The George W. Bush Presidency - Domestic and Economic Policy

POLITICAL LEADERS AND THEIR ASSESSMENT

THE GEORGE W. BUSH PRESIDENCY VOLUME II DOMESTIC AND ECONOMIC POLICY

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POLITICAL LEADERS AND THEIR ASSESSMENT

THE GEORGE W. BUSH PRESIDENCY VOLUME II DOMESTIC AND ECONOMIC POLICY

MEENA BOSE AND

RICHARD HIMELFARB EDITORS

New York

Copyright © 2016 by Nova Science Publishers, Inc. All rights reserved. No part of this book may be reproduced, stored in a retrieval system or transmitted in any form or by any means: electronic, electrostatic, magnetic, tape, mechanical photocopying, recording or otherwise without the written permission of the Publisher. We have partnered with Copyright Clearance Center to make it easy for you to obtain permissions to reuse content from this publication. Simply navigate to this publication’s page on Nova’s website and locate the “Get Permission” button below the title description. This button is linked directly to the title’s permission page on copyright.com. Alternatively, you can visit copyright.com and search by title, ISBN, or ISSN. For further questions about using the service on copyright.com, please contact: Copyright Clearance Center Phone: +1-(978) 750-8400 Fax: +1-(978) 750-4470 E-mail: info@copyright.com. NOTICE TO THE READER The Publisher has taken reasonable care in the preparation of this book, but makes no expressed or implied warranty of any kind and assumes no responsibility for any errors or omissions. No liability is assumed for incidental or consequential damages in connection with or arising out of information contained in this book. The Publisher shall not be liable for any special, consequential, or exemplary damages resulting, in whole or in part, from the readers’ use of, or reliance upon, this material. Any parts of this book based on government reports are so indicated and copyright is claimed for those parts to the extent applicable to compilations of such works. Independent verification should be sought for any data, advice or recommendations contained in this book. In addition, no responsibility is assumed by the publisher for any injury and/or damage to persons or property arising from any methods, products, instructions, ideas or otherwise contained in this publication. This publication is designed to provide accurate and authoritative information with regard to the subject matter covered herein. It is sold with the clear understanding that the Publisher is not engaged in rendering legal or any other professional services. If legal or any other expert assistance is required, the services of a competent person should be sought. FROM A DECLARATION OF PARTICIPANTS JOINTLY ADOPTED BY A COMMITTEE OF THE AMERICAN BAR ASSOCIATION AND A COMMITTEE OF PUBLISHERS. Additional color graphics may be available in the e-book version of this book.

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Published by Nova Science Publishers, Inc. † New York

CONTENTS Preface

vii Meena Bose

Introduction

xi Richard Himelfarb

Part I: The Economy, Budget, and Trade

1

Chapter 1

George W. Bush and the 2008 Financial Collapse Timothy A. Canova

3

Chapter 2

Looking for Causation in the Wrong Place: Why Decrying Government Deficits during the Bush Presidency Is a Serious Error Michael Meeropol and Joao Paulo A. de Souza

19

Chapter 3

International Trade under President George W. Bush Shahruz Mohtadi

31

Chapter 4

Commentary: The Economic Policies of President George W. Bush Marc Sumerlin and Pia M. Orrenius

41

Part II: Social Policy Chapter 5

Chapter 6

Chapter 7

Chapter 8

45

Kicking the Can Down the Road: George W. Bush’s Failed Campaign to Reform Social Security Richard Himelfarb

47

Many Children Left Behind: A Critical Examination of Educational Policy during the George W. Bush Administration Alan Singer

65

Big Government Conservatism, Expanding and Reframing Food Stamps: George W. Bush, Welfare Reform and the 2002 Farm Bill Matthew Gritter

73

Commentary: The Challenges of Leaving No Child Behind Anne-Imelda Radice and Ed Rollins

85

vi

Contents

Part III: Organization, Staffing, and Nominations

91

Chapter 9

The Chiefs of Staff in the George W. Bush White House David B. Cohen, Karen M. Hult and Charles E. Walcott

93

Chapter 10

The Umpire Strikes Out: President George W. Bush and the Politicization of Supreme Court Nominations Joel K. Goldstein

Chapter 11

Commentary: Scheduling President Bush Bradley A. Blakeman

109 123

Part IV: Politics and the Press

127

Chapter 12

The Birth of a New Political Era Daryl A. Carter

129

Chapter 13

A C Student in the White House: Conservatives and Their Report Cards on the George W. Bush Presidency Christopher Hickman

141

Press Relations in President George W. Bush’s Treasury Department Kara Alaimo

155

Chapter 14

Chapter 15

Commentary: The Challenges of Staying on Message Ron Christie, Howard B. Dean III and Ed Rollins

167

List of Contributors

173

Index

177

PREFACE Meena Bose Hofstra University, Hempstead, NY, US

The George W. Bush Presidency transformed American politics and public policy. From economic policies to domestic initiatives to foreign affairs, the legacy of the 43rd presidential administration will endure well into the twenty-first century. Many policy choices sparked heated public debate during the presidency and continue to do so today: tax cuts, education reform, interrogation policies, surveillance of suspected terrorists, military intervention in Afghanistan and Iraq, and the federal response to Hurricane Katrina, to name a few. How these and other decisions will be evaluated historically remains to be seen; for now, perhaps the clearest consensus is that the Bush 43 presidency’s actions were highly controversial – and consequential. The chapters in these three edited volumes provide a comprehensive assessment of the George W. Bush presidency’s leadership and policies.1 They include selected scholarly papers as well as commentary from administration officials and other speakers who participated in Hofstra University’s Conference on the George W. Bush Presidency, March 24-26, 2015.2 (Scholars revised their papers following the conference for the volume, and speakers reviewed their commentary to make stylistic changes and clarifications.) In planning for Hofstra’s twelfth presidential conference, the program committee discussed whether the conference was taking place too close to the Bush 43 presidency. Would the passage of time and ability to view long-term results of policy choices permit more complete analyses? Hofstra decided to move forward with the conference because of the importance of developing an early historical assessment of the presidency that encompasses perspectives from scholars, journalists, and administration officials, and these edited volumes provide a record of those evaluations. The Hofstra presidential conferences, which began in 1982 with a conference on the presidency of Franklin Delano Roosevelt and have examined every presidential administration since then up to George W. Bush, are renowned for producing a unique historical study of the modern presidency. Subsequent analyses will expand our understanding of this presidency and its place in American politics, and the broad, interdisciplinary approach and multiple perspectives in these volumes will inform those analyses.

