The Senate's Billy Carter subcommittee begins its second day of hearings today, wondering whether there really is very much to investigate. The president's hour-long new conference and detailed report Monday night only added to the doubts.

Even Sen. Bob Dole (R-Kan.), who was one of the first to call for an investigation, confessed yesterday that when it came to allegation of White House impropriety "a lot was smoke -- I'm not sure there was a flame."

Dole remarked in an interview that a colleague had needled him, saying, "You ought to be asking yourself why nine senators are out chasing Billy Carter around." Sounding half exasperated, Dole exclaimed, "Billy Carter -- so what?"

Sen. Dennis DeConcini (D-Ariz.) was asking himself the same question. "I think it has been blown out of proportion because of the political clamor," he said. "But we're so far down the road, we can't stop now."

Even as the doubts multiply, the fledgling investigation is gathering momentum. More than a dozen staff members are working on it full time. Top-flight former FBI agents, outside lawyers and investigators have been called in Sen. Birch Bayh (D-Ind.), chairman of the subcommittee, was expected to meet last night with former Watergate special prosecutor James Neal, the most likely candidate for the job of chief counsel.

And the senators on the subcommittee, four of whom are up for reelection, are worrying how they will be perceived back home. "I'd just as soon no one in Vermont know that I'm on the subcommittee," said Sen. Patrick J. Leahy (D-Vt.). "They'd wonder why I wasn't doing my other duties instead." Leahy expressed the fear that it will be seen as either "a witch hunt or a whitewash."

Republicans who only last week were gleefully referring to "Billygate" are now saying there is no comparison with Watergate. "A lot of people feel the press has made more of it than necessary," said Sen. Strom Thurmond (R-S.C.), the ranking minority member on the subcommittee. "Unless more evidence surfaces it may turn out that way." Thurmond hinted darkly, however, that "considerable significant evidence" may emerge.

Bayh said the investigation "is like walking in a mine field," and worries that "in the end, it may not amount to a hill of peanuts." His constituents, he said, are concerned about other things.

"Auto workers are on unemployment. Farmers are suffering from the grain embargo. People couldn't care less about the Libyans," he said.

In interviews yesterday with six senators on the nine-member panel, all gave the president high marks for what they alternately referred to as a "fair," "straightforward" and "open" explanation of his involvement in the Billy Carter affair.

"It took some of the wind out of the sails of efforts to criticize him," said Sen. Max Baucus (D-Mont.). "His standing in the polls is likely to rise. He probably strengthened his position at the convention."

Baucus noted that "already some Republicans are not as combative" on the Billy Carter issue. On the other hand, he added, the president's report, which detailed White House involvement in his brother's Libyan dealings, "puts more pressure on the committee to not be necessarily swayed by the moment. We must conduct a thorough investigation."

All the subcommittee members stressed that they will definitely pursue an objective, comprehensive inquiry -- but none seemed to be enjoying the exercise. "I wasn't looking to be on this committee," DeConcini volunteered.

Bayh said that heading the committee is "a political risk" for him. "There's a lot of disenchantment with confrontation between the president and Congress," he said. "My constituents are saying, 'Why can't you fellows get along?'"

Referring to his reelection campaign, Bayh added, "If I do a good job and people perceive justice is done, I suppose it would be seen as a plus" by voters.

One factor that concerns the senators is public sympathy for Billy Carter and the president.

"The basic feeling of the American people is that this may not be 'much ado about nothing,' but it's a lot to do about not very much," Baucus said. "People are saying 'poor Billy!' They think the media has made a lot out of this."