SPENDING SMARTER.

Analyses U.S. President Ronald Reagan's experiment in small government. Demagoguery of Reagan on the subject of taxes; Proposed budget for fiscal year 1988; Insistence of the administration that deficit targets be met solely through spending cuts, without new taxes; Need for Strategic Defense Initiative and other national defense programs; Plans of the government to raise gasoline taxes; Request of the administration for a three percent after-inflation increase in defense spending; Creation of the Small Business Administration, and Urban Development Action Grants, for the noble purposes of economic development and job creation.