Tag: bill clinton

France’s Valls Is No Bill Clinton

President Francois Hollande has put in place a new French government led by Prime Minister Manuel Valls. This maneuver has all the hallmarks of shuffling the deck chairs on the Titanic. Yes, one has the chilling feeling that accidents are waiting to happen.

President Hollande’s new lineup is loaded with contradictions. That’s not a good sign.

Just take Prime Minister Valls’ assertion that, when it comes to economics, he is a clone of Bill Clinton. For anyone familiar with the facts, this claim is bizarre, if not delusional.

When it comes to France’s fiscal stance, the Valls’ government is fighting austerity tooth and nail. Indeed, the Socialist government is seeking greater leeway from the European Commission (read: Germany) over targets for reducing France’s stubborn budget deficit. With French government expenditures accounting for a whopping 56.6 percent of GDP, it’s truly astounding that the government is reluctant to engage in a bit of belt tightening.

Wise Words on Fiscal Sovereignty and Corporate Taxation (sort of) from Bill Clinton

I’ve always had a soft spot in my heart for Bill Clinton. In part, that’s because economic freedom increased and the burden of government spending was reduced during his time in office.

Partisans can argue whether Clinton actually deserves the credit for these good results, but I’m just happy we got better policy. Heck, Clinton was a lot more akin to Reagan that Obama, as this Michael Ramirez cartoon suggests.

Moreover, Clinton also has been the source of some very good political humor, some of which you can enjoy here, here, here, here, and here.

Most recently, he even made some constructive comments about corporate taxation and fiscal sovereignty.

Here are the relevant excerpts from a report in the Irish Examiner.

It is up to the US government to reform the country’s corporate tax system because the international trend is moving to the Irish model of low corporate rate with the burden on consumption taxes, said the former US president Bill Clinton. Moreover, …he said. “Ireland has the right to set whatever taxes you want.” …The international average is now 23% but the US tax rate has not changed. “…We need to reform our corporate tax rate, not to the same level as Ireland but it needs to come down.”

Kudos to Clinton for saying America’s corporate tax rate “needs to come down,” though you could say that’s the understatement of the year. The United States has the highest corporate tax rate among the 30-plus nations in the industrialized world. And we rank even worse—94th out of 100 countries according to a couple of German economists—when you look at details of how corporate income is calculated.

Politicians and Their Friends

The Sunday Washington Post has a lengthy story on Terry McAuliffe’s highly successful “business” career. McAuliffe, of course, is the longtime Democratic fundraiser and “first friendof Bill Clinton who is now the Democratic nominee for governor of Virginia.

How did a lifelong political operative make many millions for himself? The Post reviews:

The pitches to potential investors in a new electric-car company have been unabashed about its promise: It will enjoy “billions” in government subsidies and tax credits, will rise to a dominant position in the U.S. electric-car industry and, perhaps most critically, has a politically connected founder with the savvy to make it all happen….

The prospectus, along with other documents reviewed by The Post, shows how GreenTech fits into a pattern of investments in which McAuliffe has used government programs, political connections and access to wealthy investors of both parties in pursuit of big profits for himself.

That formula has made McAuliffe a millionaire many times over, paving the way for a long list of business ventures, including his law firm, from which he resigned in the 1990s after profiting — along with his partners — from fees paid by domestic and foreign clients seeking results from the federal government.

A review of McAuliffe’s business history shows him often coming out ahead personally, even if some investments fail or become embroiled in controversy.

Or as McAuliffe told the New York Times:

”I’ve met all of my business contacts through politics. It’s all interrelated,” he said. When he meets a new business contact, he went on, ”then I raise money from them.”

And how did Bill Clinton meet his very good friend? Was it in high school? College? At Oxford? The local Kiwanis Club? No, President Clinton was down in the dumps after his electoral thumping in 1994 and needed to get in gear for his reelection campaign. Harold Ickes, “his politically astute deputy chief of staff,” urged him to meet McAuliffe, who had been a fundraiser for President Carter, when he was 23 years old, and Dick Gephardt. McAuliffe quickly recommended renting out the Lincoln Bedroom, and that worked so well that they became fast friends, maybe even “best friends.”

