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At a Kentucky rally in May, Hillary Clinton announced she would put her husband “in charge of revitalizing the economy, 'cause you know he knows how to do it. And especially in places like coal country and inner cities and other parts of the country that have really been left out."
Enlisting the ex-president made sense. The economy in the 1990s was far more robust than the economy President Obama has presided over. Bill Clinton acted to spur private investment and growth. He provided regulatory relief, approved spending cuts, agreed to cut the tax rate on capital gains, and endorsed a balanced budget. The economy grew and flourished.
But the notion of Bill Clinton as economic czar in his wife's administration lasted about one day. In place of his policies, Hillary Clinton has embraced the exact opposite. She stresses income redistribution. Economic growth, a bipartisan goal of presidents for decades, has been abandoned.
Rather than cut regulations, she wants more of them. Government spending would skyrocket under her, especially to pay for roads and bridges. Tax rates would increase, chiefly for those earning more than $250,000 annually. A balanced budget? That's not one of Hillary Clinton's goals.
Her husband describes her as a great "change-maker." Yet there's no change in Hillary Clinton's plan from Obama's. She would preserve the Obama status quo—that is, the weakest economic recovery since 1949, a mass exodus of workers out of the job market, and a growth rate of less than 3 percent year after year.
By copying Obama's policies, her presidency would, in effect, be his third term. She has denied Republican charges this would be the case. But at least on economics, her policies are clones of Obama's. This would all but guarantee slow growth and a weak economy.
The strongest recoveries since World War II—President Kennedy's in the 1960s and President Reagan's in the 1980s—were based on tax incentives to stimulate private investment, economic growth, and job creation. Clinton's economic ideas are nothing like these.
Why would she reject policies emphasizing growth that worked for Kennedy, Reagan, and her husband? The reason is the Democratic party "has given up on growth," says Douglas Holtz-Eakin, the former director of the Congressional Budget Office. "It's all redistribution." Rather than fight this, she has succumbed.
The words "growth" and "incentives" and "free markets" are now foreign to Democratic thinking. In the 2016 Democratic platform, new jobs would come mainly from government. "We are committed to doing everything we can to build a full-employment economy, where everyone has a job that pays enough to raise a family and live in dignity with a sense of purpose," the platform says. But "everything" doesn't include incentives for private investment, which have stagnated under Obama. Nor does it include tax cuts for businesses or individuals, which were largely responsible for the booming economies in the 1960s and 1980s. The platform was promising with its call to "make investments to spur the creation of millions of jobs for our young people." But the investments consist of "direct federal funding for a range of local programs that will put young people to work and create new career opportunities." Hillary Clinton, who should know better, has swallowed her party's platform without a peep of protest. In her acceptance speech at the Democratic convention in Philadelphia, she said, "I believe America thrives when the middle class thrives." She has that backwards. "In my first 100 days, we will work with both parties to pass the biggest investment in new, good-paying jobs since World War II," she said. "Jobs in manufacturing, clean energy, technology and innovation, small business, and infrastructure." Infrastructure is Hillary's panacea. "If we invest in [it] now"—that's government investment—"we'll not only create jobs today, but lay the foundation for the jobs of the future." Maybe, but it didn't work well for Obama, whose famous "stimulus" relied heavily on infrastructure, but didn't stimulate much.
The problems with infrastructure as a tool for revving up the economy are structural. Building roads and bridges is a slow process. "You won't get anything in the short run," Holtz-Eakin says. "There's not much help to spur a recovery." And the long-run payoff for the economy isn't great either. According to Moody's Analytics, Clinton's plan would create 10.4 million new jobs over four years. That sounds better than it really is because 6 million of those jobs would not come from infrastructure but from immigration. That would happen if the Senate's "Gang of 8" bill or something similar is enacted by Congress, which is highly unlikely. But the most striking feature of Clintonomics—version 2016—is a barrage of tax increases. In Philadelphia, she boasted the tax hikes would pay for "every single one" of the government programs she is proposing. "And here's how," she said. "Wall Street, corporations, and the super-rich are going to start paying their fair share of taxes." Americans for Tax Reform estimates her major tax increases would exceed $1 trillion over 10 years. Moody's says new taxes would raise $1.45 trillion. Either way, higher taxes that raise the cost of doing business and reduce the money available for private investment are not the best tools for generating growth and jobs. Donald Trump's advisers look at Democratic economic ideas with glee. "There's not a single pro-growth or pro-investment plank in the platform," says Steve Moore, who is working on Trump's plan. "Incentives don't matter." The same is true for Clinton. But Trump has to cease his civil war against Republicans and approve a plan that's rich in incentives for growth and jobs. Bill Clinton might like it. His wife, not so much.
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Fred Barnes is Executive Editor at the Weekly Standard.
