that confidential briefing, issuing from anonymous presidential aides, appeared on the front pages of the
Wall Street Journal
, the
New York Times
and the
Washington Post
. Even the
Baltimore Sun
was able to discuss my program in detail before I revealed it in a press conference. Unnamed White House sources were quoted as saying that the president had decided to distance himself from the plan.”