BUSINESSWEEK ONLINE : DECEMBER 13, 1999 ISSUE
GOVERNMENT

Clinton: Revenge of the Lame Duck?
Despite defeats, it's far from over for the Clinton agenda

Well before impeachment put an indelible blot on his Presidency, Bill Clinton was obsessing about his place in history. Through countless Oval Office skull sessions with historians and late-night phone calls to friends, one question loomed above all others: Would Clinton's record of legislative accomplishments prove strong enough to erase the stain of impeachment?

Now that Congress has wrapped up another session that saw many key Clinton initiatives wither, the superficial answer appears to be: No. The President attempted to bounce back from impeachment by pushing through an overhaul of Social Security, a minimum-wage hike, new patient protections, improved health care for the elderly, campaign-finance reform, and ratification of the nuclear test ban treaty. But he has little to show for such an ambitious agenda. And next year promises to be even harder on the Prez as his lame-duck status saps more of his power.

Still, Clinton could manage to snatch political victory from the jaws of legislative defeat. Not only has he triggered public debate on voter-friendly issues but he has also put the GOP on the defensive. In fact, as Hill Republicans sink in the polls, Clinton is riding high. According to a CNN/Gallup/USA Today survey on Nov. 18-21, he has a 59% approval rating--better than Ronald Reagan enjoyed at the same point in his Presidency and 15 to 20 percentage points above the GOP in many polls. ''There's almost an inverse relationship between [Clinton's] concrete success and his political success,'' says Princeton University political scientist Fred I. Greenstein.

The upshot: Barring some unforeseen issue or new scandal, the 2000 races are likely to be fought largely on Democratic turf. Says Thomas E. Mann, director of governmental studies at the Brookings Institution: ''Clinton has basically set the agenda.''

By contrast, Hill Republicans don't have much of an agenda. Texas Governor George W. Bush's economic plan could be a spark plug. But so far, the issues identified by GOP hopefuls--Bush's tax-cut proposals and Senator John McCain's efforts to rewrite campaign-finance laws--are not tops on anybody's list of voter priorities.

REPOSITIONING DEMS. Meanwhile, the political terrain shaped by Clinton could prove favorable to either Democratic contender. While getting Vice-President Al Gore elected President is one of Clinton's major goals, his agenda could just as easily help Bradley.

And there's little doubt that Clinton's agenda will be a boon to Democratic candidates for Congress, including a certain senatorial hopeful named Hillary Rodham Clinton. In the House of Representatives, nearly four times as many Republicans as Democrats are retiring, and if control shifts back to the Democrats, many of Clinton's unfinished initiatives could survive his Presidency. That would help secure his long-sought goal of repositioning the Democratic Party at the political center.

Certainly, the year wasn't a total write-off for Clinton initiatives. The President can justifiably crow about the landmark accord to bring China into the World Trade Organization. He persevered in his hard-fought battle against a massive Republican tax cut, and he saw the GOP embrace his plan to reserve 60% of the budget surplus for a strengthened retirement system.

By championing debt repayment over tax relief, Clinton buttressed his claim to restoring fiscal responsibility. And he tied Republicans up all year on Social Security. It was a huge distraction, and it forced them to spend time and money convincing voters that they were serious about safeguarding the retirement fund's surplus, albeit to little avail: A November New York Times/CBS poll found that a mere 33% of Americans trust Republicans to make the right decisions about Social Security, vs. 49% who trust Democrats.

In the wrangling over the fiscal 2000 budget, the White House not only won a high-profile showdown but also secured funding for 100,000 new teachers and 50,000 new police officers. Because Clinton was willing to veto spending bills and Republicans weren't willing to risk a government shutdown, ''[Clinton] had all the leverage, and Republicans had none,'' says Stan Collender, the federal budget guru at Fleischman-Hillard Inc., a Washington public relations firm. ''Clinton won hands down.''

PLANKS. And even some of the President's splashier legislative defeats were huge political wins. While he lost battles for a patients' bill of rights, gun control, and new drug benefits for seniors, he drew voters' attention to those issues--and preserved them as key planks for Dems campaigning in 2000.

There's some evidence suggesting that the President, working in cahoots with Hill Democrats, may have even deliberately shunned a deal on a major issue: Medicare reform. Senator John B. Breaux (D-La.) and Representative William M. Thomas (R-Calif.) painstakingly assembled a compromise plan to overhaul Medicare. But Clinton scuttled the deal only to offer his own, more modest proposal shortly afterward. ''Republicans would love to get the issue behind them,'' insists GOP strategist Daniel P. Meyer. But Clinton walked away, Meyer says, because the Democrats are determined to campaign against a do-nothing Congress.

Even Meyer and other Republicans concede that this is a smart gambit. Polls show that managed-care reform and Medicare are among voters' prime interests--and that Americans trust Democrats over Republicans overwhelmingly on these issues.

Other Clinton initiatives were a bust on political as well as policy terms, though. And the President himself bears much of the blame for failure. Case in point: White House officials ignored warning signals that the nuclear test ban treaty was in trouble in the Senate. In a stinging rebuke, the Senate on Oct. 13 rejected the pact, 48-51.

Next year is likely to bring even more policy stalemate. With some large exceptions--such as the bipartisan passage of welfare reform in 1996--conventional wisdom suggests that lawmakers are especially loath to cut deals in an election year. Sure, some modest gains are likely. Republicans vow to iron out their differences so they can pass a minimum-wage hike, if only to deprive Democrats of a campaign target.

But the political landscape has shifted since 1996. Republicans, sensing that they have a shot at putting one of their own in the White House, will want to avoid solutions to major problems so their standard-bearer can put his stamp on them. And with no election of his own, the President's priority will be doing whatever makes Al Gore and Capitol Hill Democrats look good. ''The political forces have conspired to greatly reduce the incentives for compromise on a range of issues,'' says Mann.

That will make it tough for Clinton to make any more progress burnishing his record and offsetting the stigma of impeachment. In the end, the real Clinton legacy may depend on what takes place when the President is out of office.

By Amy Borrus in Washington

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