T he next year involved an amazing combination of major legislative achievements, frustrations and successes in foreign policy, unforeseen events, personal tragedy, honest errors, and clumsy violations of the Washington culture, which, when combined with compulsive leaking by a few staffers, ensured press coverage that often resembled what Id experienced during the New York primary.
On January 22, we announced that Zo Baird had withdrawn her name from consideration for attorney general. Since we had learned about her employment of illegal immigrant workers and her failure to pay Social Security taxes for them during the vetting process, I had to say that we had failed to evaluate the matter properly, and that I, not she, was responsible for the situation. Zo had not misled us in any way. When the household workers were hired, she had just gotten a new job, and her husband had the summer off from teaching. Apparently, each assumed the other had handled the tax matter. I believed her and kept working for her nomination for three weeks after she first offered to withdraw it. Later, I appointed Zo to the Foreign Intelligence Advisory Board, where she made a real contribution to the work Admiral Crowes group did.
On the same day, the press became infuriated with the new White House when we denied them the privilege, which theyd had for years, of walking from the press room, located between the West Wing and the residence, up to the press secretarys office on the first floor near the Cabinet Room. This strolling allowed them to hang out in the halls and pepper whoever came by with questions. Apparently, a couple of people high up in the Bush administration had mentioned to their new counterparts that this arrangement impeded efficiency and increased leaks, and the decision was made to change it. I dont recall being consulted about it, but perhaps I was. The press raised the roof, but we stuck with the decision, figuring theyd get over it. Theres no question that the new policy contributed to freer movement and conversation among the staff, but its hard to say it was worth the animosity it engendered. And since, in the first few months, the White House leaked worse than a tar-paper shack with holes in the roof and gaps in the walls, its impossible to say that confining the press to quarters did much good.
That afternoon, the anniversary of Roe v. Wade, I issued executive orders ending the Reagan-Bush ban on fetal-tissue research; abolishing the so-called Mexico City rule, which prohibited federal aid to international planning agencies that were in any way involved in abortions; and reversing the Bush gag rule barring abortion counseling at family planning clinics that receive federal funds. I had pledged to take these actions in the campaign, and I believed in them. Fetal-tissue research was essential to finding better treatments for Parkinsons disease, diabetes, and other conditions. The Mexico City rule arguably led to more abortions, by reducing the availability of information on alternative family planning measures. And the gag rule used federal funds to prevent family planning clinics from telling pregnant womenoften frightened, young, and aloneabout an option the Supreme Court had declared a constitutional right. Federal funds still could not be used to fund abortions, at home or abroad.
On January 25, Chelseas first day at her new school, I announced that Hillary would head a task force to come up with a comprehensive health-care plan, working with Ira Magaziner as the lead staff person, domestic policy advisor Carol Rasco, and Judy Feder, who had led our health-care transition team. I was pleased that Ira had agreed to work on health care. We had been friends since 1969, when he had come to Oxford as a Rhodes scholar a year after I did. Now a successful businessman, he had worked on the campaign economic team. Ira believed delivering universal health coverage was both morally and economically imperative. I knew he would give Hillary the kind of support she needed for the grueling task ahead of us.
Heading up the effort to reform health care was an unprecedented thing for a First Lady to do, as was my decision to give Hillary and her staff offices in the West Wing, where the policy action is, as opposed to the traditional office space in the East Wing, where the social affairs of the White House are run. Both decisions were controversial; when it came to the First Ladys role, it seemed Washington was more conservative than Arkansas. I decided Hillary should lead the health-care effort because she cared and knew a lot about the issue, she had time to do the job right, and I thought she would be able to be an honest broker among all the competing interests in the health-care industry, government agencies, and consumer groups. I knew the whole enterprise was risky; Harry Trumans attempt to provide universal health coverage had nearly destroyed his presidency, and Nixon and Carter never even got their bills out of committee. With the most Democratic Congress in decades, Lyndon Johnson got Medicare for the elderly and Medicaid for the poor, but didnt even try to insure the rest of those without coverage. Nevertheless, I thought we should try for universal coverage, which every other wealthy nation had long enjoyed, for both health and economic reasons. Almost 40 million people had no health insurance, yet we were spending 14 percent of our gross national product on health care, 4 percent more than Canada, the country with the next-highest rate.
On the night of the twenty-fifth, at their urgent request, I met with the Joint Chiefs of Staff to discuss the gays-in-the-military issue. Earlier in the day, the New York Times had reported that, because of strong military opposition to the change, I would delay issuing formal regulations lifting the ban for six months, while the views of senior officers, as well as practical problems, were considered. It was a reasonable thing to do. When Harry Truman ordered the racial integration of the military, he had given the Pentagon even more time to figure out how to carry it out in a way that was consistent with its primary mission of maintaining a well-prepared, cohesive fighting force with high morale. In the meantime, Secretary Aspin would tell the military to stop asking recruits about their sexual orientation and to stop discharging homosexual men and women who had not been discovered to have committed a homosexual act, which was a violation of the Uniform Code of Military Justice.
The Joint Chiefs early request for a meeting created a problem. I was more than willing to hear them out, but I didnt want the issue to get any more publicity than it already was receiving, not because I was trying to hide my position, but because I didnt want the public to think I was paying more attention to it than to the economy. Thats exactly what the congressional Republicans wanted the American people to think. Senator Dole was already talking about passing a resolution removing my authority to lift the ban; he clearly wanted this to be the defining issue of my first weeks in office.
In the meeting, the chiefs acknowledged that there were thousands of gay men and women serving with distinction in the 1.8 millionmember military, but they maintained that letting them serve openly would be, in General Powells words, prejudicial to good order and discipline. The rest of the Joint Chiefs were with the chairman. When I raised the fact that it apparently had cost the military $500 million to kick 17,000 homosexuals out of the service in the previous decade, despite a government report saying there was no reason to believe they could not serve effectively, the chiefs replied that it was worth it to preserve unit cohesion and morale.