Meet the Press, Check the Facts

This Sunday (2 December 2012), David Gregory hosted a lively session of NBC’s Meet the Press. The focus of Sunday’s program was the so-called Fiscal Cliff. Gregory rounded up many of the usual Washington suspects, including Treasury Secretary Timothy Geithner, and drilled them on their talking points.

Several times, in the course of Gregory’s questioning, he referred to President Bill Clinton’s tough 1993 budget deal. Throughout the broadcast, Gregory kept stressing the fact that the 1993 deal included defense cuts. For Gregory, those cuts were the flavor of the day.

This isn’t surprising. Indeed, most members of Washington’s chattering classes parrot the line that the economy boomed during the Clinton years because Clinton was the beneficiary of the so-called peace dividend, which allowed him to cut defense expenditures.

In fact, if we look carefully at the federal budget numbers, while Clinton did cut defense expenditures, as a percent of GDP, the majority of the Clinton squeeze came from non-defense expenditures. Indeed, as can be seen in the accompanying table, the non-defense squeeze accounted for 2.2 percentage points of President Clinton’s 3.9 total percentage point reduction in the relative size of the federal government.

Clinton squeezed the budget and squeezed hard, from all major angles. This was a case in which a president’s actions actually matched his rhetoric. Recall that, in his 1996 State of the Union address, he declared that “the era of big government is over.”

Clinton’s 1993 deal marked the beginning of the most dramatic decline in the federal government’s share of the U.S. economy since Harry Truman left office. The Clinton administration reduced government expenditures, as a percent of GDP, by 3.9 percentage points. Since 1952, no other president has even come close. At the end of his second term, President Clinton’s big squeeze left the size of government, as a percent of GDP, at 18.2 percent—the lowest level since 1966.

The table contains the facts. President Clinton knew how to squeeze both defense and non-defense federal expenditures. Indeed, he squeezed non-defense a bit harder than defense. Since 1952, the only other president who has been able to reduce the relative share of non-defense expenditures was Ronald Reagan. Forget the “peace dividend”—it’s all about the Clinton “squeeze dividend.”

Clinton and Obama, Polar Opposites

Last night, Bill Clinton introduced President Barack Obama as the Democratic nominee. He went to great lengths to stress their similarities, but failed to mention their divergent views on the appropriate size of government.

When President Clinton took office in 1993, government expenditures were 22.1% of GDP, and when he departed in 2000, the federal government’s share of the economy had been squeezed to a low of 18.2%. As the accompanying table shows, during the Clinton years, federal government expenditures as a percent of GDP fell by 3.9 percentage points. No other modern president has come close.

 

And, that’s not all. During the final three years of the former President’s second term, the federal government was generating fiscal surpluses. Clinton was even confident enough to boldly claim, in his January 1996 State of the Union address, that “the era of big government is over.”

When it comes to the appropriate size of government, Clinton and Obama are polar opposites.

Clinton vs. Obama

Over the weekend I stumbled upon C-SPAN’s broadcast of Bill Clinton’s 1992 speech accepting the Democratic nomination for president, and I remembered how he seemed like a “different kind of Democrat” at the time. As I started watching, I heard Clinton saying:

The most important family policy, urban policy, labor policy, minority policy, and foreign policy America can have is an expanding entrepreneurial economy of high-wage, high-skilled jobs …

Soviet communism has collapsed and our values—freedom, democracy, individual rights, free enterprise—they have triumphed all around the world.

And then he got into the meat of the “new Democrat” message:

To turn our rhetoric into reality we’ve got to change the way government does business, fundamentally. Until we do, we’ll continue to pour billions of dollars down the drain.

The Republicans have campaigned against big government for a generation, but have you noticed? They’ve run this big government for a generation and they haven’t changed a thing. They don’t want to fix government; they still want to campaign against it, and that’s all.

But, my fellow Democrats, its time for us to realize we’ve got some changing to do too. There is not a program in government for every problem, and if we want to use government to help people, we have got to make it work again….

Now, I don’t have all the answers, but I do know the old ways don’t work. Trickledown economics has sure failed. And big bureaucracies, both private and public, they’ve failed too.

That’s why we need a new approach to government, a government that offers more empowerment and less entitlement. More choices for young people in the schools they attend- in the public schools they attend. And more choices for the elderly and for people with disabilities and the long-term care they receive. A government that is leaner, not meaner; a government that expands opportunity, not bureaucracy; a government that understands that jobs must come from growth in a vibrant and vital system of free enterprise.

