D. Dowd Muska

 

This Week's Column

   

 

Another Clinton Administration? It Depends…

September 11, 2014

“Do you remember when America was good? Do you remember when America, we had jobs and we were building towards a brighter future? And things were really happening? Clinton administration. We had it under control. Things were good, they weren’t great. We’re going to do better. But we’re going to replant our flag in the traditional things that you understand. But the traditional things in the Clinton administration. We could talk about Ronald Reagan all we want. … But the Clinton years were the golden years.”

That’s Glenn Beck, describing an in-the-know friend’s depiction of how Hillary Clinton will market herself to the electorate in 2016. It’s a pitch that’s sure to resonate with voters old enough to remember the 1990s.

On Bill Clinton’s watch, as his chums at the Center for American Progress boast, “the U.S. economy grew for 32 straight quarters.” Job creation was as strong as it was during Reagan’s reign. Median household income rose by 10.3 percent. The Dow increased from 3,242 to 10,588.

For a decade and a half, Hillary’s hubby has preened over the nirvana his sycophants tell him he tended. But as columnist Robert J. Samuelson noted, “The idea that presidents can control [the economy] lies between an exaggeration and an illusion.” The commander-in-chief’s power to inflict misery far surpasses his ability to cultivate happy days. And luck is a key factor when the final grade is assigned to an administration’s achievement on employment, income, trade, and investment.

Clinton was fortunate from the start. The short, mild recession that began in July 1990 ended 22 months before his inauguration. In the ‘90s, the Baby Boomers entered their years of peak earning potential. Energy was inexpensive. (The inflation-adjusted price of gasoline when Clinton left office was nearly half that of today.) The computer revolution zoomed along at a dizzying pace, and Internet access morphed from a curiosity to a necessity. Deregulation, begun under Jimmy Carter and continued by Reagan, fostered vibrancy in existing and newly born industries. Globalization helped -- foreign direct investment flowed into the U.S., exports surged, and imported goods were cheap.

The Comeback Kid’s wife is unlikely to make the case that her presidency will be equally lucky. She’ll assert that Bill’s tax hikes and “public investments” made the ‘90s roar. The truth is more complex.

Copying his predecessor, Clinton raised a number of taxes. His Republican enemies’ insistence that a recession would result proved wrong. But when recalling their hero’s fiscal success, liberals rarely mention that in 1997, four years after the “brave” decision on “revenue,” his administration agreed to a number of tax cuts, most notably a reduction in the rate applied to capital gains.

As tough as it must be for Robert Reich to accept, by one measure, the Clinton White House presided over the greatest reduction in federal spending of the postwar era. As a share of GDP, Washington’s outlays fell from 20.3 percent to 17.6 percent. The decline exceeded the drop-off engineered by Reagan. Much of the downshift was due to a sizable slash in expenditures on “defense.” An economy operating near capacity filled D.C.’s coffers, and the budget was balanced for the first time in decades.

Bubba was a pure pol. He pined for fawning press profiles and the adulation of a starstruck citizenry. (“I think it’s important to touch as many of the American people as we can.”) A child of the ‘60s, he was no friend of liberty, but neither was he a doctrinaire moonbat. He abandoned his healthcare scheme when polls showed it was a loser. (The BTU tax sought by Al Gore succumbed to a similar fate.) He shepherded NAFTA through Congress, over the fierce opposition of union bosses and Naderites. In 1996, he signed the GOP-crafted reform of a prominent welfare program.

George W. Bush doesn’t possess such flexibility. Ditto for Barack Obama. Ideologues -- be they neoconservatives or progressives -- don’t do objectivity, and they’re not interested in “triangulation.” The mission goes forward, no matter the consequences. So once Clinton left office, federal spending exploded. Unhinged warnings about foreign and domestic “security threats” dampened consumer, investor, and business confidence. Disastrous experiments in “nation building” got horrifically bloody. Regulations metastasizedCorporate welfare worsened. And the healthcare “system,” already woefully disconnected from market forces, aggressively advanced toward complete collapse.

Is Hillary more like Bill, or more like George and Barack? If we’re fated to find out, let’s hope she keeps her husband around, as a reminder that when it comes to the presidency, less is more.

D. Dowd Muska (www.dowdmuska.com) writes about government, economics, and technology. Follow him on Twitter @dowdmuska. He lives in Broad Brook, Connecticut.

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