Farmer Tries to Husk Clinton on Tax Issue : Politics: President debates Iowan objecting to revenue hikes. Touring flood damage, he announces disaster aid for victims.

En route to his rendezvous Tuesday with the other leaders of the world’s major industrial powers, President Clinton stopped here for what White House aides had planned as a campaign-style tour of Mississippi River flood damage. But a discussion with local farmers turned quickly from such arcane subjects as crop insurance and anti-deficiency payments to a topic far more familiar to the President: his proposal to cut the federal deficit by raising taxes.

As Clinton sat on a bale of hay under a large tent on a farm outside this agricultural city, 23-year-old farmer Steve Loussaert challenged him on his tax plan. “We’re taxed enough,” he said. “As farmers we’ve got enough to gamble on with the weather without having to gamble on our government raising taxes.”

Clinton responded with a spirited defense of his program.

He also announced that he would release about $397 million in disaster-assistance money for flood victims and ask Congress for an additional $850 million.

Clinton at first tried to deflect Loussaert’s questions, telling him that Congress would not have to raise taxes to pay for the farm disaster aid because spending so far this year has been considerably below legally mandated ceilings. But as the young man--who later told reporters that he had voted last fall for Ross Perot--continued to interject his anti-tax message, the President changed tone.

“Let’s have a political debate,” he said. “You started your thought, so you’re going to have to listen to me now.”

As he has frequently in recent weeks, Clinton pushed the idea that his program, while controversial, already has helped Americans by bringing about lower interest rates. For most people, he argued, lower interest rates have saved more money than the higher taxes in his budget would ever cost.

He also insisted, as he has with increasing vehemence of late, that his budget had “slashed spending” before calling for increased taxes. Clinton’s aides have been chagrined that Republicans have convinced many Americans that their budget is solely a tax package and have been trying to refocus attention on the spending cuts it contains.

As the evening of questions continued, Clinton clearly still had Loussaert’s challenge on his mind--returning twice to reprise their debate. “This is a very, very difficult time for our country,” he said. “The whole experience of dealing with this deficit has been very painful for me.”

In drafting a budget, he said, he had been forced to make a “politically difficult” choice between sticking “with literally what I talked about during the campaign” of not increasing taxes on the middle class or raising taxes to avoid the “risk of not being able to do enough” to increase investment in the U.S. economy.

Despite the argument over taxes, the visit brought Clinton the sort of adoring attention presidents hope for--about four hours of live coverage of every step of his journey through the area on the region’s local television channels.

Before coming to the session at the farm, Clinton toured flood-damaged regions around Davenport, Iowa, and Moline, Ill., passing fields of stunted corn and flooded soybeans and pausing on a bridge to take in the sight of the Mississippi flooding far over its banks.

* SEOUL HOTEL BLAST: An explosion rocks hotel where Clinton was to stay; bombing is ruled out. A21