LAUNCHING A NEW DOMESTIC POLICY
In practice, Clinton’s centrism demanded choices that sometimes elicited vehement emotions . The president’s first policy initiative was designed to meet the demands of gays, who, claiming a group status as victims of discrimination, had
CHAPTER 15: BRIDGE TO THE 21ST CENTURY
OUTLINE OF U.S. HISTORY
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become an important constituency for the Democratic Party .
Immediately after his inaugu- ration, President Clinton issued an executive order rescinding the long-established military policy of dismissing known gays from the service . The order quickly drew fu- rious criticism from the military, most Republicans, and large seg- ments of American society . Clinton quickly modified it with a “don’t ask, don’t tell” order that effectively restored the old policy but discour- aged active investigation of one’s sexual practices .
The effort to achieve a national health plan proved to be a far larg- er setback . The administration set up a large task force, chaired by Hillary Clinton . Composed of prominent policy intellectuals and political activists, it labored in se- crecy for months to develop a plan that would provide medical cover- age for every American citizen .
The working assumption be- hind the plan was that a govern- ment-managed “single-payer” plan could deliver health services to the entire nation more efficiently than the current decentralized system with its thousands of insurers and disconnected providers . As finally delivered to Congress in September 1993, however, the plan mirrored the complexity of its subject . Most Republicans and some Democrats criticized it as a hopelessly elaborate federal takeover of American medi- cine . After a year of discussion, it died without a vote in Congress .
President Clinton was more successful on another matter with great repercussions for the domes- tic economy . The previous presi- dent, George Bush, had negotiated the North American Free Trade Agreement (NAFTA) to establish fully open trade between Canada, the United States, and Mexico . Key Democratic constituencies opposed the agreement . Labor unions be- lieved it would encourage the export of jobs and undermine American labor standards . Environmentalists asserted that it would lead Ameri- can industries to relocate to coun- tries with weak pollution controls . These were the first indications of a growing movement on the left wing of American politics against the vision of an integrated world eco- nomic system .
Clinton nonetheless accepted the argument that open trade was ultimately beneficial to all parties because it would lead to a greater flow of more efficiently produced goods and services . His adminis- tration not only submitted NAFTA to the Senate, it also backed the es- tablishment of a greatly liberalized international trading system to be administered by the World Trade Organization (WTO) . After a vig- orous debate, Congress approved NAFTA in 1993 . It would approve membership in the WTO a year later .
Although Clinton had talked about a “middle-class tax cut” dur- ing the presidential campaign, he submitted to Congress a budget
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calling for a general tax increase . It originally included a wide tax on energy consumption designed to promote conservation, but that was quickly replaced by a nomi- nal increase in the federal gasoline tax . It also taxed social security benefits for recipients of moderate income and above . The big empha- sis, however, was on increasing the income tax for high earners . The subsequent debate amounted to a rerun of the arguments between tax cutters and advocates of “fiscal re- sponsibility” that had marked the Reagan years . In the end, Clinton got his way, but very narrowly . The tax bill passed the House of Repre- sentatives by only one vote .
By then, the congressional elec- tion campaigns of 1994 were under way . Although the administration already had made numerous foreign policy decisions, issues at home were clearly most important to the voters . The Republicans depicted Clinton and the Democrats as un- reformed tax and spenders . Clinton himself was already beleaguered with charges of past financial im- propriety in an Arkansas real estate project and new claims of sexual impropriety .
In November, the voters gave the Republicans control of both houses of Congress for the first time since the election of 1952 . Many observers believed that Bill Clinton would like- ly be a one-term president . Appar- ently making a decision to conform to new political realities, Clinton in-
stead moderated his political course . Policy initiatives for the remainder of his presidency were few . Contrary to Republican predictions of doom, the tax increases of 1993 did not get in the way of a steadily improving economy .
The new Republican leadership in the House of Representatives, by contrast, pressed hard to achieve its policy objectives, a sharp con- trast with the administration’s new moderate tone . When right-wing extremists bombed an Oklahoma City federal building in April 1995, Clinton responded with a tone of moderation and healing that height- ened his stature and implicitly raised some doubts about his conservative opponents . At the end of the year, he vetoed a Republican budget bill, shutting down the government for weeks . Most of the public seemed to blame the Republicans .
The president also co-opted part of the Republican program . In his State of the Union address of January 1996, he ostentatiously declared, “The era of big govern- ment is over .” That summer, on the eve of the presidential campaign, he signed a major welfare reform bill that was essentially a Republican product . Designed to end perma- nent support for most welfare re- cipients and move them to work, it was opposed by many in his own party . By and large, it would prove successful in operation over the next decade .