President Bush said yesterday that he decided to abandon his "no new taxes" campaign pledge because a deteriorating economy, the savings and loan bailout and a ballooning federal deficit had created a "major problem" for the country that could only be solved by "make or break" negotiations to reduce the budget deficit.

"We've got a problem that is of far greater magnitude today because we've had a much slower economy than anybody predicted, and that has meant revenue shortfalls. And that means bigger budget deficits. And that means more burden for future generations of Americans and unacceptably high interest rates," Bush said at a White House news conference.

Attempting to diminish the political storm set off by his policy reversal, Bush said he was personally "comfortable" with the decision but added that he "can understand" how some people might believe he never intended to keep the promise. "I think it's wrong, but I can understand it," he said.

He said he did not believe his credibility would be damaged "in the long run" because "I think the American people recognize that the budget {deficit} is greater than we predicted and the Democrats had predicted."

When he made his "read my lips" campaign pledge in 1988, he said, "I was convinced that I could stay the course. And we did for a long time and we may now.

"I knew I'd catch some flak on this decision," Bush added. "But I've got to do what I think is right, and then I'll ask the people for support." He said he had "expected editorial comment. We expected . . . some slings and arrows."

In explaining why he jettisoned his most memorable campaign pledge, Bush compared himself to Abraham Lincoln, apparently referring to Lincoln's decision in 1862 to issue the Emancipation Proclamation ending slavery. "I'm presented with new facts," Bush said. "I'm doing like Lincoln did, I'm thinking anew."

Bush met the press after three days of silence on his part since issuing his statement Tuesday saying "tax revenue increases" were required to bring down the deficit.

Since then, the White House has been bombarded with criticism from angry Republicans, who felt betrayed that the president had given up a key GOP political weapon, and by news reports and editorials suggesting that Bush never meant it when he said in 1988, "Read my lips -- no new taxes."

White House officials, who miscalculated the impact of Tuesday's statement, concluded after a series of meetings Thursday that Bush's political credibility was at stake and that he had to provide a public explanation of the decision.

A Bush adviser said that some Republican leaders and outside advisers pushed hard for the president to end his silence on the issue.

Robert M. Teeter, a campaign pollster and longtime political adviser to the president, had lunch with White House Chief of Staff John H. Sununu and other aides at the White House Thursday and sources said the group agreed that in order to argue that Bush's decision represented presidential leadership, the leader had to be visible. Vice President Quayle, just back from a political trip to California, also advocated this approach.

Said one official, "It is pretty hard to assert leadership when there's a hidden leader."

The result was a hastily called news conference yesterday, shortly before Bush left for his summer home in Kennebunkport, Maine. From there he will go to London for the NATO summit and later to Houston for the economic summit.

Bush said he was motivated to change his mind on taxes by the threat of "Draconian cuts in defense, student grants and a wide array of other necessary domestic services" that would result if Congress fails to meet the budget targets in the Gramm-Rudman-Hollings budget act. Based on the current projections, nearly $100 billion must be eliminated, through spending cuts and tax increases, to meet the target. However, the president refused to discuss any specific tax increases.

Bush said "tough decisions" were needed to head off the across-the-board cuts mandated under the Gramm-Rudman-Hollings law, while admitting that he "empathized" with Republican candidates who are using opposition to taxes as central elements in their campaign. "Ultimately good politics is rooted in good government," he added.

Democrats welcomed Bush's news conference remarks. "He's starting to act like a president," said Rep. Dan Rostenkowski (D-Ill.), chairman of the Ways and Means Committee.

GOP lawmakers were less enthusiastic. Asked to reconcile his contention earlier in the week that Bush had not changed his position on taxes with the president's own words yesterday, House Minority Whip Newt Gingrich (R-Ga.) said, "I'm looking forward to talking to Sununu."

Sununu told Republicans on Tuesday that Bush's statement on taxes represented nothing new.

Bush also used as a justification for his shift on taxes former president Ronald Reagan's decision in 1982 to sign a bill sharply raising taxes. But Republicans believe Reagan made a strategic blunder that year by failing to force Democrats to accept comparable spending cuts. The Republicans lost 26 House seats in the 1982 elections because of the economic recession.

Bush's reference comparing himself to Lincoln on slavery raised eyebrows on Capitol Hill. On his way into yesterday's session of the deficit-reduction talks, Senate Finance Committee Chairman Lloyd Bentsen (D-Tex.) was asked about Bush's repeated use of an Abraham Lincoln quotation. Rostenkowski, standing nearby, prompted him with a variation of Bentsen's rejoinder to Quayle during the 1988 vice presidential debate.

Said Rostenkowski: "Tell him, 'I knew Abe Lincoln, I worked with Abe Lincoln and you're no Abe Lincoln.' "

Staff writers Ann Devroy and John E. Yang contributed to this report.