In an Uncertain World (21 page)

My own position in the first year was entirely contingent on Mack's attitude. Another kind of chief of staff could have seen my authority as a threat and taken charge himself, crowding me out. Instead, Mack made room for the NEC process. A reporter once made an observation that I didn't understand at the time but was absolutely right—the NEC could not have worked unless Mack had let it work.

As the first-year difficulties mounted, Mack came to feel that the White House needed to take a more strategic approach, a view I shared. Mack suggested to the President bringing in David Gergen, who had worked in four previous administrations, as a high-level adviser with authority over the communications office. I thought that made sense; David brought a strong and experienced strategic perspective. He was very thoughtful about questions such as: How should the President use his time? How much exposure should a President have? How should he present himself? We didn't have people with the experience to think about those issues in quite the same way David did. But because he was a Republican and had worked for Richard Nixon and Ronald Reagan, Gergen was never really accepted by some who worked in the Clinton White House.

Bringing in Gergen was seen as a demotion for George Stephanopoulos, who was reassigned from his position as director of communications. George is immensely talented and wonderfully persuasive, but this situation was beyond even his powers. He told me that for a while he tried to explain to reporters that his new role still involved constant proximity to the President. But the assumption that he was being brushed aside in the shake-up was so powerful that after a while George realized that he couldn't counter it and could only wait until the wave passed. That has been my experience as well. During a media storm, you have to put aside the idea of a balanced presentation of both sides. But you should still try to get your version of events included in a story, even if only in the twenty-second paragraph, because at some point, those efforts might start to have some effect. And that's what happened here. Once the hullabaloo over Gergen's arrival died down, reporters realized that George was still central to what was happening and revisited the issue with more balance than in the initial stories.

As much as Gergen helped, he wasn't in a position to address the larger organizational problems around the White House. Toward the end of 1993, Mack decided to try to prioritize more effectively, with what came to be known as the “legacy project.” As part of drawing up the President's second budget in the fall of 1993, Mack asked various members of the administration what they would like to see as Clinton's major accomplishments, looking back from a notional perspective of either 1996 or 2006. This effort didn't have any immediate consequence, but it's interesting to look back at it now, both for my perceptions that first year and as a yardstick to measure the Clinton legacy.

In addition to health care, which we took as a given, my memo listed five “legacies”: (1) an effective human capital program of high-quality education and training; (2) progress on the problems of the inner city; (3) deficit reduction; (4) an expansion of global trade; and (5) implementation of a rational approach to regulation. Revisiting that list, which reflected my own ambitions for the administration, I'd argue that we accomplished a great deal. Deficit reduction was enormously successful, due to our policy choices and the growth those policies helped promote. Trade liberalization was powerfully advanced by passing NAFTA, strengthening the General Agreement on Tariffs and Trade (GATT), and laying the groundwork for China's accession to the World Trade Organization, and we were active more generally on international economic matters, including crisis response and prevention.

On the other issues, the picture is more mixed. The strong economy made a real difference for inner cities, and our policies, including the expansion of the Earned Income Tax Credit (EITC) and increased funding for Head Start, helped reduce poverty. (In the view of many, welfare reform had a significant impact as well, although I had serious reservations about this legislation.) But the fundamental problem of an urban underclass cut off from the mainstream of American society remains, and we still lack a federal effort commensurate with the problem. In terms of “strengthening human capital,” we substantially increased spending on education and worker training. But our public education system still falls far short of what is needed. I think we took the right approach to rationalizing regulation—from reducing export controls and simplifying loan applications for small businesses to banking reform and resisting calls to regulate the Internet. And on a related issue of great importance, we unfortunately did not address the excesses in the tort arena that are such an abuse of our legal system and so adversely affect our economic well-being. I concluded my memo with some observations based on my not-quite-a-year in Washington. “Our political system is too cumbersome to deal effectively with decision making on the complex problems of the modern world,” I wrote. “This problem may be irresolvable, but over the very long run, could overwhelm everything else.”

This last statement didn't mean that the more top-down business model of business management could or should apply to government. To the contrary, I've developed a deep respect for the differences between the public and private sectors. In business, the single, overriding purpose is to make a profit. Government, on the other hand, deals with a vast number of legitimate and often potentially competing objectives—for example, energy production versus environmental protection, or safety regulations versus productivity. This complexity of goals brings a corresponding complexity of process. Our constitutional system of checks and balances has multiple decision centers—Congress, the Executive Branch (with all its own internal complications), the courts, and state and local governments. Often the relationship among these participants is one of conflict, and, with respect to some issues, the balance of power is ambiguous. Moreover, many participants face electoral accountability. And finally, all important decisions—and even many less important ones—are made with an awareness of how they will be presented in the media.

In the corporate world, power is far more centralized. Unless trouble develops, a CEO almost always has a relatively good relationship with his company's board of directors, even as it performs its oversight function. Media scrutiny is far less of a factor, except, again, when problems occur. A successful CEO is far freer to say whatever he wants about politics, his colleagues, or his competitors, at least within reasonable limits. This simpler model might sometimes look appealing for the public sector. But in reality an immense complexity is inherent in the circumstances of a modern, democratic government. Making government more businesslike can improve efficiency—in both processes and operations—but the inherent complexity would remain.

