COLUMN ONE : An Idea Man Flexes His Muscle : Labor Secretary Robert Reich is turning his low-profile post into a power base. His close ties to the President have given him a wide-ranging portfolio and clout.

Labor Secretary Robert B. Reich, the smoothest-talking Friend of Bill in town, is suddenly at a loss for words. The question that gives him pause involves his friendship with the President of the United States.

“There is a little bit of awkwardness,” Reich finally says, choosing his words carefully. “I mean, put yourself in the position: You have an old friend of 25 years; suddenly, he’s your boss, and he’s President of the United States. It’s been difficult for me to get the two images to overlap. . . . We haven’t quite worked that one out yet.”

There is a formality to their relationship now, even behind closed doors. Reich said he makes a point of calling his friend “Mr. President,” even when no one else is around. Clinton calls him “Mr. Secretary.”

But don’t worry, Bill and Bob will work things out. While there are plenty of faux FOBs in Washington these days, Reich is the real deal.

The two go back to 1968, to the now-famous encounter when Clinton brought a seasick Reich a bowl of chicken soup during their ocean voyage to Britain and their Rhodes scholarships.

It was Reich who steered Clinton to join him at Yale Law School. Back when Clinton was still worried about the draft and whether to inhale, Reich was there.

And Reich is still there today, a key player in Clinton’s network of longtime friends who populate his Administration.

As the Clinton presidency enters its fifth month, still struggling to get on its feet, it’s clear that Reich’s influence over his old friend extends far beyond his nominal role as one of 15 Cabinet members.

In fact, the 46-year-old Reich has assumed a far more ambitious role, one to which he is uniquely suited: torchbearer for the Clinton campaign agenda.

Just about everyone who followed Clinton’s rise last year expected Reich to emerge as a power in the new Administration.

A longtime lecturer at Harvard University’s Kennedy School of Government who has made a small fortune as a popularizer of new-age politico-economic theories, Reich was the intellectual engine behind Clinton’s 1992 campaign to recast the Democratic Party into the party of ideas.

Even so, the degree to which Reich has been able to retain his standing as Clinton’s chief kibitzer is striking.

Signs of Reich’s growing power deeply trouble conservatives, who see him as their worst nightmare, an activist liberal who has the President’s ear.

They say Reich and others like him are responsible for what they see as Clinton’s post-Inaugural lurch to the left--which only recently has been addressed by such moves as Clinton’s decision to bring in Republican David Gergen as a senior staffer and his decision last week to withdraw the nomination of C. Lani Guinier to a key Justice Department post.

“Reich is a very key figure,” said Lawrence Kudlow, a former Ronald Reagan Administration economic policy-maker. “It is important to recognize that this Administration has become surprisingly liberal surprisingly quickly, and Reich is one of the architects of that.”

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Reich’s business card may say “Secretary of Labor,” but his FOB status has quickly enabled him to become an economic- and domestic-policy minister with the clout to dip into almost any issue that piques his wide-ranging interests.

As a member of Clinton’s powerful National Economic Council, he is in the middle of Administration debates over health care reform, education policy, welfare reform, national service, and technology policy, as well as the overall shape of deficit reduction and government spending priorities.

He has inserted himself into the regulatory process, demanding, for instance, that the Federal Communications Commission consider the impact on U.S. jobs of its pending decision on the future standard for high-definition television.

Forming a ‘Cluster’

Reich is low-key and collegial, but there is no doubting his ambition. Already, he is quietly drawing the Education Department and the Commerce Department into his orbit.

He is working with Education Secretary Richard W. Riley on job training and apprenticeship programs that help bridge the gap between school and the workplace. He is collaborating with Commerce Secretary Ronald H. Brown on a yearlong study of the future of labor-management relations, which will recommend changes in the nation’s New Deal-era labor laws.

In effect, Reich wants to form a “cluster” of Cabinet agencies, based at the Labor Department, to break down traditional bureaucratic barriers to quick action. The concept is in keeping with Clinton’s preference for assembling ad-hoc task forces to address key issues.

In the process, Reich has upgraded the role of labor secretary--a backwater Republican patronage post for the past 12 years--to an unprecedented level.

Analysts agree that never before has a labor secretary been this close to a President or wielded this much influence within an Administration.

Now, along with National Economic Council Chairman Robert E. Rubin, Atty. Gen. Janet Reno, Interior Secretary Bruce Babbitt and, perhaps, health care task force director Ira Magaziner, Reich has emerged as one of the early stars of an Administration sorely in need of some star power.

