
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, May 17, 1990                   TAG: 9005170223
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-8   EDITION: METRO 
SOURCE: The New York Times
DATELINE: WASHINGTON                                LENGTH: Medium

BUSH: DEFICIT CONTROL `URGENT'/ PRESIDENT RELUCTANT TO AIR PROPOSAL

In his first public explanation of why he initiated budget negotiations with Congress, President Bush said Wednesday that the deficit problem had become "urgent enough" that it needed to be addressed now, while the economy was reasonably strong.

But Bush, speaking at a news conference, declined to say what he wanted to do about it.

"I don't want to inadvertently send the wrong signals to the markets," the president declared, repeating what he said in private to congressional leaders on Tuesday in the first session of the negotiations.

Bush's refusal to make his case in detail and in prime time on television was challenged by Democratic legislators. They maintain that Bush, and Ronald Reagan before him, sold the public a bill of goods about the strength of the economy and the virtue of low taxes, and say Bush is unwilling to take the political heat necessary to rectify past mistakes.

"What we're seeing is a recognition of what has been a continuing crisis," said Rep. Leon Panetta of California, chairman of the House Budget Committee.

"What we feel needs to be done is for the president to make a presentation to the American public. The problem is serious, and you can't use smoke and mirrors to get around it any longer."

Democratic lawmakers told Bush on Tuesday that they would have trouble selling unpopular measures to their constituents if he did not make his own case in a televised address.

Asked at his news conference why he did not, Bush said, "I'm not going to go out there and do something that might inadvertently suggest crisis and frighten the markets."

Bush also refused to say whether he had changed his mind about opposing all new taxes. He did say his administration and Congress had to be careful not to cut spending or raise taxes so much that the economy would be damaged.

In his first 15 months in the White House, Bush never hinted the economy was anything but rosy, that the budget deficit might require painful belt-tightening or higher taxes might be acceptable.

Wednesday he said striking a deal to cut the deficit would be the biggest test of his leadership on a domestic policy issue.

The president was asked whether his stance had changed because high interest rates threatened economic growth, because automatic spending cuts called for by the Gramm-Rudman-Hollings budget-balancing law if the deficit was not brought down enough might be too deep for the country to absorb, or because he was frustrated by the lack of money available for programs he favored. He responded:

"I want to say almost all of the above, but it's really that when you take a look at the most recent estimates, the problem is of such a magnitude that we have to address it.

"It's more that than it is a fear of any specific category. It's just big enough that we have to do something about it, and that's why I've taken the approach I have taken."

by CNB