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Perestroika For The Potomac

Looking back at his record of failure in numerous campaigns for the 4  presidency, the socialist Norman Thomas remarked that …

Looking back at his record of failure in numerous campaigns for the 4  presidency, the socialist Norman Thomas remarked that while he’d rather be right than president, at any time he was ready to be both. Having staked out their positions on the issues, both presidential candidates are qualified to be neither. What this campaign (not to mention the current political system) could use is a massive dose of what got Gorbachev a Nobel prize, namely, glasnost and perestroika.

While Clinton blames Bush for the staggering $333 billion federal deficit in 1992, the Arkansas governor proposes net spending increases totaling over $200 billion. On the other hand, Bush blames a Democratic-controlled Congress for not passing his economic agenda, yet takes credit for the Clean Air and Americans With Disabilities acts, which will add at least $60 billion in costs that an investment-starved economy can ill afford.

The irony is that the present crisis never had to take place. When Reagan left office in January 1989, the economy enjoyed its longest postwar peacetime expansion.

More than 10 million net new jobs had been created. Some 82 percent of these were in higher-paying, higher-skilled categories such as technical, precision production, and managerial-the prattle of the U.S. turning into a nation of hamburger flippers notwithstanding. As a result of Gramm-Rudman, the federal deficit as a percentage of GDP fell from a high of 6.3 percent in 1983 to 3 percent six years later. Contrary to assertions that reductions in marginal tax rates of the early 1980s left the government short of funds, record revenues were collected by the Treasury during this period.

One might have supposed that George Bush, if not Congress, would have learned something from this. Yet the White House and Congress used various accounting tricks to subvert Gramm-Rudman, leaving them no choice but to cut 1991 spending drastically. Instead, we got the 1990 budget deal-advertised as a necessary tax-to decrease the deficit by $500 billion. A study by The Heritage Foundation budget specialist Daniel Mitchell based on figures released by the Office of Management and Budget reveal that the deal, in fact, raised the 1991-95 deficit by $707.8 billion-an astounding error of $1.2 trillion!

But the problem runs deeper than the deal Dick Darman dealt his boss. Over eight years, Ronald Reagan reduced domestic spending from 14.3 percent of GDP to 12.24 percent. In just three years, according to Mitchell’s analysis, George Bush and Congress have permitted domestic spending to climb to 14.92 percent, wiping out all the gains achieved during the Reagan years. Inflation-adjusted domestic spending has climbed by an average 7.14 percent annually under Bush, or more than 13 times faster than the 0.53 percent average annual growth under Reagan, and nearly two and one-half times faster than the 2.95 percent average annual growth under Carter.

Clinton, to his credit, makes it clear he has no ambition to roll back the leviathan’s claim on our resources. Yet Bush asks us to believe that he will. If we are indeed faced either way with Clintonomics, would it not be preferable to have it under Clinton?

Government has grown from 12 percent of GNP in 1929 to more than 40 percent. Inevitably, this results in reduced personal freedom and greater, misplaced expectations on the government to do more. Term limits are at best an incomplete answer. (The motto of Congressmen Anonymous: Stop me before I spend again.)

George Marotta, a Palo Alto investment portfolio manager and Hoover Institution research fellow, told a group of retired federal employees, “If I were younger, I would run for Congress. My campaign slogan would be, ‘Elect me, and I will do less for you than my opponent, the incumbent.’ “

He’d get my vote.

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