He made his famous promise to “end welfare as we know it.”

That’s not President Obama’s style. He’s not that kind of Democrat. He doesn’t talk about free enterprise as an American value, not even when speaking of freedom to students in China. Search for “free enterprise” on the White House website, and the first hit is to his famous “You didn’t build that” speech in Roanoke—which doesn’t include the word “enterprise,” or the word “free.” He doesn’t say that big bureaucracies have failed, or that we need more choice in education and health care.

Which presumably means Bill Clinton will have to write a different speech when he nominates President Obama for reelection on Wednesday night.

Now don’t get me wrong. There was plenty of old-fashioned Democratic liberalism in Clinton’s 1992 speech. He talked about “what all of us must give to our Nation,” which fits well with Obama’s view. He denounced outsourcing, he proclaimed that “health care is a right,” he promised billions in new federal spending and lots of programs.

He even deplored polarization and “the stereotypes that blind us,” reminding us that today’s complaints about polarization are nothing new. And I was struck by the way he delivered that complaint. He said that “for too long politicians have told the most of us that are doing all right that what’s really wrong with America is the rest of us—them.” And he elaborated:

Them, the minorities. Them, the liberals. Them, the poor. Them, the homeless. Them, the people with disabilities. Them, the gays.

All good points. Too much stereotyping. Too much polarization. Too much partisanship. Except that his list of stereotypes was very partisan. What about “Them, the conservatives”? “Them, the rich”? Aren’t those polarizing stereotypes too? You’d think a different kind of Democrat would have deplored all the stereotypes that politicians use to divide people.

David Maraniss writes in today’s Washington Post that “on most of the big issues, there is little or no space between [Clinton and Obama] as pragmatic liberals.” Maybe so, but in his campaign—and in his response to a midterm electoral rebuke—Clinton certainly gave voters the impression that he was a “different kind of Democrat,” one who appreciated the limits of government and the virtues of free enterprise. This week he’ll presumably have to give a full-throated defense of a president who never said that the era of big government is over, who increased the food stamp rolls by 14 million after Clinton reduced them by 11 million, who increased the national debt by $5 trillion compared to $1.6 trillion in the Clinton years. No doubt he’ll do a great job.

President Obama Accuses Bill Clinton of ‘Thinly Veiled Social Darwinism’

Actually, Bill Clinton must be something even worse than a social Darwinist. That’s because the title of this post is wrong. Obama said that Paul Ryan’s plan (which allows spending to grow by an average of 3.1 percent per year over the next decade) is a form of “social Darwinism.”

But the proposal from the House Budget Committee Chairman only reduces the burden of federal spending to 20.25 percent of GDP by the year 2023.

Yet when Bill Clinton left office in 2001, following several years of spending restraint, the federal government was consuming 18.2 percent of economic output.

And by the President’s reasoning, this must make Clinton something worse than a Darwinist. Perhaps Marquis de Sade or Hannibal Lecter.

Here’s a blurb from the New York Times on Obama’s speech.

Mr. Obama’s attack, in a speech during a lunch with editors and reporters from The Associated Press, was part of a broader indictment of the Republican economic blueprint for the nation. The Republican budget, and the philosophy it represents, he said in remarks prepared for delivery, is “antithetical to our entire history as a land of opportunity and upward mobility for everyone who’s willing to work for it.” …“Disguised as a deficit reduction plan, it’s really an attempt to impose a radical vision on our country. It’s nothing but thinly veiled social Darwinism,” Mr. Obama said. “By gutting the very things we need to grow an economy that’s built to last — education and training, research and development — it’s a prescription for decline.”

I’m particularly amused by the President’s demagoguery that Ryan’s plan is “antithetical to our entire history” and “a radical vision.”

Is he really unaware that a small and constrained central government is part of America’s history and vision? Doesn’t he know that the federal government, for two-thirds of our nation’s history, consumed less than 5 percent of GDP?

Of course, that was back in the dark ages when people in Washington actually believed that the Constitution’s list of enumerated powers in Article 1, Section 8, actually enumerated the powers of the federal government. How quaint.

No wonder this Ramirez cartoon is so effectively amusing. It certainly seems to capture the President’s view of America’s founding principles.