GEORGE BUSH: THE FIRST TERM

REVIEWING their stewardship of the domestic economy during the past 3-1/2 years, White House budget, Treasury, and Commerce officials highlight policies that have helped to restart the economy's stalled engine and ensure long-term growth.

Office of Management and Budget director Richard Darman credits the Bush administration with making a commitment to reduce the federal deficit, the economy's most pressing problem.

The White House was forced to raise taxes to reach a compromise with Congress in the 1990 budget agreement - legislation designed to cut the growth in the federal government's borrowing needs by a half-trillion dollars in five years.

The president's abandonment of his 1988 "no new taxes" pledge, a move that incurred the wrath of many Republicans and conservatives, resulted in a budget accord that fell short of drastically slashing federal accounts. It did make a stab at the deficit. The government's previously unbridled spending has compounded the nation's debt, which surpassed the $4 trillion mark on July 31. Fed action favored

Averse to higher taxes and limited by the government's spending constraints, President Bush has favored action by the Federal Reserve (Fed) as an economic- policy tool. Lower rates, he has argued, would make borrowing cheaper to cash-strapped individuals and companies and add the necessary stimulus to the dormant economy.

During the past two years, the White House has relentlessly pressured Fed chairman Alan Greenspan to lower interest rates. But, guarding against inflation, the Fed has been cautious. Its stubborn refusal was often the White House's explanation when the economy worsened.

The Bush administration prevailed, however. Many businesses and consumers now enjoy the lowest short-term interest rates in decades. Inflation remains low, despite the rate reductions. Unfortunately, so do consumer spending and business borrowing.

American exports made up more than half the country's economic growth in 1991, says Treasury Secretary Nicholas Brady. "Every $1 billion worth of manufactured exports generates 20,000 US jobs," he points out. Trade outlets sought

While working to break down trade barriers around the globe - such as with the 12-nation European Community and Japan - the Bush administration has looked to neighboring markets as the strongest outlets for United States exports.

Capitalizing on the advent of economic reform leaders in Latin America and the Caribbean, the White House embarked on the so-called Brady Plan and the Enterprise for the Americas Initiative to help reduce the region's debt burden and boost its investment and trade prospects.

The region, in which the US is the leading trader, is the fastest- growing market for US exports. The 1986 US trade deficit of $10.8 billion within the region was reduced to less than $1 billion in 1991.

The new North American Free Trade Agreement, strongly pushed by the Bush administration and pending congressional approval, eliminates barriers between the US and its first- and third-largest trade partners, Canada and Mexico.