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Rick A. Lazio ventured into New York's most economically challenged region Thursday to promote his view of an upstate on the upswing and to make no apologies for his strategies for creating jobs and stemming population loss.

In fact, despite a barrage of criticism from Democratic opponent Hillary Rodham Clinton, the Republican Senate candidate insists his plan is better.

"I'm trying to lay out a more comprehensive strategy, and I think I have more credibility (on the issue) because I know I can be more effective in getting the job done," he said. "I've been down this path and know what it takes."

In a major address before the Buffalo Rotary Club at HSBC Arena and later with editors and reporters of The Buffalo News, the Suffolk County congressman defended his "macro" approach based on sweeping tax cuts. That stands as the single most important effort, he said, in rejuvenating an upstate economy that he and Gov. George E. Pataki both say is showing major signs of improvement.

That aspect of his plan alone, he said, will help stem the imbalance between the dollars New York sends to Washington every year and the dollars it receives in return.

In addition, Lazio emphasized specifics such as wiring all parts of New York for Internet access, as well as new points such as completing Route 219, introducing high-speed rail service to upstate and fighting for federal dollars to complete whatever plan is finally adopted for Buffalo's Inner Harbor.

"We can either build on these accomplishments or return to the policies that caused all our problems in the first place," he told the Rotarians, referring to "big government running roughshod" over its citizens.

"That approach to economic development has not worked, and it never will work," he added.

Lazio chose the same venue as the first lady did last Thursday to emphasize his approach to upstate's economic condition, suddenly emerging as a white-hot topic in the 2000 Senate campaign. As Clinton fires away at Lazio across upstate television screens for failing to recognize the region's lagging economy, and as Lazio chastises her for improperly labeling the region a "vast economic wasteland," they are wrangling over what has become one of the few genuine issues of the contest.

And in recent days, the controversy has spread far beyond the one-on-one confrontations between Clinton and Lazio.

Pataki has chimed in, blasting Clinton for criticizing an economy showing improvement under his administration.

County Executive Joel A. Giambra has also recognized that progress, but has asked fellow Republican Lazio to come up with more ways the federal government can help a region he says is "not yet out of the woods."

Local economic-development officials say that while the area's economy is improving, the signs are not yet strong enough to pronounce the trend a lasting one.

Political experts question why Lazio can't capitalize more on an issue that helped elect U.S. Sen. Charles E. Schumer, D-N.Y., in 1998, and Giambra in 1999.

With the loss of much of its traditional heavy industry base over the past 30 years, upstate cities such as Buffalo, Syracuse, Utica and Schenectady have experienced serious population losses and a long list of accompanying problems.

Pataki identified those problems in his successful 1994 campaign against Democrat Mario M. Cuomo, and now points to optimistic signs he says testify to his efforts. The governor says that after his administration reduced taxes on many fronts, reduced the high cost of workers' compensation and increased state economic-development efforts, Clinton has no right to point fingers.

"It just galls me that people like Mrs. Clinton, who didn't live here and who didn't see the devastation of the Cuomo years, are now talking about how we have to do more," he said. "I understand we have to do more, particularly in Western New York, but it's a far different upstate now."

The governor says upstate New York, if it were considered a separate state, ranked 50th among the states with a 0.2 percent private-sector job growth rate in 1996. That jumped to 19th with a 2.5 percent level in 1999 (though some in the federal government dispute that number as inflated), and this year ranks 18th through August.

He says $1.6 billion has been committed by private industry in Erie County over the past two years with expansion projects by General Motors, Adelphia Communications and others. He says Erie County has seen almost 12,000 new jobs created here over the past 18 months -- a far cry from when the job totals dwelt in the negative.

"In no way am I saying our job is done," Pataki said, "but we have to continue to reduce the regulatory burden on business and cut the taxes that Rick Lazio and I are arguing for. Mario Cuomo and Mrs. Clinton are against those tax cuts.

"The bottom line is that our policies are working," he added.

Clinton, meanwhile, has used numbers not as rosy, mainly because they cover longer time periods than Pataki's annual reports.

All of this fuels a debate that won't die. Clinton's campaign manager said Tuesday he finds it "amazing" that Lazio has not offered a specific upstate plan. In unveiling a new television ad boasting of Clinton's tax cut plan -- which includes targeted small-business tax cuts to help small upstate businesses -- Bill de Blasio said Lazio seems unable "to recognize real problems that exist."

Lazio's lack of focus on the upstate economy "suggests it's not (his) priority," the campaign chief said. Without mentioning Pataki by name, de Blasio said part of Lazio's failure to key in on the upstate economy issue is his "relationships on the state level."

The Clinton campaign has been quick to rally around a Quinnipiac College poll issued Wednesday that put the first lady at the 50 percent mark for the first time. As important, though, the poll showed her gaining strength upstate, statistically tied with Lazio in the more conservative region.

De Blasio said there is a "clear correlation" between the amount of time Clinton has spent upstate talking about upstate issues over the past year and her rising poll numbers. He said pundits predicted Clinton would spend little time upstate in the heat of the campaign.

"It's clear she kept coming back and coming back. I think upstaters appreciate that," he said.

Lazio, meanwhile, said in Buffalo on Thursday that he did not believe the upstate aspect of the Quinnipiac poll.

Andrew J. Rudnick, president of the Buffalo Niagara Partnership, has long advocated the need for statewide politicians to recognize the needs of upstate. He said the region still must face up to the fact that it has missed out on 10 years of national boom times, though he agrees the signs are encouraging.

"Compared to our past, we're doing better, and the trend is in the right direction," he said. "But it's probably too early to say the trend is sustaining."

The recovery is still fragile enough, he added, that the focus must be maintained on the region.

And then there is the political aspect of the controversy. With polls and the Clinton camp crowing over the surge in upstate numbers, some analysts wonder why Lazio is not riding the issue harder.

"People do want to see statewide candidates talk about the issue," said William Cunningham, an Albany Democrat and a veteran of several statewide campaigns. "People in upstate New York and Western New York in particular know that interest is indicative of these questions: 'Do you understand us here? Do you have any idea of what we face and have to deal with?' "

Barry Zeplowitz, a Buffalo Republican consultant, said upstaters and especially Western New Yorkers perceive that the area is still undergoing hard times.

"It has to help her," Zeplowitz said, referring to Clinton. "If anything, it breaks people away fromnot liking her, since she's addressing an issue we care about."

Tom Precious of The News Albany Bureau contributed to this report.

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