Primaries Tip Hand of Candidates Building Case for Fiscal Discipline

It turns out we don’t have to wait until next fall to hear the debates between the parties’ presidential nominees. Previews of the likely arguments in the general election are already appearing--in the party primaries.

Republican John McCain says opponent George W. Bush’s tax plan is too big, is tilted toward the rich and could endanger Medicare and Social Security.

Isn’t that what Democrats usually say about Republicans?

Al Gore has been denouncing fellow Democrat Bill Bradley’s health care plan as a big-spending threat to the economy that would plunge the federal government back into deficit and force up interest rates.

Isn’t that what Republicans usually say about Democrats?

Each of these arguments is turning heads. “McCain is trying to do something that has never been done before--which is win the New Hampshire primary from the left,” says Stuart Stevens, a top media advisor to Bush. It’s just as remarkable to hear a Democrat mobilize the party faithful around the rallying cry of fiscal responsibility. “You never would have heard that argument 20 years ago,” says Garry South, the chief strategist for California Gov. Gray Davis, a leading Gore supporter.

Each of these disputes embodies competing strains of thought in the parties. In proposing his massive tax cut, Bush is identifying with Ronald Reagan and the supply-siders of the 1980s. Like Reagan, Bush makes both an economic case for tax cuts (they’re needed to keep the economy growing) and an ideological one (if the money is left in Washington, the government will spend it). “Government ought to do a few things and do it well,” Texas Gov. Bush says, “and one way to make sure that part of my philosophy rings true is [to] not allow the surplus to be spent on [new] programs.”

Arizona Sen. McCain is updating the arguments of traditional fiscal conservatives who banged heads with the supply-siders through the 1980s. In those years, Senate Republican leaders like Bob Dole argued that deficit reduction had to take priority over big tax cuts; now, with the budget balanced, McCain argues that stabilizing Social Security and Medicare and paying down the national debt should receive highest priority. In a speech Tuesday, McCain is expected to increase the size of the tax cut he’s offering; but he still wants to devote 70% of the on-budget federal surplus to Social Security and Medicare. That’s a higher percentage than President Clinton recommends.

The Democratic race, meanwhile, is evolving into a contest between the fiscal philosophies of the 1960s and 1990s. Bradley’s aides insist he will maintain a balanced budget. But in the manner of 1960s liberals like Hubert H. Humphrey, Bradley, a former senator from New Jersey, subtly equates compassion with the willingness to spend. That formulation encourages commitments whose cost could strain his promise of fiscal discipline; Bradley’s health care plan, whose 10-year cost could exceed $1 trillion, is the largest federal spending plan any Democrat has proposed in years. “If not now, when?” Bradley declared in one speech about his health care program. “It is not--and never has been--a question of money. It’s a question of will.”

To Gore, money is always part of the question. Like Clinton, Vice President Gore argues that new programs must be constrained by the overriding imperatives of maintaining the budget in balance and paying down the national debt. Bradley, he charges, could “blunder” into a recession by spending so much that he reopens the deficit and produces higher interest rates. Gore comes at Bradley from the opposite direction too, by charging that Bradley’s new spending would leave him without funds to strengthen Medicare. But mostly Gore warns that the next president’s top priority must be to sustain the expansion in the private economy--even if that means sometimes playing Scrooge on public spending.

“The key question,” Gore says, “is how do we keep the prosperity going? I’m all in favor of spending. I’ve proposed a good bit more of it myself in the budget that I’ve put out. But it’s only one arrow in the quiver, and economic growth is the most important means to provide growth and opportunity.” That’s a subtle, but critical, shift in emphasis for a Democrat.

Human nature being what it is, Bradley and Bush may have an easier case to make. Anyone now opening Christmas credit card statements can understand why promises of new spending and tax cuts might inspire more enthusiasm than lectures about paying the bills. Pushing these ideas also allows Bush and Bradley to portray themselves as idealists committed to “big change” in the capital. Last week Bradley insisted that Gore was stuck in a “Washington bunker”; Bush, likewise, portrays McCain as trapped “in a Washington mind-set.”

But Gore and McCain, the voices of fiscal caution, have assets too. Voters may not be sure exactly what’s produced the prosperity of the late 1990s, but they don’t appear eager to abandon the deficit-first fiscal strategy that’s been associated with it. When asked whether they would prefer to devote the surplus primarily to a large tax cut or to use the money for Social Security, Medicare and a smaller tax cut, majorities in both parties preferred the latter in a recent Los Angeles Times Poll. And a Democratic Leadership Council poll has found that two-thirds of Democrats now want to maintain a balanced budget even if that means limiting future spending in areas such as education.

Whether those preferences are equally strong among the hard-core activists who dominate both primaries remains to be seen. These arguments may not decide either contest, but to hear them even raised in primaries shows how a constituency is developing in both parties to protect the hard-won budget surplus.

Many liberals were infuriated in 1995 when Clinton committed the Democrats to balancing the federal budget; Bradley’s showing may reveal how many Democrats still want to break out of that box with major new spending. A strong McCain performance in New Hampshire and beyond would suggest tax cuts are losing some luster as a silver bullet in Republican politics. The strong economy has pushed the stock market to heights, and unemployment to depths, that many analysts considered unimaginable. It might be no less remarkable if the economic boom made fiscal discipline a stronger political calling card than promises of new spending or tax cuts.

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See current and past Brownstein columns on The Times’ Web site at: https://www.latimes.com/brownstein.