Regan embarrasses Reagan

Press, 28 February 1981, Page 8

Regan embarrasses Reagan

NZPA-Reuter Washington : Embarrassed White House officials were yesterday trying -to back-track on assertions by the American Trea- I sury Secretary (Mr Donald Regan) that mistakes by the ; Prime Minister (Mrs Margaret Thatcher) had reduced the chances of success for the Conservatives Government’s economic policy. President Ronald Reagan i was clearly embarrassed by ( Mr Regan’s remarks, made in evidence to a Congres- : sional committee. < The remarks came during i a day in which Mrs That- I cher and Mr Reagan nad i been paying compliments to each other. 1 Reuter reported that Mr I Regan had told the Congres- ’ sional committee that Mrs 1 Thatcher had failed to cut 1 taxes sufficiently and had

spent too much to increase productivity effectively while reducing inflation. He also said that Mr Reagan's programme of tax and spending cuts would succeed where Mrs Thatcher's so far had not, partly because the United States Government played a smaller role in the economy than the British Government. White House officials immediately tried to back-track ; on Mr Regan’s remarks. ; A spokesman said that the I situation in the United King- i dom was different from that I in the United States, and ] that honest parallels could i not readily be made. When .the issue was raised ; later at a briefing attended ’ by British journalists, Mr R. 1 T. McNamara, the Treasury i Deputy Secretary, was clear- 1 ly taken aback. < He knew nothing about t

the evidence. But he did say that the American Administration was not trying to distance itself from Mrs Thatcher and her policies. Earlier, Mr Reagan welcomed Mrs Thatcher at the White House and both pledged to stand together against foes and threats to freedom. “Britain and America will stand side by side,” Mr Reagan said when he greeted her at the start of a threeday visit to the United States, the first by a West European leader since he took office last month. He criticised the Soviet arms build-up and intervention in Afghanistan, cautioned against any Soviet move into Poland, and said the North Atlantic Treaty Organisation would be “the steadfast centre of our mu-1

tuaL security.” Mrs Thatcher, who shares Mr Reagan’s conservative views, hailed his “splendid victory” in the Presidential election and praised his leadership. “In Britain, you will find a ready response, an ally valiant, staunch and true.”