Oh That Hillary...(untangling the Clinton rhetoric)

I didn't wake up this morning intending to write a pick on Hillary post, but to be perfectly fair, she started it.

I was watching the caucus coverage on CNN this morning, and heard her stumping out at the cauci. It was a perfect example of the two biggest problems I have with her as a candidate:

1. She equates eight years as First Lady with political leadership experience. I don't think we'd accept that qualification for Nancy Reagan, or Laura Bush, and I find it disingenous to the extreme for her to expect us to do so for her.

2. She came out with this gem of a quote:

"It took a Clinton to clean up after fhe first Bush, and it just might take a Clinton to clean up after the second Bush."

Now, first of all, I don't approve of legacy politics. A continuous family line of political leadership just smacks a little to close to monarchic ruling class to me. More importantly, though, the sheer unmitigated rhetoric in this statement just floored me, until I realized what a calculated play it was at manipulating the emotions of younger voters.

She had made economic conditions a repeated point in her speech, and it seemed at that moment to have been the foundation for the Bush cleaning quote. It's pertinent, as well, for when it comes to the most positive indicators of Bill Clinton's terms in office, favorable economic conditions are the strongest testimonial anyone can offer. For those of you who weren't old enough to be politically conscious during the Reagan years, a little clarifying history is in order, so here's an utterly over-simplified crash course in recent economic history, with a pdf full of pretty colored charts illustrating what I'm describing: (you might want to right click and open that in a new window)

Coming out of the oil crisis in the 70's, Reagan inherited a critically high inflation rate, which led to a massive market correction, in the form of a recession, in 1981. He made economic conditions his priority (along with a strong defense, and muscular foreign policy), and was able to create controlled growth with a well managed inflation rate that pulled the country out of recession, and into a strong growth period.

However, as in all things, the economy is based on cycles, known as business cycles. Inflation, GDP, and unemployment will rise and fall over time based on the birth, growth, and death or transformations of the companies which form the framework of our economy. (There's a much more detailed explanation on how the cycles work, related to manufacturing inventory, in the PDF) When the first Bush was elected, he rode the coat tails of the exiting incumbent, but didn't have the economic savvy to well mitigate the coming downturn in the economic cycle. History shows us that this was a short term correction in market valuation, but with his built in reputation of being the weaker half of the Reagan cowboy team, the economic downturn destroyed any remaining public confidence he had by forcing him to break the one economic policy he had stumped with: "Read my lips: No. New. Taxes."

I know, it sounds a bit lame now, but believe me, in 1988, it was bold and daring, cocky, and utterly economically naive and infeasible. One thing that politicians should have learned by now is that if you don't make good on your least common denominator stances, populist support is out of the question. (You hear that, Charlie Crist? "Drop like a rock", buddy.)

So, out with the old, and in with the daring and dashing William Jefferson. The market correction had stabilized by 1993 when he took office, so all Mr. Clinton had to do to win was let it ride. His first term was economically unremarkable, and marked by slight growth. He was globally diplomatic while remaining somewhat of an isolationist in practice on foreign military policy (which explains the lack of strong military response to terrorist attacks during his tenure). However, lo and behold, along came the grand invention of the interwebs, and the economy took off like a shot. Companies were building fortunes on the new technology, and online trading allowed hundreds of thousands of average shmoes to pump and dump their life savings into Wall Street just like the pros. Obscene speculative valuations on companies with seven figures in debt, combined with the tens of millions of dollars controlled by nervous, naive and inexperienced amateur day traders, led to a market so amazingly over inflated that it had nowhere to go but down, leading to the recession of 2001 when the dot com bubble burst.

And who was there to reap that benefit? The second Bush. Amazingly enough, some people were so irrationally and illogically deranged in their anger about the election of Bush, that they tied that recession to Bush himself, as though his evil influence was so pervasive, that in a matter of mere months after he was elected, he had flushed the entire economy down the drain. That mindset exhibits such an utter lack of understanding of the economy as to be mind boggling, especially when coming from otherwise seemingly intelligent people.

If ever there had been a time in the US, since the Great Depression, when some Executive and Congressional oversight of the economy was needed, it was during the Clinton Administration, when some conservatism on growth and valuation could have helped the dot com bubble grow into a full fledged industry a little more slowly, securing itself with strong fiscal foundations, and forcing the superstart ups of that time to earn their keep. Responsible economic oversight would have been the legacy of Bill Clinton, evidenced in a lasting era of prosperity. Instead, Bush the Second inherited the mess left by Clinton the first, and for Clinton the second to refer back to that as an achievement in her campaign rhetoric speaks strongly of her belief in the short memories and attention spans of the electorate.

Bush the second, has indeed, earned his poor reviews on his administration. However, the economy during his administration has made some progressive growth, and picked itself out of the hole left for it by the previous administration. The two weakest areas in the US economy right now are related to hedge funds and the sub-prime industry, both lobbies who have been heavily coddled by the Democratic party.

If that's what Clinton means by "cleaning up after the Bushes", then thanks, but I'll pass. If that's not what she means, then it's just one more example of disingenuousness from a candidate who's built a career on it.