Don’t Kill Bill

By Will Marshall

Tagged Bill ClintonEconomics

This essay is the first part of an exchange with historian Nelson Lichtenstein. Read responses 2, 3, and 4.

Is it really necessary to debate progressives again over Bill Clinton’s legacy? With a vengeful Donald Trump thrashing about our political waters like a blood-frenzied shark, it seems like a distraction.

What’s more, the left’s revisionist history of the Clinton years strikes me as a facile exercise in presentism—reinterpreting the past to score present-day ideological points. Nonetheless, the “neoliberal” legend seems to be gaining currency outside the activist and academic circles from which it sprang.

In a widely noted speech last April, National Security Adviser Jake Sullivan took errant potshots at Clinton’s trade policies by way of touting the Biden Administration’s turn to industrial policy as a bold new departure in economic philosophy. Rolling out Bidenomics in July, President Biden confusingly described it as a rejection of the “trickle-down economics” that has supposedly held sway for the last 40 years—a period that includes the eight years of the Obama-Biden Administration.

So thanks to Democracy for giving me an opportunity to make the case that Clinton’s economic policies were more progressive than he gets credit for.

Any honest history starts here: The 1990s were pretty damn good years for America. Compared to what’s befallen us since 2000, the decade before looks like a golden age of pragmatic liberalism.

On Clinton’s watch, the U.S. economy turned in its strongest performance since the booming 1960s, averaging 4 percent growth a year. Yes, the rich did just fine, but so did everyone else. The unemployment rate fell from an average of 7.2 percent between 1980 and 1992 to 3.9 percent by 2000. Median household income grew by 14.5 percent between 1993 and 2000. Economist Robert Shapiro (a key member of Clinton’s economic team and former colleague at the Progressive Policy Institute) notes that inflation-adjusted incomes of Americans in the two lowest-income quintiles increased by nearly 17 percent, far more than under any recent President.

That’s economic growth with equity—exactly what today’s progressives bemoan the absence of.

Crime, poverty, teen pregnancy, and welfare dependency also declined during the Clinton years. American scientists and entrepreneurs midwifed the World Wide Web, setting the stage for today’s flourishing digital economy. Clinton took advantage of the “peace dividend” to increase public investment and social supports for the working poor, while also balancing the federal budget for the first time in 30 years.

As the Cold War wound down, his Administration cut defense spending, avoided open-ended military interventions, and used trade agreements, aid, and NATO membership to consolidate what political scientist Samuel Huntington called a “third wave” of democratic transitions around the world.

On the political front, Clinton and his New Democrat allies ushered in an unusual period of critical self-reflection and intellectual ferment. Recall that Democrats then were in the throes of a long presidential losing streak widely attributed to an exhausted liberalism. By the 1980s, the party’s agenda had degenerated into little more than a stapled-together sheaf of interest-group demands.

Clinton’s election in 1992 on a platform of genuinely novel ideas—national service; reinventing government; community policing; ending welfare as a way of life; wage subsidies to lift working families out of poverty; public school choice for families trapped in failing urban schools—turned his flailing party around. Four years later, his reelection marked the first time a Democrat had won back-to-back presidential contests since FDR in 1936.

Given this record, you’d think progressive Democrats would be naming airports after Clinton rather than denouncing him for insufficient ideological purity. With apologies to Elvis Costello, what’s so funny about peace, prosperity, and competent governing?

Of course, Clinton made plenty of mistakes and had his share of peccadilloes. And he obviously isn’t solely responsible for all the good things that happened on his watch. But more often than not, he used his folksy charm, command of substantive detail, and consummate skill for public persuasion to reinforce the nation’s economic and social progress.

And this is crucial: He not only championed liberal goals, but by anchoring them in mainstream American values, he managed to win broad public support for them—including from working-class voters who have since forsaken the Democratic Party.

Nonetheless, progressive activists and academics seem obsessed with retroactively winning arguments that Clinton’s left-leaning critics lost back in the 1990s. Their beef with Clinton goes roughly as follows: He made too many concessions to free-market economics and conservative social values. He embraced free trade and globalization, which shipped U.S. manufacturing jobs overseas and left blue-collar workers stranded. He played small ball and didn’t transform America into a European-style social democracy. And, perhaps most unforgivable of all, he shared the public’s mistrust of sclerotic government bureaucracies and statist solutions.

It’s true that Clinton had a healthy respect for the vital role a dynamic private sector plays in creating good jobs and abundant economic opportunity. He believed that without individual initiative, open markets, and robust competition, you won’t generate the innovation, productivity gains, and high wages that are an essential precondition for broadly shared prosperity.

This is an article of faith for most Americans and hardly makes Clinton a closet acolyte of Milton Friedman. To lump him in the “neoliberal” basket along with libertarians like Ronald Reagan and Margaret Thatcher is to define the term so elastically as to include every past U.S. President. When was the last time voters sent a democratic socialist to the White House?

It’s also true that Clinton didn’t indulge in the business-bashing rhetoric of lefty populists like Senators Bernie Sanders and Elizabeth Warren. He believed America would make more forward progress when the public and private sectors rowed in the same direction, and when Washington’s economic and regulatory policies went with rather than against the grain of economic logic. Clinton pitched a hopeful economic message to ordinary Americans who “work hard and play by the rules.” He raised taxes on the wealthy and cut taxes on working families. He proposed an ambitious plan for universal health coverage, which arguably cost Democrats control of Congress in the 1994 midterms. After it failed, Clinton won passage of the Children’s Health Insurance Program (CHIP), expanding coverage to six million kids.

