Clinton’s Impact on Business
President-elect Bill Clinton’s victory will mean a broad array of new policy initiatives that will affect the economy and business. Here briefly is how some major industry sectors are likely to be affected by a Clinton.
Aerospace/Defense: Wants to cut defense outlays by $60 billion over five years, compared with current spending projections. Will create new federal research agency to employ defense industry scientists and engineers on civilian projects.
Agriculture: Pledges expanded use of ethanol, made from corn, as a fuel for use in cars and trucks. Promises a summit meeting between farmers and environmentalists to discuss controversies over use of pesticides and chemicals.
Banking: Wants to create 100 community development banks to be funded from both public and private sources to make loans to small businesses, and provide marketing expertise to young companies. Favors “individual development accounts” for poor people, with the government matching money put aside by individuals in tax-free accounts for use in paying college bills, buying a first home, or starting a business.
Energy: Endorses a a federal automobile efficiency standard of 40 miles a gallon. Promises to promote the use of natural gas in homes and industries. Will seek environmental safeguards in Mexico in exchange for support of the North American Free Trade Agreement.
Healthcare: Wants a law requiring all companies to provide health insurance for their workers. Would create a board to set a national limit for health care spending. Favors “managed competition,” in which Americans are required to enroll in large service networks of doctors and hospitals to hold down costs.
High-technology: Would use federal funds to help build a national “information highway,” a network of fiber optic cables linked to every household and business. Would create 170 research centers to promote productivity in manufacturing.
Taxation: Clinton will seek a top tax rate of 36% for those making over $200,000 a year. Will impose tougher tax collection polices for foreign firms operating in the U.S. Wants a targeted capital gains tax cut, with a 50% reduction in the tax on profits for those who start a new business and run it for five years.
Trade: Favors North American Free Trade Agreement combining the United States, Canada and Mexico in a single trading market. Says he will consider some changes because of objections by unions worried about jobs fleeing to low-cost sites in Mexico, and environmentalists fearful of pollution as factories relocate.
Transportation: Will create a Rebuild America Fund, with $80 billion over four years in federal spending, to renovate roads and bridges and create a high-speed train network. Money from Washington would be supplemented by contributions from state and local governments, and investments by private firms and pension funds.
Workplace: Supports bill to prohibit companies from hiring permanent replacements for strking workers. Favors family and medical leave bill, which requires firms to give employes 12 weeks of unpaid leave for family illness or birth of a child. Wants to require all companies to spend 1.5% of payroll on job training, or contribute to a national training fund.
