Clinton Names Bentsen, Panetta to Economic Team : Appointments: His selection of Texan for Treasury secretary and Californian for budget chief in addition to other appointees seeks to reassure Congress, Wall Street.

President-elect Bill Clinton, in a gesture of solidarity with Congress and reassurance for Wall Street, Thursday announced his choice of Sen. Lloyd Bentsen of Texas and Rep. Leon E. Panetta of California to head the team that will guide economic policy in the new Administration.

The five-member core group introduced by Clinton consisted entirely of figures from the nation’s political and financial Establishment, suggesting that the incoming President may be inclined to soften his message of change with a heavy dose of familiarity.

In presenting the team as charter members of his new Cabinet, Clinton nevertheless sought to amplify his commitment to give top priority to the economy. He promised to “work my heart out with these people” to tackle the nation’s long-term economic problems.

As the designated Treasury secretary, the 71-year-old Bentsen brings with him from Capitol Hill a combination of status and goodwill gained from his years as chairman of the Senate Finance Committee. Panetta, the 54-year-old choice as director of the Office of Management and Budget, carries a reputation as a fierce foe of budget deficits.

Other members of the new team include Robert E. Rubin, a co-chairman of Goldman, Sachs & Co. and a top Democratic fund-raiser, as chairman of the new National Economic Council; investment banker Roger Altman, a longtime friend of Clinton, as deputy Treasury secretary; and economist Alice Rivlin, the first director of the Congressional Budget Office, as Panetta’s deputy.

With Bentsen as a possible exception, the group brings to the new Administration a powerful bias in favor of deficit reduction. That inclination, together with increasing signs of economic recovery, may make it less likely that Clinton will propose the kind of costly short-term stimulus package that some advisers once thought necessary.

But with more activist transition advisers like Harvard professor Robert B. Reich still taking the lead in developing policy options for Clinton, the new appointees may function more as ambassadors to Congress and Wall Street than as architects of the new Administration’s economic policy.

With the choices--his first steps toward filling the ranks of his new Administration--Clinton showed little attention to the diversity that he promised would be a principal feature of the new government. Among the top five appointees, only Rivlin was someone other than a white male. Each of the officials has close ties to either Wall Street or Capitol Hill and Rubin and Bentsen are both multimillionaires.

But Clinton, who later promised that “there will be diversity,” indicated that he intends to expand his circle of advisers in coming days. His aides suggested separately that his next round of appointments to key economic positions would reflect a broader social and ideological cast.

Among those now expected to be included in that group is UC Berkeley economist Laura D’Andrea Tyson, who is described as the leading candidate to head the Council of Economic Advisers, another key economic position.

The simultaneous announcement of the five top economic advisers departed from a tradition of focusing first on Cabinet nominees. Of the five, only Bentsen will serve as a member of the Cabinet.

And while Clinton said that Bentsen would retain the Treasury secretary’s customary role as chief economic spokesman, he also made plain that he expects the group to work as a team over which he will serve as final arbiter.

He said that the success of his economic agenda will “depend not only on the talents of these people as individuals . . . but also on their capacity to work together for the common good of all Americans.” Rubin, who is to serve as his top economic aide in the White House, later said bluntly that the internecine warfare that has divided previous administrations “simply is not going to be the way it is going to work” under Clinton.

Indeed, as his appointees took turns at the microphone after being introduced by Clinton, each took pains to echo what has become the President-elect’s central message: that the nation’s economy remains crippled by deep and “fundamental” wounds which the new Administration must seek to heal.

“I think we’re all going to sound a little bit alike,” Rubin admitted half-apologetically, “which I suppose is what Gov. Clinton meant when he spoke about a team.”

As the director of the newly established National Economic Council, Rubin is to play a particularly important role in the next White House as the principal coordinator of policies developed across the Administration.

But while Clinton described Rubin’s role as roughly comparable to that of the existing national security adviser, aides said that the purview of the panel would be limited primarily to domestic matters. A plan to describe it as an “economic security council” was rejected because the moniker “gave it too much of an international cast,” one source said.

The flurry of appointments, which is expected to continue today and Saturday, puts Clinton’s economic team in place in time to participate in the much-ballyhooed “economic conference” of business leaders that the President-elect will convene in Little Rock next week.

But, for Bentsen and Panetta at least, the more important task almost certainly will be to help drive Clinton’s agenda through Congress, drawing on their years of legislative experience.

Bentsen, the courtly Texan who ran for vice president on the Democratic ticket in 1988, is somewhat more conservative than most other lawmakers. He used his position at the helm of the Senate Finance Committee to promote tax breaks for the oil and gas industry and for real estate investment.

He nevertheless won Clinton’s praise as a man who could command Wall Street’s respect while showing “an unrelenting concern for the Americans who make their living on Main Street.” He is expected to serve as a loyal advocate of the incoming President’s policies.

The choice of Bentsen came despite warnings from Texas Democrats that his departure from the Senate could leave the seat vulnerable to a Republican takeover. But while his appointment set the stage for a bloody fight in the state, Bentsen and Clinton both expressed confidence that their party could fend off the GOP challenge.

In choosing Panetta to take charge of the OMB, Clinton was said to have heeded the dinner-table advice of House Speaker Thomas S. Foley (D-Wash.) and House Majority Leader Richard A. Gephardt (D-Mo.), both of whom told the President-elect that they have high regard for the Budget Committee chairman.

The California congressman, who has represented a Carmel Valley district for 16 years, took charge of the House panel in 1989 and has become an incessant advocate of deficit reduction. Like his new deputy, the 61-year-old Rivlin, Panetta sometimes has suggested that Clinton’s proposals paid too little heed to the problems posed by the budget deficit.

With Altman, 46, and Rubin, 54, Clinton brings to the team men who have strong Wall Street ties. They also may reflect the President-elect’s own ideas and energy more closely than other members of the new team. Altman, now a top official of the Blackstone Group, an investment bank, was a Clinton classmate at Georgetown University and served as an assistant Treasury secretary in the Jimmy Carter Administration.

Rubin, whose leadership at Goldman, Sachs has earned him a reputation as a strong manager and a fortune worth $50 million to $100 million, helped to raise money for Clinton’s presidential campaign. A leading contributor himself, he has given $275,000 to various Democratic Party committees in the last two years.

David Shulman, managing director of the Salomon Bros. investment firm, characterized the appointments as olive branches to two constituencies that can make or break Clinton’s plans to reform the economy and transform the nation’s domestic agenda.

“It looks like a group of people who will breeze through the Senate and Wall Street will be comfortable with,” he said.

But some activists who had hoped that a Clinton Administration would represent an about-face from business as usual were disappointed in the selections. “We’ve got folks who know Wall Street and folks who know Washington and that’s not enough breadth to represent the face of America and those who want true change,” said Pamela Gilbert, acting director of Congress Watch, a public-interest lobby.

Times staff writer Jonathan Peterson in Los Angeles contributed to this story.

First Appointments

President-elect Bill Clinton named the following people to help him revitalize the economy:

Lloyd Bentsen Post: Treasury secretary

Leon E. Panetta Post: Director of the Office of Management and Budget

Robert E. Rubin Post: Assistant to the President for economic policy

Alice Rivlin Post: Deputy director of the Office of Management and Budget

Roger Altman Post: Deputy Treasury secretary