Clinton to Set Out New Policy Goals : Presidency: He plans a major speech this week, even though aides say he’s undecided on how to counter the GOP. Some question if the time is right.

President Clinton, still shaken by the Republican takeover of Congress in last month’s elections, plans to deliver a major speech this week designed to demonstrate a clear sense of where he hopes to take the nation--even though he himself has not yet determined precisely where that is.

Although Clinton is determined to deliver what would amount to a pre-State of the Union Address setting out his goals and priorities, he is being pulled by conflicting advice from aides and is feeling the pressure of competing Democratic and Republican agendas.

He has held a series of meetings with Republican congressional leaders and conferred almost daily with his own advisers, but remains undecided on how to counter many of the GOP’s plans, including proposals to cut middle-income and capital gains taxes, senior aides acknowledge.

Even the question of what he should tell the American people about the plans he is devising has left the President in a state of uncertainty. Some advisers said they felt he should keep a lower profile until the 104th Congress convenes on Jan. 4.

“What should I be saying?” Clinton asked a longtime political confidant several days ago.

“Nothing,” was the reply. “You’ve talked enough. Give the people a break. Give us all a break and let us trim the Christmas trees and get through the holidays before you say anything else.”

Clinton, irrepressible when there’s an opportunity to expound on politics, rejected the advice.

Some aides expressed concern that the speech will serve little purpose except to give the Republicans another target for the steady drumfire of criticism they have leveled at Clinton’s policies since the sweeping GOP victories in the November elections.

“Democrats have been through an earthquake and we need a temporizing, a time to put our house back in order,” said a close Clinton adviser. “We don’t need more speeches right now.”

However, Patrick J. Griffin, Clinton’s assistant for congressional relations, said the President is intent on laying out his goals for the next two years. “He’s still thoroughly going through the budget and studying health care and other programs, but he has not made up his mind on a number of things,” Griffin said.

“He won’t have the final details for his speech--a lot will still be formative--but he’ll give a clear sense of direction.”

Another senior aide who declined to be identified said that while the White House was still uncertain about the setting for the speech, tentatively scheduled for Thursday, “the President will speak in some forum and talk about a major agenda that will include a credible budget and probably a middle-income tax cut. But my bet is ‘no’ on a capital gains tax (cut); he just hasn’t made up his mind.”

Clinton, who has been noncommittal about a capital gains tax cut, has said that while he favors a middle-income tax reduction and doesn’t rule out working with the Republicans on some of their ideas, his standard will be: “Will it help increase incomes for the middle class? Will it promote jobs and growth? And can we pay for it?”

During the 1992 campaign, Clinton promised relief for middle-income taxpayers. But once in office, he pushed that pledge aside to concentrate instead on lowering the federal budget deficit. Aides say that while he is now studying several proposals for a middle-income tax cut, he is still adamant about opposing any reduction in taxes that would increase the deficit.

Whatever the final shape of Clinton’s agenda, it is certain to be found wanting in the GOP-controlled Congress when it competes with the sweeping reform proposals of the House Republicans’ “contract with America.” Moreover, the President must deal with the centrist Democratic Leadership Council’s “progressive alternative” to the GOP plan, as well as with other proposals Democrats can be expected to initiate in Congress.

The 10-point GOP contract provides for House votes on a wide range of tax cuts, spending reductions, welfare reforms and constitutional changes in the first 100 days of the new Congress.

Meanwhile, the Progressive Policy Institute, the DLC’s think tank, issued a statement sharply contrasting its proposals with those of the House Republicans and declared that the Democrats’ loss of control of Congress frees them “to stop defending the status quo” and challenge the GOP for “the mantle of radical reform.”

The DLC is important to Clinton because it was organized a decade ago to give voice to the views of moderate Democrats--views that he himself has espoused and that many analysts consider vital to his chances for political recovery.

With the two competing programs differing sharply in many respects, especially in tax and spending proposals, Clinton and his aides have been conferring with both camps trying to reach a consensus on some issues that the President can support without undermining his budget and his agenda for the next two years.

Although Clinton’s inclination is to go all-out in competing on the policy front, some of his advisers have suggested that letting the Republicans get out front with some of their more radical proposals would in effect be giving them enough rope to hang themselves.

Sen. David Pryor (D-Ark.), one of Clinton’s closest friends, said he favors the give-them-enough-rope strategy, especially in response to some of the “gloating” and sharply partisan comments by incoming House Speaker Newt Gingrich (R-Ga.), who has said he’ll cooperate, but not compromise, with Clinton.

On the other hand, Pryor said he was encouraged that incoming Senate Majority Leader Bob Dole of Kansas appeared at his own request before a closed-door session of the Democratic caucus in the Senate and pledged to be less confrontational, saying there were things he wants to see settled in a bipartisan fashion.

Clinton irritated Republicans earlier in his term by failing to work closely with them, and it remains a sore point with some party leaders. Sen. Trent Lott (R-Miss.), the incoming Republican whip, said he had not even met Griffin, Clinton’s congressional relations assistant, until Griffin sought his help on a matter recently.

Now that Republicans control Congress, Clinton aides acknowledge that the Administration needs to broaden and improve its relationship with them. Griffin, who has met regularly with many Republicans, declined to comment on Lott’s remark about not meeting him until recently, but said he’s looking forward to working with the Mississippi senator.

Griffin said he requested meetings with all the new Senate Republican committee chairmen immediately after they were named and plans to meet with subcommittee chairmen and the heads of House panels as well. He said he is asking Republicans how the White House can best work with them as they develop their agendas.