On the eve of critical negotiations with Congress, the Bush administration's budget director said yesterday that the alternative to agreement on a deficit-reduction plan is at least $80 billion in forced spending cuts, which would lay waste to most domestic programs.

Richard G. Darman, director of the Office of Management and Budget, told a group of reporters that possible revenue-raising measures will be discussed for the first time by administration and congressional representatives when they resume their meetings today. He predicted that by Thursday, proposals for $45 billion to $60 billion in deficit reductions "will come from all parties -- including the administration."

As the bipartisan budget summit prepared to move from detailed briefings to direct negotiations, with only the principals present, Darman said, "We feel a lot better about the group and the process than we did a few weeks ago." But he cautioned that the "chemistry" and mutual trust that have been built up in the past four weeks of briefings are untested. No one, he said, is under any illusions "about how hard this is."

What ultimately may force action, Darman said, is the realization that "sooner or later, we have to deal with each other" to avoid sequestration, the technical term for across-the-board spending cuts that would be of unprecedented magnitude in order to meet the Gramm-Rudman-Hollings deficit target of $64 billion for fiscal 1991.

Darman's estimate of "at least $80 billion" for sequestration was about $20 billion higher than the administration originally had warned might be necessary. Even if the lower figure should prove accurate, Darman said, it would, among other things, eliminate student aid grants for 1.2 million people and reduce all other surviving student aid grants by $675 apiece; force furloughs of 5,500 federal prison guards; cause the intermittent shutdown of some airports and increase delays in the air transport system four- to sixfold; and stop work on almost half the hazardous waste sites slated for Superfund cleanup.

Darman read the figures from a 22-page draft of a document he plans to make public on July 15 as a warning to Congress of the potential costs of an impasse. By then, he said, the lawmakers will be facing another deadline -- the need to increase the $3.12 trillion ceiling on Treasury borrowing before they start their annual August recess.

Darman said the national debt limit that was expected to get the government through all of this year will be exceeded by September, largely because "we're spending money so fast on the savings and loan {cleanup} resolutions."

While the deadline for lifting the debt ceiling before the congressional summer vacation "is the real midnight hour," Darman said, the administration hopes to see substantial progress in negotiations before Congress starts another 12-day break on June 29. An overall agreement on the elements of the package by that date is important, he said, to allow sufficient time for the detailed staff work required to handle not only the medium-term deficit-reduction plan but long-term reforms of $6 trillion worth of government credit and insurance programs.

Darman said the prospect of $80 billion or more in forced cuts is horrifying enough that all parties to the negotiation will recognize the law must be changed. But he said that "neither the administration nor the financial markets" would accept simple bookkeeping changes or target adjustments that would postpone the problem for another year. "It will require change in substantive law," he said.

While withholding any details of the administration's package, Darman indicated he was ready to offer suggestions in the defense and entitlements areas "if the group is interested." He also said President Bush was likely to join the discussions personally in the next two weeks and "is fully prepared" to lead the lobbying and public education effort if a bipartisan package can be assembled.

While conceding that the negotiators face "large problems of trust and the management of political risk," Darman said he was encouraged by the fact that "there have been a number of occasions when people could have taken cheap partisan shots and didn't."

Staff writer John E. Yang contributed to this report.