Economy slips further as Washington spins wheels

There is a pause in Washington as leaders consider their respective deadlocks.

President Reagan proposes a tax cut, but members of his party in Congress ask if it can pass. Industry wants a reduction in the cost of money, but the Federal Reserve Board says that the Treasury deficit should first be brought under control. Unemployment is high but increased production waits for a revival of public confidence, consumer purchasing, and world trade. In the midst of recession leaders look for a catalyst to start things moving again. The most searching look in many years is being given to the problems of the economy itself.

President Reagan and his advisers are committed to the forecast that the economy will bounce back beginning in midyear, though this commitment has been recently diluted a bit. The government's sensitive barometer of ''leading economic indicators,'' issued here March 1, declined 0.6 percent in January, the sixth straight monthly decline, or an annual rate of 7.2 percent. At the same time the Commerce Department, which compiled the figures, readjusted an earlier index downward - it previously reported a 0.6 percent increase for December but said that later figures turned this into a 0.3 percent decline.

The decline in White House economic optimism, though not fully acknowledged, has been one feature of President Reagan's first year in office. On the Wall Street barometer this is graphically portrayed first by the rise in the Dow Jones industrial average to 1024 last May, and later by its collapse to the present fluctuating figure 200 points lower (around 820-825) today. Two-hundred points can't be skimmed off the value of stocks in America without a sense of discouragement, even if the instruments involved are paper values.

America's economy affects the world and there are currently European cries that the United States should put its financial house in order, particularly by lowering interest rates. High rates here send up the cost of borrowing money in West Germany, France, and the NATO countries generally.

Not for sometime has there been such uncertainty over the economy. Purchase of new cars, homes, and other capital goods has dropped seriously. Expectation persists that by summer there will be a turnaround. Two circumstances begin to intrude, however, in economic speculation: One is the possibility of some dramatic bankruptcy or business failure that might occur before the government could intervene with aid as it did in the Chrysler case. The other is the revival of interest in the big depression that lasted from the 1929 crash to Pearl Harbor. It is agreed that the US is in a recession, normally defined as two consecutive quarters in which the gross national product has declined. Like the word ''panic'' used in the last century to describe a period of acute shortage in liquid assets, a ''depression'' has a loose definition. It is often described as a recession with unemployment over 10 percent. Unemployment now is under 10 percent.

The economic situation is becoming centrally important to the administration. Its economic success is challenged, its authority is in doubt in Congress, and a midterm election is coming up this fall. President Reagan called on a group of independent economists and the leaders of the Republican-dominated tax-writing Senate Finance Committee to go over the situation.