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Organizing a conference with more than thirty sessions, approximately 60 scholarly papers, and more than two dozen administration officials and other speakers, is a monumental task, as is developing volumes of selected papers and commentary. For help with conference planning, Hofstra thanks the George W. Bush Presidential Library and Museum, especially Director Alan C. Lowe, who participated in the conference (some of his commentary is in the first volume), as well as the Office of George W. Bush. The administration officials and invited speakers who participated in the conference all made special efforts to join us for the sessions, and Hofstra extends deepest gratitude to them for taking the time to inform the historical record. Hofstra gives special thanks to the Joseph G. Astman Distinguished Conference Scholar, author and New York Times journalist Peter Baker, for sharing his insights on the Bush presidency in multiple conference sessions (some of his commentary is in the first volume); and to Dr. Jeffrey A. Engel, Director of the Center for Presidential History at Southern Methodist University, for indispensable advice in conference planning. Hofstra also thanks Dr. Engel, Dr. Graham C. Dodds, Associate Professor of Political Science at Concordia University, Dr. Martha Joynt Kumar, Director of the White House Transition Project and Professor Emeritus of Political Science at Towson University, and Dr. Shirley Anne Warshaw, Harold G. Evans Chair of Eisenhower Leadership Studies at Gettysburg College, for sharing their insights about leadership and the George W. Bush presidency in the highly instructive closing plenary session of the conference. Many offices and individuals at Hofstra were indispensable to making the conference a success, including, but not limited to: the Board of Trustees; Hofstra Cultural Center; Office of University Relations, Hofstra University Museum; Hofstra University Library Special Collections; President Stuart Rabinowitz; former Provost Herman A. Berliner; Dean of the Hofstra College of Liberal Arts and Sciences Bernard J. Firestone; the conference program committee; faculty who served as panel and forum chairs; and student panelists and hosts. Hofstra conveys its deepest gratitude to Mr. Peter S. Kalikow for establishing the University’s Peter S. Kalikow Chair in Presidential Studies in 2006 and the Peter S. Kalikow Center for the Study of the American Presidency in 2007. Mr. Kalikow inspires students and faculty alike with his dedication to advancing scholarly and public understanding of the American presidency. His continuing encouragement, counsel, and assistance in organizing events such as the Conference on the George W. Bush Presidency are instrumental in developing that understanding. Developing the conference and these three edited volumes would not have been possible without the intellectual contributions, sage advice, and tireless efforts of three individuals at Hofstra: Dr. Rosanna Perotti, chair of the Department of Political Science and a former presidential conference organizer; Dr. Richard Himelfarb, associate conference director and co-editor of the second volume; and Dr. Paul Fritz, coordinator for student hosts for the conference and co-editor of the third volume. Their absolute dedication to informed, respectful analysis in presidential studies is a model for scholarly discourse, and their expertise informs each of the three volumes. The Kalikow Center has worked with Nova Science Publishers on several edited volumes, and gives special thanks to Nadya Columbus, Alexandra Columbus, and their fine editorial staff for their continuing dedication to and steadfast support of presidency studies.

Preface

ix

ENDNOTES 1

2

The three volumes are: Meena Bose, ed., The George W. Bush Presidency, Volume I: The Constitution, Politics, and Policy Making (Hauppauge, NY: Nova Science Publishers, 2017); Meena Bose and Richard Himelfarb, eds., The George W. Bush Presidency, Volume II: Domestic Policy (Hauppauge, NY: Nova Science Publishers, 2017); and Meena Bose and Paul Fritz, The George W. Bush Presidency, Volume III: Foreign Policy (Hauppauge, NY: Nova Science Publishers, 2017). For more information on Hofstra’s March 2015 Conference on the George W. Bush Presidency, see the conference website, www.hofstra.edu/gwb.

INTRODUCTION Richard Himelfarb Hofstra University, Hempstead, NY, US

It is easy to forget that George W. Bush entered the White House in 2001 focused on domestic issues and the economy. Indeed, during the 2000 campaign his priorities were clear: tax cuts, education reform, prescription drugs for seniors and Social Security. Of course, 9/11 changed everything; from then on Bush's attention shifted to national security and foreign policy. However, even as his energies turned to the War on Terror, Afghanistan and Iraq, Bush continued to pursue his domestic agenda, albeit in a more episodic manner than he originally intended. Given the constraints it faced, the Bush White House achieved an impressive set of legislative victories. By the end of his first term, Congress had enacted two major tax cuts, landmark education reform and the largest expansion of Medicare since the program's inception. Add to this the confirmation of two conservative Supreme Court justices in his second term and it is clear that George W. Bush's domestic presidency, though overshadowed by his duties as commander in chief, was significant and consequential to the nation. This is not to say that the effects of these policies were necessarily positive. Indeed, many remain controversial almost a decade after Bush's departure. Collectively the articles and commentaries in this volume amount to a debate about Bush's domestic policies and their long-term effects. All were initially presented at the 2015 Hofstra University Conference on the George W. Bush Presidency. Over three days, academics, journalists, and former administration officials gathered to discuss and debate his legacy. This volume includes both critics and defenders of the administration. While contributors made minor changes for this volume, all remain consistent and true to their presentations at the conference. The first section addresses the economy, budget, and trade. Chapter one is critical of Bush's policies. Timothy Canova argues that the administration's laissez faire approach led to the collapse of the housing market in 2008 and that its support for the Troubled Asset Relief Program (TARP) amounted to a top down bailout of those responsible. Chapter two defends the Bush administration on the budget and economics. Michael Meerpol and Jao de Souza address the deficits and debt accrued during the Bush presidency. They argue that deficits do