The chief of naval operations, Admiral Frank Kelso, said the navy had the greatest practical problems, given the close and isolated living arrangements on ships. The army chief, General Gordon Sullivan, and U.S. Air Force General Merrill McPeak were opposed, too. But the most adamant opponent was the commandant of the Marine Corps, General Carl Mundy. He was concerned about more than appearances and practicalities. He believed that homosexuality was immoral, and that if gays were permitted to serve openly, the military would be condoning immoral behavior and could no longer attract the finest young Americans. I disagreed with Mundy, but I liked him. In fact, I liked and respected them all. They had given me their honest opinions, yet had made it clear that if I ordered them to take action theyd do the best job they could, although if called to testify before Congress they would have to state their views frankly.
A couple of days later, I had another night meeting on the issue, with members of the Senate Armed Services Committee, including Senators Sam Nunn, James Exon, Carl Levin, Robert Byrd, Edward Kennedy, Bob Graham, Jeff Bingaman, John Glenn, Richard Shelby, Joe Lieberman, and Chuck Robb. Nunn, while opposed to my position, had agreed to the six-month delay. Some of my staffers were upset with him for his early and forceful opposition, but I wasnt; after all, he was personally conservative, and as chairman of the committee, he honored the military culture and saw it as his duty to protect it. He was not alone. Charlie Moskos, the Northwestern University sociologist who had worked with Nunn and me on the DLC national-service proposal and who said he had known a gay officer during the Korean War, was also against lifting the ban, saying that it preserved the expectation of privacy to which soldiers living in close quarters were entitled. Moskos said we should stick with what the great majority of military people wanted, because the main thing we needed in the military was the ability and willingness to fight. The problem I saw with his argument, and Sam Nunns, is that they could have been used with equal force against Trumans order on integration or against current efforts to open more positions to women in the military.
Senator Byrd took a harder line than Nunn, echoing what I had heard from General Mundy. He believed homosexuality was a sin; said he would never let his grandson, whom he adored, join a military that admitted gays; and asserted that one reason the Roman Empire fell was the acceptance of pervasive homosexual conduct in the Roman legions from Julius Caesar on down. In contrast to Byrd and Nunn, Chuck Robb, who was conservative on many issues and had survived heated combat in Vietnam, supported my position, based on his wartime contact with men who were both gay and brave. He wasnt the only Vietnam combat veteran in Congress who felt that way.
The cultural divide was partly, but not completely, partisan and generational. Some younger Democrats opposed lifting the ban, while some older Republicans were for lifting it, including Lawrence Korb and Barry Goldwater. Korb, who had enforced the ban as an assistant secretary of defense under Reagan, said it was not necessary for maintaining the quality and strength of our forces. Goldwater, a former chairman of the Senate Armed Services Committee, a veteran, and the founder of the Arizona National Guard, was an old-fashioned conservative with libertarian instincts. In a statement published in the Washington Post, he said that allowing gays to serve was not a call for cultural license but a reaffirmation of the American value of extending opportunity to responsible citizens and limiting the reach of government into peoples private lives. In his typically blunt way, he said he didnt care whether a soldier was straight, but whether he could shoot straight.
As things turned out, Goldwaters support and all my arguments were academic. The House passed a resolution opposing my position by more than three to one. The Senate opposition was not as great but was still substantial. That meant that if I persisted, the Congress would overturn my position with an amendment to the defense appropriations bill that I couldnt easily veto, and even if I did, the veto would be overridden in both houses.
While all this was going on, I saw a poll showing that by 48 to 45 percent the public disagreed with my position. The numbers didnt look too bad for such a controversial issue, but they were, and they showed why Congress thought it was a dead-bang loser for them. Only 16 percent of the electorate strongly approved of lifting the ban, while 33 percent very strongly disapproved. Those were the people whose votes could be influenced by a congressmans position. Its hard to get politicians in swing districts to take a 17 percent deficit on any issue into an election. Interestingly, the biggest divisions were these: self-identified born-again Christians opposed my position 70 to 22 percent, while people who said they knew homosexuals personally approved of it 66 to 33 percent.
With congressional defeat inevitable, Les Aspin worked with Colin Powell and the Joint Chiefs on a compromise. Almost exactly six months later, on July 19, I went to the National Defense University at Fort McNair to announce it to the officers in attendance. Dont ask, dont tell basically said that if you say youre gay, its presumed that you intend to violate the Uniform Code of Military Justice and you can be removed, unless you can convince your commander youre celibate and therefore not in violation of the code. But if you dont say youre gay, the following things will not lead to your removal: marching in a gay-rights parade in civilian clothes; hanging out in gay bars or with known homosexuals; being on homosexual mailing lists; and living with a person of the same sex who is the beneficiary of your life insurance policy. On paper, the military had moved a long way, to live and let live, while holding on to the idea that it couldnt acknowledge gays without approving of homosexuality and compromising morale and cohesion. In practice it often didnt work out that way. Many anti-gay officers simply ignored the new policy and worked even harder to root out homosexuals, costing the military millions of dollars that would have been far better spent making America more secure.
In the short run, I got the worst of both worldsI lost the fight, and the gay community was highly critical of me for the compromise, simply refusing to acknowledge the consequences of having so little support in Congress, and giving me little credit for lifting another ban on gays, the ban against serving in critical national security positions, or for the substantial number of gays and lesbians who were working throughout the administration. By contrast, Senator Dole won big. By raising the issue early, and repeatedly, he guaranteed it so much publicity that it appeared I was working on little else, which caused a lot of Americans who had elected me to fix the economy to wonder what on earth I was doing and whether theyd made a mistake.
