Bill Clinton’s Neoliberal Record: A Cheat Sheet
Remarkably, the matter of whether the Democratic Party has become a neoliberal party has recently become controversial, with this going, for example, for Bill Clinton’s term in office (1993–2001).
For as long as I can recall, the clear answer would seem to have been yes. Elected as part of a backlash against neoliberalism, with a more progressive tax code, a Keynesian infrastructure-building plan, and universal health care including a public option all central to his campaign platform, Clinton implemented none of these objects, spending his eight years in office vigorously implementing neoliberal policies, setting “structural adjustment (a smaller state, a balanced budget, a paydown of the debt, all as the rich pay less rather than more), laissez-faire (privatization, deregulation, a reduction of the social safety net), and free trade (NAFTA, GATT, etc.) above all other goals. (Indeed, many of us remember how the administration told its supporters they wouldn’t be getting health care reform and explained that they spent all their political capital fighting for NAFTA — getting the acquiescence of Democrats in a right-wing policy rather than getting the acquiescence of Republicans in a progressive policy.)
Still, I decided to check the Clinton record systematically, taking as a starting point the “Timeline of Major Actions” on the Clinton White House’s own web site (hardly an unfavorable source to that administration).
At the end of that check my answer to the question “Was Bill Clinton a Neoliberal” was an even more emphatic “Yes” than before.
If you want the long version, with all the details, and footnotes for all the details, you can click here.
If you want the short version, just keep reading.
During the Clinton administration deficit reduction and free trade were indeed the twin priorities of economic policy. Where deficit reduction was concerned, one should remember that his tendency was to minimize tax increases, particularly on the affluent. The 1993 tax act raised the uppermost income bracket to 39.6 percent, but this was still markedly below what it was in the first six years of Reagan’s administration (50 percent), while the 1997 Taxpayers’ Relief Act lowered capital gains taxes to the 20 percent mark that even in Reagan’s day was thought overambitious — all as taxes on fuel and Social Security benefits went up. Unsurprisingly, a check of the statistics from the conservative Tax Foundation shows that, relative to their share of Adjusted Gross Income, the rich were carrying less of the tax burden in 2000 than in 1992, never mind 1980.
Instead Clinton emphasized cuts in spending. This was ultimately to include Medicare cuts (passed on the very same day as the capital gains tax cut), but the cornerstone was the ultimately Reaganesque Reinventing Government (whose accomplishments Clinton trumpted with the declaration that “The era of big government is over”). Ultimately reducing the Federal government by a fifth, to its pre-New Deal size relative to the size of the country, it accomplished this by having government simply govern less. The nature of regulatory agencies like the Environmental Protection Agency and the U.S. Department of Agriculture became much more “hands-off,” with inspectors treading lightly, while the budget-cutting, “hands-off” approach similarly applied to social spending. Rather than repairing the damage done to domestic Federal programs by Reagan’s reign, departments like Housing and Urban Development also took cuts, while grant money was dispensed to states, communities and even private actors to which it delegated its mission — with the approach carried even further in regard to new initiatives. It kicked the infrastructure plan to the curb, entrusting jobs creation to its enterprise zone scheme instead. And what could not be delegated was outsourced — with the Defense Department an early, massive, and ultimately notorious example.
All of this fit in with a broad tendency toward deregulation generally, which went beyond significant deregulation of electricity, telecommunications and finance (most notoriously the winking at violations of the Glass-Steagall Act like the Citibank-Travelers’ Group merger, on the way to the Act’s complete repeal), to handicapping Federal regulation as such with the 1999 Regulatory Improvement Act — which sought to keep regulators off the backs of business by tying up the regulators themselves in red tape (ironic, in light of the Reinventing Government spirit); while those free trade agreements tied regulators’ hands yet again. (That food not up to local safety standards? Tough, it’s getting imported anyway.)
The trend also fit in with the privatization of much government functioning, with telecommunications an especially dramatic example, with the privatization of the National Science Foundation’s Network (the “backbone of the Internet), and much of the electromagnetic spectrum (the Clinton deficit hawkishness that saw it cut enforcement of worker, consumer, environmental safety, and Medicare spending, not keeping it from giving Big Media the broadcast licenses it could have auctioned off for $70 billion in a colossal act of corporate welfare). It fit in, too, with the cutting of the safety net, the most striking example of which was the 1996 welfare reform, which eliminated welfare’s status as an entitlement, capped off benefits (five years’ lifetime use, maximum) and turned welfare into “workfare” — all while allowing states to outsource the determination of welfare eligibility, and relied on a private business alliance, the Welfare-to-Work Partnership, to get recipients off the rolls and into the work force, where they constituted an underclass, deprived of the same rights enjoyed by other workers.
Much of this is, alas, not spelled out in the aforementioned Timeline, which instead emphasizes an impressive-seeming number of acts taken by the administration on behalf of the public, particularly in regard to education, health care and worker protection. Still, it must be noted that all of this occurred within that framework of budgetary austerity, government downsizing, deregulation which limited the resources put to realizing any of these goals. Where education is concerned, it is worth remembering the extreme distance between the Goals 2000 (a 90 percent-plus rate of high school graduation, American students first in the world in math and science) and the results. Where the administration made more progress was in, again, that neoliberal object of privatization, as it promoted and enlarged funding for charter schools, and set to work privatizing “Sallie Mae.” Where health care is concerned, the sum total of its acts fell far short of the effort toward a genuine health care reform promised in the campaign (emphatic about how Clinton would get “tough” with the industry), let alone the result. Even with the help of boom times, they did not put a dent in the system’s costs (evem in terms of its share of national income), nor reduce the number of uninsured.
Where the situation of workers is concerned, the results were similarly meager, reflecting the modest goals and limited push for them, which made their neutralization easy — an increase in the minimum wage that only partly restored its earlier purchasing power (actually a sixth under what it was in 1981 after two rises) before being eroded by inflation; a ban on Permanent Striker Replacement blocked in court; new ergonomics standards for the Occupational Safety and Health Administration Congress repealed almost as soon as Clinton left office; and a number of decisions of the National Labor Relations Board containing some progressive content that were promptly overturned under the next administration. Even the administration’s most enduring success, the Family and Medical Leave Act, still afforded only brief, unpaid leave to a limited portion of the work force (in contrast with the norm in the rest of the developed world).
“But what about the environment?” one might wonder. After all, wasn’t Mr. Al “Inconvenient Truth” Gore Vice President? The Clinton administration did sign the Kyoto protocol — but let it go unratified. In any event, the administration, never terribly interested in energy or climate, acquiesced in the fossil fuels-based policy driven by Big Oil’s needs as his predecessors had done before him. Indeed, more remarkable where energy policy is concerned is the rush to privatize Federal utilities, both civilian and Defense Department, and such assets as the country’s civilian uranium enrichment program and Naval Petroleum Reserve ( most of which, interestingly, went to that Gore family sponsor through the generations, Occidental Petroleum).
One can argue about whether these policies were desirable, or simply the best a Democrat could have done at the time. But they cannot argue that they were not neoliberal.
Originally published at http://naderelhefnawy.blogspot.com.