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not hinder economic growth; those during Bush's two terms were not egregiously high; and they are not to blame for the economic downturn in 2008. They believe the true cause of economic problems during this period lay with increasing income inequality that occurred on Bush's watch but had been building since the 1980s. In chapter three, Shahuz Mohtadi addresses international trade and argues that here politics trumped policy. Despite Bush's stated commitment to free trade he imposed steel tariffs and signed a protectionist farm bill. The author finds Bush's rationale here was to strengthen his political base for the 2002 elections and increase congressional support for Trade Promotion Authority. Chapter four contains excerpted conference commentary from administration officials on economic policy. Mark Sumerlin, an economic adviser to President Bush, explains the policy process that produced its tax plan. He emphasizes that both conservatives and Keynesian leaning economists in the administration supported them, albeit for different reasons. Sumerlin also argues that Bush does not receive sufficient credit for how his policies prevented an economic collapse following 9/11. Pia Orrenius, a senior economist with the Council of Economic Advisers, details the Bush administration efforts to formulate immigration policy. She praises President Bush’s understanding of the issue and believes the temporary worker program he proposed reflected his principles. Unfortunately, in her assessment, the administration “missed our small window of opportunity” to pass the plan at the beginning of the second term, choosing instead to pursue Social Security reform. Social policy is the focus of the second section. In chapter five, Richard Himelfarb examines what was arguably President Bush's most significant failure, Social Security reform. He argues that the president overestimated his political capital, including his popularity, while underestimating the difficulties attendant in reforming the politically sensitive program. All the same, he concludes that it is unlikely any proposal to reform Social Security would have won congressional passage given the political and institutional constraints of the period. By comparison, Alan Singer's analysis in chapter six examines perhaps the Bush administration's most significant legislative success in domestic policy, the No Child Left Behind Act of 2001(NCLB), but judges it a public policy failure. According to his analysis, NCLB contained insufficient funding, set unattainable standards for students and teachers, and undermined learning with its emphasis on standardized tests. Chapter seven discusses President Bush's expansion of the food stamp program in the context of his commitment to compassionate conservatism. Matthew Gritter explains how Bush framed support for the 2002 Farm Bill around traditional conservative concepts such as the deserving poor and the need to reduce government waste and regulation. Had foreign affairs not intervened such policies would likely have played a more defining role in Bush's presidency. In chapter eight, Anne-Imelda Radice responds to criticism of NCLB by defending the character and good intentions of Rod Paige, the Secretary of Education she served. Whatever the merits of the legislation those associated with it cared deeply about the nation’s children and hoped to eliminate “the soft bigotry of low expectations” undermining public education. Ed Rollins, a senior presidential fellow at Hofstra University’s Peter S. Kalikow Center for the Study of the American Presidency, follows with a broader discussion of Bush’s record on education noting that his interest and involvement in the issue dated back to his two terms as governor of Texas.

Introduction

xiii

Section three covers organization, staffing, and nominations. In chapter nine, the authors study Bush's two chiefs of staff, Andrew Card and Josh Bolten. David Cohen, Karen Hult and Charles Walcott find that both men worked successfully “to facilitate the President's choices.” At the same time, the authors point out that Card and Bolton adapted to the president's proclivities and behaved as “honest brokers, not courtiers.” Chapter 10, covering Bush's Supreme Court nominations, focuses on policy in addition to process. Its author, Joel Goldstein, argues that the administration's approach to selecting nominees was highly ideological and ultimately detrimental to the Court's institutional standing. Chapter 11 emphasizes competence and order in the Bush administration. Brad Blakeman, Deputy Assistant to the President for Scheduling from 2001-2004, recalls the Bush White House as a model of administrative efficiency. Only staff who truly needed to meet with the president were granted access; Bush's time was scheduled 21 days in advance; meetings began and ended at assigned times. With the important exception of Vice President Dick Cheney, the system was enforced fairly and equitably, says Blakeman. Politics and the press are the focus of the final section. In chapter 12, Daryl Carter explores the ways in which Bush's policies and his years in the White House “finally broke the back of American complacency and homogeneity.” In particular, he believes that the administration's support of tax cuts, increased federal spending and education reform contained in NCLB proved ineffective and contributed to growing discord in the country. Christopher Hickman assesses Bush's legacy from the perspective of the conservative movement in chapter 13. On domestic issues he finds disdain for Bush's brand of biggovernment conservatism and embrace of presidential activism. In chapter 14, Kara Alaimo assesses press relations in George W. Bush’s Treasury Department by comparing them to those of his successor, President Barack Obama. She finds that reporters who covered both administrations “indicated that the Bush administration was more forthcoming with reporters.” Alaimo traces the differences to Bush officials’ desire to overcome perceived liberal bias in the media and the caution exhibited by Obama officials fearful of roiling financial markets in 2009. The final chapter contains comments from three men with extensive experience in politics and media relations. Ron Christie, a Bush staff aide from 2001 to 2004, describes the extensive White House effort to coordinate a coherent and cohesive communications strategy. Howard Dean, a senior presidential fellow at Hofstra University’s Peter S. Kalikow Center for the Study of the American Presidency, and a noted critic of Bush administration policies, surprises by praising the president as “a good guy” and “a good politician.” Interestingly, he views many of Bush’s public relations problems as resulting from circumstances beyond his control. Ed Rollins echoes Dean’s analysis and adds that the relentlessness of the 24-hour news cycle makes it increasingly difficult for any White House to manage its message effectively. Taken together, the chapters in this volume provide a set of diverse perspectives on the domestic policies of George W. Bush. They will engender further discussion about a controversial president whose policies frequently deviated from traditional conservatism and changed the nation.

PART I: THE ECONOMY, BUDGET, AND TRADE

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 1

GEORGE W. BUSH AND THE 2008 FINANCIAL COLLAPSE Timothy A. Canova Nova Southeastern University, Shepard Broad Law Center, FL, US

ABSTRACT The economic, trade, and regulatory approach of the Bush administration was a continuation of the Washington Consensus that has dominated American politics for nearly four decades. This policy agenda includes deregulation, liberalization of trade and finance, privatization of state assets and functions, fiscal austerity, and central bank independence – an overall “trickle-down” policy mix that would prove unsustainable. Stagnant wages and growing income inequality was masked by rising debt levels, which in turn fueled a massive consumption binge. The result was an enormous inflation of asset prices and gigantic bubbles in real estate, mortgage and securities markets. When the bubble burst, the Bush administration compromised any pretense to free market principles by bailing out huge banks and propping up its failed Washington consensus.

