Hillary Clinton, Bill Clinton, Her Economic Advisor, Oh My!
[Cross posted at Daily Kos]
Today Hillary Clinton entered the clueless world of George W Bush. She displayed her "my way or the highway" modus operandi that made her 1990s healthcare foray into such a debacle. Back then she didn’t care to listen to healthcare experts, this time she doesn’t care to listen to economists.
This morning on ABC’s This Week she showed us that she would be no less of an heir than John McCain to George W Bush’s head-in-the-sand governing style:
Pressed to name an economist who supports her plan to temporarily suspend the federal gas tax, Sen. Hillary Rodham Clinton said today that commuters, truck drivers and other gas customers know it would make a difference.
“We have to get out of the mindset where somehow elite opinion is always on the side of doing things that really disadvantage the vast majority of Americans,” Clinton said during an appearance on ABC’s “This Week with George Stephanopoulos at the Conrad Hilton Hotel in downtown Indianapolis. “I’m not going to put my lot in with economists because I know if we did it right … we would design it in such a way that it would be implemented effectively.”
An Obama supporter picked from the audience by Stephanopoulos to ask a question in the town hall meeting format of the show said she makes less than $25,000 a year, so the price of gas is not an academic issue for her.
“I really do feel pain at the pump,” said Kara Glennon. “However, I do feel pandered to when you talk about suspending the gas tax. I don’t think that it’s really a reasonable plan. Call me crazy, but I actually listen to economists because I think they know what they’ve studied.”
Later on CNN’s Late Edition Gene Sperling, a top economic advisor to Hillary Clinton (who was also economic advisor to President Clinton), was left with the unenviable task of cleaning up after his candidate. Sperling, who is a man of integrity, could not bring himself to justify Hillary Clinton’s gas tax holiday for the oil companies. Pressed repeatedly by Wolf Blitzer to explain Clinton’s proposal Sperling punted:
BLITZER: …As you know, Gene, a lot of economists out there think it is not going to achieve its desired results, and it is largely political pandering.
SPERLING: I think the problem with a lot of the criticism is that they have not recognized that this is a balance between two competing long-term agendas. Senator Clinton has a very bold long- term agenda on moving us towards a low-carbon, pro-jobs future. That includes, as you know, a capital trade proposal, fuel efficiency, commitment for 5 million jobs, and a windfall profits tax. These are all things that are part of the long-term agenda.
But she also has an agenda about empowering people to deal with the middle-class squeeze, which includes a bold $1,000 savings incentives for savings in your IRAs and 401(k)s, a $3,500…
BLITZER: What about the gas tax?
SPERLING: I’m getting to that. $3,500 credit for college loans, and, as you heard Elizabeth Edwards say recently, the best plan for actually reducing health care costs.
BLITZER: But what about the gas tax?
SPERLING: Well, the point is that you have to try to find a balance. And the way her balance is working is she’s saying we’re going to take the savings from the windfall profit tax and from closing energy loopholes, and use them for energy efficiency and creating these 5 million green energy jobs.
But for just three months, for just three months, as you noted, she would say you can put this into the highway trust fund, so the families who are dealing with the middle-class squeeze now, in terms of higher food prices, $3.70 gas, lower home prices, could have a little relief over three months. And I think a lot of the criticism has been as if this was her long-term agenda, which it is not.
BLITZER: All right. So on this specific issue, she’s more aligned with McCain than she is with Obama.
Later after Robert Reich called Hillary Clinton’s plan "dumb" and "stupid", Blitzer tried again with Sperling:
BLITZER: Is there any serious economist out there who thinks this is a wise policy? Because as you heard Robert Reich just say, there is — the notion out there, if you eliminate this gas tax, the demand will go up, and then the price will simply go back up right away.
SPERLING: Listen, it’s like I said before, she’s got a long-term agenda for a low-carbon energy future with a strong cap and trade proposal.
BLITZER: But let’s go back to this. What is the economic rationale for eliminating these gas taxes over three months?
SPERLING: The economic rationale is simply that we have very rarely ever been in a time like this, where you almost have a bit of a mini-stagflation going on. You have got an economy that is almost in recession. You have people paying twice as much for eggs as they used to. They’re paying twice as much for gas prices as they used to. And when you have a campaign and an agenda that focuses on the middle class squeeze, as Senator Clinton does, and when you’re focusing on that in terms of lowering health care prices, in terms of lowering the cost of sending your kids to college, making it easier to save, just to simply say that for this three months we could just put some of that money into the highway trust fund, not cost any jobs, as Senator McCain would. It is just a little bit of relief for the people that are struggling and the truckers that are struggling day by day right now.
It’s not surprising that Gene Sperling is having trouble justifying a gas tax holiday. Back in 2000 he advised President Clinton not to suspend the gas tax. Here is President Clinton at a press conference in 2000 explaining that a gas tax holiday would not pass the savings to the consumer:
Q. Mr. President, in light of the fact that OPEC has decided to increase production, do you see it as a mistake for the Senate to proceed with a bill that would suspend the gas tax? And if it reached your desk, would you veto it?
A. Well, I don’t expect it to reach my desk because there seems to be bipartisan opposition to it in the House, including among the leadership. But the problem I have with it, apart from what it might do to the Highway Trust Fund and the spending obligations that have already been incurred by the acts of Congress, the budgets, is that I’m not sure that the savings would be passed along to the consumers in addition to that. So I think there are a lot of questions about it. But I don’t expect it to pass.
Hillary Clinton herself was against cutting the gas tax before she decided to pander to Indiana and North Carolina voters. Here she is debating Rick Lazio in 2000:
And one of my fundamental disagreements during this campaign with my opponent was when he called for the repeal of the gas tax. Now, the gas tax is one of those few taxes that New York actually gets more money from Washington than we send. And we are totally reliant on it to do things like finishing I-86 in the Southern Tier, or the fast- ferry harbor works up in Rochester, as well as the work we need to do here in the city.
But now Hillary Clinton has decided that the economists, her husband, her own economic advisor and common sense be damned. It’s her way or the highway - and it will be a highway in disrepair because she would rather give billions in tax giveaways to oil companies than pay for the maintenance of the nation’s infrastructure.