Why the howls? Clinton said he'd make changes

DAN RODRICKS

February 18, 1993|By DAN RODRICKS

Howl away if you must. But don't say Bill Clinton didn't deliver on a promise of change.

Maybe he didn't go far enough last night, maybe he went too far.

But, hey, hey, hey! Compare the kid's first major address to Congress with George Bush's last one, and it's pretty clear, as my friend Bush Hog put it over lunch at Attman's yesterday, "We're under new management, folks."

George Bush's last State of the Union address was a paean to fat cats. It offered little more than warmed-over trickle-down economics, served with a side order of status quo blah-blah and a stern warning against the prosecution of class warfare in national policy. It was Jan. 28, 1992, and Bush once again proposed more welfare for the wealthy, including a cut in the capital gains tax.

Here's what Bush said:

"Those of you who say, 'Oh no, someone who's comfortable may benefit from that,' you kind of remind me of the old definition of the Puritan who couldn't sleep at night worrying that somehow someone somewhere was out having a good time."

For sure, someone was having a good time.

A few weeks before Bush's speech, the Internal Revenue Service reported that, in 1990, some 550,000 couples and individuals had incomes of $200,000 or more. Of that number, 472 with a total income of $211 million paid no taxes at all.

"The opponents of this measure," Bush went on, "and those who've authored various so-called soak-the-rich bills that are floating around this chamber, should be reminded of something: When they aim at the big guy, they usually hit the little guy. And maybe it's time that stopped."

Right. As if we hadn't been giving tax breaks to the rich for the last decade.

The watchdog group, Citizens for Tax Justice, quoted in the March 1 issue of The Nation, figures that the wealthiest 1 percent of Americans -- average income of almost $600,000 annually -- raked in more than $71 billion in 1992 from tax breaks enacted over the previous 15 years.

And that kind of thing went on while the middle class paid more in taxes and more for education, housing and health care, with health care costs -- to workers and employers -- going off the charts.

Bush was so out to lunch he didn't realize how many other Americans had sobered up to the reality of his and the Reagan administration's unfair tax policies.

It was just before the 1992 State of the Union address that the Federal Reserve confirmed what had been suspected: The rich got richer in the 1980s while the middle class stagnated. It was a relatively small number of affluent Americans who enjoyed the boom, and the gap between the rich and everyone else widened. The Fed said a dramatic rise in the net worth of the most affluent Americans was due to the economic power they had when the 1980s began -- before Reagan gave them tax breaks! They benefited further from the stock market boom, the explosion in housing prices and the high interest paid on certificates of deposits and other investments. They enjoyed huge capital gains.

el,.5l At the same time, the Census Bureau reported that 33.6 million Americans lived below the government-set poverty line ($13,359 annually for a family of four). A record 23.6 million people -- nearly 1 in 10 Americans -- were getting food stamps in 1992.

Now, you're going to hear howling about Clinton going after the rich.

But look, the rich will adjust. They'll survive.

Middle-class Americans might have thought a tax break would be sweet, but most of them recognized reality: It's time to pay up or shut up. And they're not going to be asked to pay as much as the rich are. Fine with me.

But if Clinton backs off or doesn't go far enough, or if the tax revenues he's requesting don't go toward some serious deficit reduction -- we're talking about the future of our kids here -- then it won't be fine with me. For now, I think we have to give the guy a chance.

Still, howl away if you must. The more the howls, and the more diverse they are, the better off Clinton will be.

If this so-called sacrifice goes across the board -- if it's fair and genuine -- then we are on to something. And Clinton has a chance to change America.

Which is what we hired him to do.

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