By almost any measure, George W. Bush presided over the weakest economy of any president since Herbert Hoover. Even before the onset of the Great Recession of 2007-2009, the Bush years were marked by the slowest economic growth since World War II and, according to the Wall Street Journal, the worst record of job creation on record.1 He then presided over the worst financial crisis and economic downturn since the Great Depression. Although the Bush approach may appear as a muddle of laissez-faire deregulation and crony capitalism based on selective federal interventions,2 it was in many ways a continuation of the bipartisan Washington Consensus that had been in place for nearly two decades, the major tenets of which included the liberalization of trade and finance, deregulation of industry, privatization of state assets and functions, fiscal austerity, and central bank independence.3 Although union busting was not on the list, hostility to trade unions and the immiseration of the American middle and working classes was the quite predictable consequence of every plank of the consensus agenda.

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The Bush administration deregulated and liberalized the financial system in ways that would prove to be unsustainable. On all fronts, the Bush program was one of old-fashioned “trickle down,” using all the levers of government to reward the wealthy and powerful, with the false promise that the huge redistribution of income to the top would trickle down to middle and lower income households through increased investment by the wealthy. Instead, the result was an enormous inflation of asset prices and gigantic bubbles in real estate, mortgage and securities markets. Under President Bush, federal banking and securities regulators continued to deregulate and de-supervise big financial institutions. This served the interests of the top donors to the Republican Party and President Bush’s 2000 and 2004 election campaigns.4 Although Bush had proposed tighter controls over the privately-owned, government-supported entities (GSEs), Fannie Mae and Freddie Mac, he failed to make this a legislative priority and was unwilling to compromise when his former Treasury secretary John Snow wanted to cut a deal.5 In addition, Bush chose James Lockhart, an old Andover prep school buddy to oversee the GSEs and he pronounced them sound even as they approached insolvency.6 Lawrence Lindsey, Bush’s first chief economics advisor, would later lament that “no one wanted to stop that bubble” as long as the proliferation of easy credit was helping meet the administration’s housing goals.7 William Seidman, former head of the Federal Deposit Insurance Corporation and Resolution Trust Corporation during the Savings and Loan Crisis, later said that the Bush administration allowed the mortgage market “to operate as a barroom brawl” without rules to make the market work well.8 The result was a complete deterioration in lending standards and an unsustainable bubble in the nation’s markets in housing, mortgages and mortgage-backed securities. Each of the main planks of the agenda had the effect of redistributing income from middle and lower income groups to wealthy elites. Bush, like Reagan, lowered marginal income tax rates, a supply-side fiscal policy that enriched those already well off. Meanwhile, the Bush administration spending programs led to the largest federal deficits then in American history. This included two unfunded wars in Afghanistan and Iraq, with the cost of the Iraq conflict running into the trillions of dollars.9 In December 2003, President Bush signed into law a Medicare Part D prescription drug benefit program that was estimated to cost more than $1.2 trillion in the coming decade,10 while preventing the federal government from negotiating directly with drug companies to lower drug prices for Medicare beneficiaries.11 These spending programs were taxpayer-funded windfalls for big corporations, including the Big Pharma cartel, which busted the federal budget and thereby precluded much needed spending on long-term infrastructure investments. Bush trade policies followed the logic of trickle-down as well. By bringing the People’s Republic of China into the World Trade Organization (WTO), trade and capital flows were further liberalized, thereby contributing to growing U.S. trade and current account deficits. This resulted in greater U.S. dependence on huge inflows of portfolio capital to finance the mounting levels of private and public borrowing. Meanwhile, with China keeping its currency undervalued, U.S. businesses outsourced ever more production and focused completely on short-term earnings management, resulting in increased profits flowing to top management and large shareholders. Stagnant wages and growing income inequality was masked by rising debt levels, which in turn fueled a massive consumption binge. Americans relied increasingly on borrowed money to fill the gap between stagnant wages and rising home prices. The bubble economy, built on growing debt burdens and the insecurity of American workers, was

George W. Bush and the 2008 Financial Collapse

5

unsustainable. When Federal Reserve monetary policy tightened in 2006, partly a result of a slow down in capital inflows, market interest rates went up, including on the resetting of adjustable rate mortgages. This was the beginning of the end as the giant housing and mortgage bubbles soon began to deflate. Mortgage refinancings slowed, mortgage defaults began to rise, and soon the music stopped and those who were left holding mortgage backed securities, or who had sold insurance of such securities through credit derivatives, were ruined.

PART I: THE FAILURE OF THE WASHINGTON ORTHODOXY The shift to deregulation in banking and finance picked up steam in the late 1970s and early 1980s. President Carter began the process of interest rate deregulation, which was continued under President Reagan, along with the deregulation of lending standards, the liberalization of mortgage products, and the growth in securitization of mortgages and other assets.12 Throughout the 1980s and 1990s, mortgage lenders were increasingly pushing mortgage products that shifted risks and burdens to borrowers, such as adjustable rate mortgages and interest-only loans with negative amortization and balloon payments. Then the Clinton administration abolished some of the most significant New Deal era regulations and oversight of U.S. banking and finance.13 In November 1999, President Clinton signed into law the Gramm-Leach-Bliley Financial Services Modernization Act, which effectively gutted what was left of the 1933 Glass-Steagall Act that had separated commercial banking from investment banking and securities. A year later, the lame duck president and Congress enacted the Commodity Futures Modernization Act, which effectively deregulated financial derivatives and provided legal certainty to privately negotiated over-thecounter (OTC) derivative instruments. Together, these reforms enabled large commercial banks, organized as financial holding companies, to trade in riskier securities and derivatives through their subsidiaries. The market for mortgage bonds expanded rapidly with the introduction of financial derivatives and newly enhanced powers for the largest financial institutions. According to the Financial Crisis Inquiry Commission (FCIC), created by President Obama to investigate the causes of the 2008 crisis, “the creation of an enormous volume of collateralized debt obligations (CDOs),” composed of the riskier tranches of mortgage backed securities (MBS), “fueled demand for nonprime mortgage securitization and contributed to the housing bubble.” In April 2003, the Financial Accounting Standards Board (FASB), officially recognized by the SEC, liberalized its standards for the reporting of securitizations and derivative financial instruments to allow banks to move these liabilities off-balance sheet. As a result, banks would issue CDOs through off-balance sheet entities, including conduits known as “variable interest entities,” thereby greatly understating their leverage.14 Offbalance-sheet assets grew tremendously, more than seven times faster than on-balance-sheet assets.15 These FASB decisions, which were effectively ratified by the Fed and Comptroller of the Currency, dismantled many core restrictions on off-balance sheet finance by banks, which would eventually allow the largest banks to reduce their effective capital ratios and increase leverage in pursuit of ever higher profits.16

