NEW Hampshire's minority Democratic Party is caught in the middle of an internal dispute just as the state prepares for its high-profile presidential primary season this fall.The issue is over the new state chapter of the Washington, D.C.-based Democratic Leadership Council. The DLC is a Democratic organization formed in 1985 that is trying to broaden the party's appeal beyond its traditional liberal constituency. But some New Hampshire party activists say it may undermine their struggling Democratic Party in this heavily Republican state. "I suggest that we go back to the classic Democratic Party," says New Hampshire Democratic Party chairman Chris Spirou. "If it was good enough for Harry Truman, if it was good enough for John F. Kennedy ... then it should be good enough for us." Last June, the state Democratic Party voted not to recognize the state's DLC chapter. The rift came to the fore last week when Mr. Spirou refused to attend a forum featuring Arkansas Democratic Gov. Bill Clinton, chairman of the national DLC. But Governor Clinton, considered a possible presidential candidate, nevertheless drew a crowd of Democratic activists. Despite resistance to the new organization, other Democrats feel the state DLC will give the state party a much-needed boost. "The DLC has emerged as the idea wing of the Democratic Party," New Hampshire DLC chairman Maurice Arel said at the forum last week. "Our beginning has been controversial, [but] we believe that the New Hampshire DLC complements the state Democratic Committee." The national DLC is an issues-oriented group that strives for innovative policymaking. Some say it has conservative leanings since it advocates a strong defense policy, welfare reform, and tax breaks for the middle class. The DLC, however, claims its only agenda is to strengthen the Democratic Party. Political observers say the New Hampshire dispute is symbolic of the Democratic Party's insecurity at the national level. William Schneider, a political analyst at the American Enterprise Institute, says the Democratic National Committee is suspicious of the DLC and sees it as an organization of conservative Southern Democrats who want to rid the party of its traditional liberalism. "There is some puzzlement and resentment as to what the DLC is trying to do, particularly in a state like New Hampshire," Mr. Schneider says. "New Hampshire Democrats ... are liberal but in the independent way." But John Broderick, president of the New Hampshire DLC, has grown frustrated with the politics of the state party. The party "is a political mechanism to assist candidates to get elected," he says. "I think among some of us there was a feeling that we weren't doing better here. The party structure isn't really designed to have these broad-based discussions." Mr. Broderick says he is also frustrated by the party's liberal positions. "The people who are most active in party politics are the most liberal," he says. "If you are a good [state] Democrat you are pro-choice ... [and] you must be against the Seabrook nuclear power plant." Some observers here say the dispute is merely a clashing of personalities between two ambitious men. On one end is Mr. Spirou, elected as party chairman in February. At the other end is the more conservative Broderick, former legal counsel to the state party, who may harbor his own political ambitions. "It has nothing to do with political philosophy and everything to do with personality," says Joseph Grandmaison, former state Democratic Party chairman. "How does this affect real Democrats? They couldn't care less. It's all inside baseball." Yet others say it a result of the party's own identity crisis. "It's also indicative of a national conflict over the direction of the party," says Richard Winters, chairman of the government department at Dartmouth College. "Should it adhere to its purer issues stands or should it attempt to respond more directly to what many perceive as the increasing conservatism of the American electorate?"