Confronted by a daunting budget deficit as well as tantalizing opportunites to promote Middle East peace and U.S.-Soviet accord, President-elect Bush says caution will be his watchword in the White House.

"I'm one who always has been a little bit cautious, and yet I don't want to seem negative," Bush said at a recent news conference when asked what he thought of Soviet leader Mikhail Gorbachev's dramatic pledge to cut Soviet military forces by 500,000 men and 10,000 tanks.Would Bush consider something similar?

"I am interested in progress but I want it to be prudent," he said.

On the Middle East, too, the man who is about to take over from Ronald Reagan expressed a meticulously careful view of possibilities for opening a dialogue with the Palestinian Liberation Organization -- just before Reagan gave the O.K. to that historic move.

"Before we have a dialogue with the PLO, the signals have to be clear, unmistakable, unambiguous . . . so that no one can argue with what has been said," Bush told reporters. Then, an hour or two later, he endorsed Reagan's decision to open that dialogue.

As these and other episodes suggest, caution and prudence are likely to be familiar descriptives in the presidency of George Bush, which begins with a gala inaugural January 20.

That will go as well for the domestic problems, and especially the budget deficits now running about $150 billion a year, which will get even higher priority than the array of challenges on the diplomatic front.

"I can't imagine anything that would dominate the first 100 days of the administration more than the deficit," said one senior Bush aide who is slated for a key White House job.

Bush's prudent-man style of government will stand in sharp contrast to the unbridled enthusiasm Reagan exuded in pushing his conservative, super-patriot's vision of the world.

Restraint is characteristic of the president-elect, who styles himself "a practical man" and has spent the weeks since his November 8 victory over Democrat Michael Dukakis reaching out to political adversaries -- including Dukakis --and reassuring U.S. allies.

"I'm not much for the airy and abstract," he says. "I like what works. I'm not a mystic. I don't yearn to lead a crusade."

This has been underscored by his decision to staff the top levels of his administration with familiar professional government figures such as close friend James Baker as secretary of state, Brent Scowcroft as national security adviser, Richard Darman as budget director and many Reagan administration holdovers.

While Reagan's style was to make grand moves and charm the public, he often upset U.S. allies who bristled over what they regarded as inadequate consultation on issues that affected their security. A notable example was his near-agreement with Gobrachev at the 1986 Reykjavik summit to wipe out U.S. and Soviet long-range nuclear missile arsenals.

Bush, by contrast, says a NATO summit to establish alliance arms control strategy must precede any summit between himself and Gorbachev. Bush insiders say a Bush-Gorbachev summit is not likely before the second half of next year.

"There obviously are opportunities in the relationship with the Soviet Union," one senior Bush aide said. "George certainly has a sense of the reality of that opportunity."

But this aide emphasized that Bush also sees "the problems associated with over-optimism." He argued that the vice president "deserves credit for the self-discipline for not feeling obliged to just shove things out right now for the sake of getting headlines."

It was not immediately clear how Bush intended to proceed in the Middle East but, to some extent, his maneuvering room was restricted by Reagan's sudden December 14 decision to clear the way for official talks with the PLO.

Bush quickly expressed pleasure with that decision, keeping to his loyal lieutenant stance right to the end.

"I'm vice president of the United States and I'll support this administration until I become president of the United States," he has said. "I've done that for seven years and 11 months and I'm not going to change now."

His advisers say they expected he would adopt the same approach to the fast-changing Middle East situation that he is pledging toward Moscow - to get his team together for what he calls "a hard Bush administration look at it."

On the budget deficit, America's top domestic issue, Bush has vowed to reduce red ink without raising taxes or cutting the Social Security program - a feat many economists say is impossible.