   

WHEN I THINK ABOUT what I wish we had accomplished in our administration and didn't, broad-based health care reform ranks very high. Our country's health care system remains an inefficient mixture of market and nonmarket forces that leaves large numbers of people inadequately covered and at the same time consumes a much larger portion of GDP than competitor nations spend. At the start of our administration, I shared the conventional view that the prospects for health care reform looked good. The campaign had built a mandate for reform and there was widespread public and congressional support for it.

My own involvement was limited, but I came away from our failed effort at comprehensive health care reform with several observations. Most fundamentally, the sheer magnitude of the endeavor—a major policy shift in an area encompassing 14 percent of GDP—made health reform extremely difficult to pass. The larger and more complicated the public policy undertaking, the more special interests there are that may take umbrage and organize against it.

In this case, massive forces arrayed against this effort, many with a vested interest in the status quo, and spent tens of millions of dollars to defeat the President's efforts. One example of this was a huge multimillion-dollar national advertising campaign against the plan that proponents lacked the resources to counter. And these ads weren't constrained by the truth. I turned on the TV late one night in my room at the Jefferson and saw one of the “Harry and Louise” ads.
That isn't what our proposal says,
I said to myself. But these ads were highly effective.

The politics were also very complicated, and I thought Lloyd Bentsen, who had been the savvy chairman of the Senate Finance Committee before becoming Treasury Secretary, made a lot of sense when he said that the President's deficit reduction plan and health care reform were simply too much for our political system to process at one time. Also, over time, my colleagues working on health care told me that the initial Republican support they had expected slipped away. Watching members in both parties who had publicly espoused support for health care reform “to and fro”—rather than work with each other and compromise to reach a conclusion acceptable to the majority—was a crash course in the realities of politics. The lesson I took from that was that the politics is as important as the policy, because if the politics doesn't work, the policy—no matter whether the decisions are sensible or not—won't be implemented.

Undoubtedly, there were other factors militating against the success of health care reform. For example, some argue that the program itself was too complicated or just substantively wrong. My own view—though I was not expert in this area—was that the underlying, market-oriented approach of the bill made sense in many respects, but various of the specific provisions were open to question.

One factor I did feel able to judge was the internal White House process, and that to me seemed flawed. The President, having decided on the broad parameters of the policy, set up a project run by the First Lady and Ira Magaziner, an extremely bright, very intense management consultant who had known the President since their student days. But giving the Health Care Task Force a hundred-day deadline to submit legislation was probably unrealistic. More significantly, health care cuts across much of the domestic side of the government, and significant participants inside the administration—including the members of the economic team, even though most agreed with the general approach—didn't think, at least until nearer the end, that this process aired their views in a way that seriously affected decision making. Consequently, people whose internal backing was crucial too often felt somewhat disaffected, and cooperation was less than it could have been. At one point, for instance, Lloyd Bentsen said he couldn't produce cost estimates because he didn't feel adequately informed. Also, important arguments and criticisms weren't exposed in the way that would have occurred in an NEC-type decision-making process.

And, of course, the health reform process had the additional complication of having the First Lady in charge. In Little Rock, during the transition, the President-elect asked me what I thought about having Hillary head his health care task force. I told him I liked the idea—she was smart and effective and clearly knew the subject well. As I had gotten to know Hillary during the transition, I even had the naive idea—perhaps augmented by a feeling of rapport with her that I never lost—that she could be involved some way in running the White House. What I didn't understand at that stage was how being the President's wife would complicate her role. Nor, apparently, did the President, with all of his political savvy. People tend to pull their punches and to be less forthcoming in dealing with a President's family member. What's more, the assumption that a close relative of the President has a back channel in daily life would always render such a process suspect to some degree.

One irony is that Hillary, contrary to some impressions, was amenable to challenge and debate. At some point, for instance, a number of us came to believe that a more limited and less costly benefits package would be preferable for fiscal and economic reasons. Although this was a very central issue and Hillary believed a more comprehensive benefits package was worth the cost, she was receptive to airing the issue fully. Someone suggested that knowledgeable proponents of each side present their views in a debate for the President. She agreed, and a candid and vigorous debate in front of several dozen people in the Roosevelt Room ensued. Unfortunately, details of that debate leaked and appeared on the front page of
The New York Times
the next day. Leaks, and the damage they can do to internal communication and the ability of an administration to implement a political strategy, are a frustrating reality of Washington life, and it is almost impossible ever to know—as opposed to suspect—who a leaker is.

Health care not only competed, politically and internally within the administration, with the economic plan in the first half of the administration's first year—usually considered the most propitious time to accomplish large purposes—it then competed with NAFTA in the second half of 1993. After the economic plan passed in the summer of that year, the President had to decide whether to give precedence to health care reform or NAFTA. Fighting on both fronts would spread our political operations too thin, creating a greater risk that both would fail. The President convened a small meeting in early September that Mack McLarty and I organized in the White House residence. Warren Christopher, Lloyd Bentsen, and I all spoke in favor of putting NAFTA first, arguing that this was our only real chance because, as the midterm election drew nearer, the odds of passing such a controversial trade bill would diminish. Hillary and Ira spoke in favor of putting health care first, both to maintain momentum and because the election posed a problem for health care as well. In hindsight, I think both sides were right. The President decided to proceed with NAFTA first, but also to continue some political effort on health care until NAFTA passed and health care could get the highest priority. That seemed to me both a good decision and an example of good White House process. Of course, that was easy to say when the decision came out the way I wanted.