I was finding it a challenge to keep another campaign commitment: cutting the White House staff by 25 percent. It was a nightmare for Mack McLarty, especially since we had a more ambitious agenda than the previous administrations and were getting more than twice as much mail. On February 9, just a week before I was slated to announce my economic program, I proposed the 25 percent reduction, cutting the staff by 350 people, down to 1,044 employees. Everybody took a hit; even Hillarys office would be smaller than Barbara Bushs, though she would take on greater responsibilities. The reduction I regretted most was the elimination of twenty career positions in the correspondence section. I would have preferred to reduce their numbers by attrition, but Mack said there was no other way to meet the goal. Besides, we had to have some money to modernize the White House. The staff couldnt even send and receive e-mail, and the phone system hadnt been changed since the Carter years. We couldnt do conference calls, but anyone could press one of the big lighted extension buttons and listen in on someone elses conversation, including mine. Soon we had a better system installed.
We also beefed up one part of the White House staff: the casework operation that was designed to help individual citizens who had personal problems with the federal government, often involving an effort to obtain disability, veterans, or other benefits. Usually citizens call on their U.S. senators or representatives for help in such matters, but because I had run a highly personalized campaign, many Americans felt they could call on me. I got an especially memorable request on February 20, when Peter Jennings, the ABC news anchor, moderated a televised Childrens Town Meeting in the White House, in which young people between the ages of eight and fifteen asked me questions. The kids asked if I helped Chelsea with her homework, why no women had been elected President, what I would do to help Los Angeles after the riots, how health care would be paid for, and whether I could do anything to stop violence in schools. A lot of them were interested in the environment.
But one of the children wanted help. Anastasia Somoza was a beautiful girl from New York City who was confined to a wheelchair because of cerebral palsy. She explained that she had a twin sister, Alba, who also had cerebral palsy but who, unlike her, couldnt speak. So because she cant speak, they put her in a special education class. But she uses computers to speak. And I would like her to be in a regular education class just like me. Anastasia said she and her parents were convinced that Alba could do regular schoolwork if given a chance. Federal law required children with disabilities to be educated in the least restrictive environment, but the critical decision about what is least restrictive is made at the childs school. It took about a year, but eventually Alba got into a regular class.
Hillary and I kept in touch with the Somoza family, and in 2002, I spoke at the girls high school graduation. They both went on to college, because Anastasia and her parents were determined to give Alba all the opportunities she deserved, and werent shy about asking others, including me, to help. Every month, the agency liaison who headed the casework operation sent me a report on the people wed helped, along with a few of the moving thank-you letters they sent.
In addition to the staff cuts, I announced an executive order to cut administrative expenses 3 percent throughout the government, and a reduction in the salaries of top appointees and in their perks, like limousine service and private dining rooms. In a move that would prove to be a tremendous morale booster, I changed the rules of the White House Mess to allow more junior staff to use what had been the private preserve of high-level White House officials.
Our young staffers were working long hours and weekends, and it seemed foolish to me to require them all to leave for lunch, order in, or bring a paper bag with food from home. Besides, access to the White House Mess implied that they, too, were important. The mess was a wood-paneled room with good food prepared by navy personnel. I ordered lunch from it almost every day and enjoyed going down to visit with the young people who worked in the kitchen. Once a week they served Mexican dishes I especially liked. After I left office, the mess was again closed to all but senior staff. I believe our policy was good for morale and productivity.
With all the extra work and fewer people to do it, we would have to rely more than ever not only on those junior staffers, but also on the thousand-plus volunteers who put in long hours, some of them virtually full-time. The volunteers opened the mail, sent form replies when appropriate, filled requests for information, and did countless other tasks, without which the White House would have been far less responsive to the American people. All the volunteers got in return for their efforts, apart from the satisfaction of serving, was an annual thank-you reception Hillary and I hosted for them on the South Lawn. The White House couldnt function without them.
Besides the specific cuts I had already decided on, I was convinced that with a longer-term systematic approach, we could save a lot more money and improve government services. In Arkansas, I had initiated a Total Quality Management program that had achieved positive results. On March 3, I announced that Al Gore would lead a six-month review of all federal operations. Al took to the job like a duck to water, bringing in outside experts and consulting widely with government employees. He kept at it for eight years, helping us to eliminate hundreds of programs and 16,000 pages of regulations, to reduce the federal workforce by 300,000, making this the smallest federal government since 1960, and to save $136 million in tax money.
While we were getting organized and dealing with the controversies in the press, most of my time in January and February was devoted to filling in the details of the economic plan. On Sunday, January 24, Lloyd Bentsen appeared on Meet the Press. He was supposed to give nonspecific answers to all questions regarding the details of the plan, but he went a little further than that, announcing that we would propose a consumption tax of some kind and that a broad-based energy tax was under consideration. The next day, interest rates on the governments thirty-year bond fell from 7.29 to 7.19 percent, the lowest rate in six years.
Meanwhile, we were struggling with the budget details. All the spending cuts and taxes that raised real money were controversial. For example, when I met with Senate and House leaders on the budget, Leon Panetta suggested that we have a one-time three-month delay in increasing the Social Security cost-of-living allowance. Most experts agreed that the COLA was too high, given the low rate of inflation, and the delay would save $15 billion over five years. Senator Mitchell said that the suggested delay was regressive and unfair, and that he couldnt support it. Neither would the other senators. Wed have to find that $15 billion elsewhere.
Over the weekend of January 3031, I brought the cabinet and senior White House staff to Camp David, the presidential retreat in Marylands Catoctin Mountains. Camp David is a beautiful wooded site, with comfortable cabins and recreational facilities, staffed by men and women from the navy and the Marine Corps. It was the perfect setting for us to get to know one another better and talk about the year ahead. I also invited Stan Greenberg, Paul Begala, and Mandy Grunwald. They felt that they had been shut out of the transition, and that an obsession with the deficit had overtaken every other objective I had advanced in the campaign. They thought Al and I were courting disaster by disregarding the deeper concerns and interests of the people who had elected us. I sympathized with them. For one thing, they hadnt been in on the hours of discussions that led most of us to the conclusion that if we didnt deal with the deficit, we couldnt achieve sustained strong growth and that my other campaign commitments, at least those that cost money, would die in the stagnant backwater of a sluggish economy.
