If you look at poll numbers, pundit columns and anywhere else in the news, you know now is the golden age of Bill Clinton. According to Gallup polling, 69 percent of Americans view him “favorably.” Clinton’s Democratic National Convention speech was the most “ooh-ed” and “ahh-ed” over, leading to people wanting him to be “Secretary of Explaining Stuff.” Even many Republicans, including Mitt Romney, have been caught testifying of the 42nd president’s greatness.
But instead of simply basking in the Clinton mystique and using his popularity to advance their own personal agendas, President Barack Obama and other elected officials should take the government during his tenure as a lesson and a guide.
One of the loudest and most persistent themes of the Obama administration is fairness. Most specifically, there is the idea of tax fairness and income inequality. In the debates leading up to his election, Obama would often say that even though raising capital gains taxes (taxes on investments) led to no increase in revenue, he would raise them as an issue of fairness. Obama has also lauded the so-called “Buffett Rule,” which is a bill titled “Paying a Fair Share Act of 2012.”
Under Clinton, income share of the top 1 percent increased more quickly and for a longer period of time—his entire presidency—than anytime after 1917. Also, at the beginning of his presidency, Clinton signed the Omnibus Budget Reconciliation Act of 1993, raising income taxes on the top 1.2 percent.
Along with the enormous amount of revenue coming from the Dot-Com bubble, the higher tax rate led to reducing the deficit the last three years of his eight-year term. It did little for income inequality.
The “Paying a Fair Share Act of 2012” would not even dent the budget. It would raise merely $47 billion over 11 years, according to the congressional Joint Committee on Taxation, and there is no evidence it would bring income equality. The “Paying a Fair Share Act of 2012” is not an effective taxation policy.
Instead, President Obama should be looking toward achieving economic growth, which will help the middle class. One good way to do this is to take Bill Clinton’s 2011 advice from the article, “It’s Still the Economy, Stupid” by promoting more jobs in energy. Let’s achieve that by creating a truly all-of-the-above approach, one that still advances projects like the Keystone XL Pipeline and not just companies like Solyndra and other energy sources that are obviously not ready for prime time. There is never going to be across-the-board income equality, but until the economy starts producing more jobs, the middle class will only weaken. Reducing costly regulations and reducing taxation on oversea profits could entice businesses to invest in jobs and bring their profits back to spend in the United States.
Deficit reduction is supposedly another important goal for both parties, but if the Obama administration wishes to only use the Clinton tax policies as a guide to do so, it is again missing something. This time it is government spending as a percent of GDP. During Clinton’s term, this metric increased only two of the eight years. We were spending less and taxing slightly more. If the Obama administration, or anyone for that matter, wishes to cut the deficit, actual cuts are going to need to happen.
This is why the refusal to agree on the Simpson-Bowles Committee proposal by the likes of both President Obama and vice presidential candidate Paul Ryan was such a mistake. If people want to swoon over the Clinton presidency for anything (I highly suggest Christopher Hitchen’s book “No One Left to Lie to” to stop any such swooning) it should be that there was compromise.
Unfortunately for us, the compromise under the Clinton administration and the Newt Gingrich-led House of Representatives will never happen with the current White House administration. This is a failure in both parties. So while Republicans talk about the conservative policies of the Clinton Administration, they should start looking at the compromises made as well. The first step for Republicans is to drop the “No Tax Increase” pledges—any pledge for that matter—and start compromising to reach marginal improvements in policy.
Economic problems require compromise on both sides of the aisle and also an economy that produces more taxable wealth. The only things citizens can directly control of the two is the leadership. So in the November election think about the president, senators and representatives you think can create a government that will compromise like Clinton and the Gingrich congress, and that is who is deserving of your vote.
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