With an eye to Ronald Reagan on one hand and Sen. Edward Kennedy on the other , President Carter has fashioned an "economic program for the eighties" that tries to whittle away at two "unacceptables."
One "unacceptable," says the President, is a jobless rate that is expected to hang above 8 percent at least through next year.
Equally unacceptable, says chief White house domestic adviser Stuart E. Eizenstat, is the nation's underlying inflation rate of 9 or 10 percent.
"How," asks Mr. Eizenstat, "does the US achieve sustained economic growth, enough to reduce unemployment, without re-igniting inflation?"
Complicating the task is the expectation that, despite oil conservation, the United States will face "sustained external inflationary pressures," as the Organization of Petroleum Exporting Countries jacks up oil prices in the future.
Mr. Carter's answer to all this is an "economic revitalization" program with the theme of "investment" -- mostly private, but some public -- designed to stimulate "real economic growth of 4 to 5 percent per year."
Consistent with the theme of investment, 55 percent of Carter's tax-cut proposals would benefit business, only 45 percent would aid individuals. The business, or "supply side," benefits mount to 65 percent by 1985.
This is far more generous to corporations than the traditional two-thirds, one-third split favoring individuals that has characterized past tax cuts.
White House officials describe sharp differences between the Carter program and economic proposals offered by Mr. Reagan. Eizenstat also concedes that Senator Kennedy's "input has been felt in this program," especially in the "commitment to create jobs."
Congress will be asked to consider the bulk of the President's program in January, after the election, when a fresh legislative body -- and presumably a re-elected President Carter -- settle down to next year's work.
If Congress were to approve the Carter program relatively intact, it would, by White House reckoning, achieve the following results:
* The consumer price index would be reduced only by 0.2 percent, mainly through an offset to higher social security taxes which employers, as well as workers, are scheduled to pay in 1981.
* Four hundred thousand jobs would be created next year and a total of 950, 000 by the end of 1982. These would be in addition to jobs created by youth employment and synthetic fuels programs already on the books.
This would move the jobless rate down from the otherwise-expected 8.5 percent to 8.1 percent in 1981, with another drop the following year.
The nation's gross national product (GNP) would grow 2 or 3 percent faster than would be the case, without the Carter program.
* The fiscal 1981 federal budget deficit would be increased, says Budget Director James T. McIntyre Jr., "by about $6 billion," to at least $35 billion.
This is the budget that Carter had vowed would be balanced, until the current recession shrank government tax receipts and boosted unemployment compensation and welfare outlays.
Carter will ask Congress to pass two parts of his program immediately, before lawmakers go home for the November election.
One would provide jobless Americans with an additional 13 weeks of unemployment compensation, beyond the 39 weeks now available in many states. (When the recession is over, the period of eligibility would revert to the usual 26 weeks.)
To help attract private investment to distressed areas, Carter seeks more government money -- loan guarantees, development grants, interest subsidies -- under the so- called "countercyclical revenue-sharing program."
This already-existing program targets federal assistant to depressed areas, mainly cities, where unemployment is chronically high.
These, says Eizenstat, are the "short- term" aspects of the Carter program. The rest is "investment strategy."
Highlights on the business side:
* Corporations would be allowed a speedier and simpler write-off against taxes of new investment designed to modernize plants and equipment.
* Separately, the 10 percent investment tax credit would be made partly refundable. Currently, firms can deduct from taxes 10 percent of their investment costs -- but only if they pay taxes.
New firms just starting out, and ailing industries like autos and steel, may make no profits on which to pay taxes. Under current law, they lose the advantage of the investment tax credit. Carter would reward firms that invest for future growth but make no profits, by giving them cash payments.
* Highways, railroads, ports, and mass transit would get extra money to rehabilitate the national transportation network.
* Funding for scientific research and technological development would be expanded.
* An additional $975 million would be appropriated in fiscal 1981 for weatherization of homes, public housing, schools, hospitals, and federal buildings. In addition to saving energy, this would create jobs.
Among tax reductions for individuals in the Carter program:
* Higher social security taxes due in 1981 would be offset -- in some cases wholly, in others partly -- by an income tax credit equal to 8 percent of the worker's total social security tax payment for the year.
* Families with two wage earners would get a special tax deduction, to help offset the so-called "marriage penalty," whereby a working married couple pays higher taxes than an unmarried pair.
* Families paying social security taxes, but earning too little to pay income taxes, would receive a more generous earned income tax credit, or cash payment, from the treasury.
Eizenstat, comparing Carter and Reagan economic proposals, not surprisingly finds several advantages for the tax-cut plans advanced by the President.
Carter's income tax proposals, he said, are weighted to help lower-income Americans; Reagan's 10 percent across-the board-income tax reduction would benefit higher-income people.
Also, said Eizenstat, the Carter model is oriented far more to generating investment -- and hence is less inflationary -- than the program suggested by Reagan.