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In addition, according to the Financial Crisis Inquiry Commission, the proliferation of increasingly complex derivatives, such as credit default swaps (CDS), facilitated the sale of CDOs “by convincing investors of their low risk, but greatly increased the exposure of the sellers of the credit default swap protection [such as the American International Group (AIG)] to the housing bubble’s collapse.”17 While these Clinton era reforms helped set the stage, none of the ensuing market developments were inevitable. It was Bush administration decisions to largely de-supervise the biggest banks and financial institutions that were key to the timing, scale, and enormous scope of the bubble. These decisions were made across a range of regulatory agencies, including the Federal Reserve Board of Governors (BOG) and regional Federal Reserve Banks, the Office of Comptroller of the Currency (OCC), the Office of Thrift Supervision (OTS), and the Securities and Exchange Commission (SEC). At the center of this deregulation frenzy was Alan Greenspan, the chairman of the Federal Reserve Board from 1987-2006. Greenspan had previously served as director at J.P. Morgan and was devoted to the extreme libertarian philosophy of Ayn Rand. In 2004, President Bush reappointed Greenspan to a fifth term as Fed chairman and then appointed his former White House chief economist, Ben Bernanke, to succeed Greenspan in 2006. Greenspan supported the Bush supply-side tax cuts and provided significant monetary stimulus throughout this period. Along with Bernanke, Greenspan also ignored repeated warnings and requests from the Federal Reserve’s Consumer Advisory Council and Fed governor Edward Gramlich to use the Fed’s considerable authority under the Home Ownership and Equity Protection Act (HOEPA) of 1994 to investigate and regulate abuses in the subprime mortgage market.18 Sheila Bair was one of President Bush’s few truly great appointments among the banking regulators. Appointed in 2006 to chair of Federal Deposit Insurance Corporation (FDIC), Bair would later tell the Financial Crisis Inquiry Commission that the Fed’s authority to set mortgage lending rules under HOEPA was the “one bullet” left in the regulatory arsenal that might have prevented the financial crisis.19 Throughout her time at FDIC, Bair fought constant turf battles with other agency heads, many of whom had close ties with private banking interests and refused to reign in their risky lending practices. These included James Gilleran, who headed the Office of Thrift Supervision (OTS) from 2001-2005, and his successor John Reich who served as OTS director from July 2005 to early 2009, after himself heading the FDIC.20 In 2003, Gilleran and Reich appeared for a photo-op with representatives of three banker trade associations posing with garden shears as they cut red tape that was wrapped around a stack of papers. Gilleran held a chainsaw. The message was clear that the OTS would provide mortgage lenders who re-chartered under OTS -- among the nation’s largest Savings and Loans -- with an environment free from regulatory intrusion.21 OTS would engage in a regulatory “race to the bottom” with other chartering agencies, repeatedly lowering regulatory standards in a competition for bank charters. Bank charters were important for these regulatory agencies since their budgets were financed from chartering fees. But also important was the laissezfaire regulatory philosophy shared throughout the Bush administration. The Bush hands-off approach also served the private interests of many regulators. For instance, the OCC was headed by John Hawke from 1998-2004 and by John Dugan from 2004-2010. Prior to his appointment, Hawke was chairman of Arnold and Porter for nearly a decade, representing the largest banks and financial institutions.22 Dugan had previously been a bank lobbyist for twelve years.23 In 2003, Hawke invoked the 1863 National Bank Act to

George W. Bush and the 2008 Financial Collapse

7

preempt the attorney generals of all 50 states from investigating and prosecuting predatory lending practices by banks and mortgage lenders24. So much for conservative values of federalism and devolving decision-making to the states. This was another missed opportunity to prevent the crisis in housing and mortgage finance. Two state AGs, Roy Cooper of North Carolina and Tom Miller of Iowa, headed a committee of state officials that urged Hawke to give the states more latitude to curtail the riskiest and most predatory practices in the mortgage industry. As Cooper later concluded, Hawke “took 50 sheriffs off the job during the time the mortgage lending industry was becoming the Wild West.”25 Hawke would later blame mortgage brokers and originators which were the responsibility of states, but his preemption decisions prevented any effective oversight of mortgage lenders, including S&Ls owned by Lehman Brothers and others that were a big part of the bubble and bust. According to Kathleen Keest, a former assistant attorney general in Iowa, Hawke’s preemption campaign “pushed aside state laws and state law enforcement that would have sent the message that there were still standards in place, and it was a big part of the message to the industry that it could regulate itself without rules.”26 Although these regulatory decisions encouraged the growth of risky mortgage securities, federal regulators could still have limited the risk to the so-called “Too Big To Fail” institutions, including the largest commercial and investment banks, by reducing their leverage and imposing higher capital requirements. The 2004 Basel II capital guidelines, set by the Bank for International Settlements (BIS) Basel Committee on Banking Supervision, called for “risk-weighted” capital standards. In a coordinated November 2001 rulemaking by four federal regulators – the Fed, OCC, OTS, and FDIC – risk weights were lowered from 50 percent to 20 percent for banks and thrifts on their holdings of triple-A or double-A rated private-label MBSs. This effectively reduced capital ratios from 4 percent to 1.6 percent for banks purchasing private-label MBS, including those with underlying mortgages consisting of high-risk Option Adjustable Rate Mortgages (ARMs), liar’s loans, and subprime loans with low down payments.27 In addition, Basel II permitted large commercial banks and bank holding companies to use their own internal risk assessment models to calculate their regulatory capital for their securities portfolios, thereby often reducing their effective capital ratios further.28 With the complicity of the major credit rating agencies, banks were able to increase their leverage ratios and load up on subprime mortgage bonds. Meanwhile, decisions by the Bush administration’s SEC would reduce capital standards for the largest investment banks. The Bush SEC provides a case study in the failure of laissezfaire. Each of President Bush’s three successive SEC chairmen were advocates, to varying degrees, of laissez-faire approaches to government. Harvey Pitt, Bush’s first SEC chairman, assured a major accounting group, the American Institute of Certified Public Accountants (AICPA), that there would be fewer SEC demands on companies to restate their earnings and promising a “kinder, gentler” SEC.29 Some commentators found Pitt’s assurances to be unsettling, particularly since Enron had just imploded under a cloud of corporate governance and accounting scandal. Other major corporations would soon follow suit. Moreover, Pitt had cozy relations with AICPA, the Big Five accounting firms, and major corporations and Wall Street banks, which he had represented in private practice, just prior to his appointment by Bush to lead the SEC.30 Pitt would ultimately resign after less than two years amid his own scandal in his process for selecting the first chairman of the Public Company Accounting Oversight Board (PCAOB), a new entity created by the Sarbanes-Oxley Act of 2002 to

