Democrats Expect Clinton Pay-Back : Politics: Having delivered an election victory, state party members are looking for projects that create jobs here. They say California is the economic engine that drives the nation.

California Democrats, having delivered a mighty election victory to Bill Clinton in November, are counting on special treatment from the incoming President to lift the state out of its economic rut.

Via letter, phone call and gentle persuasion, Californians have put out the word to Clinton and his lieutenants: The national economy cannot be fully restored until its once-powerful California segment gets well. Just as important, goes the message, California needs customized solutions to its particular set of economic woes.

So far, Clinton aides have made no promises. “The (economic) decisions will be too tough,” said a veteran California congressman. “No one is nailing down any deals.”

But there are high expectations, and not only by virtue of California’s enormous needs. As Clinton undoubtedly recognizes, the state delivered 54 electoral votes on Election Day, more than any other state, and will play an important role in any 1996 reelection bid.

For now, however, California’s supplicants are content to make their pitch for help--and to watch. Highest on the agenda is retooling the state’s shattered defense industry, whose post-Cold War decline has profoundly affected interrelated industries. Other issues singled out are transportation projects, urban aid, trade agreements and streamlined administrative procedures that would accelerate approval of state projects.

State Democrats also are expecting Clinton to appoint a healthy number of Californians to serve in the new government. Several have been named to high posts and most Democrats are optimistic that the trend will continue in second- and third-tier jobs that have more regional and state effect.

“We’ll be watching that like a hawk because it’s easy to count,” said Rep. George E. Brown Jr. (D-Colton). “We’re entitled to 10% or more in Cabinet-level positions, and even more in sub-Cabinet posts. It’s too early to tell whether we’re on track--although the early signs are good.”

But the most consistent theme espoused in interviews is recognition that a complete national economic turnaround depends on a vibrant California recovery.

Clinton must realize “that California is far from out of the recession, whatever the rest of the nation is doing,” said state Treasurer Kathleen Brown. “And without California the country will not enjoy a robust recovery. We’re the economy’s 300-pound gorilla.”

She worries that California’s unique conditions might get lost in such a long-term economic recovery plan and advocates “targeted” assistance for the state. Citing the loss of 900,000 jobs in the state, “California could qualify as the No. 1 area,” Brown said.

“We deserve special attention for having carried an enormous burden,” said Rep. Don Edwards (D-San Jose), dean of the state Democratic congressional delegation. “We once were the arsenal of democracy, now we need special help because the arsenal is being dismantled.”

The state’s 52-member Washington delegation will try to do its part to keep California issues in the foreground. More known for its internal bickering than its ability to pull together on key statewide issues, the delegation is pledging to be more collegial--and effective--in the 103rd Congress.

As a sign of the new approach, the entire delegation, including both California senators, sent a letter last Thursday to Clinton’s transition office urging the selection of San Bernardino as the site of one of several new Defense Department regional accounting centers.

The centers, each of which will generate about 4,000 jobs, are being hotly pursued by 20 cities that are finalists in the nationwide competition.

A California victory could provide an indication of how the state will fare in the hunt for federal largess.

“This is a little plum,” Rep. Brown said. “I have a sneaking suspicion that Clinton is looking for quick ways to help California.”

But the country’s troubled economy will make the competition on Capitol Hill for federal money and programs more vicious than ever.

Interviews with more than 10 California Democrats in the House and party officials in Sacramento and Washington identified several key areas that need “special attention” from the Clinton Administration.

DEFENSE CONVERSION: This was most often mentioned as the key to a true California revival--and the most complicated. Key issues being promoted:

* Job retraining programs for high-tech defense workers.

* Redirecting those workers to mass transit, rail and the next generation of aircraft.

* New tax laws to ease rules for risk-taking high-tech firms.

* A beefed-up Commerce Department to nurture advanced technologies.

* Increased funding for government consortiums working on new electronic communications technology.

TRANSPORTATION: This area is regarded as the natural target for a quick, massive economic stimulus. Dozens of California projects, authorized by the 1991 Intermodal Surface Transportation Efficiency Act, await appropriations--as do numerous projects nationwide. There is virtual unanimity that full funding of the act would deliver a jolt to California economy. State planners say California has more than $10 billion in such ready-to-go projects. Other key issues:

* Waive requirement for local matching funds.

* Expand Amtrak intercity rail system through a 1-cent federal gasoline tax.

* Give priority to research and development (magnetic levitation, fuel cell buses) to lure private investment.

* Tap into funds from other federal agencies for “crossover” research into transportation issues such as working with EPA on alternative fuels.

* Remove limits on private investment in transportation facilities.

URBAN AID: “Attention must be paid to the cities, and we need some leadership from the President,” said Rep. Maxine Waters (D-Los Angeles), who has been working to rebuild riot-torn South-Central Los Angeles.

“The war on poverty was never completed,” she said. “The right wing has done a good job in saying that the programs failed, but many good programs got derailed.” Key issues:

* Enterprise zones that offer tax credits in exchange for “sincere” job creation.

* Requiring that up to 50% of new jobs in enterprise zones go to neighborhood workers.

* Re-establishing “teen posts,” neighborhood youth centers that act as comprehensive social service agencies, offering sports, field trips, academic assistance and mentoring for inner-city youths.

* Additional federal loan guarantees to stimulate small business.

* Stipends for hard-core unemployed while undergoing job training.

* Increased funds for low-income housing and Head Start programs.

TRADE AGREEMENTS: Although many Democrats are enthusiastic about expanded trade with Pacific Rim nations and are particularly excited about the diplomatic opening to Vietnam, a growing number believe that the approval process for GATT (General Agreement of Tariffs and Trade) and the North American Free Trade Agreement need to be slowed down. Key issues:

* “Both (agreements) would have significant impact on the state,” said one top Democrat. “They were rushed together at the end at the expense at some important California industries.”

* “If Clinton asks for fast-track (approval) of NAFTA to be extended, he’ll get it.”

STREAMLINING OF PROCEDURES: Because many of California’s safety and environmental standards are more stringent than the federal government’s, some project reviews get bogged down in parallel review procedures. Key issues:

* Ensure that no federal project that meets tougher state law is delayed because of separate federal study.

* Consider state regional planning agencies as extensions of federal staff for projects that meet state quality assessments.

In addition, treasurer Brown wrote to Clinton last month urging the extension of three federal programs that would boost the housing and small manufacturing sectors--industrial development bonds, low-income housing tax credits and single-family mortgage revenue bonds. All three programs expired last year “in the bitter wrangling over the tax packages,” wrote Brown.

Other party officials expect Clinton to move quickly to establish his environmental credentials.

“Clearly he could hit an environmental home run pretty quickly,” said Bill Carrick, a Los Angeles Democratic consultant. “It’s a hell of a lot more popular--and a hell of a lot easier--than talking about defense conversion and urban problems. In a speech he could symbolically address the offshore drilling anxiety.”

Despite the gravity of the state’s economic problems, most party officials are almost incautiously upbeat about the 46-year-old President-elect’s warm regard for the state--and the effect that will have on his decision-making.

“Clearly Clinton is factoring in the importance of California,” said Leslie Francis, executive director of the Democratic Congressional Campaign Committee. His Thanksgiving weekend trip outside Santa Barbara demonstrated that belief, he said.

“There is a political dimension that can’t be ignored,” Francis said. “It’s pretty obvious he’s trying to secure California as a viable Democratic state.”

Perhaps even more important, according to some state Democrats, Clinton is in tune with the youth-oriented California culture.

“He gets it,” said state Democratic Party Chairman Phil Angelides. “He understands it by virtue of his education and his age.”