Hillary Clinton the Candidate: Which Clinton Is She?

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As a fictional version of Sen. Hillary Rodham Clinton exasperatedly shouted on Saturday Night Live last weekend, "Is there anyone in the [expletive] country who didn't know I was running for president?" The genuine article finally told America, "I'm in," on Saturday via a video on the new presidential campaign website for her 2008 exploratory committee. But what does the U.S. senator from New York want to do if elected president, at least in domestic economic policy? It would hardly be a stretch to think that a first Hillary Clinton term might be, in effect, the third Bill Clinton term–you know, the one that Al Gore was supposed to preside over.

But after listening to Hillary's inaugural campaign video and perusing her recent speeches, it seems as if she'll be campaigning not so much as Clinton 3.0 but more as Clinton 1.0, the "putting people first" Beta version from Bill Clinton's 1992 campaign that got tossed overboard in the early months of his first term. While candidate Bill campaigned on a Main Street-friendly program of increasing public investment in human capital–aka workers–President Bill shifted to a Wall Street-friendly strategy of cutting the budget deficit so the Federal Reserve and bond market would lower interest rates. (The theory was that out-of-control deficits would devalue the dollar and create higher inflation down the road.) As former Labor Secretary Robert Reich has written:

... the administration was unable to increase public investment. It had to cut the budget deficit it inherited so that Alan Greenspan and his colleagues at the Federal Reserve, plus bond traders on Wall Street, would feel confident enough to reduce interest rates. But even when the economy soared in the late 1990s and deficits turned into large surpluses–that is, even when we could afford it–Clinton and the Democrats were reluctant to push an investment agenda. Instead, they admonished Congress to "save Social Security first," a stopgap strategy that left the surpluses on the table.

In her campaign video, Hillary Clinton says, "It is time to renew the promise of America, our basic bargain that no matter who you are or where you live, if you work hard and play by the rules you can build a good life for yourself and your family." That sounds a lot like the 1992 speech Bill Clinton gave at the Wharton School of Business, where he said America needed to "forge a new social compact for economic growth. ... It means giving every young American who works hard and plays by the rules a chance to get ahead." (It was a theme he repeated throughout the campaign and two terms in office.)

Hillary Clinton also spoke of wanting to "dialogue" with Americans about how to "make us energy independent and free of foreign oil, how to end the deficit that threatens Social Security and Medicare, and let's definitely talk about how every American can have quality, affordable healthcare." Notice that there was nothing in that brief laundry list about the importance of balanced budgets, a hallmark of President Bill's revised economic policy. And back in 1992, candidate Bill pledged only to cut the deficit in half by 1992.

Hillary fleshed out some of her thoughts on the economy last April in a speech before the Economic Club of Chicago:

I suggest that we agree on the need for an economic strategy that keeps our economy growing and creating good jobs in the face of new competition. ... We can return to fiscal discipline. We can invest in infrastructure, research, and education, jump-start a smarter energy future, promote manufacturing, rein in healthcare costs. And we can do it in ways that renew the basic bargain with America's middle class.

The emphasis throughout the speech was on increasing government investment spending–such as in a "national energy research program"–rather than balancing the budget, where she spoke only vaguely of the wisdom of "declining deficits" and "deficit reduction." (Hillary also wants oil companies–the same ones that may be losing various tax breaks and subsidies under a Democratic Congress–to contribute $20 billion a year to a "strategic energy fund.")

Similarly, in Bill's Wharton speech, he proposed all sorts of investment tax credits and public infrastructure spending, including shifting funds from the Pentagon to finance the creation of "a high-speed rail network between our nation's major cities. Bullet trains in five major corridors could serve 500,000 passengers a day at speeds up to 300 miles an hour."

Maybe the most interesting tidbit from her April speech–one I am sure the GOP will hammer her on if she is the Democratic nominee–is her apparent belief that the Kyoto treaty, meant to reduce global-warming emissions, is a "great organizing principle" for a national economy.