Clinton Can Teach Us A Thing Or Two
The Age
Tuesday March 23, 1999
PERHAPS no one is watching, but the wheels of government in Washington keep turning. Americans are being Monica-ed out of their minds, but the Clinton administration is coming up with ideas of far more relevance to their future than the voyeuristic farce on the TV news.
Take the Budget proposals President Bill Clinton sent to Congress in January. From education to retirement income, from trade to technology, from the jobless to the ozone layer, his administration is still overflowing with ideas on things that governments can usefully do.
With just six weeks to go to the Victorian Budget, and seven weeks to the Federal Budget, these ideas could be usefully studied by our own governments as examples of how they can creatively respond to the challenges thrown at us by the twin revolutions of globalisation and technological change - not to mention the ageing of the population.
Whether any of Clinton's ideas become reality is anyone's guess. As the old Washington saying has it: ``The President proposes, but the Congress disposes." For President Clinton does not control his nation's Budget: Congress writes it, and his only influence is that if he doesn't like it, he can veto it.
Always tortuous, in recent years the US Budget negotiations have even ended in complete stalemate; the Republican Congress and the Democrat President could not agree on any compromise, and so simply recommitted existing programs for another year. Will the post-impeachment moderation on Capitol Hill allow at least some of Clinton's initiatives to become reality this time?
Maybe. But barely had last year's Federal Budget ended up in surplus - the first in a generation - than Republicans and Democrats began warring over what to do with it. Key Republicans urged a 10 per cent tax cut all around; Democrats proposed laudable spending initiatives. And then the Clinton administration came in with a third alternative that has reoriented the whole debate: save the money.
The centrepiece of Clinton's new Budget proposals is a massive commitment of future federal surpluses to various forms of saving. Specifically, he proposes that:
* 60 per cent of future surpluses be put in the Social Security Trust Fund from which Americans' old-age pensions are paid, so it will have enough money to fund the baby-boom generation in their retirement.
* 16 per cent be committed to top up funding for Medicare, which pays the health bills of the elderly.
* 11 per cent be dedicated to a new savings program, like the Keating Government's plan for superannuation co-contributions by workers and government. Clinton's plan for Universal Savings Accounts (or USA) envisages the Federal Government matching workers' own contributions to retirement savings accounts, with extra help for those on low incomes.
The aim of these pledges, of course, is to anticipate the future demands of an ageing America on public funds after 2010. But it also would provide a sorely needed boost to America's steadily sinking national savings rate, now one of the three lowest in the Western world, along with Britain and New Zealand.
Clinton's savings plan has gone down so well with ordinary Americans that the Republicans have now abandoned the Big Tax Cut in favor of writing their own version of Rescuing Social Security, coupled with smaller, targeted tax cuts. The contrast between Washington and Canberra - where pensions remain totally unfunded, and this Government's only initiative has been to tear up Keating's co-contribution proposal - is humbling.
Clinton's second priority is education, which in the US is mostly run by local government, but increasingly topped up by federal funds. Some of these plans reflect catchy political pitches - such as Clinton's crusade to connect every school library and classroom to the Internet, and to put another 100,000 teachers in primary schools to reduce class sizes to an average of 18 - but they also reflect Americans' realisation that education will be crucial to their children's future.
His latest initiative again seizes the middle ground. Mingled with new programs to modernise ageing school buildings and recruit teachers for troubled schools comes a plan to require ``accountability" from schools receiving federal funds.
Schools would have to end automatic promotion, and instead keep children down until they can read and write properly. They would have to adopt policies to halt ``the breakdown in classroom discipline". Low-performing schools would be given funding and mentoring to improve their performance, but be shut down, reformed or privatised if they still failed.
One could go on, across a range of issues, but you get the drift. Governments can tackle the big issues. One reason Clinton is so popular is that his Government is doing so.
* E-mail: opinion@theage.fairfax.com.au
© 1999 The Age