Clinton’s 2nd-Term Agenda Sparks Debate

What will he do if he wins?

With his show-closing acceptance speech at tonight’s Democratic National Convention, President Clinton hopes to convince Americans he has a clear and comprehensive plan to guide a second term--and lead America into a new millennium.

No one listening is likely to think Clinton lacks for specific proposals and initiatives; aides promise a cascade of them tonight, many familiar, some new. But the speech is unlikely to end the fierce debate in political circles over what a second term might look like. The argument is fueled not by a lack of detail on Clinton’s agenda. At stake instead are more fundamental questions about whether the ideas being presented in his campaign truly represent the priorities and commitments that would drive him through four more years.

Immediate clues to Clinton’s direction could come in his personnel decisions. Already, some initial planning for second-term personnel shifts has begun, according to White House Chief of Staff Leon E. Panetta. It is underway now in part because White House officials recognize the faults of their chaotic transition in 1992. Then Clinton emphasized racial and gender diversity over fidelity to his campaign message and appointed a government where traditional liberals outnumbered centrist “new Democrats.”

Panetta himself is among those expected to depart. Senior advisor George Stephanopoulos has told friends that he intends to leave, but some think Clinton would prevail on him to stay. Political strategist Dick Morris is widely expected to recede after the election.

The Cabinet could see a large turnover--those expected to leave include Secretary of State Warren Christopher, now 70, though some believe that he may remain for a time. Health problems are likely to cause Atty. Gen. Janet Reno to step down. And liberal stalwarts Donna Shalala at the Health and Human Services Department and Robert B. Reich at the Labor Department are doubtful members of a second-term Cabinet.

Shifts at the Top

Likely to stay are Bruce Reed and Gene Sperling, two aides who have been central to the formulation of Clinton’s social and economic policy since his 1992 campaign.

If Panetta leaves, the competition to replace him could feature Commerce Secretary Mickey Kantor, who is known to desire a post closer to the head of the table, Deputy Chief of Staff Harold M. Ickes and Erskine Bowles, a former deputy chief of staff known as a non-ideological manager. The list of possible successors to Christopher is long, with no clear front-runner. An intriguing name in the mix, as a gesture of bipartisanship, is Republican Sen. Richard G. Lugar of Indiana.

Shalala’s departure could present Clinton with his most revealing personnel decision. With liberals already deeply unhappy about his decision to sign the welfare reform bill, Clinton’s commitment to enforcing it could be signaled by whether he replaces her with another figure close to the party’s left or someone more centrist.

After a dizzying first 30 months of peaks and valleys and shifts in ideological direction, Clinton during the past year has settled into a steadier and more moderate course. In unison, Clinton and his advisors have insisted in a symphony of interviews this summer that he has been chastened by his earlier reversals on such issues as health care. They insist that he would steer a second term with his eyes firmly on such centrist priorities as balancing the federal budget, cutting taxes and improving education.

“He will stay the course he has charted,” Ickes said.

Liberals Mobilize

Others, however, suspect that further course corrections aren’t impossible. Led by presidential nominee Bob Dole, Republicans say a reelected Clinton would snap back to the left, stripping off his recent moderation like a mask. Charges Dole: “All the liberalism he can think of and all his wife can think of will come bubbling to the surface.”

Few Democrats think Clinton would ever again risk embracing as many liberal priorities as he did in 1993 and 1994, when he became entangled in efforts to open the military to homosexuals, guarantee universal health care and pour billions of dollars into social programs meant to prevent crime.

But liberals are already mobilizing to tilt Clinton back toward the left, particularly on spending issues. And privately, even some of Clinton’s key centrist supporters admit that they aren’t entirely sure how he would respond to the pressure.

Much will depend on whether Republicans retain control of Congress--and whether the prospect of two more years of divided government encourages compromise on both sides. Meanwhile, the competition among Democrats angling for Clinton’s job in 2000--particularly a potential rivalry between Vice President Al Gore and House Minority Leader Richard A. Gephardt--could further complicate the political environment.

Budget Pains

If Clinton wins, the policy decision that would most shape his second term will be whether to stick with his plan to balance the budget over six years. Some aides palpably chafe against the required spending cuts, but most agree that the president will not--and politically cannot--walk away from his commitment.