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regulate the accounting industry, replacing self-regulation by AICPA, the industry trade group.31 President Bush’s initial response to the Enron scandals was to blame the frauds on “a few bad apples.” But attention soon turned to Bush’s own dodgy business record, which included a 1990-91 SEC investigation into his share dealings as a director of Harken Energy Corporation, when he took 34 weeks to give “timely” notice of an $848,560 stock trade made a week before the company disclosed bad news.32 In July 2002, a near unanimous House and Senate responded by passing the Sarbanes-Oxley Act. In signing the Act into law, Bush claimed that it included “the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt. The era of low standards and false profits is over; no boardroom in America is above or beyond the law.”33 Yet, by the end of Bush’s second term, the entire U.S. financial system was imploding under a mountain of misstated earnings and badly rated debt securities. The Sarbanes-Oxley Act had not prevented low standards and false profits from finding their way into corporate boardrooms after all. To succeed Harvey Pitt as SEC chairman, Bush selected William Donaldson, an investment banker and fellow member of the Skull and Bones, the elite and secretive Yale University society.34 In 2000, Donaldson had sold his firm, Donaldson, Lufkin and Jenrette, to Credit Suisse for more than $11 billion.35 At his confirmation hearing, Donaldson pledged to restore investor confidence and fight for a larger budget for the SEC, which was notoriously underfunded, understaffed, and overworked.36 He also vowed to be independent of his former Wall Street ties. But instead, Donaldson would preside over one of the sorriest periods and greatest failures in the agency’s history. The SEC had jurisdiction under federal securities law to regulate broker-dealers, including the capital requirements of broker-dealer subsidiaries of investment banks. Since 1975, it had imposed a net capital rule that required broker-dealers to calculate their capital according to bright-line rules based on asset class and credit ratings. In 2002, the European Union (EU) announced that U.S. financial firms, to continue doing business in the EU, would need a “consolidated” supervisor of their holding companies by 2004 or be subject to EU oversight. U.S. commercial banks already complied, with the Fed serving as their consolidated supervisor. The OTS would later satisfy the EU as the consolidated supervisor of AIG. However, the five largest U.S. investment banks, with $2.5 trillion in combined assets, did not meet the standard since no one supervisor was overseeing them on a consolidated basis. Bear Stearns, Lehman Brothers, Goldman Sachs, Merrill Lynch, and Morgan Stanley went shopping for a regulator. They lobbied the SEC to create the Consolidated Supervised Entity (CSE) program to oversee the holding companies and subsidiaries of investment banks that had large broker-dealer subsidiaries.37 Henry Paulson, the CEO of Goldman Sachs, led the lobbying effort. While the SEC had authority to oversee the broker-dealer subsidiaries, they did not have express legislative authority to require consolidated review of the investment banks at the holding company and sister subsidiary levels. The SEC offered an “alternative net capital rule” for broker-dealers that volunteered to be subject to consolidated supervision under the CSE program. This roughly followed the approach of the 2004 Basel II Accord for banks, which were permitted to to use their own internal risk models as an alternative to the traditional risk-weighting of assets.38 Now investment banks would be allowed to create their own proprietary Value at Risk (VAR) models to calculate their regulatory capital, and the

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SEC estimated that the new reliance on VAR would allow their broker-dealers to reduce average capital charges by 40 percent.39 The SEC formally approved the CSE program on a Saturday meeting in April 2004 in a basement hearing room, removed from the attention of the press. In relying on the assurances of the investment banks, SEC commissioner Harvey Goldschmid, a Democrat appointed by President Bush, commented at the meeting, “We’ve said these are the big guys, but that means if anything goes wrong, it’s going to be an awfully big mess.” Everyone laughed, a bit nervously it seemed.40 Annette Nazareth, director of the SEC Division of Market Regulation (DMR) that was charged with overseeing the CSE program, assured the commissioners that her division was up to the challenge. In fact, as later detailed by the Financial Crisis Inquiry Commission, the DMR was not up to the challenge. For example, DMR had insufficient manpower and resources and never assigned on-site examiners; missed annual exams of at least some of the investment banks; failed to require Bear Stearns to change its asset balance, reduce its leverage, or increase its cash liquidity pool in response to the firm’s concentration of mortgage securities and high leverage; and permitted Bear Stearns to increase its reliance on overnight repurchase lending.41 The SEC’s own Inspector General issued a report in 2008 detailing the many failings in the SEC’s laissez-faire approach to enforcement under the CSE program.42 While the CSE program was adopted when Donaldson was SEC chairman, its implementation was the responsibility of Donaldson’s successor, Christopher Cox, a former White House lawyer for Ronald Reagan and former Republican member of Congress from Orange County, California. Cox was a champion of laissez-faire economics who was now in charge of supervising, on a consolidated basis, the five largest investment banks. The paucity of SEC staff members assigned to the task – by some accounts only seven staffers – is suggestive of Cox’s support for industry self-regulation and lack of initiative to press the giant Wall Street investment banks in any way that would result in higher capital charges.43 Under his watch, the CSE program would permit these banks to borrow as much as $40 for each dollar of capital, leaving them vulnerable to even a small drop in asset prices and small increase in funding costs, without the capital to absorb modest, let alone significant losses.44 The Financial Crisis Inquiry Commission would conclude that the SEC’s “poor oversight of the five largest investment banks failed to restrict their risky activities and did not require them to hold adequate capital and liquidity for their activities, contributing to the failure or need for government bailouts of all five of the supervised investment banks during the crisis.”45 Bear Stearns and Lehman Brothers went under, Merrill Lynch was acquired by Bank of America, and Goldman Sachs and Morgan Stanley were allowed to convert quickly into bank holding companies to gain access to the Federal Reserve’s discount lending. The “awfully big mess” that Goldschmid had laughed about came to pass, but not before Nazareth became an SEC commissioner and then left the SEC to become a partner at Davis Polk, the Wall Street powerhouse law firm representing the largest financial institutions.46 Goldschmid too was already gone, having returned to his endowed perch at Columbia University. George Soros, the billionaire hedge fund manager, considered this SEC decision to be “the most shocking abdication of responsibility.”47 Some defenders of the Bush SEC claim that due to the voluntary nature of the CSE program, it lacked authority to impose stringent requirements on the big investment banks. For instance, the CSE program was intended to include external audits of the banks’ risk management to ensure quality independent unbiased