I let Mandy and Stan start the discussion. Mandy outlined the anxiety of the middle class about jobs, retirement, health care, and education. Stan said that voters most important concerns were, in order, jobs, health-care reform, welfare reform, and then deficit reduction, and that if deficit reduction was going to require the middle class to pay more taxes, I had darn sure better do something else for them. Hillary then described how wed failed in Arkansas in my first term by doing too many things at once, without a clear story line and an effort to prepare people for a long, sustained struggle. Then she told them about the success wed had the second time around, by focusing on one or two issues every two years, and laying out long-term goals, along with short-term benchmarks of progress against which we could be judged. That kind of approach, she said, enabled me to develop a story line people could understand and support. In response, someone pointed out that we couldnt develop a story line as long as we were awash in leaks, all of which concerned the most controversial proposals. After the weekend, the consultants tried to come up with a communications strategy that would take us beyond the daily leaks and controversies.
The rest of the retreat was devoted to more informal, personal conversations. On Saturday night there was a session, run by a facilitator who was a friend of Al Gores, in which we were supposed to bond by sitting in a group, taking turns telling something about ourselves the others didnt know. Though the exercise got mixed reviews, I actually enjoyed it, and managed to confess that, as a child, I was overweight and often ridiculed. Lloyd Bentsen thought the whole exercise was silly and went back to his cabin; if there was something about him the rest of us didnt know, it was intentional. Bob Rubin stayed, but said he didnt have anything to sayapparently such group unburdening wasnt the key to his success at Goldman Sachs. Warren Christopher did participate, probably because he was the most disciplined man on the planet and thought this baby-boomer version of Chinese water torture would somehow strengthen his already considerable character. All in all, the weekend was helpful, but the real bonding would come in the fires of the struggles, victories, and defeats that lay ahead.
On Sunday night, we were back in the White House to host the annual National Governors Association dinner. It was Hillarys first formal event as First Lady, and she was nervous, but it went well. The governors were concerned about the economy, which diminished state revenues, forcing them to cut services, raise taxes, or both. They understood the necessity of reducing the deficit, but didnt want it to come at their expense, in the form of responsibilities shifting from the federal government to the states without funds being provided to pay for them.
On February 5, I signed my first bill into law, keeping another campaign commitment. With the Family and Medical Leave Act, the United States at last joined more than 150 other countries in guaranteeing workers some time off when a baby is born or a family member is sick. The bills principal sponsor, my longtime friend Senator Chris Dodd of Connecticut, had worked for years to enact it. President Bush had vetoed it twice, saying it would prove too burdensome for business. While the legislation had some strong Republican supporters, most Republicans had voted against it for the same reason. I believed that family leave would be good for the economy. With most parents in the workforce, by choice or necessity, it is imperative that Americans be able to do well both on the job and at home. People who are worried about their infants or their sick parents are less productive than those who go to work knowing theyve done right by their families. During my time as President, more than thirty-five million people would take advantage of the Family and Medical Leave law.
In the next eight years, and even after I left office, more people would mention it to me than any other bill I signed. Many of their stories were powerful. Early one Sunday morning, when I came in from my jog, I ran into a family touring the White House. One of the children, a teenage girl, was in a wheelchair and obviously very ill. I greeted them and said that if theyd wait for me to shower and get dressed for church, Id take them into the Oval Office for a picture. They waited and we had a good visit. I especially enjoyed my talk with the brave young girl. As I walked away, her father grabbed my arm and turned me around, saying, My little girl is probably not going to make it. The last three weeks Ive spent with her have been the most important of my life. I couldnt have done it without the family leave law.
In early 2001, when I took my first shuttle flight from New York to Washington as a private citizen, one of the flight attendants told me that both her parents had been desperately ill at the same time, one with cancer, the other with Alzheimers. She said there was no one to care for them in their last days except her and her sister, and they wouldnt have been able to do it without the family leave law. You know, the Republicans are always talking about family values, she said, but I think how your parents die is an important part of family values.
On February 11, as we worked to finish the economic plan, I finally got an attorney general, having decided, after a false start or two, on Janet Reno, the prosecuting attorney of Dade County, Florida. I had known about and admired Janets work for years, especially her innovative drug courts, which gave first-time offenders the chance to avoid going to jail if they agreed to undergo drug treatment and check in regularly with the court. My brother-in-law Hugh Rodham had worked in the Miami drug court as an attorney with the public defenders office. At his invitation, I had attended two sessions of the court myself in the 1980s, and was struck by the unusual but effective way the prosecutor, defense lawyer, and judge worked together to convince the defendants that this was their last opportunity to stay out of prison. The program was very successful, with a much lower recidivism rate than the prison system, at far less cost to the taxpayers. In the campaign, I had pledged to support federal funding to establish drug courts based on the Miami model all across the country.
Senator Bob Graham gave Reno a glowing endorsement when I called him. So did my friend Diane Blair, who had gone to Cornell with her thirty years earlier. So did Vince Foster, who was a very good judge of people. After he interviewed Janet, he called me and said in his droll way, I think weve got a live one. Reno also was immensely popular with her constituents, based on her reputation as a no-nonsense, tough but fair prosecutor. She was a native Floridian, about six feet tall, and had never married. Public service was her life, and she had performed it well. I thought she could strengthen the often-frayed relationships between federal law enforcement and its state and local counterparts. It concerned me a little that, like me, she was a stranger to Washingtons ways, but in Miami she had had extensive experience working with federal authorities on immigration and narcotics cases, and I thought she would learn enough to get along.