“I don’t think you can suddenly charge into the next four years without setting a balanced budget as the foundation,” Panetta said.

But that course will impose progressively more pain. Under the budget Clinton has already proposed, after 1997, no program--not even Clinton’s most favored “investments” like his national-service initiative or Head Start--would grow faster than inflation. Other programs would see substantial reductions. If forced to vote on it in 1997, Democrats would likely divide on such an austere budget as profoundly as they did over the welfare reform legislation.

Clinton must also decide whether to pursue politically risky long-term reforms in Medicare, Social Security and other entitlements, meant to curb their rising costs, before baby boomers start retiring.

In recent weeks, Clinton has spoken generally of appointing a bipartisan commission to recommend changes. Sharpening that point, Panetta says such a commission would have to be appointed “early on” in a second term: “It can’t be something that drags on as you get closer to the [next] presidential election.”

And, Panetta said, “the preference” would be to structure the commission so that Congress would have to provide an up-or-down vote on its recommendations--the same process that pushed Congress toward approval of the proposals from the commission evaluating military base closings in the wake of the Cold War.

Two major alterations Clinton has made in his style of operation since the GOP congressional landslide in 1994 would continue to guide a second term, aides believe. One is to pursue his goals more incrementally.

After overloading Congress with his massive proposal to reconstruct the health insurance system, Clinton in a second term would likely pursue step-by-step expansions of coverage--starting with the unemployed. After that, Clinton may seek to guarantee insurance for all children--as First Lady Hillary Rodham Clinton suggested in her convention speech Tuesday night--though some officials caution that no one in the administration has yet presented a plausible plan to do so.

One thing Clinton won’t do, Ickes and other aides say, is try again to mandate that businesses provide insurance for their workers. That reflects a second major shift in his operation. After initially seeking to reach his goals primarily with direct government actions--like new spending programs--Clinton now is more likely to use indirect means, like tax credits, vouchers, or simple thumping of the bully pulpit.

Within these limits, many think education would become the centerpiece of Clinton’s argument that government should now focus on programs that “enable” people to make more of their own lives if they are willing to work.

“Clinton’s legacy in Arkansas was about education, and that’s what it will be about here,” said Rahm Emanuel, a senior White House advisor and another on the list of those likely to leave after the election.

In the past few months, Clinton has proposed a new $10,000 tax deduction and a $1,500 tax credit to cover the cost of college tuition. The tax credit is intended to cover the full cost of attending at least two years at a community college--and, as Clinton declared in a speech last June, to make those two years of education as universal as the first 12 are now.

Welfare Revisions

On another front, Clinton has already indicated that he would like to reopen the welfare legislation to remove the provisions barring public assistance to legal immigrants who are not yet citizens; tonight he’s expected to also propose a new tax credit for businesses that hire former welfare recipients, as well as financial incentives to states and cities to place them in jobs.

And though his focus has drawn ridicule from some observers, aides believe that Clinton will continue to mine the vein of “family-friendly” proposals that he has emphasized during the past year--his call to expand the Family and Medical Leave Act and his encouragement of such measures as school uniforms and curfews to promote student discipline and safety.

One large unanswered question is whether this agenda--marked more by the quantity than the scale of its ideas--would be sufficiently ambitious to satisfy a man with his eyes no longer on reelection but history. Pointing the federal budget toward balance would be a historic achievement--but one Republicans have usually prized much more than Democrats.

Another unanswered question is whether liberals would accept these generally centrist priorities as quiescently after the election as they have before.

Robert Borosage, co-director of the new liberal group Campaign for America’s Future, thinks that if Clinton wins, “it’s big fight time” over the party’s direction. If Democrats retake the House, the tension could intensify because seniority now assures that almost all of the major committees would be chaired by staunch liberals.

Foreign policy could also challenge Clinton.

National Security Advisor Anthony Lake said the administration would try in a second term to expand the North American Free Trade Agreement and forge new trade pacts with Asian nations. Both projects currently are on the shelf because Clinton’s free-trade agenda has alienated key Democratic constituencies.

Clinton, hoping to sway history’s verdict, will also continue efforts to bring peace to Northern Ireland and the Middle East and complete the unification of Europe through a gradual expansion of NATO, Lake said.