Budget is likely to shape the legacy Clinton leaves THE CLINTON BUDGET

August 08, 1993|By Carl M. Cannon | Carl M. Cannon,Washington Bureau

WASHINGTON -- The sweeping tax increases, spending cuts and shifting of defense spending to social programs in the 1,800-page budget bill passed by Congress late Friday represent a patchwork quilt of ideologies, economic theories and political compromises that is only partly President Clinton's vision.

But it doesn't matter. From now on, this bill will be seen by the nation as Mr. Clinton's budget, Mr. Clinton's spending cuts, and Mr. Clinton's tax increases. So will any spending cuts that come later -- even though they were insisted on by conservative Democrats as the price of passage.

Short of war -- and maybe even then -- these budget agreements will probably shape Mr. Clinton's legacy more than any other policy decision he makes in the Oval Office, according to both allies and critics.

"Once it passes, it's his from here on out. It's just like a giant albatross around his neck," said Martin C. Anderson, one of the architects of Ronald Reagan's 1981 budget bill. "Everything that happens to the economy is his, too."

Countered Paul Begala, a political adviser to the president: "We know that we'll be judged on this [budget]. The reason we don't mind is because it's going to work."

Modern presidents rise -- or more often fall -- with the perception that once the federal budget agreement is signed, the president is its sole author. In turn, whether it's fair or not, the president also gets the credit -- or the blame -- for the performance of the entire economy.

Mr. Clinton appears to have understood this point. Instead of carping about what he didn't get, the president has embraced this budget as it changed shape like clay in the hands of congressional budget negotiators.

'Our plan'

"This is our plan," Mr. Begala said Friday. "If Congress had come back with something that violated the president's principles, he could have vetoed it -- and he would have."

But to keep the process running, Mr. Clinton adopted a budget that made a lot of little compromises, abandoned a key campaign promise made last year and negotiated away one of the "principles" enunciated again and again this spring by top White House staff members.

The little compromises ranged from backing down on an administration proposal to charge royalties for Western hard rock mining to abandoning subsidies for companies that relocate factories to Puerto Rico.

The key campaign promise that went by the boards was the one for a middle-class tax cut. And the "principle" that turned out to be expendable was a broad-based energy tax, which was supposed to raise about $72 billion over the next five years and encourage energy conservation.

In place of the energy tax is a much smaller, 4.3 cent-a-gallon gasoline tax that will raise somewhere in the ballpark of $23 billion.

And reducing the annual budget deficits, perhaps the bill's dominant characteristic, was a minor theme for Mr. Clinton when he ran for president last year.

Mr. Reagan, however, said in 1980 that he would balance the budget. He left the biggest deficits in history. On the other hand, Mr. Reagan's famous domestic spending cuts were not as deep as they are now described, and his tax reductions couldn't have been enacted without Democratic votes.

But the budget and the economy were his to run on in 1984. And though Mr. Reagan would tell audiences that his deficits wouldn't have been so large without the layers of additional spending added on by a Democratic-controlled Congresses, his own advisers concede now that this argument carried little weight with voters.

What worked for Mr. Reagan was that by 1984, the economy had improved.

In last year's election, President George Bush told voters that his decision to increase taxes in 1990 was a mistake. This is not the universal view of economists, who point out that the federal debt would have been much larger without the 1990 budget deal. Mr. Bush's real sin, according to the judgment of voters, was that the economy grew stagnant on his watch and he didn't do much to fix it.

For better or worse

Thus, Mr. Clinton is stuck with this budget, for better or worse. It will be his to run on in 1996. He and his staff appear to relish the prospect, though some Democrats believe Mr. Clinton must keep insisting that the budget bill is a starting, and not an ending, point.

"It has to be the framework for a larger vision that includes job-creation legislation, welfare reform, NAFTA [the North American Free Trade Agreement]," said former Democratic congressman Tony Coelho, who has informally advised the White House. "Republicans will be out there painting this as 'taxes, taxes, taxes.' He has to give people something else to talk about. He has to make sure people understand this is just the beginning."

This is precisely what the president stressed while the close voting in the House and Senate was being conducted. When balky Democrats insisted on a spending cut conference, the president saw it as a way to showcase Vice President Al Gore's task force on "re-inventing government."

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