When is a neo-liberal a moderate Republican?

Recently Charles Peters of The Washington Monthly outlined what he termed ''A Neo-Liberal Manifesto.'' In an essay reminiscent of the Republic's early days when political ideas meant more than public opinion polls, Peters listed the chief concerns of this eclectic group: community, democracy, and prosperity.

The apparent goal of neo-liberalism is to combine the traditional values of liberalism - compassion, equity, and opportunity - with an understanding that energy is no longer cheap, that global markets are no longer dominated by the United States, and that military superiority, while a nice slogan, is a specious undertaking.

There even exists a lineup of neo-liberal stars: Democratic Senators Bill Bradley, Gary Hart, and Paul Tsongas; Democratic Representatives Tim Wirth and Richard Gephardt; and journalists James Fallows of The Atlantic, Michael Kinsley of Harper's, and Peters of the spirited Washington Monthly.

But before one assumes that only Democrats are speaking to the moderate majority dominant in American politics, one should remember that moderate Republicans long have been concerned with combining common sense and compassion.

Moderate Republicans, like neo-liberals, are concerned about growing unemployment, deficits that do matter, and nervous allies who wonder if the administration is really serious about arms reduction. Moderate Republicans, in fact, are a key link in the growing constituency tired of the politics of extremism. They are aware that neither liberal dogma nor rightist rhetoric is capable of delivering us from the present predicament.

As an example, most GOP moderates supported the President's 1981 budget and tax cuts. In their opinion, a nation then plagued by double-digit inflation and the lowest level of capital formation in the industrialized world had lost its ability to lead the Western bloc.

This year, however, they have split with the President. Why? Because of the limits placed upon budget cuts. Defense spending must not be held sacred while social programs continue to bear the brunt in reductions. Prudence dictates that if a 30 percent increase in defense spending continues to worsen industrial bottlenecks and create cost overruns, then defense priorities must be reexamined.

This includes, of course, the proposed growth in nuclear arms. Moderates like John Chafee, Robert Stafford, and Pete McCloskey are sponsoring legislation to place an immediate halt on the deployment and production of nuclear weapons. Only after the ever-increasing stockpiles of nuclear arms are controlled, reduced, and, if possible, eliminated, will a safer, saner world emerge.

But GOP moderates have not totally split with the President. In fact, they were quite influential in getting his recent tax bill through Congress. They welcomed his recognition that political victories are won in the center and teamed with moderate Democrats to pass a bill that, despite its political costs, makes economic sense.

Parallel to the belief that cuts in federal spending must be equitable is another important moderate principle: the extension of basic civil rights and civil liberties. For many, this stems from the opposition early Republicans had to slavery.

Today a similar sense of moral outrage can be found. Moderate Republicans like Jim Leach, Millicent Fenwick, Bob Packwood, and Lowell Weicker argue that human rights can hardly be proclaimed abroad if women are not given equal protection under the law, if vigorous support is not given to equal opportunity measures, if legal services are not provided America's poor and those discriminated against because of sexual preference, and if our government refuses to commit itself to affirmative action.

Moderate Republicans fear that if these rights are not protected and extended , then further credence will be given to the suspicion that the GOP is the party of the boardroom and not the party that represents the diversity of the American people.

But one of the most difficult tasks facing public policymakers lies in determining the level of responsibility assumed by the federal government, state governments, and local governments. While Democrats generally have supported measures strengthening centralize government, Republicans have been on the forefront of decentralizing government. Fearing the misuse of concentrated power , Republicans believe individuals have more control through local jurisdiction. Several plans have already been introduced by GOP moderates to encourage just this.

Sen. John Heinz in September introduced a measure that if passed will stimulate neighborhood self-help efforts. It combines the competing forces of centralization and decentralization by providing federal matching funds to neighborhood development organizations. These funds will be based upon the amount of money an organization can raise from local institutions. In turn, the unattached federal dollar will assist local efforts in creating new jobs, stimulating business development, improving vocational training, and providing neighborhood clean-up and protection services.

This is similar to a bill introduced earlier by Mark Hatfield, but defeated by a Democratic Senate. Hatfield, now a cosponsor of the Heinz bill, sought to challenge the powers of big government, big labor, and big business by allowing individuals to take tax credits for contributions made to neighborhood corporations. In both cases, a radical Republican principle has been followed: empowerment of individuals as well as of local governments.

Moderate Republicans certainly welcome those such as neo-liberals who are just now discovering the virtues of the political center. Here progress is made, not on the political fringe. In fact, those perplexed by growing deficits, rising unemployment, and arms escalation should be heartened, if not refreshed, by the perspective offered by moderate Republicans. Because it is by combining pragmatism and idealism that the values of community, democracy and prosperity are best advanced.