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The Republican Promise

Contract With America

House Republican Conference, Washington, DC

On the Edge: The Clinton Presidency

by Drew Elizabeth
Simon and Schuster, 462 pp., $24.00

Arrogant Capital: Washington, Wall Street, and the Frustration of American Politics

by Kevin Phillips
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The Politics of the High-Wage Path: The Challenge Facing Democrats

by Ruy A. Teixeira
Economic Policy Institute, Washington, DC, Working Paper 110 pp.

On September 27, the House Republican Conference—which has imposed on Republicans in Congress more ideological unity through their years as the minority party than the Democrats have had in ages—issued its tensection “Contract” as a joint campaign platform for Republican candidates across the country. For the next forty-one days this fall, the “Contract With America” was viewed by most commentators in official Washington as a strategic mistake.

The underlying idea of “nationalizing” the congressional elections was, however, seen to be shrewd. Even as Republicans have dominated presidential elections in the last twenty-five years and have always been in contention for control of the Senate, the local popularity and patronage power of Democratic representatives have made it hard for Republican challengers to dislodge them. By making each House race a referendum on Bill Clinton and on established government in general, the Republicans hoped to convert a nationwide conservative mood into the first Republican majority in the House since 1954.

The problem, or so it seemed, lay in the details of the Contract. Early in 1994 Newt Gingrich, the new speaker of the House who was then the House minority whip, had begun laying plans for a joint document that could help Republican candidates and, if all went well, serve as a legislative agenda for a new Republican-controlled House. He and Representative Dick Armey of Texas, the new House majority leader, went through an elaborate process of consulting Republican candidates, through focus groups and questionnaires, to see which issues would help them most in their campaigns. (The best account of the Contract’s history is an article by Dan Balz in The Washington Post, November 20, 1994.) The goal was to include issues that would attract the hard-core Republican voters without adding anything that might scare off moderates or create bitter fights among party members.

The resulting document was therefore hedged in many ways. It said nothing about two issues that matter intensely to some Republican activists—abortion and school prayer. Gingrich’s recommendation that children be taken from unfit parents and placed in orphanages made news after the election but was not part of the Contract. Proposals that would have a big impact on the budget, for instance through changes in the welfare system or America’s defense commitments, were accompanied by no details whatever to suggest how much they would cost. The centerpiece of the plan was a promise to bring a “balanced budget amendment” to the House floor for a vote. The Republicans knew that this would have no effect on federal spending in the short run, and would probably not matter in the long run, either, since chances are remote that the necessary thirty-eight state legislatures would ratify the amendment and put it into effect. (The states’ main fear is that if the federal government could not legally run a deficit, it would simply pass on safety, environmental, health, and other obligations to the states, without giving them the money to pay for new programs. Congress’s habit of enacting “unfunded mandates” has been the major strain on state budgets in the last decade. A federal balanced-budget amendment would likely make it worse.)

Such vagueness was in keeping with Gingrich’s career in Congress, during which he had often struck provocative or outrageous-seeming poses, without having serious plans to back them up. Five years ago I attended a small dinner in Washington at which he spoke. “The big media and the Democratic establishment don’t have a clue,” he said in his excited way. “What’s really going on in this country is Teenage Mutant Ninja Turtles!” As with many of his previous positions, on space exploration and the “Conservative Opportunity Society,” this made him seem more hip than most other politicians, and in fact Gingrich is one of the few elected officials who seems capable of fresh thought. But in the case of the Ninja Turtles, as with a number of his other positions, Gingrich never got around to explaining what (if anything) he had in mind. I’m just guessing now, but I would bet that references to Beavis and Butthead showed up in Gingrich’s speeches last year, and have been replaced by Mighty Morphin’ Power Rangers now.

Despite some of its lapses in specificity, the Contract was clear enough about its main points—more money for defense, and tax cuts directed mainly at corporations and upper-income Americans. Some Democrats, therefore, thought the Contract would actually work to their advantage. “We are absolutely grateful for it,” Clinton’s confidant George Stephanopoulos told Michael Kelly of The New Yorker two weeks before the election. Stephanopoulos said that the White House viewed the Contract as a godsend, which like Pat Buchanan’s fulminating speech at the Republican convention in 1992 would drive centrists toward the Democrats. “If people look at their ideas, they will realize they are bad.”

Perhaps Stephanopoulos did not believe this even as he said it—he has become notorious in Washington for issuing flat-earth public denials that anything could possibly be wrong with the administration or its policies—but many political operators initially felt that the Republicans might have hurt themselves by shifting attention from what the Democrats hadn’t done to what the Republicans might do. Then came November 8, the forty-second day after the release of the Contract, when the Republicans gained nine seats in the Senate, an astounding fifty-two seats in the House, and eleven governorships. The Contract seemed to have been part of a masterful strategy.

Now the 104th Congress convenes, and the Contract is, as Representative Armey has put it, “a seriously intended legislative agenda” for action in the next 100 days. What sort of agenda might it be?