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review.48 But without explicit legislative authority, the Division of Market Regulation instead allowed the banks to utilize their own internal auditors to evaluate the critical risk management control systems.49 This undermined the oversight design approved by the Commission to ensure thorough and meaningful monitoring.50 On September 28, 2008, in announcing the end of the CSE program during the height of the financial crisis, SEC chairman Cox claimed that the crisis had made it “abundantly clear that voluntary regulation does not work” and that “the CSE program was fundamentally flawed from the beginning, because investment banks could opt in or out of supervision voluntarily. The fact that investment bank holding companies could withdraw from this voluntary supervision at their discretion diminished the perceived mandate of the CSE program, and weakened its effectiveness.”51 It was a lame defense of the SEC’s neglect and failure. True, the investment bank holding companies could withdraw from the CSE program, but then they would be subject to EU consolidated supervision or forced to close down all of their operations in the EU. Under Cox, the SEC had served more as lapdog than watchdog as the largest investment banks in the country became overleveraged and undercapitalized while taking on ever increasing levels of risk. Cox was also widely criticized during the crisis for acting too slowly to prevent hedge funds and other speculators from short-selling the stock of investment banks, particularly Lehman, Merrill, and Bear Stearns.52 Likewise, critics claimed that Cox should have reintroduced the “uptick” rule to stop unrelenting short-selling. His reluctance to act suggested either a naivety or complicity with the predatory agenda of private speculation. When he did act, it was only after the market sell-off became quite dire and British regulators had already acted. The SEC finally put in place a rule against abusive “naked” short-selling of stock in financial firms, but not until the damage had already been done. Cox, like the president he served, looked increasingly like a deer in the headlights during, in the words of the Financial Times, “the most catastrophic destruction of capital since the 1930s.”53 Laissez-faire looked more like lazy fare. The SEC had failed miserably to achieve the primary objectives of federal securities law, including the protection of consumers and investors, and promotion of full disclosure, market efficiency, economic growth, and stability of financial markets.54 The short-selling of financial stocks that roiled markets and institutions in the fall of 2008 highlighted another major failure in the laissez-faire model, namely the growing speculative nature of financial markets, made so much more so by the liberalization of derivatives. Some legal scholars consider the proliferation of derivative financial instruments to be the most direct cause of the crisis.55 English and American common law traditionally addressed derivatives by distinguishing between “hedging agreements in which at least one of the parties was seeking to reduce risk and purely speculative contracts between two parties each seeking trading profits.”56 Under the common law rule against “difference contracts,” courts would not enforce purely speculative derivatives which were considered gambling contracts. This rule was also codified in Grain Futures Act of 1922 and reenacted during the New Deal as the Commodity Exchange Act (CEA) of 1936.57 However, this began to change when Wendy Gramm headed the Commodity Futures Trading Commission (CFTC) from 1988 to 1993. A conservative economist and wife of then Republican U.S. Senator Phil Gramm, Wendy Gramm steered the CFTC into a new laissez-faire policy approach. In 1989, her CFTC issued a “safe harbor” policy statement declaring that it would not regulate swap transactions. Congress followed up in 1992 by giving the CFTC authority to exempt various

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types of derivatives from the CEA and preempted state law that made OTC derivatives unenforceable.58 A year later, the CFTC used this authority to formally exempt OTC swaps from the CEA and preempt state anti-wagering and anti-bucketshop laws.59 What followed should have been a warning about the dangers of laissez-faire policy in derivatives. In April 1994, Proctor and Gamble announced a $157 million trading loss speculating on interest rates through derivatives. A few months later, Orange County, California was forced to file for bankruptcy after more than $2 billion in losses on highly leveraged derivatives. In early 1995, Barings, one of the world’s oldest investment banks, suddenly collapsed just days after it was reported that a single trader in its Singapore office had lost more than $1 billion of the bank’s money in unauthorized gambles on the direction of Japanese stock prices and interest rates.60 These were not the only big losses on derivatives. But for every dollar lost by one party, there was a counter-party with a comparable gain, strengthening the constituency for financial speculation. In the summer of 1998, the CFTC, now headed by Brooksley Born, a Clinton appointee, issued a concept release indicating that it might seek to exercise regulatory authority over financial derivatives. According to Lynn Stout, “This was a dramatic shift in policy, as it implied OTC derivatives might be treated as illegal off-exchange futures.”61 There was a ferocious counterattack by the derivatives industry and its allies in government led by Federal Reserve chairman Alan Greenspan, Treasury secretary Robert Rubin, and Treasury undersecretary Larry Summers, three members of the Presidential Working Group that recommended that the CEA be amended to bring “legal certainty” and enforceability to all off-exchange derivatives trading. They were undeterred by the sudden meltdown of the Long Term Capital Management hedge fund in October 1998, triggered by huge trading losses on interest rate and currency derivatives. It would take a $4 billion industry financed bailout, brokered by the Federal Reserve Bank of New York, to prevent huge losses from spreading to the biggest banks. A lame duck Congress followed up with the Commodities Futures Modernization Act of 2000 (CFMA), signed into law by a lame duck Clinton in December 2000. In between, Ms. Born resigned from the CFTC.62 It was an impressive demonstration of the political power of speculative finance. The Bush administration further contributed to the rise in derivative trading with the Bankruptcy Abuse and Consumer Protection Act of 2005 (BACPA), which provides counterparties in derivative contracts with the right to immediately collect on those contracts at the beginning of bankruptcy.63 During the Bush era, derivatives would explode in volume, with over $50 trillion in credit default swaps and several hundred trillion dollars in interest rate and currency derivatives. According to the Financial Crisis Inquiry Commission, credit default swaps, “sold to provide protection against default to purchasers of the top-rated tranches of CDOs, facilitated the sale of those tranches by convincing investors of their low risk, but greatly increased the exposure of the sellers of the credit default swap protection to the housing bubble’s collapse.”64 Synthetic CDOs enabled speculators to bet against the housing bubble, including Goldman Sachs, which had bet against the same mortgage bonds and CDOs that it had created and already sold off to unsuspecting clients and investors.65 AIG was one of the big sellers of credit default swaps and its implosion in the fall of 2008 resulted in the Federal Reserve Bank of New York making an emergency equity investment and taking a 79.9 percent interest in AIG, all to make sure that AIG continued paying off on its swaps to Goldman Sachs and other counterparties. The Fed was not just the lender of last resort; it was the house, covering the bets of speculators.

