(FORTUNE Magazine) – WHEN RONALD REAGAN launched his tax reform crusade in November 1984, top congressional tax writers did not rush to enlist. That he ultimately won the war is due mostly to the two fellows pictured at right, as odd -- and winning -- a couple as Laurel and Hardy. At first Dan Rostenkowski, the Democratic chairman of the House Ways and Means Committee, insisted that deficit reduction was a far more urgent goal. And Bob Packwood, the independent-minded Republican who chaired the Senate Finance Committee, dismissed some points of Reagan's plan with the memorable line, ''I sort of like the tax code the way it is.'' In the end, both changed their tunes and made Reagan's dream a reality. The result: A radically new tax code that will raise business taxes by some $120 billion over five years -- and lower personal taxes by roughly the same amount. No other event of 1986 will have a more profound effect on Americans and their economy. The word ''reformer'' has never been associated with Rostenkowski, 59, a purebred machine Democrat who came to Congress in 1959 as former Chicago Mayor Richard Daley's man in Washington. But the brawny, 6-foot 2-inch chairman saw in the President's plan an opportunity to put a decidedly Democratic stamp on the Administration's tax overhaul. ''In the beginning it was a challenge politically,'' he says in his gravel voice. The President's package, of course, already had many traditionally Democratic elements, among them the closing of corporate loopholes and the elimination of many of the poor from the tax rolls. Hitting business harder and providing more relief to middle-class workers, Rostenkowski reasoned, would give his party, his committee members, and himself something to crow about. As he put it at the time: ''If we pass reform, it will be the hallmark of my career.'' So Rostenkowski shelved deficit reduction and made tax reform his top priority. For a while it was a lonely quest. Even the most popular President in decades could not ignite public enthusiasm, and committee members were fast losing interest. ''There were many times when I felt it was hopeless,'' Rostenkowski recalls. One of the lowest points came when his committee voted to give banks bigger tax breaks by liberalizing, rather than scaling back, write-offs for bad loans. To embarrass the members, the wily chairman disbanded the committee for ten days, letting ''the press pound on us.'' Criticism of the committee's largess to the banks was widespread. When Rostenkowski reconvened the group, the members handily reversed their vote, putting reform back on track. THE CHAIRMAN then established a series of committee task forces designed to help build consensus in key areas. Meanwhile, in one-on-one meetings, he used his personal clout to corral support from the members. Says a top aide: ''There was a certain amount of intimidation. People weren't anxious to go head-to-head with Rosty.'' Through this process Rostenkowski realized the committee was wedded to maintaining the deduction for state and local taxes, a provision the Administration wanted to kill. Preserving that break, says Rostenkowski, ''was the main turning point.'' Soon after, the bill passed the committee 28 to 8 and was on its way to the Senate. At first the House bill did not please Finance Committee Chairman Packwood, 54, a cerebral and outspoken Oregonian who believed strongly in using tax incentives to achieve social and economic goals -- particularly when they helped his state's timber industry. Since the House version eliminated many such breaks, it was an ''anathema'' to Packwood, according to William M. Diefenderfer, the Finance Committee's chief of staff. So it was hardly surprising that Packwood allowed his committee to restore tax break after tax break. That left the package billions of dollars in the red and totally unacceptable to Reagan, who insisted on ''revenue neutrality.'' The press began savaging the committee's work as tax de-form, and Packwood as ''Senator Hackwood.'' Facing the prospect of political failure, Packwood had a Paul-on-the-road- to -Damascus-style conversion. Over two rare cheeseburgers and two pitchers of beer at the Irish Times restaurant on Capitol Hill, Packwood and Diefenderfer hatched their now famous ''25% solution.'' (So famous that a plaque in the restaurant hangs above their table commemorating the event.) The chairman would propose a top tax rate of 25% for individuals, later to be inched up to 28%. At this low level, he reasoned, tax incentives would not be so important, either economically or politically. To Packwood's delight, his high-risk, low-rate gamble paid off. Suddenly the Finance Committee members also got religion. To pay for the rate cuts, the committee eliminated most tax shelters and many other once sacred tax breaks. The bill then sailed through the full Senate. In October, Reagan signed tax reform into law. Says a buoyant Packwood: ''The glue that held everyone together was the lower rates.'' Those rates have already come under attack by none other than Rostenkowski, who would like to raise them next year to -- no surprise -- cut the deficit. But Packwood says that would be a ''betrayal'' of the American people. And Rostenkowski concedes even he won't stick his toe in the water unless he gets some support from Reagan. Rosty can plan on dry feet.