COLUMN LEFT / ALEXANDER COCKBURN : Big Populist Woof, Little Economic Bite : Clinton made good noises, but the wrong people will pay.

Some smart animal breeder should go to work on a populist watchdog. Given the liability problem these days, it should have tiny teeth but a terrific bark. It could be called the Clinton, a popular item in pet stores at least for the next four years.

Like many a politician before him, Clinton has long known the importance in political life of letting out a really lusty, populist WOOF once in a while, before wagging an apologetic tail at the chauffeur to let him know that the rich folk are safe any time they care to step out of the limo.

Heavily freighted with rich folks’ campaign contributions, Clinton let out a regulation number of populist woofs through last year’s campaign about the rich paying their share, before heading for Washington to appoint a cabinet 77% solid with millionaires, a higher percentage even than the Reagan-Bush muster.

Now comes the populist woofery of Clinton’s economic plan, as laid before Congress Wednesday night.

The next day’s headlines announced that the rich were going to “take it on the chin,” with the top marginal rate going up to 36%, estate taxes going up, allowable itemized deductions going down. Given the hubbub, you’d have thought Clinton had set platoons of Jacobins to stack copies of the Forbes 400 ‘round the houses of the rich and burn them to the ground.

Fair’s fair. At least the dog did bark in the night. Clinton told Congress he wanted rich people to pay more, just as they supposedly had done back in 1986 when the top marginal rate was 50%, or in the 1950s when it was over 90%.

The problem is that whatever the notional top marginal tax rate, rich folks hire accountants and politicians to make sure the system stays the same. And the top capital gains tax rate did stay the same, at 28%. So the accountants will be working overtime shoving money from one column to another, and the congressional finance committees will heave with mighty purpose, designing safe harbors for the new tax shelter industry that Clinton’s tax plan is conjuring into being like God’s finger moving over the primal slime.

The trouble with this sort of economic populism is that it never really ends up changing the terms of the fundamental equation, as represented by the Byzantine system of tax credits and expenditures that end up costing the Treasury in revenue each year an amount roughly level with the federal deficit as it now stands. It’s a structure so incapable of permitting any genuine redistribution--the basic idea of a progressive tax--that some radicals supported Jerry Brown’s plan last year for a flat tax, which would at least cut the hypocrisy down to size.

President Clinton’s proposals were entirely traditional in that regard. Nothing truly dangerous--economic populism with teeth as well as bark--was offered. No suggestion of limiting home mortgage interest deductibility, a notorious gift to the better off. Nothing dismaying to Wall Street, like a securities transaction tax.

And indeed Clinton’s entire plan pivoted on Wall Street’s central demand to the new Administration, that the agenda be first and foremost concerned with deficit reduction. “If there’s anything this program is directed at,” Clinton economic coordinator and erstwhile financier Robert Rubin told reporters Wednesday, “it’s interest rates.” The theory here is the one, beloved by Wall Street, that the prime inhibition to economic growth is the deficit, and that with an attack on the deficit, interest rates will fall and rosy times return once more. The theory does not require anything so raffish as promotion of growth via consumer demand.

The answer to Wall Street is that the relationship between interest rates and investment growth is weak and that there are cheaper ways of getting interest rates down than by cutting demand.

But Wall Street won the day, and the deficit cutters won the day, as it was clear they had from the moment Clinton announced his economic team.

We’re paying the penalty for 15 years’ worth of Chamber of Commerce propaganda about the deficit, which ordinary Americans now wrongly conceive to be as big a crisis as cancer. (As a percentage of gross domestic product, the deficit is currently far below levels associated with periods of great economic expansion.) A timid, shriveled jobs and infrastructure plan barely dares lift its head above the rubble of urban America. On a day when it was announced that housing starts had dropped 7% nationally, and when the National Guard was rehearsing how to put down the next riot in Los Angeles, the dominant turn was one of belt-tightening and austerity, graced with those barks of the watchdog fretting excitedly at the end of its chain.