A LITTLE MORE than 20 years ago, then-president Ronald Reagan set out to change the American economy. With the support of a cowed and weak Congress, Reagan changed the tax laws and government spending priorities in a way that set off a fundamental shift in the distribution of wealth in the United States. By 2002, the rich have gotten way, way richer, poverty and homelessness have increased dramatically, and the United States has become the single most socially stratified nation in the developed world.

As Tim Redmond reports on page 13, that's the background for the budget decisions the San Francisco Board of Supervisors will be making in the next few weeks. The context is crucial: for the most part, Mayor Willie Brown's budget continues the trend that Reagan started in 1981. There are no significant new taxes on the wealthy. There is no significant attempt to make big business pay its fair share of the cost of city services. In fact, the mayor has essentially covered the entire $90 million deficit by cutting programs.

And, as we report in our special budget package this week, the programs the mayor has cut reflect the overall regressive nature of the budget: The high-paid bureaucrats are protected (employees who earn more than $130,000 a year are all getting juicy raises). The cops are protected (police overtime – mostly a fat perk – is actually increasing). The sole-source contracts (worth $100 million) are protected. But 61 low-paid hospital laundry workers will lose their jobs. Public health, homeless programs, recreation and park programs, the children's budget – all are facing big cuts.

So far, the supervisors are treating the budget relatively gently – the Budget Committee has trimmed a little here and there and is making some recommendations. But this Brown budget is a disaster, and the supervisors should reject it. Instead, they should demand that big businesses and the wealthy – who have seen their state and federal taxes drop by huge amounts in the past 20 years – pay a much larger share of the city's costs (we've listed several revenue suggestions on page 13). And they should look to the high-paid employees and spending that doesn't directly affect ground-level services (like police overtime and P.R. contracts) before they cut programs that serve the most needy.