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The Two Clinton Presidencies September 10, 2012 8:30 AM | Tagged as 1994, Clinton, macroeconomics
Ref: Wall Street Journal - September 5, 2012, Page A16, Editorial: “Of Bill and Barak”
I lived through the 1990’s under President Clinton. I know what really happened during those years. There were two Clinton presidencies: from 1993 to Nov 1994 (two years) and from Nov 1994 through 2000 (six years).
In the first, Bill was far left. He raised taxes. He tried to nationalize one seventh of the economy through the ill-fated HillaryCare. He raised gas taxes. He avoided fixing welfare. He passed a $31 billion Keynesian stimulus. The economy sunk under the policies of his first presidency.
Then, Bill got what he deserved.
In Nov 1994, the nation rebelled. The Republican takeover of the house signaled the end (for a lengthy time) of big government. That was Bill’s most famous line (except for a few finger wagging quotes from his scandals) which was delayed until his 1996 State of the Union message, “The era of big government is over.”
The economy jumped with the November 1994 election, not because of Bill’s past policies but because of the Republican takeover and the eventual pivot Bill did to the center. Bill and Congress cut spending as a percent of GDP. It was growth not Bill’s tax increase of 1993 that reduced the deficit. Also, Bill was riding the once in a lifetime peace dividend. In 1997, Bill cut the capital gains tax and revenues rushed into the Federal fisc, lowering the deficit even more.
See the curves of interest rates and stock prices in the referenced WSJ article. Things changed in Nov 1994.
History is mostly facts. We need to remember these facts and not the narrative some would have us believe about how Bill gets all the credit for our growing economy of the 1990’s.
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