Over the weekend, we worked hard to finish the economic plan. Paul Begala had come to work in the White House a couple of weeks earlier, in large measure to help me explain what I was about to do in a way that was consistent with my campaign message of restoring opportunity for the middle class, something he believed most members of the economic team didnt care enough about. Begala felt that the entire team should stress three points: that deficit reduction is not an end in itself, but the means to achieve the real objectiveseconomic growth, more jobs, and higher incomes; that our plan represented a fundamental change in the way government had been working, ending the irresponsibility and unfairness of the past by asking the wealthy big corporations, and other special interests that had benefited disproportionately from the tax cuts and deficits of the 1980s to pay their fair share of cleaning up the mess; and that we should not say we were asking people to sacrifice but to contribute to Americas renewal, a more patriotic and positive formulation. Begala wrote a memo containing his arguments and suggesting a new theme: Its NOT the deficit, stupid. Gene Sperling, Bob Reich, and George Stephanopoulos agreed with Paul, and were glad to have some inside help in arguing the message.
While all this was going on in public, we were struggling hard with some big questions. By far the largest was whether to include health-care reform along with the economic plan in the omnibus Budget Reconciliation Act. There was a compelling argument for doing so: first, the budget, unlike all other legislation, isnt subject to the filibuster rule, the Senate practice that allows just forty-one senators to kill any bill by debating it to death, blocking a vote until the Senate has to move on to other business. Since the Senate had forty-four Republicans, the probability that they would at least try to filibuster health care was high.
Hillary and Ira Magaziner badly wanted health care in the budget, the congressional leaders were open to it, and Dick Gephardt had urged Hillary to do it, because he was sure the Republican senators would try to filibuster health care if it were proposed by itself. George Mitchell was sympathetic for another reason: If health-care reform were introduced as a separate bill, it would be referred to the Senate Finance Committee, whose chairman, Senator Pat Moynihan of New York, was, to put it mildly, skeptical that we could come up with a workable health-care plan so quickly. Moynihan recommended that we first do welfare reform, and spend the next two years developing a health-care proposal.
The economic team was adamantly opposed to including health care in the budget, and they had good reasons, too. Ira Magaziner and many health-care economists believed, correctly as it turned out, that greater competition in the health-care marketplace, which our plan would promote, would produce significant savings without price controls. But the Congressional Budget Office would not give credit for these savings in any budget we presented. Thus, to provide universal coverage, we had either to include a provision for backup price controls in the plan, raise taxes and cut other spending even further, or reduce the deficit target, which might adversely affect our strategy to lower interest rates.
I decided to delay the decision until after I put the details of the economic plan before the people and the Congress. Not long afterward, the decision was made for me. On March 11, Senator Robert Byrd, the senior Senate Democrat and ultimate authority on the bodys rules, told us he would not make an exception for health care to the Byrd rule, which prohibited the inclusion of nongeneric items in the budget-reconciliation bill. We had enlisted everyone we could think of to make the case to Byrd, but he was adamant that health-care reform could not be construed as part of the basic budget process. Now, if the Republicans could sustain a filibuster, our health-care plan would be dead on arrival.
In the second week of February, we decided to kick the health-care can down the road and complete the rest of the economic plan. I had become deeply immersed in the details of budgeting, determined to understand the human impact of our decisions. Most of the team wanted to cut farm supports and other rural programs, which they thought were unjustifiable. Alice Rivlin pushed hard for the cuts, suggesting I could then say I had ended welfare for farmers as we know it. It was a takeoff on one of my best campaign lines, a pledge to end welfare as we know it. I reminded my mostly urban budgeteers that farmers were good people who had chosen hard work in an uncertain environment, and though we had to make some cuts in their programs, we dont have to enjoy it. Since we couldnt restructure the whole farm program, reduce the subsidies in other nations budgets, or eliminate all the foreign barriers to our food exports, we ended up reducing the existing farm benefits modestly. But I didnt enjoy it.
Another thing we had to consider in proposing cuts, of course, was whether they had a chance to pass. For example, someone said we could save a lot of money by eliminating all the so-called highway-demonstration projects, which were specific spending items members of Congress obtained for their districts or states. When the suggestion came up, my new congressional liaison, Howard Paster, shook his head in disbelief. Paster had worked in both the House and Senate and for both Democratic and Republican lobbying firms. A New Yorker with a brusque, candid manner, Howard snapped, How many votes does the bond market have? Of course, he knew we had to convince the bond market that our deficit-reduction plan was credible, but he wanted us to remember that it first had to pass, and inflicting personal pain on members of Congress was unlikely to prove a successful strategy.
Some of the proposals we considered were so absurd they were comical. When someone suggested we impose fees for Coast Guard services, I asked how they would work. It was explained that the Coast Guard was quite often called upon to bring in boats that were in distress, often due to the negligence of the operators. I laughed and said, So when we pull up alongside, or throw down a rope from a helicopter, before we do the rescue, were going to ask, Visa? MasterCard? We let that one go, but eventually we did come up with more than 150 budget cuts.
Deciding on the tax increases was no easier than choosing the budget cuts. The toughest issue for me was the BTU tax. It was bad enough that I was going back on my commitment to cut middle-class taxes; now I was told we had to raise them, both to reach the $140 billion deficit reduction target in the fifth year and to turn the psychology of the bond market. The middle class had been shafted in the eighties, and Bush had been crippled by signing a gas-tax increase. In one fell swoop, if I proposed the BTU tax I would make the Republicans the anti-tax party again, largely to satisfy the hunger of the prosperous interest-rate setters for a little middle-class pain, in this case about $9 a month in direct costs, rising to $17 when indirect costs, in the form of higher prices for consumer products, were included. Lloyd Bentsen said that he had never had any fallout from voting for energy taxes, and that Bush was hurt by signing the 1990 gas-tax increase because of his read my lips pledge and the fact that the most militant anti-taxers were hard-core Republicans. Gore again pushed for the BTU tax, saying it would promote energy conservation and independence.