His Administration created the first national family leave law; made the largest investment in college aid since the G.I. Bill; drew tens of thousands of volunteers into community and national service; and poured hundreds of billions of dollars into a slew of initiatives (the Community Investment Act, Empowerment Zones, and Enterprise Communities) to seed economic development in disadvantaged neighborhoods.

Left-wing Democrats—echoed by candidate Donald Trump in 2016—claim Clinton’s support for NAFTA and other trade deals destroyed U.S. jobs. They have a timing problem. Manufacturing employment actually rose after NAFTA, peaking in 1998. In fact, the economy created more jobs (23 million) over Clinton’s eight years than under any other President.

Critics are on firmer ground in saying Clinton’s support for China’s entry into the World Trade Organization in 2000 contributed to the “China shock”—the loss of hundreds of thousands of factory jobs (variously estimated at between 500,000 and one million out of a net reduction of five million) in the 2000s. What lay behind that decision, however, wasn’t neoliberalism, but two other considerations.

One was development theory, which posits that as countries move up the development curve and liberalize their economies, public pressure for political liberalization usually follows. The other was the hope that bringing China into a world of open economies, international rules, and economic interdependence would head off a Sino-U.S. collision. Under Xi Jinping, however, China instead seems to be reverting to Maoist despotism and belligerent nationalism. Maybe Clinton and other democratic leaders made a bad bet on China, but it seemed a reasonable and fair-minded one at the time.

In retrospect, it’s also easy to fault Clinton and U.S. policymakers for being unduly complacent about the impact of trade and especially technological change on less educated workers. Amid all the excitement around the “new economy” aborning in Silicon Valley and other technology nodes, and the rapid growth of new jobs for “wired workers,” the challenges facing workers in traditional manufacturing centers got less attention.

Political leaders, however, aren’t seers. They make decisions based on the conditions they face while in office. From 1993 to 2000, globalization was working for all Americans. Afterward came terrorism and war; the plunge in manufacturing jobs; a slowdown in business investment and productivity; wage stagnation and worsening inequality; the 2008-09 housing and financial crisis and ensuing Great Recession; and the right-wing populist upheavals that have convulsed the entire transatlantic world. These discrete developments can’t be charged to Clinton’s account or to a nebulous academic conceit like “neoliberalism.”

On trade, it’s not Clinton but progressives who are at odds with the Democratic Party’s traditions and, apparently, present views. Just as Presidents Kennedy, Truman, Roosevelt, and Wilson were strong free traders, Gallup’s most recent poll on trade shows that 72 percent of Democrats see foreign trade as an economic opportunity for America rather than a threat.

The simpler explanation for why many progressives are ambivalent at best about Clinton’s legacy is generational change. The millennials’ political coming of age has pushed the party steadily to the left. In 1994, the share of all Democratic voters identifying as liberal was 25 percent, rising to 40 percent by 2010 and 50 percent by 2017. In 2023, Gallup reported that the percentage of Democrats who identify as liberal reached a record 54 percent in 2022.

Every generation is entitled to its own experiences, political outlook, and dreams of making the world anew. But Democrats are in the business of winning elections and governing, and they face a practical problem: While the party has moved left, the rest of the country hasn’t. Conservatives (36 percent) and moderates (35 percent) are still the largest groups, while just 26 percent of voters identify as liberals. (In 1993, just 18 percent of Americans said they were liberals.) Only about 8 percent of U.S. voters identify as very or extremely liberal.

In Clinton’s day, the share of white, Black, and Hispanic Democrats identifying as liberal was about the same. Today, college-educated whites are more than 20 points more liberal than Black and Hispanic Democrats. “Unlike three decades ago, the Democrat Party is now a coalition of White Liberals and non-white voters the majority of whom think of themselves as moderate or conservative,” says William Galston of the Brookings Institution.

Affluent white progressives with college degrees are more preoccupied with post-material issues—“social justice,” climate change, gender fluidity—than the kitchen-table economic concerns of working-class voters. As liberal analysts Ruy Teixeira and David Shor have shown, their views on public safety, crime, immigration, and race and gender identity are far from those of the median U.S. voter. That’s one of the reasons Republicans made inroads among Black and especially Hispanic working-class voters in 2020 and 2022.

In addition, the left’s dour economic message has proved anything but popular with working-class voters. For the past 15 years, progressives have been telling Americans they are victims—of a rigged economy, greedy corporations and billionaires, structural racism, late-stage capitalism, treasonous trade treaties. Their solution? Expand government redistribution and social services to compensate Americans for the lack of genuine economic opportunity.

It’s past time for Democrats to adopt a post-populist economics that offers working Americans a hopeful and uplifting story of how today’s economic changes and technological advances can make their lives better.

Instilling optimism and confidence in Americans’ ability to innovate, compete, and adapt to economic change was Bill Clinton’s specialty. Unlike today’s progressives, he knew how to speak to non-college-educated Americans’ economic aspirations and values across racial and ethnic lines. Clinton was the last Democratic President to win working-class voters, twice.

So maybe today’s progressive critics—whose own electoral record is as yet unblemished by success in national politics—could learn a thing or two from the political Natural from Hope, Arkansas.

This essay is the first part of an exchange with historian Nelson Lichtenstein. Read responses 2, 3, and 4.

Read more about Bill ClintonEconomics

Will Marshall is the president of the Progressive Policy Institute.

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