ANOTHER GOOD FAITH EFFORT?

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The White House has instructed agency heads to prepare for a possible federal shutdown in case budget negotiators are still at loggerheads when the temporary funding agreements expires Friday. President Clinton told reporters in Paris that he's prepared to negotiate in good faith with Republicans when budget talks resume, but he warned the GOP against threatening to close the government again. "That won't work," he said. "It didn't work last time." TIME's Michael Duffy reports from Washington: "The White House clearly has the upper hand heading into the negotiations tomorrow. They've made several concessions in the past several weeks and the pressure is on the Republicans right now to make a few of their own." Senate Budget Committee Chairman Pete Domenici (R-NM) told reporters Republicans would work long and diligently: "We want to get this done." Still, while new economic forecasts released earlier this week by the Congressional Budget Office brought the two sides closer together, major disagreements remain over how much savings should come out of Medicare, whether to block grant Medicaid, and the size of tax cuts.