The Clinton Budget: Will It Do?

A Vision of Change for America

by President Bill Clinton
US Government Printing Office, 145 pp., $7.50 (paper)

Budget of the United States Government Fiscal Year 1994

US Government Printing Office, 1,310 pp., $43.00 (paper)

Perhaps if people were told of their dangers,” Churchill suggested to Britain’s war cabinet in 1940, “they would consent to make the necessary sacrifices.” Economic dangers differ from wartime peril, of course, but over much of the past year the American political system looked as if it were about to apply Churchill’s maxim in just that context.

The 1992 election campaign did not initially focus on the dangers inherent in the trajectory of mounting debts and deficits charted by Presidents Reagan and Bush, but it certainly did so once Ross Perot reentered the contest. Both Mr. Perot in his televised “infomercials” and Bill Clinton in his own campaign appearances repeatedly emphasized the economic damage done when a nation persistently lives beyond its means.

The two challengers also repeatedly made the case that the real burden of this excess falls primarily on Americans who are too young to vote, or not yet born, and on that ground they questioned not only the Reagan-Bush policy’s economic wisdom but also its moral probity. And while they differed over concrete matters like which government programs to cut and whether or not to impose a fifty cents per gallon tax on gasoline, both men were plain that Americans can and should make sacrifices, by forgoing some of what government now does as well as by paying more for it, to prevent those dangers from becoming realities.

Just after the election, Mr. Clinton used the Little Rock economic conference to focus public attention yet more fully on what is wrong with the government’s tax and spending policies and what will happen over time if it isn’t fixed. With the President-elect sitting close at hand, some of the country’s most distinguished economists explained why today’s huge excess of spending over revenues causes the US government to drain away the bulk of what Americans save, why that loss of saving restricts what the nation can invest, and why without adequate investment the standard of living cannot rise. Other speakers, including many who have since assumed responsible positions in the new administration, explored potential ways of addressing these problems, again including solutions that would require real public sacrifice.

Finally, the new President himself took up the message, beginning right from his first day in office. In his Inaugural Address, President Clinton observed that “most people are working more for less” already, and argued that to reverse this creeping decline,

we must invest more in our own people, in their jobs, and in their future, and at the same time cut our massive debt.… It will require sacrifice, but it can be done and done fairly, not choosing sacrifice for its own sake but for our sake.

Four weeks later, in his State of the Union speech, the President was even more explicit. The problem, as he put it, is “two decades of low productivity, growth, and stagnant wages; persistent unemployment and underemployment; years of huge Government deficits and declining investment in our …

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Letters

How Dangerous is the Deficit? An Exchange February 17, 1994