New York ? Lyndon B. Johnson wrecked his presidency and the nation’s economy by hiding the moral and financial costs of his war in Vietnam as long as possible. Rather than acknowledge the enormous burden he had undertaken in their name, Johnson kept Americans in the dark about Vietnam and helped foster a generation of cynicism about government.

George W. Bush’s fiscally relaxed approach to paying for the war on terrorism risks repeating some of Johnson’s mistakes. By pretending that Sept. 11 changed everything except his tax-cutting priorities, Bush ventures onto the path of well-intentioned deception traveled by his Texan predecessor.

As a candidate, Bush spoke eloquently about returning “the people’s money” then piling up in federal budget surpluses. But as a wartime president, Bush does not speak of paying “the people’s bills,” which exist, mount in times of crisis and produce prolonged national deficits that drag the economy downward.

Bush hurled a bolt from the blue with his proposal for a Department of Homeland Security, which had been kept even from his secretaries of state and defense. The president’s logic, outlined in his June 6 speech, for focusing the government on one overriding security mission was persuasive.

Less convincing were his staff’s claims that this gargantuan reorganization of big chunks of the federal government into one vast security agency can be accomplished without new government spending and staff. After summoning the nation to war, the White House promised business and tax-cutting as usual.

There are enough differences chiefly in the size and nature of the U.S. and global economies and in the wars themselves to give Bush a chance to escape Johnson’s fate. LBJ came to office already known as the greatest political manipulator of his time. Bush still benefits from an image of being a likable, even slightly befuddled guy.

But one thing has not changed: The essential element of governance and economic prosperity in the United States is trust. A general acceptance that contracts will be fairly enforced by an independent judiciary allows Americans to make deals, take financial risks, wait for paychecks for work already done and get on with their daily lives without having lawyers or weapons constantly at their side.

Damage that trust significantly and economic activity will suffer as greatly as political confidence. Markets and nations become paralyzed when they cannot understand, much less trust, what they are being told.

The strength of the homeland defense approach articulated by Tom Ridge is to recognize that societies survive from the bottom up that an alert, vigilant and properly informed citizenry is the front line of a democracy’s struggle against the shadow world of terrorism. But that approach requires a commitment to making sure that sacrifices are described honestly and spread fairly across the public.

Bush begins to undermine his credibility on this score. As he calls Americans and the rest of the world to the banner of fighting global terrorism, he also feathers his political nest by imposing steel tariffs and supporting a farm subsidy bill that are unfair to American taxpayers and consumers and to many of the nations whose help Bush seeks in fighting global terrorism.

Taxes are more than a device to raise revenue. They are a statement of consensus on national purpose. No one likes to pay more than his or her fair share, and excessive taxation stifles enterprise. But the people’s bills must be paid, too. They should not be passed on to another generation or hidden away until after elections.

American corporations also damage national confidence by pursuing tax avoidance as a primary business goal. Congress and professional associations can discourage such practices. What if the New York Stock Exchange were to delist U.S. companies that move to Bermuda and other offshore tax havens to escape taxes they legitimately owe at home?

Last week, New York City’s indefatigable Dist. Atty. Robert Morganthau showed how easily the moral rot of tax avoidance and tax denigration spreads. He brought an indictment against Dennis Kozlowski, the former chief executive of Tyco International, accusing him of defrauding New York of $1 million in sales taxes.

Tyco was a pioneer in the Bermuda tax dodge. Other companies now reincorporating in tax-friendly Bermuda are Stanley Works, the toolmaker, and Nabors Industries, a Houston-based drilling company. (What is it with Texas and taxes?)

“If U.S. corporate taxes are comparatively too high, Congress can address that,” Morganthau told me. “But you destroy the tax system if you persuade the taxpayer that others can get away with not paying their share, and that fairness is not the basis of the system.”

And you cripple your ability to fight a war the nation cannot afford to lose.