Stay With Deficit Target, Clinton Urges : Budget: He asks Democrats not to retreat from $500-billion cut. White House sets up ‘war room’ to drum up support, answer attacks.

President Clinton implored House and Senate negotiators Thursday not to retreat from his $500-billion deficit-reduction target as they began the contentious process of stitching together a final version of his five-year economic program.

“There is a consensus that we ought to make this the biggest deficit-reduction package the country has had. That means hard numbers and good figures,” Clinton told reporters after a meeting with congressional leaders.

Clinton’s appeal came as the White House mobilized a “war room” response team to drum up support for the President’s program, which will undergo surgery at the hands of 210 lawmakers participating in a closed-door conference committee for the next week or two.

In the past few days, some Democrats have suggested that lowering the deficit-reduction target would make it easier for the two houses to reach an agreement, because they would not be forced to raise taxes or cut spending by as much as Clinton has proposed.

The opening session of the enormous conference committee was punctuated by lofty rhetoric from Democrats and bitter recriminations from Republicans--all of which was strictly for public consumption, as the real work is being done behind the scenes.

While the panel officially includes 210 members from both parties, the critical decisions will be made by five Democrats: House Speaker Thomas S. Foley (D-Wash.), Senate Majority Leader George J. Mitchell (D-Me.), House Majority Leader Richard A. Gephardt (D-Mo.), House Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.) and Senate Finance Committee Chairman Daniel Patrick Moynihan (D-N.Y.).

Although the President is expected to devote about three-quarters of his time to the negotiations over the next couple of weeks, he said that he plans to leave it to the lawmakers themselves to hammer out compromises in the areas where the two bills differ.

The White House effort will focus on winning political support to assure that the plan passes both houses before Congress leaves town for its annual August recess.

“We’ll have backup and cover from the White House that didn’t exist before as we face these massive political attacks,” said Rep. Bill Richardson (D-N.M.), a member of the House leadership who will be trying to sell his colleagues on the package. “We should have had a stronger message early on, and we should have done more groundwork, but it’s recoverable.”

Administration and congressional officials concede that Republicans have been enormously successful in exploiting the plan’s political weaknesses. The White House, determined not to get caught flat-footed again, has mapped out an aggressive strategy to corral Democratic votes and drum up public enthusiasm for the package.

Operating from a makeshift “war room” in the Old Executive Office Building adjacent to the White House, Clinton aides are preparing a “rapid response team” to immediately answer Republican critics of the President’s plan.

The group, aided by the Democratic National Committee, is preparing radio and television advertising in support of the budget package, as well as suggested letters to editors of local newspapers. Surrogate speakers are being recruited from party ranks, labor unions and other organizations supporting the Clinton plan to fan out across the country to sell it.

“We have to be as aggressive and sharp and engaged at every level as we possibly can be in the promotion of these programs,” said Democratic National Committee Chairman David Wilhelm.

A White House official said Clinton would accelerate his schedule of interviews with local radio, television and newspapers over the next several weeks to reach as many voters as possible and would travel frequently to make his pitch.

At the opening session, House Budget Committee Chairman Martin Olav Sabo (D-Minn.), the titular head of the conference committee, warned that voters will be looking for proof that government--where power now rests solely in the hands of Democrats--can work.

“This is our best chance to regain control of our economic future,” he said.

Republicans argued, however, that the economic plan amounts to nothing more than a warmed-over version of a traditional Democratic tax-and-spend agenda.

The House and Senate versions of the bill are similar in most respects; Sabo estimated that the two are 80% to 95% alike. But it could prove difficult to find common ground on the remainder. The most contentious issue will be an energy tax: The House version includes Clinton’s proposal to raise $71.5 billion over five years with a broad-based levy, while the Senate would trim it by almost two-thirds and apply it only to most transportation fuels.

The Senate version also includes stiffer cuts in social spending and fewer tax breaks for poor people and urban development.

Complicating the task of finding a compromise is the fact that neither House nor Senate negotiators have much room to maneuver. With no Republicans in either house supporting the bill, it passed the House by a paper-thin, six-vote margin, and Vice President Al Gore had to cast a rare tie-breaking vote to get it through the Senate. Thus, neither side can afford to make major concessions that will cost votes.

Sen. Pete V. Domenici (R-N.M.) and other Republicans questioned whether it is necessary to impose roughly $250 billion in new taxes in light of updated projections indicating that this year’s deficit will be lower than earlier projected. Domenici said that Treasury data indicates that the deficit will be at least $50 billion lower than the $322 billion figure cited as recently as April.

Budget Director Leon E. Panetta assailed Domenici’s comments about the new deficit figures as “setting new heights of hypocrisy” after months of Republican charges that Clinton has not done enough to confront the deficit.

“I’m very surprised and shocked by Sen. Domenici, who I think represents all Republicans,” Panetta said at a hastily called late-afternoon White House press briefing. “They’ve not only lost direction but they’ve lost their spine in dealing with the deficit.”