Candidates Out in Force as Campaign Hits High Gear : Politics: New Hampshire’s poor economy is the backdrop as Democrats hammer away at Bush. The issue dominates opening day.

The first full week of the 1992 presidential campaign opened Monday with Democratic candidates blanketing New Hampshire, focusing on the economy and attacking President Bush for the haggard condition of the state’s shops and factories and for the long unemployment lines.

“The campaign starts today in New Hampshire,” said Iowa Sen. Tom Harkin, who is hoping to revive a drive that has seemed stalled of late.

“This is a sea-change period for the country,” Arkansas Gov. Bill Clinton--widely regarded as the campaign’s early front-runner--told a crowd of both Democrats and Republicans at the Manchester Rotary Club. The time has come, Clinton said, for “doing away with brain-dead politics of both parties and moving into the 21st Century.”

Clinton followed up his call by releasing a 17-page booklet titled “A Plan for America’s Future,” which is designed to back up his claim that he is the most specific of the candidates in saying what he would do if elected. The pamphlet added a few new details to a series of economic proposals that have formed the centerpiece of Clinton’s campaign to date.

Clinton shared the podium at the Rotary Club with former Massachusetts Sen. Paul E. Tsongas, who issued a lengthy economic plan that focused on ways to revive New Hampshire’s sagging fortunes.

Harkin spoke at a campaign rally in Nashau, N. H., criticizing Bush as a President who “doesn’t really understand what is happening to hard-working, ordinary Americans.” He called for a targeted investment tax credit for manufacturers who buy new machinery manufactured in the United States.

Nebraska Sen. Bob Kerrey visited two factories in the state, calling for new government policies to provide incentives for high technology investments and warning that without such action, the country would continue to fall behind Japan and Germany in the search for new global markets.

Kerrey and Clinton later departed for New York, where both were to speak at a Democratic dinner in Queens. Many Democratic strategists believe New York’s April 7 primary could effectively complete the nomination process that New Hampshire’s Feb. 18 voting will begin.

Bush’s Republican challenger, Patrick J. Buchanan, also stumped New Hampshire Monday, while Bush partisans prepared for a visit by Vice President Dan Quayle.

Economic messages are expected to be particularly potent in the state, which has seen its once robust economy devastated by plant closings, bank failures and real estate problems in the last two years. Democrats plan to hammer away at the economy, hoping their words will strike a chord with voters and that New Hampshire’s economic gloom will provide a perfect background for their national message that Bush’s economic leadership has failed the country and endangered its future.

As a result, economics not only will likely be the main issue in the New Hampshire phase of the campaign, it may be the only issue.

Among the candidates, only two resisted New Hampshire’s call on Monday--Virginia Gov. L. Douglas Wilder, whose campaign appears to be writing off the state in the hopes of saving money to do well in Southern states with more black voters, and former California Gov. Edmund G. (Jerry) Brown Jr., who spent the day in Iowa, where he complained that the state’s caucus system is “rigged” in favor of Harkin, the home-state favorite.

The other candidates all reached that conclusion weeks ago and have been avoiding Iowa. Brown appears to hope that with the rest of the field absent, he can generate momentum for his low-budget campaign by taking second place in Iowa, which votes eight days before New Hampshire.

Bush, too, has been absent from New Hampshire, but his Administration has been sending money instead, pouring federal largess into the state ever since polls began to show the President in potential trouble there.

Among other steps, the Administration announced it had chosen Pease Air Force Base to be the site of a new federal passport processing facility, increased Small Business Administration loans in New Hampshire and moved to clear up delays in state Medicaid claims.

Tsongas took aim at that strategy, saying that New Hampshire residents want “more than election-year handouts” and that the state “doesn’t want to be bought off by a President worried about reelection.”

He then offered an unusual speech for a presidential candidate, one that would have seemed more appropriate for someone running in the state’s gubernatorial election. The speech proposed that New Hampshire establish a state venture capital fund to finance new businesses, set up two technology parks near its two major universities and reform its laws on corporate governance to attract new companies.

While Tsongas has been basing his appeal to New Hampshire on the argument that he, as a fellow New Englander, knows more about its economic problems than any of his rivals, Clinton has been campaigning on the theme that he, more than any other candidate, has a plan to revive the economy. Monday’s release of his 17-page pamphlet was designed to back that up.

The newest detail in the proposal concerns the tax treatment of children. Under current law, families are allowed to deduct $2,150 from their taxable income for each dependent. For the majority of Americans, that exemption reduces their actual tax bill by $323 per dependent. But upper-income taxpayers save nearly $650 per dependent because they pay income taxes at a higher rate.

Clinton’s proposal, borrowed from a plan put forward last year by House Ways and Means Committee member Rep. Thomas J. Downey (D-N.Y.) and Sen. Albert Gore Jr. (D-Tenn.), would replace the exemption with a tax credit that ultimately would reach $800 per child.

The proposal would cost up to $22 billion. Combined with Clinton’s earlier call for a 10% tax cut for middle-income taxpayers, taxes for the average two-child family would be cut by up to $1,300, Clinton’s campaign estimates.

Clinton proposes to cover the cost of these plans by raising taxes on those earning more than $200,000 and by closing unspecified tax loopholes.