Clinton turns attention to faiscal issues; President beats drum for his plan to shore up Social Security; Trip to N.H. begins today; White House, GOP square off for debate over spending surplus

THE BALTIMORE SUN

WASHINGTON -- With the impeachment trial behind him, President Clinton turned in earnest yesterday to his legislative agenda, preaching the virtues of his Social Security proposal to a crowd of young people at the White House and once again declaring the moment "a season for renewal."

The Social Security event was the first true policy address since his Senate acquittal, and it kicked off a flurry of presidential activity.

Today, he makes his first post-impeachment domestic foray out of Washington with a sentimental journey to New Hampshire, where he once proclaimed himself "the Comeback Kid."

Tomorrow, after an Oval Office meeting with French President Jacques Chirac, Clinton will hold a brief news conference, the first at the White House since Oct. 28.

And early next week, GOP congressional leaders will meet with him to discuss legislative issues and symbolically bury the hatchet.

"This is a time for renewal," Clinton declared, after an extended speech that was heavy on dry policy talk and light on politics. "I hope we make the right decisions."

Clinton is far from out of the woods.

His Social Security plan is under attack from a Republican Party worried about the political cost of impeachment and anxious to engage Clinton in a policy debate.

His legal battles continue with a threat this week from U.S. District Judge Susan Webber Wright in Arkansas that she may cite him for contempt of court.

And the press' attention is more focused on his wife's political future than his own.

The highlight of the Social Security event may have been when Virginia Sen. Charles S. Robb lamented the retirement of New York Sen. Daniel Patrick Moynihan next year, then turned to Hillary Rodham Clinton and said, "All I can say to New York is I hope you can find someone of similar intellectual stature."

But the president appeared yesterday to relish what he called "a great debate" between his proposal to use three-quarters of the burgeoning budget surplus to reduce the national debt and the GOP proposal for an immediate broad-based tax cut. And he made a remarkable plea for a president supposedly disgraced and hobbled by scandal and impeachment: Trust me.

He acknowledged that the Republican call for a 10-year, $743 billion tax cut may sound more appealing than debt reduction and staving off insolvency in Social Security and Medicare.

But, he added, "in defense of our plan, I think we ought to be at least entitled to the benefit of the doubt, based on the last six years."

Clinton has set himself up as a prudent fiscal conservative staving off a politically popular but reckless tax cut, but the poll-driven president clearly knows that his position is more popular than he is willing to admit.

The president's pollster, Mark Penn, said yesterday that his polls show the public favors Clinton's proposal over a large tax cut by four or five to one. Even confidential GOP polls indicate the Republican tax cut drive is appealing only to core conservative voters, not critical swing voters.

Neither Clinton nor his aides appear to be ducking the trust issue. Penn insisted yesterday that the public trusts Clinton to look out for its interests, and Penn pledged that Clinton "is going to be an activist on all fronts" in his final two years in office.

Home of 'Comeback Kid'

While Clinton has yet to address his impeachment at length, he has alluded to it in myriad ways, such as yesterday's call for renewal and today's trip to New Hampshire.

White House aides insist it is only a coincidence, but it was exactly seven years ago today that Clinton eked out a second-place finish in the New Hampshire primary after being clobbered by accusations of draft-dodging and Gennifer Flowers' charges of marital infidelity.

On Feb. 18, 1992, at a Merrimack, N.H., hotel, Clinton declared that New Hampshire had made him "the Comeback Kid."

"I may not be perfect," candidate Clinton said at the time, "but I'll hang in there and fight until the last dog dies."

It turned out perhaps to be the secret of his success, and no doubt, Penn said, Clinton will relive those days when he holds a private luncheon in Merrimack, then joins Democratic Party stalwarts for a fund-raising dinner tonight in Manchester.

"There's something special about New Hampshire for the president," acknowledged White House spokesman Joe Lockhart.

But for now, Clinton appears determined to talk more about the future than the past. He insisted his proposals for Social Security and Medicare would harness today's robust economy to preserve a safety net for generations to come.

Sharp cut in federal debt

According to the administration, the president's plan would reduce the $3.7 trillion in federal debt held by the public by nearly $3 trillion over the next 15 years. By then, that portion of the federal debt would be the smallest percentage of the nation's economy since 1917.

Under the plan, the federal government would buy back Treasury bonds and notes held by the public, then convert them into "special" Treasury bonds -- or IOUs -- for Social Security and Medicare.

When the baby boom generation begins to retire, those IOUs would ensure that Social Security and Medicare would be first in line for federal spending. By White House accounting, that could push Social Security's insolvency date as far back as 2055.

But Republicans in Congress are not buying that accounting, charging that the administration is "double counting" by saying the plan reduces the debt and saves Social Security all at once, with the same money.

When pushed, White House officials concede that what the plan really does is greatly reduce the federal debt now, so that when the Social Security system reaches the point of insolvency around 2032, the government would have the flexibility to begin deficit spending once again to shore it up.

Neither Clinton nor the Republicans have proposed any structural changes to Social Security -- such as raising payroll taxes or decreasing benefits -- that would save the system in the long run.

"It's really a temporary adjustment," said Robert Reischauer, a former director of the Congressional Budget Office, now at the Brookings Institution, who said fundamental changes will have to be made sooner or later. "You can run but you cannot hide."

House Ways and Means Committee Chairman Bill Archer fired a shot across the White House bow yesterday, saying Clinton's plan would actually "explode" the total national debt, from $5.4 trillion in 1998 to $6.7 trillion in 2004.

While the White House measures only the debt that the government owes to the public, Archer adds the debt one government agency owes another, including trillions in IOUs for Social Security funds spent by other agencies.

The bewildering complexity of Clinton's budget has provided GOP partisans with an easy target, but Reischauer noted that Republicans have not yet come up with proposals of their own.

"This is politics. You criticize the other team's effort in any way you can," Reischauer said. "That doesn't mean when push comes to shove, the Republicans won't resort to similar kinds of solutions."

Big picture and details

Clinton acknowledged the confusion yesterday in an event broadcast to about 1,000 college students on 43 campuses across the country, including the University of Maryland Eastern Shore. But he dismissed it with a shrug.

"Underlying all of it, there is fundamentally a very simple choice: Will our first priority be spending the budget surplus we have worked so hard to create on a terrifically appealing tax cut in the moment, or will our first priority be investing whatever the necessary amount of the surplus is, for at least the next 15 years, to strengthen Social Security and Medicare?"

"Remember," he added, in comments that quickly raised Republican ire, "in every complex debate, the details really matter, but they only matter after you make the big, simple decisions."

Pub Date: 2/18/99

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