Finally, I gave in, but made some other changes in Treasurys tax proposals that I hoped would reduce the tax burden on average Americans. I insisted that we include in the budget the full $26.8 billion cost of my campaign proposal to more than double the tax cut for millions of working families with incomes of $30,000 or less, called the Earned Income Tax Credit (EITC), and for the first time offer a more modest EITC to more than 4 million working poor Americans without dependents. This proposal would ensure that, even with the energy tax, working families with incomes of $30,000 or less would still receive a meaningful tax cut. On the campaign trail, I had said at virtually every stop, No one with children who works full-time should live in poverty. In 1993, there were a lot of people in that situation. After we doubled the EITC, more than four million of them moved out of poverty into the middle class during my presidency.
As we were trying to close the deal, Laura Tyson said she felt she had to point out that there was no significant economic difference between a fifth-year reduction of $140 billion and one of $120 or $125 billion. Congress would probably pare back whatever I proposed anyway. She argued that, if it eased our political problems or was simply better policy, we would save ourselves some headaches by reducing the figure to $135 billion or even a little less. Reich, Sperling, Blinder, Begala, and Stephanopoulos all agreed with her. The others held out for the high number. Bentsen said we could save $3 billion by dropping the estimated cost of welfare reform from the budget. I agreed. After all, we hadnt developed our proposal yet, and the number was just a guess. We knew wed have to spend more on training, child care, and transportation to help poor people move from welfare to work, but if we moved enough people off the rolls, the net cost might go down, not up. Moreover, I believed we could pass welfare reform separately with bipartisan support.
Later, Lloyd Bentsen added a final piece to the plan, removing the $135,000 earnings cap on the 1.45 percent payroll tax that funded Medicare. This was necessary to make sure that our numbers on extending Medicares solvency added up, but it did ask for more from the wealthiest Americans, whose top rate we were already proposing to raise to 39.6 percent, and who would almost certainly never cost the Medicare program as much as they would now pay into it. When I asked Bentsen about it, he just smiled and said he knew what he was doing. He was confident that he and other high-income Americans who would pay the extra tax would more than make it back in the stock market boom that our economic program would spark.
On Monday, February 15, I gave my first televised address from the Oval Office, a ten-minute outline of the economic program I would unveil two days later to a joint session of Congress. Even though the economy was in a statistical recovery, it was a jobless one, burdened by the quadrupling of the debt in the last twelve years. Since all the deficits were the result of the tax cuts for the wealthy, soaring health costs, and increases in defense spending, we were investing less in the things that make us stronger and smarter, richer and safer, like education, children, transportation, and local law enforcement. At the rate we were going, our living standards, which usually doubled every twenty-five years, wouldnt do so again for another one hundred years. Reversing the trend would require a dramatic change in our national priorities, with a combination of tax increases and spending cuts to reduce the deficit and invest more in our future. I said that I had hoped to pursue this course without asking more of middle-class Americans, because they had borne hardships and had been treated unfairly in the previous twelve years, but the deficit had grown far beyond the earlier estimates on which I had built my budget proposals in the campaign. Now more Americans must contribute today so that all Americans can do better tomorrow. However, unlike what had happened in the 1980s, most of the new taxes would be paid by wealthier Americans; for the first time in more than a decade, were all in this together. In addition to deficit reduction, my economic plan would provide incentives to businesses to create new jobs; a short-term stimulus to add 500,000 jobs right away; investments in education and training, with special programs to help displaced defense workers; welfare reform and the big increase in the EITC; Head Start opportunities and vaccinations for all children who need them; and the national service initiative to allow young people to earn money for college in return for serving in their communities. I acknowledged that these proposals would not be easily or quickly implemented, but when they were, we could restore the vitality of the American dream.
On Wednesday night, in the address to Congress, I explained the strategy behind the plan and outlined the specifics. Its guiding principles were four: to shift more public and private spending from consumption to investment in order to create more jobs; to honor work and family; to produce a budget with conservative estimates, not the unrealistic rosy scenario figures that had been used in the past; and to pay for the changes with real cuts in spending and fair taxes.
To create more jobs, I proposed a permanent investment tax credit for small businesses, which employed 40 percent of the workforce but were creating most of our new jobs, and the establishment of community development banks and empowerment zones, two of my campaign commitments, which were designed to bring new loans and investments into poor areas. I also asked for more money for roads, bridges, mass transit, high-tech information systems, and environmental cleanups to increase productivity and employment.
On education, I recommended increased investments in and higher standards for public schools, and incentives to encourage more students to go to college, including my national service initiative. I complimented Congress on passing the family leave law, and asked them to follow up with tougher child-support enforcement. On crime, I asked for passage of the Brady bill, military-style boot camps for first-time nonviolent offenders, and my proposal to put 100,000 new police on the streets.
I then asked Congress to help me change the way government worked, by enacting campaign finance reform and registration requirements for lobbyists, and eliminating the tax deduction for lobbyists expenses. I committed to reduce the size of the federal workforce by 100,000, and to cut administrative expenses, saving $9 billion. I asked Congress to help me slow spiraling health-care costs, and said that we could continue modest defense downsizing but that our responsibilities as the worlds only superpower required us to spend enough to keep our military the best trained and equipped in the world.
I saved taxes for last, recommending that we increase the top income tax rate from 31 to 36 percent on incomes over $180,000, with a 10 percent surcharge on incomes over $250,000; raise the corporate income tax rate from 34 to 36 percent on incomes over $10 million; end the tax subsidy that made it more profitable for a company to shut down its American operations and move overseas than to reinvest at home; subject more of the income of the best-off Social Security recipients to taxation; and enact the BTU tax. The income tax rates would increase on only the top 1.2 percent of earners; the Social Security increase would apply to 13 percent of recipients; and the energy tax would cost about $17 per month for people with incomes of $40,000 or more a year. For families with incomes of $30,000 or less, the EITC would more than offset the cost of the BTU tax. The taxes and budget would enable us to reduce the deficit by about $500 billion over five years at present economic estimates.