In a city built on appearances, Reich’s height--4 feet, 10 1/2 inches, having gained the half-inch after double hip replacement last summer--hasn’t hurt him at all.

He’s a natural on TV talk shows and delivers pointed speeches without a text, both skills learned during his days as an author and college lecturer. His ability to deliver an appropriate quote on demand is highly prized in Washington.

In a self-deprecating style, he disarms listeners by opening each speech with jokes about his height, which was stunted by a childhood spinal disease: “When I started this job, I was 6-foot-2,” he deadpans. “I’ve always been on Bill Clinton’s short list,” is another favorite.

He is working so closely with Riley, he adds, that the two are joined at the hip--”my hip and his knee.”

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Reich has been overcoming challenges all his life, excelling so much that hardly anyone has ever had time to notice his height. Indeed, not too many years ago, Reich was probably better known nationally than Clinton.

Raised in South Salem, N.Y., the son of a local clothier, Reich gained notice as a 1960s student leader at Dartmouth University; that’s when he became acquainted with a fellow student leader at Wellesley College named Hillary Rodham.

“I’ve known Hillary--I mean the First Lady--longer than I’ve known the President,” Reich said.

He went to Yale Law School after his Rhodes scholarship and began a rapid ascent through the public policy ranks.

Worked With Bork

After clerking for a federal appeals court judge, he joined the Gerald R. Ford Administration, ironically as an assistant to then-Solicitor General Robert H. Bork, whose 1987 Supreme Court nomination by Reagan failed in the Senate because of his extremely conservative views.

He later held a policy post at the Federal Trade Commission under Ford and stayed there during the Jimmy Carter years before moving to the Kennedy School as a lecturer specializing in political economics.

Trained as a lawyer, Reich nonetheless emerged as one of the nation’s most influential economic analysts of the early 1980s.

His great talent was his ability to synthesize the seemingly disparate trends and abstract research done by other academics and then to offer a coherent explanation of the economic and social upheaval that has gripped the United States over the past decade.

His critics dismissed him as a policy huckster, and he was rebuffed in his bid for tenure at the Kennedy School. But his skills brought him enormous success as an author, television analyst and lecturer.

By 1992, Reich was making more than $500,000 a year, earning as much as $14,000 per speech at a time when his academic salary was just $75,000 per year, according to the financial disclosure report he filed for his nomination.

Defending the Agenda

The economic plan that Clinton unveiled in February owed much to the thinking and writing that Reich had done at the Kennedy School, so it’s little wonder that Reich is one of the sturdiest defenders of the Clinton agenda.

He often appears to be the last to give up in the face of pressure from moderates and conservatives for compromise on Clinton’s new spending programs.

What’s more, his second-floor office at the dowdy Labor Department building at the foot of Capitol Hill has become a center of intellectual ferment within the Administration, in much the same way that Jack Kemp’s office at the Department of Housing and Urban Development was during the George Bush presidency.

The crucial difference, of course, is that Clinton listens to Reich, whereas Bush tended to ignore Kemp.

“Kemp was doing the thinking for Bush, very much like Reich is for Clinton,” said Jim Pinkerton, a former Bush Administration domestic-policy official. “But Kemp was very much isolated and much maligned by the White House staff.”

With so much to juggle, however, Reich admits he has spread himself too thin.

“I can’t keep up this pace for more than about six months,” he said. “At some point, things will have to settle down.”

He said he hopes to cut back his schedule by the time his wife, Clare Daulton, a law professor at Northeastern University, and their two young sons, Adam and Sam, move from Boston to Washington this summer.

Reich’s manic schedule reflects the scattershot approach of the entire Administration and suggests why the Clinton gang seems so undisciplined.

During one recent day, Reich attended meetings on economic policy and health care at the White House and on Capitol Hill, held a press conference on education and gave a speech on labor policy to a major union group.

At work by 7:30 a.m., Reich conducts meetings until 9 many nights.

Reich says he tries to limit his involvement in White House debates to issues that relate in some way to labor policy.

He argues that the central theme of the Clinton agenda is to help Americans work smarter and more competitively, so he has staked out a role as the member of the inner circle who provides a voice for the American worker in discussions of both economic and domestic policy.

To underscore that point, he has taken to calling himself the “secretary of the American work force” and the “central banker of the nation’s greatest resource.”

