In his press conference yesterday, President Obama added another item to his growing list of historical misrepresentations about spending and debt ceiling negotiations.
After claiming that never “in the history of the United States” had elected officials used the debt ceiling as political leverage (false), and after insinuating that it’s somehow unusual to expect presidents to negotiate over spending bills (absurd), Obama yesterday mixed a false history of the Clinton-Gingrich shutdowns into his press room lecture.
“[B]ack in the ’90s we had a government shutdown,” he said. “That happened one time, and then after that, the Republican Party and Mr. Gingrich realized this isn’t a sensible way to do business. You know, we shouldn’t engage in brinksmanship like this, and then they started having a serious conversation with President Clinton about a whole range of issues, and they got some things that they wanted. They had to give the Democrats some things that the Democrats wanted. But it took on, you know, a sense of normal democratic process.”
As one of the principal negotiators in the 1995-1996 budget showdown between Republicans and President Clinton, it is clear to me the President has a number of very important things wrong.
First, there were two shutdowns, not one, and that was important. In mid-November of 1995, the government closed for several days after Clinton vetoed our Continuing Resolution which contained more spending cuts than he was willing to accept.
The public blamed Republicans for the first shutdown much more than they blamed Clinton. A CNN/Gallup poll released at the time found that Americans blamed the GOP over the President by 2-to-1, 49 percent to 26 percent. In part this was because the press was anti-Republican. But in part it was because we’d made so clear beforehand that we were willing to close the government if necessary.
The pressure on us to cave was enormous. Instead, we refused to give-in, and worked with President Clinton to pass a very short-term extension of government funding and increase in the debt ceiling as negotiations continued. A month later, no compromise had been reached, and despite the media pressure on us, we allowed the government to close again, this time for three weeks.
Which leads to President Obama’s second false claim: that it wasn’t until after the shutdowns that we began a “serious conversation” with President Clinton to advance our priorities.
This could not be more mistaken. Clinton and I spoke virtually every day during the shutdowns. We were constantly negotiating. And more importantly, although the shutdowns were in some ways a temporary PR setback for Republicans (they did no lasting damage), they were critical in convincing the President and the country that we were serious about doing what said we’d do in 1994–and that we were willing to be tough to get it done. That was of enormous strategic value going forward.
President Obama is right that the shutdowns of 1995 were a pivotal moment which cleared the way for the success Republicans had afterward. But he’s very wrong about the reason.
It was after the shutdowns and significantly because of them that we achieved some of the greatest growth and opportunity for all Americans in a generation.
In 1996, we passed welfare reform, and in the next several years two out of every three Americans on welfare either went to work or went to school.
The House Republican majority was reelected for the first time since 1928.
We passed four consecutive balanced budgets, the only ones in our lifetimes.
We cut taxes for the first time in 17 years, including the largest capital gains tax cut in American history.
These big victories very well might not have happened if not for the shutdowns in 1995-1996.
The policy changes helped power an economic boom so big that it produced a $5 trillion turnaround in the fiscal outlook of the United States between January 1995 and January 1999, from a $2.7 trillion deficit over ten years to a $2.3 trillion surplus. The nation’s ten-year debt outlook went from 56 percent of GDP to just 12 percent.
What President Obama calls “brinksmanship” and not a “sensible way to do business” may be one of the most successful negotiations ever for Americans.
Republicans today face a very similar challenge to the one we faced in 1995, and with similar pressure to cave. Yet just as in 1995, they are proving to the President that he must take the Congress seriously.
Americans should hope Obama learns that lesson as well as President Clinton did, and with such strong results.