At the end of the speech, I did my best to bring home the magnitude of the deficit problem, pointing out that if present trends continued, within a decade the annual deficit would increase to at least $635 billion a year from this years $290 billion, and that interest payments on our accumulated debt would become Americas largest budget item, taking more than twenty cents of every tax dollar. To show I was serious about deficit reduction, I invited Alan Greenspan to sit with Hillary in the First Ladys box in the House gallery. To show he was serious about it, Greenspan came, overcoming his understandable reluctance to make what could be seen as a political appearance.
After the speech, which was generally well received, all the commentators noted that I had abandoned the middle-class tax cut. So I had, but a lot of my other promises were fulfilled in the economic plan. Over the next few days, Al Gore, the cabinet members, and I fanned out across the country to sell it. Alan Greenspan praised it. So did Paul Tsongas, who said the Clinton who spoke to Congress was not the Clinton he ran against, which, of course, is what my political advisors and some congressional Democrats were worried about.
There were enough important and controversial proposals in the speech to keep Congress busy for the rest of the year, not to mention the other legislation that already was, or soon would be, on their calendar. I knew that there would be a lot of ups and downs before the economic program passed, and that I wouldnt be able to spend all of my time pushing it. Foreign problems and domestic developments wouldnt permit it.
On the home front, February ended in violence. On the twenty-sixth, a bomb exploded at Manhattans World Trade Center, killing six people and injuring more than one thousand. The investigation quickly revealed it to be the work of terrorists from the Middle East, who hadnt covered their tracks very well. The first arrests were made March 4; eventually, six of the conspirators were convicted in federal court in New York and each sentenced to 240 years in prison. I was pleased with the effectiveness of our law-enforcement work, but troubled by the evident vulnerability of our open society to terror. My national security team began to devote more attention to terror networks and what we could do to protect ourselves and free societies around the world against them.
On February 28, four agents from the Bureau of Alcohol, Tobacco, and Firearms were killed and sixteen others wounded at the onset of a confrontation with a religious cult, the Branch Davidians, at their compound outside Waco, Texas. The Davidians were suspected of illegal firearms violations. The sects messianic leader, David Koresh, believed he was Christ reincarnate, the only person who knew the secret of the seven seals referred to in the book of Revelation. Koresh had almost hypnotic mind control over the men, women, and children who followed him; a large arsenal of weapons, which he was obviously prepared to use; and enough food to hold out for a long time. The standoff between the Davidians and the FBI dragged out for almost two months. During that time, several adults and children left, but most of them stayed, with Koresh promising to surrender but always finding an excuse to delay doing so.
On Sunday night, April 18, Janet Reno came to the White House to tell me that the FBI wanted to storm the compound, apprehend Koresh and any of his followers who had taken part in killing the agents or some other crime, and free the rest of them. Janet said she was concerned by FBI reports that Koresh was sexually abusing children, most of them pre-teens, and that he might be planning a mass suicide. The FBI had also told her that it couldnt keep so many of its resources tied down in one place forever. They wanted to raid the compound the next day, using armored vehicles to break holes in the buildings, then blast tear gas into them, a maneuver they estimated would force all the members to surrender within two hours. Reno had to approve the assault and wanted my okay first.
Several years earlier, I had faced a similar situation as governor. A right-wing extremist group had established a compound in the mountains of north Arkansas. Among the men, women, and children who lived there were two suspects wanted for murder. The people lived in several cabins, each of which had a trapdoor that led to a dugout from which they could fire on approaching authorities. And they had a lot of weapons to fire. The FBI wanted to storm them, too. At a meeting I convened with the FBI, our state police, and cooperating law-enforcement people from Missouri and Oklahoma, I listened to the FBIs case, then said that before I could approve the action, I wanted someone whod fought in the jungles of Vietnam to fly over the place in a helicopter and make an assessment. The battlewise veteran who made the inspection for me returned to say, If those people can shoot at all, youll lose fifty men in the assault. I called off the raid, put a blockade around the camp, cut off food-stamp aid to the several families who had been receiving it, and prevented anyone who left the premises to get supplies from going back. Eventually the holdouts gave in, and the suspects were apprehended with no loss of life.
When Janet made her case to me, I thought we should try what had worked in Arkansas before we approved the FBI raid. She countered that the FBI was tired of waiting; that the standoff was costing the government a million dollars a week and tying up law-enforcement resources needed elsewhere; that the Branch Davidians could hold out longer than the Arkansas people had; and that the possibilities of child sexual abuse and mass suicide were real, because Koresh was crazy and so were many of his followers. Finally, I told her that if she thought it was the right thing to do, she could go ahead.
The next day, as I watched CNN on a television just outside the Oval Office, I saw Koreshs compound in flames. The raid had gone terribly wrong. After the FBI fired the tear gas into the buildings where the people were holed up, the Davidians started a fire. It got worse when they opened the windows to let the tear gas out and also let in a hard wind off the Texas plains, which stoked the flames. When it ended, more than eighty people had died, including twenty-five children; only nine survived. I knew I needed to speak to the press and take responsibility for the fiasco. So did Dee Dee Myers and Bruce Lindsey. But several times during the day, when I wanted to go ahead, George Stephanopoulos urged me to wait, saying we didnt know whether anyone was still alive or whether, if Koresh heard my words, he might snap and kill them, too. Janet Reno did appear before the cameras, explained what happened, and took full responsibility for the raid. As the first woman to hold the attorney generals post, she thought it was important not to pass the buck. By the time I finally talked to the press about Waco, Reno was being praised and I was being criticized for letting her take the fall.