Like the Bill of Rights and the original Commandments, the Contract With America has ten parts. (Gingrich was reportedly determined that it have exactly ten sections, and as a result several sections are grab bags of vaguely related measures.) The names of the sections are as significant as many of the provisions. To cynics they may seem Orwellian—the plan to cut capital gains taxes by 50 percent is called the “Job Creation and Wage Enhancement Act”—but they reflect the determination of Gingrich-era Republicans to position themselves as forward-thinkers, in contrast to stodgy old Democrats. Gingrich has taken the same approach in reorganizing congressional committees. For instance, what was once the Education and Labor Committee is now the Economic Opportunity Committee. The Republicans are also determined, Perot-like, to appeal to today’s wide-spread disillusionment with politics. The Contract’s preamble says, “In this era of official evasion and posturing, we offer instead a detailed agenda for national renewal, a written commitment with no fine print.” Under the Contract the Republicans have committed themselves to introduce the following legislation within 100 days:

1) “Fiscal Responsibility Act”: the balanced-budget amendment plus line-item veto power for the president.

2) “Taking Back Our Streets Act”: measures expanding prison construction, increasing sentences, and reducing the possibility of appeal for death-sentence cases.

3) “Personal Responsibility Act”: welfare reform.

4) “Family Reinforcement Act”: diverse measures including tax incentives for adoption.

5) “American Dream Restoration Act”: mainly a different form of tax-sheltered retirement account.

6) “National Security Restoration Act”: defense measures, mainly limiting US participation in United Nations ventures.

7) “Senior Citizens Equity Act”: expanded tax breaks for Social Security recipients.

8) “Job Creation and Wage Enhancement Act”: mainly a 50 percent reduction in capital gains taxes.

9) “Common Sense Legal Reforms Act”: assorted changes intended to reduce excess litigation.

10) “Citizen Legislature Act”: term limits for representatives and senators.

In addition to these legislative proposals the Contract promised sweeping changes in the way Congress itself was organized. Gingrich has already put some of these changes into effect, by eliminating, consolidating, and renaming House committees and cutting off funding for several dozen “caucuses,” the best-known of which is the Congressional Black Caucus.

The several dozen disparate proposals lumped together in the Contract and the changes in congressional operating rules can be examined by putting them in three broad categories with the names Gingrich might use in a private Republican strategy session:

1) The “It’s About Time” Package of Common Sense Reforms. Some elements of the Contract are popular because they deserve to be. These were measures which are widely seen as reasonable but which have seemed impossible to enact.

The best idea in this group, and the best thing Newt Gingrich has done since the election, is his promise to end Congress’s shameless practice of exempting itself from the laws, mandates, and regulations it imposes on the rest of the country. The US Navy has to abide by laws forbidding sexual harassment; the office of Senator Bob Packwood does not. The Denny’s restaurant chain could be prosecuted for violating laws against racial or religious discrimination; the office of Senator Jesse Helms could not.

The Contract also promises that Congress will stop imposing unfunded mandates on state and local governments—for example, to pay for toxic-site cleanups or make all buildings accessible to disabled people. In reality this will not stop the practice—it is too attractive a way for representatives to take brave stands without putting up any money—but it will make it easier for states (and the press) to complain the next time it occurs. The “Family Reinforcement Act” includes a clause that would make court orders for child-support payments enforceable across state lines and provide federal help in making deadbeat parents pay.

Somewhat more controversial but just as overdue are the Contract’s proposals for a “loser pays” rule in lawsuits and line-item veto power for the president. “Loser pays,” also known as “the English rule,” holds that the party that loses a lawsuit pays the legal fees of the winning side. The idea of this system, which has prevailed in England for decades, is to make filing a lawsuit riskier, so that fewer of them are filed. The main objection to “loser pays” is that it would discourage some otherwise deserving suits, since poor plaintiffs would be afraid of financial ruin if they lost. The Contract’s plan is surprisingly solicitous on this point: it says that the loser must pay the winner an amount no greater than the loser’s own legal costs. That is, if a poor plaintiff sued a rich corporation and lost, his maximum risk would be double his own legal expense, not whatever huge fee the corporation’s counsel might have run up. Also, this rule would apply only to a narrow category of cases filed in federal courts.

The line-item veto has long been anathema to Congress, since it reduces legislators’ bargaining power with the president. Under current law a president is, of course, forced to sign or veto a bill in toto. Legislators therefore get excited whenever a bill that really matters to a president is up for consideration, since they know they can lard it with their own projects without risking a veto of the entire package. With line-item veto power, a president could knock those projects out. Under the Republican provision, Congress could reinstate vetoed items with a two thirds vote. Most states (forty-three out of fifty) give their governors some form of line-item veto power. The Republicans justify this limitation on Congress’s power by saying that “Congress has neither the will nor the desire to cut wasteful government spending”; it cannot lead to worse budget practices than we have today.

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