The "Greatest Prosperity Ever": Should the Clinton-Gore "New Economic Plan" Get the Credit?
by Lawrence A. Hunter on 10/31/2000
8 Pages
Synopsis:
Now that the Clinton-Gore administration is winding down, both men would have us believe that today's superb economy and large federal budget surpluses are a result of their "New Economic Plan" (NEP). The NEP, enacted in 1993, consisted primarily of a huge tax rate increase and planned large budget deficits for the duration of a two-term Clinton presidency. President Clinton is touting the NEP because of his obvious concern for his legacy, and Mr. Gore is using the NEP as a primary argument for his election as President. The Gore-2000 web page contends: “[Gore] cast the deciding vote for the 1993 Administration Economic Plan which helped to eliminate the federal budget deficit and provided incentives to promote economic growth.” During the first presidential debate in the 2000 campaign, the vice president went further: “I had the honor of casting the tie-breaking vote to end the old economic plan here at home and put into place a new economic plan that has helped us to make some progress, 22 million new jobs, the greatest prosperity ever.”
The historical record belies these assertions. The United States is indeed experiencing “the greatest prosperity ever” but empirical evidence demonstrates that it is in spite of, not because of, the Clinton-Gore “new economic plan.” To appreciate this fact, it is important to grasp precisely what the proponents of the 1993 tax increase thought they were accomplishing, the logic behind their plan as well as what actually happened
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