Economic policy of the Bill Clinton administration
The ultimate goal involved rendering the American government smaller, less wasteful, and more agile in light of a newly globalized era.
[3] Clinton assumed office following the end of a recession, and the economic practices he implemented are held up by his supporters as having fostered a recovery and surplus, though some of the president's critics remained more skeptical of the cause-effect outcome of his initiatives.
David Greenberg, a professor of history and media studies at Rutgers University, opined that: The Clinton years were unquestionably a time of progress, especially on the economy ... Clinton's 1992 slogan, 'Putting people first,' and his stress on 'the economy, stupid,' pitched an optimistic if still gritty populism at a middle class that had suffered under Ronald Reagan and George H.W.
[6] Republican Congressional leaders launched an aggressive opposition against the bill, claiming that the tax increase would only make matters worse.
[10][11] After Republicans won control of Congress in 1994, Clinton vehemently fought their proposed tax cuts, believing that they favored the wealthy and would weaken economic growth.
[12] In April 1996, Clinton and Congress finally agreed on a budget that provided money for government agencies until the end of the fiscal year in October.
It is not accurate to discredit the exceptional fiscal austerity of the Clinton era relative to other modern Presidents, which nevertheless coincided with a booming economy by virtually any measure.
On taking office in early 1993, Clinton proposed a $16 billion stimulus package primarily to aid urban area programs favored by progressives.
To receive the full TANF grant amounts, states had to meet certain requirements related to their own spending, as well as the percentage of recipients working or participating in training programs.
The law also modified the eligibility rules for means-tested benefits programs such as food stamps and Supplemental Security Income (SSI).
These block grant amounts proved to be more than the states could initially spend, as AFDC and TANF caseloads dropped by 40% from 1994 to 1998 due to the booming economy.
[22] Opponents argued that lowering tariffs and relaxing rules on imports would cost American jobs because people would buy cheaper products from other countries.
[25][better source needed] NAFTA provided for gradually reduced tariffs and the creation of a free-trade bloc between the United States, Canada, and Mexico.
Opponents of NAFTA, led by 1992 independent presidential candidate Ross Perot, claimed it would force American companies to move their workforces to Mexico, where they could produce goods with cheaper labor and ship them back to the United States at lower prices.
[27] While economists generally view free trade as an overall positive for the nation's involved, certain groups may be adversely affected, such as manufacturing workers.
In November 1993, he hosted a meeting of the Asia-Pacific Economic Cooperation (APEC) in Seattle, Washington, which was attended by the leaders of 12 Pacific Rim nations.
In 1994, Clinton arranged an agreement in Indonesia with Pacific Rim nations to gradually remove trade barriers and open their markets.
The agreement–the result of more than a decade of negotiations–would lower many trade barriers between the two countries, making it easier to export U.S. products such as automobiles, banking services, and motion pictures.
However, the agreement could only take effect if China was accepted into the WTO and was granted permanent "normal trade relations" status by the U.S. Congress.
Many Democrats as well as Republicans were reluctant to grant permanent status to China because they were concerned about human rights in the country and the impact of Chinese imports on U.S. industries and jobs.
[33] Although Governor Clinton had a large farm base in Arkansas; as president he sharply cut support for farmers and raised taxes on tobacco.
[34] At one high level policy meeting budget expert Alice Rivlin told the president she had a new slogan for his reelection campaign: "I’m going to end welfare as we know it for farmers.” Clinton was annoyed and retorted, “Farmers are good people.
But we don’t have to feel good about it.”[35] With exports accounting for more than a fourth of farm output, farm organizations joined business interests to defeat human rights activists regarding Most Favored Nation (MFN) trade status for China They took the position that major tariff increases would hurt importers and consumers.
The expanding use of pesticides and fertilizers, polluted soil and water not just on each farm but downstream into rivers and lakes and urban areas as well.
The argument was that the federal government in effect was subsidizing ranchers, with a few major corporations controlling millions of acres of grazing land.
Babbitt and Oklahoma Congressman Mike Synar tried to rally environmentalists and raise fees, but senators from the Western United States successfully blocked their proposals.
[citation needed] While he disputes that claim, he expressed regret and conceded that in hindsight he would have vetoed the bill, mainly because it excluded risky financial derivatives from regulation, not because it removed the long-standing Glass-Steagall barrier between investment and depository banking.
[42] These derivatives, such as the credit default swaps at the core of the 2008 crisis, were basically used to insure mortgage-related securities, with AIG the major provider.
[43] Clinton presided over the following economic results, measured from January 1993 to December 2000, with alternate dates as indicated: Clinton has been heavily criticized for overseeing the creation of the North American Free Trade Agreement (NAFTA), which made it more affordable for manufacturing companies to outsource jobs to foreign countries and then import their product back to the United States.
Some liberals and nearly all progressives believe that Clinton did not do enough to reverse the trends toward widening income and wealth inequality that began in the late 1970s and 1980s.
