The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1996, Landmark Communications, Inc.

DATE: Wednesday, January 24, 1996            TAG: 9601240379
SECTION: FRONT                    PAGE: A1   EDITION: FINAL 
SOURCE: BY ANN DEVROY, THE WASHINGTON POST 
DATELINE: WASHINGTON                         LENGTH: Long  :  163 lines

STATE OF THE UNION ADDRESS ``ERA OF BIG GOVERNMENT IS OVER'' CLINTON PUSHES SCHOLARSHIPS, WAR ON GANGS AND TAX CREDITS

Borrowing generously from Republican themes, President Clinton Tuesday night declared that the ``era of big government is over'' and sought to ease middle-class anxieties with an upbeat vision of a nation pulling together to prepare itself for the new century.

With Republicans bruised by weeks of vicious partisan budget battles sitting mostly silently in their seats, Clinton used his election-year State of the Union address before a joint session of Congress to point out how many goals he and Republicans share, without dwelling on how strenuously he and Congress have fought over how to achieve them.

He is for a balanced budget, but not their balanced budget. He is for welfare reform, but not their welfare reform. He is for family, individual responsibility, self-reliance, the fight against crime and the battle against drugs. But they disagree on government's role.

Senate Majority Leader Robert J. Dole, Kan., the leading Republican presidential candidate, made the differences between the presidential rhetoric and presidential action the theme of his televised response. Dole outlined GOP differences with Clinton, assailing the president as ``the chief obstacle to a balanced budget'' and ``the rear guard of the welfare state.''

Dole said Clinton was ``careening dangerously off course'' in welfare, education, Medicare and taxes, and promised, ``We will challenge President Clinton again and again to walk the talk he talks so well.''

Clinton, far less sharp in his approach and much more conciliatory, re-enlisted in the smaller government movement in words that could come out of the mouths of most, if not all, Republicans. ``Big government does not have all the answers,'' Clinton said. ``There is not a program for every problem. We know we need a smaller, less bureaucratic government in Washington. . . one that lives within its means.''

The speech comes at an extraordinary moment for Clinton, as he pauses between innings in the bitter struggle with reigning Republicans over balancing the budget and his tough re-election campaign.

Hillary Rodham Clinton, in the traditional first lady's balcony spot with daughter Chelsea at her side, was a visible reminder of the president's continuing, intractable problem with the Whitewater investigations and their many offshoots. It was Hillary Clinton's first public appearance since the announcement Monday that she has been subpoenaed to appear before a grand jury Friday.

Clinton made no mention of those troubles Tuesday night.

Hillary Clinton was applauded as she entered with the couple's 15-year-old daughter, Chelsea, who was making her first State of the Union appearance. The president introduced the beleaguered Hillary Clinton as a ``wonderful wife, a magnificent mother and a great first lady,'' and Chelsea led a standing ovation of Democrats and Republicans alike.

The president broadly laid out what he called seven challenges for an ``Age of Possibility,'' sketching a future in which individuals, community and other segments of society take more responsibility for making America work.

Among the challenges Clinton outlined for the nation was to strengthen the American family, to provide educational opportunities for all Americans, to help Americans achieve economic security, to protect the nation against criminals and drugs, and to protect the environment.

In a brief segment on foreign policy, the president also said the nation's challenge is to maintain its leadership in the international fight for freedom and peace.

And finally, he listed what he called the nation's challenge to politicians to produce a smaller, less bureaucratic government that earns, again, the ``respect and trust of the American people.''

He challenged Congress to pass new campaign finance reform as a step in that direction.

Ending his address with the same ``big government is over'' assertion as he began, Clinton said that despite that, ``We cannot go back to the era of fending for yourself. We must go forward to the era of working together as a community, as a team, as one America to solve our problems.''

With government funding disappearing and Republicans in charge of Congress, Clinton had little to offer in the way of new government programs, a traditional State of the Union device for Democrats and even some Republicans before the current balance-the-budget era.

Instead, the president offered a handful of modest proposals aimed primarily at easing middle-class anxieties, including a $1,000 scholarship for the top 5 percent of all high school graduates.

Aides said the scholarships would cost taxpayers $125 million.

He called for tax incentives for businesses that clean up abandoned properties and expansion of a federally funded college work-study program to one million students, up from 700,000 now.

He called for an FBI-led war against youth gangs and for legislation protecting workers' pensions and insuring health care benefits for employees who change jobs or have pre-existing conditions.

Clinton did not avoid his fights with Republicans over the budget, but he did not emphasize them Tuesday night.

The president reiterated a position he has repeated almost daily since the budget talks broke down almost two weeks ago - that the Republicans should accept an increase in the federal debt ceiling and agree to a balanced-budget deal that locks in $600 billion in savings while deferring settlement of major differences.

What Clinton did emphasize on the budget was the human side to the government shutdown, in the form of Richard Dean, a Social Security Administration employee flown to Washington to sit in the audience and have his story told by the president.

Clinton used Dean to tell the nation - and the Republicans - that government shutdowns are a mistake. Dean, who works in Oklahoma City, helped rescue fellow workers in the bombing there and then was ``forced out of his office again'' by the government shutdowns.

``On behalf of Richard and his family, I challenge all of you in this chamber: Never, ever, shut the federal government down again,'' Clinton said.

A dozen or more polls have shown that Americans blame Republicans by a wide margin for shutting down the government during the budget disputes; their faith in GOP handling of economic and budget issues has dropped dramatically.

House Speaker Newt Gingrich, R-Ga., has said the shutdown tactic, aimed at forcing Clinton into a budget compromise, was a mistake, and Tuesday night had to sit behind the president and listen to Clinton revel in the public popularity of his position.

House Republican freshmen may be squabbling with Clinton, but that did not stop some of them from going into the House chamber hours before the speech to claim prime seats along the center aisle, where lawmakers are most likely to shake the president's hand as he enters and leaves and be captured by the television cameras.

Coached to treat Clinton with respect or be seen as juvenile, Republicans politely applauded both Hillary Clinton, when she arrived, and the president.

The Virginia delegation has a mixed reaction to the president's address.

Republican Sen. John Warner thought the speech was pure politics.

``I think the President gets an Oscar for high drama and very carefully taking basic Republican values and wrapping them in his own rhetoric.''

Warner said the speech was the foundation for Clinton's re-election campaign.

Democrat Rep. Norman Sisisky expressed relief that the President did not ``pick of fight with Congress'' over the budget impasse.

Sisisky said the speech was a likely foreshadowing of the President's upcoming campaign strategy to move more to the center of the American electorate.

Democrat Rep. Owen Pickett felt the speech was more generic.

``It was a pragmatic speech,'' Pickett said. `'It was a patriotic speech.''

Rep. Bobby Scott praised the president for highlighting the success of Democrats in reducing the nation's deficit.

Democratic Sen. Chuck Robb was impressed.

``I thought the president laid out an ambitious agenda . . . He did not give a staus quo or a continue to march speech, but said that here are the specific challenges we face and here are the ways, if we put aside partisanship, that we can meet the objectives.'' MEMO: The Associated Press and staff writer Jon Frank also contributed to this

report.

ILLUSTRATION: Color photo

ASSOCIATED PRESS

President Clinton acknowledges the applause and cheers in the House

gallery before his fourth State of the Union address Tuesday.

Graphics

PILOT ONLINE

The full text of President Clinton's State of the Union speech is

on the News page of Pilot Online at http://www.infi.net/pilot/

TOPIC CLINTON HIGHLIGHTS DOLE' COMMENTS

[For complete graphic, please see microfilm]

KEYWORDS: STATE OF THE UNION ADDRESS by CNB