Clinton wants to focus on numbers President urges delay in policy decisions until after election


WASHINGTON -- President Clinton proposed yesterday that he and Republican congressional leaders strike a balanced budget deal by agreeing on the savings needed in various programs but putting off disputes over how to reach those savings until this year's elections.

Mr. Clinton, speaking at his first formal news conference in five months, was trying to put the best face on 50 hours of intense budget negotiations that sputtered to a standstill Tuesday.

The next day, financial markets went into a tailspin after House Speaker Newt Gingrich said he feared that no agreement would be reached before the November elections.

The president adopted, and thus neutralized, the Republicans' best argument -- that the federal budget should be balanced. But he rejected, or tried to sidestep, the conservative policy changes in such programs as Medicare, Medicaid and welfare that the Republicans use as the basis for much of their budget savings.

"We are not that far apart," Mr. Clinton said of his proposal for balancing the budget over seven years and the most recent counteroffer from the Republicans. "The differences in dollars are not as different now as some of the differences in policies. We can get it done, and I believe we will get it done in the near future."

The Republicans were icy to Mr. Clinton's offer. Although GOP leaders were also trying to calm the jittery financial markets, there was clearly no enthusiasm for the president's proposal.

"I'm very disappointed," said Mr. Gingrich, who held his own news conference in Seattle.

But the president noted that reaching an agreement with the Republicans may require that they give up trying to resolve deep philosophical disagreements, such as whether the Medicare program should be restructured to move most elderly patients into managed care and whether the federal government should end its 30-year guarantee of health care for the poor through Medicaid.

"What has held up this agreement is the insistence of the Republicans on cuts that I believe are excessive in Medicare, Medicaid, education and the environment, and insistence on a tax increase on the lowest-income of our working families," the president said. "These things are not necessary to balance the ++ budget.

Such fundamental policy changes could be debated in the fall elections, said Mr. Clinton. Voters could indicate their preferences through the candidates they elect.

Although he did not address the president's proposal directly, -- Mr. Gingrich complained bitterly about Mr. Clinton's continued use of the term "cuts" to describe Republican proposals that actually allow spending increases but at a slower rate than the president says is needed to account for inflation and increasing numbers of people served.

zTC "I don't know how you can have good-faith negotiations with someone who does that," the House speaker said.

Tony Blankley, Mr. Gingrich's spokesman, described the president's gambit as "nonsense."

"You can't separate the numbers from the policy that undergirds it," Mr. Blankley said in a telephone interview. Refusing to make the Republican policy changes "is hardly a neutral position," he said.

Mr. Clinton seemed to be taking advantage of what the White House believes was a coup in the budget talks. By offering last weekend a proposal that congressional economists say will reach a balanced budget in seven years, the president has robbed the Republicans of the argument that he is unwilling to make any commitment to that goal.

Many Republicans say that Mr. Clinton will go no further in the budget talks because his liberal backers in the Democratic Party do not want him to make the policy changes in health care, welfare, and other issues that they believe are critical to bringing spending into line with revenue.

In fact, there seemed to be little more holding the two sides together at this point than a common desire to avoid a free fall in the financial markets.

"We're both concerned about the markets," Senate Majority Leader Bob Dole said of himself and the president. Speaking to reporters in South Carolina, Mr. Dole said: "We don't want to upset the markets. We don't want people to lose money. We do want a balanced budget."

The bellwether Dow Jones industrial average plunged more than 160 points on Tuesday and Wednesday, after both sides announced a recess until next week and Mr. Gingrich suggested the possibility of no agreement until late this year.

The Dow recovered some of its losses yesterday, rising 32 points, partly on hopes for a breakthrough in the budget talks.

Questions about the budget far outshadowed renewed questions about Hillary Rodham Clinton's role in Whitewater and the 1993 firing of the White House travel office. And the president was not even asked about a decision by a federal appeals court to let a sexual harassment suit against him proceed while he was in office.

Asked to assess the job Mr. Gingrich has done in leading the Republican majority in the House during its first year in power, the president responded more like a political reporter than Mr. Gingrich's nemesis.

"Well, first of all, you have to look and say that they've held together pretty well," the president said.

"He's held them together pretty well on a course that I have often disagreed with -- but you must give him credit for that."

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