Clinton to allow states major role in welfare reform President seeks broad consensus on several issues

WASHINGTON — WASHINGTON -- President Clinton promised yesterday to help the nation's governors turn the welfare system into a "hand-up, not a hand-out" and made his first presidential foray to Capitol Hill to consult with legislators on his economic package.

Mr. Clinton was intent throughout a busy day on cementing the partnerships with the state and congressional leaders that he will need to pass his proposals for reducing the federal deficit and stimulating the economy.


TC Despite new government figures released yesterday that showed economic prospects brightening, the administration continued to discuss a job-creating stimulus package of as much as $31 billion.

To the governors, Mr. Clinton outlined his plans to introduce a two-year training program for eligible welfare recipients who would then have to work in the private or public sector.


But he also told the governors that they were free to experiment with their own ideas on welfare reform, just as 24 hours earlier he promised them similar latitude on Medicaid initiatives.

During his economic discussions on Capitol Hill, he sought to avoid the kinds of complaints that arose in his effort to integrate gays into the military when many congressmen were ignored. Instead, he asked Democratic senators for specific suggestions concerning job initiatives, budget cuts and possible tax increases.

Inside the White House, there was relief that the Clinton program was firmly back on track, addressing the issues that matter most to the middle class.

Mr. Clinton's welfare package, unveiled to the governors, had few new specifics in it beyond his campaign promises to "end welfare as we know it."

He told the governors: "On welfare reform, as on health care reform, there are no top-down, made-in-Washington solutions that will work for everyone. The problems and the progress are to be found in the communities of this country."

He said he would appoint a task force to work out the details of the reform in consultation with the governors, but he outlined four principles to enable welfare recipients "to move from dependence to dignity."

* First, he proposed a two-year education and training program that would lead to a job. He said there must be "a time-certain beyond which people don't draw a check for doing nothing when they can do something."

Aides said the task force would work out whether eligible people who did not find work would immediately lose their benefits.


Mr. Clinton said those who worked should be guaranteed health care and child care services, the cost of which currently dissuade many welfare recipients from seeking jobs.

* Second, earned income tax credits should be expanded to ensure that anyone who works full-time can escape poverty.

Mr. Clinton said the scheme would be less expensive than having the government "pay people to remain idle." It would "reinforce the work ethic" and could produce "a dramatic breakthrough in our efforts to liberate people from their dependency."

* Third, he advocated tougher enforcement of child support through a national data bank to track "deadbeat parents."

He said that states should go as far as possible to establispaternity at hospital during birth and that the Internal Revenue Service should be used to collect payments in seriously delinquent cases.

Parents of an estimated 15 million children owe support payments. The money -- estimates range from $5 billion to $25 billion -- could "go a long way toward cutting the welfare roles and lifting single parents out of poverty," said Mr. Clinton.


* Finally, he encouraged reform experiments at the state level. "My view is that we ought to give you more elbow room to experiment," Mr. Clinton told the governors, promising to allow waivers from federal regulation even for experiments with which he did not agree.

"If it works, let's tell everybody it works, so we can all do it. And if it doesn't, let's have the courage to quit and admit it didn't."

"I think all of us want what most people on welfare want -- a country that gives you a hand up, not a handout," Mr. Clinton said.

After the governors' meeting, he headed for Capitol Hill to lay the ground work for the economic package he will outline in his State of the Union address Feb. 17. He also discussed the family leave bill under Senate consideration and campaign-finance reform with the legislators.

The Commerce Department yesterday announced that the Index of Leading Economic Indicators, the government's principal forecasting guage, registered a 1.9 percent surge in December, its best performance in 10 years, suggesting that the economy is likely to grow steadily over the coming months.

But Sen. Paul S. Sarbanes, the Maryland Democrat who is vice-chairman of the Joint Economic Committee, said there is concern that the surprisingly strong growth rate of 3.8 percent for the last quarter of 1992 may be adjusted downward when new figures are released Friday. So far, there has been no sign of new jobs being created as a result of more robust growth.


President Clinton is working on both a short-term economic stimulus package of about $30 billion that Congress would be asked to enact right away and a long-term deficit-reduction program that would be reflected in his budget proposal for fiscal 1994.

His advisers have discussed a plan that would devote about half the short-term spending to public works projects, such as highways, bridges and water treatment systems, and the rest to an investment tax credit.

The administration's stimulus package would be designed to create 200,00 to 500,000 jobs within a year, according to George Stephanopoulos, the White House spokesman.

But most of the details of the plan remain in flux, said Mr. Sarbanes, who attended a briefing Monday night with Treasury Secretary Lloyd Bentsen, Leon E. Panetta, director of the Office of Management and Budget, and Robert E. Rubin, chairman of Mr. Clinton's new National Economic Council.

"They are still trying to piece things together," Mr. Sarbanes said. "My sense is that they're going to go right down to the wire."