Of course, almost everything in government has some effect on workers and the workplace, and Reich has defined labor policy in the broadest possible terms. That makes it easy for him to perform what seems to be his real function.

Reich is fighting a quiet battle to keep the President’s focus on the pro-growth, pro-spending domestic agenda that was the hallmark of the campaign.

He says he believes that new spending programs in areas such as job training and public works got Clinton elected. Those initiatives are crucial, Reich says, to Clinton’s ability to distinguish himself from Ross Perot and the Texas billionaire’s grim program of sacrifice in the name of deficit reduction.

“No modern economy is turning its back on its fundamental building blocks: its people and its infrastructure,” Reich said in a Washington speech, echoing the themes of the Clinton campaign manifesto, “Putting People First.” “We must invest in one another directly. And that is what this campaign which we have finished, which we have won, is all about.”

Internal Debates

Reich’s preoccupation with last year’s agenda puts him at odds with officials who were not involved in the campaign and who say they believe that Clinton must respond to mounting pressure from Congress and the public to focus on reducing the deficit and controlling spending.

“I don’t think it is a big secret that Reich is among those pushing for a more expansive investment spending policy,” said Jeff Faux, president of the Economic Policy Institute, of which Reich was a founding board member.

“He was instrumental in moving the campaign in that direction in the spring of 1992. Now, we agree that Clinton could be in big trouble in the off-year elections in 1994 because of the big hit the economy will take because of the focus on deficit reduction.”

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By all accounts, the internal debates have remained friendly. But the tensions between Reich and deficit hawks like White House Budget Director Leon E. Panetta and his deputy, Alice Rivlin, are clearly rising.

The intense discussions within the Administration over the costs of Clinton’s pending health care reform plan have only made matters worse.

Asked about reports of a rift with Panetta, Reich refused to comment; a Panetta spokesman denied there was any tension between the two.

But other senior Administration officials say Reich is leading a liberal wing of the Administration that often clashes with the Panetta camp over tactics and strategy surrounding economic and budget policy.

While both sides support the substance behind Clinton’s spending agenda, the Panetta moderates say they believe that the President must focus first on deficit reduction to win credibility with voters who are worried that Clinton is a tax-and-spend liberal at heart.

“There have been differences over strategy, not over substance,” Rubin said.

All this is happening at a time when Reich is busy trying to do his day job: spearheading a dramatic shift in U.S. labor policy.

From family leave to job retraining, Clinton and Reich seem determined to follow through on campaign promises to create a labor agenda sharply at odds with the openly anti-union policies of the Reagan-Bush era.

That means that Reich faces a tough balancing act: He must find a way to meet the immediate demands of Big Labor without giving up his broader, long-term strategy for addressing the needs of the workplace of the 21st Century.

And he must to do that without antagonizing business and risking the loss of key Clinton supporters in corporate America.

So far, many of Reich’s labor initiatives could have been drafted at AFL-CIO headquarters: Clinton has reversed two Bush Administration anti-union executive orders and has promised to lift the ban on the air traffic controller’s union imposed by Reagan in 1981.

Clinton and Reich have also embraced Big Labor’s No. 1 political priority: legislation that would prevent companies from permanently replacing striking workers.

“One of the key issues for Reich will be relations with organized labor, and so far, the Administration has tried to meet labor’s concerns without getting anything in return,” said Robert Lehrman, a labor expert at American University in Washington.

Walking a Tightrope

How can Reich walk the tightrope between business and labor?

“It’s not easy,” said Kitty Higgins, Reich’s chief of staff. “You’ve got constituencies--labor, civil rights groups, community groups in the job training area--who have been out in the wilderness for 12 years, and they have things they want to get done. But I think we have to make sure that people have a balanced view of what were doing.”

While Reich insists that he doesn’t intend to become the “secretary of organized labor,” he clearly has a fight on his hands.

Even so, specific problems involving his role as labor secretary aren’t likely to jeopardize his broader standing within the Administration. His ties to the First Family are too deep, too strong.

Consider this scene: Clinton and Reich are standing backstage at a Washington event for the Children’s Defense Fund in March, when the announcer’s voice calls out, introducing “the President of the United States.”

Instead of striding onto the stage, Clinton pushes Reich into the limelight instead. While his old friend flusters, the President of the United States remains in the shadows, buckled over in laughter.

* CLINTON CRONYISM: Appointing friends to posts is seen as source of trouble. A12