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Modest success marks Clinton era Arkansas remains poor, but has made gains in Democrat's tenure

WASHINGTON — WASHINGTON -- During his 12 years as governor of Arkansas, Bill Clinton has improved the schools, kept taxes low, increased the number of jobs, improved civil rights for minorities and maintained one of the cleanest environments in the country.

Or, he has presided over one of the worst-educated states in the country, raised taxes on everything from groceries to used cars, watched as wages declined, failed to gain a civil rights law for his state's citizens and allowed the poultry industry to stall state regulation of water pollution caused by chicken droppings.

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Both pictures are true. Neither is complete.

Mr. Clinton's record is as ambiguous and contradictory as the man himself often has been on this year's campaign trail. When he took over, Arkansas ranked as one of the nation's poorest states. It still does. But in many ways, the state has made steady progress under Mr. Clinton's tenure.

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The overall assessment of his record depends in large part on whether one looks at where the state stands or where it is moving. Much also depends on what year one looks at.

During the first part of the 1980s, Arkansas was hard hit by the twin downturns in the nation's farm economy and its oil and gas industry. Economic statistics taken from that decade show slow growth, declining incomes and poor job markets. During the last four years, however -- while President Bush presided over a stagnant national economy -- Arkansas' picture has improved substantially.

Here is a closer examination of the Clinton record:

Economy

The official version of the history of the Arkansas economy during the Clinton era runs something like this:

When he first took office in 1978, economic development in the small Southern state amounted to "smokestack chasing." State officials would look for industrial plants in the Midwest and Northeast and woo them with promises of cheap labor, low taxes and lax regulation.

Mr. Clinton has said that he quickly realized that such efforts were self-defeating. Employers attracted by the promise of low wages would forever remain low-wage employers. They would stay in the state for a while but eventually would be lured away by other areas -- Mexico or Taiwan -- that could promise even lower costs. And in the meantime, such industries would do little to lift the state from poverty.

And so, during his first two-year term and again in 1982 when he regained his office after losing it in 1980, Mr. Clinton set out to change the state's approach to encouraging development in its impoverished backwaters. He pushed for major education reforms to improve the future work force, as well as the creation of new agencies to provide capital to encourage business starts.

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At first, progress was slow, particularly in the recessionary years of the mid-1980s. But in recent years, Arkansas has led the nation in new job growth.

This version of the story is true. But only in part.

Mr. Clinton's programs may have had some impact on the state's job-growth rate, but the impact has been small. The main source of new jobs has been the state's rapidly growing chicken industry, growth that has made the poultry producers a powerful entity in Arkansas. And that, in turn, has stymied efforts to control chicken-related pollution.

In addition, jobs in the chicken factories are generally low paying, as are jobs in the timber industry -- another source of Arkansas' strong employment growth in recent years.

Comparing 1979 with 1991, the number of non-farm jobs in Arkansas has increased by 24 percent, a rate slightly higher than the national average of 20 percent during that period. Nationally, most of that job growth took place in the early and mid-1980s. In Arkansas, much of the growth was in the last four years. Since Mr. Bush took office, jobs nationwide have increased by only 1 percent, while jobs in Arkansas have increased by 11.5 percent.

In another key economic category, Arkansas' per capita annual income has gone from $6,911 in 1979 to $14,629 in 1991. That was a healthy rate of growth, but overall only kept pace with the national averages. And the state remains near the bottom in per capita income; only West Virginia, Mississippi and Utah rank below it.

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Still, during the years Mr. Clinton and Mr. Bush have both been chief executives, Arkansas has done better than the nation as a whole. Nationally, per capita income adjusted for inflation has dropped 1 percent since 1989. In Arkansas, per capita income adjusted for inflation has grown 2 percent, making the state one of the few that can show actual income growth during the Bush years.

Spending and Taxes As governor, Mr. Clinton has faced strict constraints on his ability either spend money or raise it. Under the Arkansas constitution, the budget must be balanced. The state has an automatic budget-cutting process that cuts spending to match revenues each quarter of the year. As for taxes, most can be increased only if three-fourths of the Legislature concurs. Effectively, that means that as few as 12 members of the state Senate can kill a tax increase, and they usually have.

The exceptions to that rule are sales taxes and fees, and Mr. Clinton has turned to both to raise revenue. As governor, he put through two major sales tax increases. The first, in 1983, raised the sales tax from three cents on the dollar to four cents. The second increase, in 1990, added another half cent to the levy.

Adjusted for inflation, state spending in Arkansas increased 33 percent between 1980 and 1991. Spending increased somewhat faster than statewide income. But despite those spending increases, Arkansas has one of the lowest tax burdens in the nation.

Education and Environment

No issue has had a greater priority with Mr. Clinton than education. His biggest political battle was a confrontation with the state teachers union over teacher competency tests -- part of a broad package of educational reforms Mr. Clinton was able to get passed in 1983.

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Mr. Clinton's efforts on education even won him praise from President Bush. In 1989, when Mr. Clinton headed a task force of governors that worked with administration officials in setting new education goals, Mr. Bush wrote him a letter complimenting his work.

Nonetheless, education reforms take many years to have an impact, and so far, the measurable changes in the state's rankings are small.

On the environmental front, Mr. Clinton took on the timber industry during his first term (1979-81) and lost a major battle over clear-cutting in the state's forests. He also staged a major fight with the state's chief utility over nuclear power. When he returned to office in 1983, Mr. Clinton took a more low-key approach on environmental concerns, playing down the issue in the interests of economic growth.

The resulting problems have been most evident in northwestern Arkansas, the center of the state's poultry industry. The chief culprit is chicken droppings, which area farmers traditionally have used for fertilizer. In limited amounts, that practice causes few environmental problems, but as the industry has grown, the amount of chicken waste has exceeded the land's ability to absorb it, resulting in runoff into lakes and streams, where the nitrogen in the chicken droppings causes sharp increases in the growth of algae. That, in turn, robs the water of oxygen needed by fish.

Mr. Clinton and his aides correctly note that overall, the state remains one of the nation's cleanest. The vast majority of the state's rivers and streams are clean, and Arkansas is one of the few states that complies fully with the Clean Air Act.


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