For the second time in less than twenty-four hours, I had accepted advice that ran counter to my instincts. I didnt blame George. He was young and cautious and had given me his honest, albeit mistaken, opinion. But I was furious at myself, first for agreeing to the raid against my better judgment, then for delaying a public acknowledgment of responsibility for it. One of the most important decisions a President has to make is when to take the advice of the people who work for him and when to reject it. Nobody can be right all the time, but its a lot easier to live with bad decisions that you believed in when you made them than with those your advisors say are right but your gut says are wrong. After Waco, I resolved to go with my gut.
Perhaps one reason I didnt trust my instincts enough is that the administration was being hammered hard in Washington and I was being second-guessed at every turn. After a great initial appearance on Capitol Hill, Hillary was being criticized for the closed meetings of her health-care task force. Since they were consulting with hundreds of people, nothing they did was secret; they were simply trying to move with dispatch over many immensely complicated matters to reach my overly ambitious goal of presenting a health-care plan to Congress within one hundred days. The task force heard testimony from over 1,100 groups, had more than 200 meetings with members of Congress, and held public meetings all around the country. Its reputation for being secretive was exaggerated. In the end, the task force operation proved too unwieldy and was allowed to expire, and we couldnt make the hundred-day deadline anyway.
As if all this werent enough, I also suffered the defeat of my short-term stimulus package, which was designed to create 500,000 jobs by getting money out quickly to cities and states for infrastructure projects. The economy was still growing slowly, it needed the boost, and the modest nonrecurring expenditures wouldnt have made our deficit problem worse. The House passed the bill handily and the Senate was for it, too, but Bob Dole had more than forty Republican senators who were willing to filibuster it. After the first filibuster vote, we should have tried to negotiate a smaller package with Dole, or accepted a less ambitious compromise proposal offered by Senators John Breaux and David Boren, two conservative Democrats. Senator Robert Byrd, who was handling the proposal, was adamant that if we didnt bend, we could break the filibuster. But we couldnt, and finally admitted defeat on April 21, two days after Waco.
In my first term, the Republicans resorted to the filibuster to an unprecedented extent, thwarting the will of the congressional majority, out of either conviction or a desire to prove that I couldnt lead. Senator George Mitchell had to have twelve votes to break filibusters just in my first hundred days.
On March 19, we suffered a personal blow that put politics in perspective when Hillarys dad had a massive stroke. Hillary rushed to his bedside at St. Vincents Hospital in Little Rock, with Chelsea and my brother-in-law Tony. Dr. Drew Kumpuris, Hughs doctor and our friend, told Hillary that her father had suffered severe brain damage and was in a deep coma from which, in all probability, he would never emerge. I got there two days later. Hillary, Chelsea, Dorothy, and his sons, Hugh and Tony, had been taking turns talking, even singing, to Hugh, who looked as if he was just sleeping peacefully. We didnt know how long he would last, and I could stay only a day. I left Hillary in the good company of her family, the Thomasons, Carolyn Huber, who had known Hugh ever since her days as the administrator of the Governors Mansion, and Lisa Caputo, Hillarys press secretary and a favorite of Hughs because like him she came from eastern Pennsylvania, near his hometown of Scranton.
The next Sunday, I flew home again for a couple of days. I wanted to be with my family, even though there was nothing to do but wait. The doctor told us that Hugh was essentially brain dead. Over the weekend, the family decided to take him off the machine that was breathing for him, and we all said prayers and good-byes, but Hugh didnt go for it. His strong old heart just kept beating. Though I had been able to attend to most of my duties in Arkansas, I had to return to Washington on Tuesday. I hated to leave, knowing it was the last time Id ever see my father-in-law. I loved Hugh Rodham, with his no-nonsense gruffness and fierce family loyalty. I was grateful that he had accepted me into the fold twenty years earlier, when I was scruffy, penniless, and, worst of all, a Democrat. I would miss our pinochle games and political arguments, and just knowing he was around.
On April 4, with Hugh still hanging on, Hillary had to return to Washington, too, to get Chelsea back to school after spring break, and to get back to work. She had promised to give a speech on April 6 at the University of Texas at Austin for Liz Carpenter, who had been Lady Bird Johnsons press secretary. Liz pressed her not to cancel, and she decided to go. At a time when she was grief-stricken, she reached deep inside herself to say that, as we moved into the new millennium, we need a new politics of meaning. We need a new ethos of individual responsibility and caring. We need a new definition of civil society which answers the unanswerable questions posed by both the market forces and the governmental ones, as to how we can have a society that fills us up again and makes us feel that we are part of something bigger than ourselves. Hillary had been moved to make this argument by reading an article written by Lee Atwater shortly before he died at forty of cancer. Atwater had become famous and feared for his ruthless attacks on Democrats while working for Presidents Reagan and Bush. As he faced death, he found that a life devoted only to getting power, wealth, and prestige left a lot to be desired, and he hoped that in a parting shot, he could push us to a higher purpose. In Austin, on April 6, bearing her own sorrow, Hillary tried to define that purpose. I loved what she said and was proud of her for saying it.
The next day, Hugh Rodham died. We had a memorial service for him in Little Rock, then took him home to Scranton for the funeral at the Court Street Methodist Church. I eulogized the man who had put aside his Republican convictions to work for me in 1974, and who, through a lifetime of learning from personal experience, had let go of all the bigotries he had grown up with. He lost his racism when he worked with a black man in Chicago. He lost his homophobia when he was befriended and looked after by his gay neighbors, a doctor and a nurse, in Little Rock. He had grown up in football- fanatical eastern Pennsylvania, where the Catholic stars went to Notre Dame and the Protestant ones like him played for Penn State. The divide revealed a prejudice against Catholics that was also part of Hughs upbringing. He gave that up, too. We all thought it fitting that his last days were spent in St. Vincents Hospital, where the Catholic nuns took loving care of him.