The idea of building defenses against nuclear attack-rather than relying only on retaliation-is picking up support, even while continuing to come under critical attack from some quarters.

In the first serious polling devoted to space-based defense, Arthur J. Finkelstein & Associates surveyed 1,000-odd California voters in February. Overall, 82 percent supported the idea of developing a satellite system to defend against nuclear attack. High levels of support were found among Republicans, Democrats, and independents, with more than two-thirds favoring the concept in each group. Support was strongest among those under 26 and weakest among those 65 and over. Interestingly, when asked to rank a list of defense projects, including the B-l bomber, nuclear submarines, the MX missile, and cruise missiles, along with a "system to defend against incoming nuclear missiles," an overwhelming majority favored the defensive option.

But will it work? That's the question most often asked, and the objection most often raised to the "Star Wars" concept. Those in the disarmament community- for example, the Union of Concerned Scientists-maintain that such a system would be a cruel hoax unless it provided a virtually leak-proof defensive shield. And important Defense Department factions make the same argument, maintaining that a decade or two of R&D on high-tech concepts is required before attempting to deploy any sort of system.

A strong dissenting view comes from advocates of using off-the-shelf technology to build an initial, less-than-perfect system. Ex-NASA physicist Robert Jastrow, for example, has argued that even a system that would intercept only half the USSR's warheads would require them to at least double their weapons inventory (at huge expense) and would drastically reduce their confidence of succeeding in a nuclear attack.

And a recent Defense Department report by a panel of 12 weapons analysts chaired by Fred Hoffman makes an even stronger case for a low-tech, quick-fix initial system. First of all, a simple ground-based defense of US missile silos (achievable in two years for under $5 billion) would eliminate the present Soviet ability to wipe out most of those missiles in a first strike. And because the most likely Soviet attack would be against military installations, not cities (according to long-standing Soviet war plans), there are advantages to being able to protect military targets prior to the advent of a system leak-proof enough to protect cities. Furthermore, a several-layer intermediate system would develop various core technologies that would form the basis for later, more advanced systems.

So there are a number of good reasons for getting on with the task, rather than waiting for an elusive degree of ultimate perfection.


Critics called it "voodoo economics." But proponents of supply-side economics said it was only common sense: if you lower tax rates, people will produce more, because they can keep more of what they additionally earn; economic activity will increase; and total tax revenues will rise. Now comes powerful evidence that the supply-siders were not just preaching sorcery.

As economic journalist Warren Brookes pointed out in a recent syndicated column, changes since 1969 in the tax rates on capital gains (earnings on the sale of capital assets, such as stocks, property, or a business) offer a demonstration of the touted supply-side effect. In 1969 Congress raised the top capital-gains tax rate from 35 to 49 percent, thereby hoping to rake in an additional $2 billion a year in taxes. Instead, tax revenues from capital gains fell by about $1.7 billion. But in 1978 the top rate was cut to 28 percent-followed by a further cut to 20 percent in 1981-and total tax revenues from capital gains have steadily increased ever since.

Just as dramatically vindicatory of the supply-side hypothesis, Brookes also noted, are the changes in new stock offerings following the changes in capital-gains tax rates. In 1969, when the top rate stood at 35 percent, 1,026 new stock offerings were made, with a value (in 1972 dollars) of $3 billion. But following the 1969 increase of the top rate to 49 percent, new stock offerings declined almost steadily; by 1978, new stock offerings numbered only 45, with a value (in 1972 dollars) of a mere $166 million. Then, following the 1978 tax cut, new offerings started to rise, and by 1983- after the top rate had been cut to 20 percent in 1981-875 new offerings were made, with a total value (again, in 1972 dollars) of $5.8 billion, nearly double the previous record high of 1969.

"It is no accident," Brookes wrote, "that 1983's unprecented 3.8 million new jobs coincided with and proceeded directly from the nearly 40 percent increase in the value of corporate stocks since August 1982." (Japan and West Germany, incidentally, whose economic performances are so widely acclaimed, have no capital-gains tax.)

Having pulled the rug from under the supply-side critics on the issue of the stimulative effects of lowering taxes, Brookes subsequently took up the matter of how the income-tax cuts initiated by the Reagan administration supposedly favor the rich. According to recently released Treasury Department data on income taxes for 1982-when individual tax rates on wages and salaries were cut an average of 7.5 percent-tax revenues from those making more than $100,000 a year were 13 percent higher than the year before, and revenues from those in the $50,000-or-more-a-year category were up 6 percent.

Conversely, tax revenues from those making less than $20,000 a year dropped 12 percent, while those making between $20,000 and $50,000 a year paid 4 percent less in taxes in 1982 than in 1981. A significant factor in this shift of the federal tax burden to the rich was a 55-percent rise in the number of returns filed by those with incomes of $1 million or more.

Reflecting on how "high marginal tax rates penalize chiefly the U.S. Treasury, not the rich," the Wall Street Journal, in an editorial entitled "Tricklenomics," further pointed out that "the tax cuts are fueling an entrepreneurial explosion. New incorporations have doubled since 1977, and may have hit a record 600,000 in 1983." And, noted the Journal, "Minorities and women are starting new firms even faster than the average."

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