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PART II: THE TRICKLE-DOWN BAILOUT The response of the Bush administration to financial crisis anticipated the Obama administration approach. Both administrations would turn to fiscal stimulus, but both were flawed in size and scope of the stimulus. Both would support a massive bank bailout that left in place millions of underwater mortgages and the flawed incentives of bankers to rely on trading for short-term profits. Under Bush, the Federal Reserve started its massive liquidity support and “quantitative easing” (QE) asset purchase programs, a trickle-down monetary approach that continued during the Obama administration. The objective in all these efforts was to prop up and stabilize the financial system to encourage renewed lending and reinflation of the bubble economy. In the process, the Fed helped prop up the failing laissezmodel itself. The housing market turned down in 2006, followed by the U.S. economy, which went into the Great Recession in late 2007. The Bush administration responded with a $168 billion fiscal stimulus in early 2008 that consisted of one-time tax rebates of up to $600 for individuals, $1200 for couples filing jointly, and additional payments to families of $300 per child.66 But many households would either save the money or use it to pay off debt, diluting the effect of the stimulus. To the degree the rebates were spent, they may have done more to stimulate the Chinese economy than the U.S. economy, while adding to the federal deficit.67 The Bush stimulus anticipated a larger fiscal stimulus in President Obama’s first weeks in office, which was also top-heavy with tax credits, and without any significant funding for new public sector infrastructure or jobs programs. Obama followed the orthodox consensus that only the private sector could create jobs and that fiscal stimulus should be mostly limited to tax incentives.68 Both Bush and Obama administrations rejected any “bottom-up” approach of public works and jobs programs, which were such an important part of President Franklin Roosevelt’s response to the Great Depression.69 During the depths of the Bush recession, more than 800,000 Americans were losing their jobs each month, with nearly 9 million net jobs lost during the recession.70 The jobless rate rose to a post-Great Depression high. When unemployment finally started coming down, it coincided with a sharp decline in labor market participation rates. To this day, the official unemployment rate largely hides the continuing legacy of the Great Recession: huge drop offs in labor market participation, and persistently high levels of long-term unemployment, discouraged workers, and part-time workers unable to find full-time work. The Bush and Obama administration responses to the crisis revealed the power of a captured federal government and a central banking cartel, working together, to prop up an economy marked by cartels and oligopolies that masquerade as free markets in industry after industry. By 2006, the smart money was already beginning to see that housing and mortgage markets were about to turn down in a big way, and speculators were soon betting against these markets through derivatives such as credit default swaps (CDS).71 Fortunes would be made on these bets. Meanwhile, the Bush White House was receiving warnings of an impending crash in housing and mortgage markets.72 But it was already too late to do anything about the bubble, even assuming the will to try. Instead, the Bush administration apparently got itself ready for the crash and put together a team that could be counted on to prop up the Washington Consensus policy agenda and big Wall Street backers.

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In July 2006, President Bush replaced John Snow with Henry Paulson, the CEO of Goldman Sachs, as Treasury secretary. Goldman Sachs was already betting through derivatives against the mortgage market and CDOs that it had created and sold to investors.73 As Treasury secretary, Paulson was in a perfect position to help his former firm and the rest of Wall Street when the panic hit in 2008. He proposed and crafted the Troubled Asset Relief Program (TARP) authorizing Treasury to spend up to $700 billion propping up the largest banks.74 U.S. banks and thrifts would suffer large loses in late 2008 and into 2009, but thanks to TARP and the Federal Reserve’s huge liquidity and asset purchase programs, would return to high profit levels a year later.75 Alan Greenspan stepped down from the Federal Reserve in 2006 to become an advisor to the Pacific Investment Management Company (PIMCO), the world’s largest mutual fund, as well as the Deutsche Bank’s investment banking team. Soon he would also join Paulson and Co., a giant U.S. hedge fund that earned billions of dollars in 2007 when it bet correctly on the collapse of the sub-prime mortgage market.76 Bush replaced Greenspan with Ben Bernanke at the Fed. Bernanke had auditioned for the job while serving as a Fed governor from 2002-05 and as chief of Bush’s Council of Economic Advisers in 2005-06. In a 2002 speech, he assured listeners that the central bank could prevent deflation and depression by printing money, the equivalent of a “helicopter drop” of money.77 As Fed chairman, Bernanke would drop trillions of dollars not on the general population, but on the largest financial institutions to ensure their solvency and survival. He rejected all proposals for any “bottomup” central bank support targeted directly to small and moderate sized businesses, as practiced by the Federal Reserve in the 1930s and 1940s when Marriner Eccles was Fed chairman.78 Instead, under Bernanke, all Federal Reserve support was trickle-down, going to Wall Street interests, none to Main Street. President Obama would reward “Helicopter Ben” by reappointing him as Fed chairman and Time magazine then named him person of the year for 2009. In 2003, Timothy Geithner, a protégé of Robert Rubin -- formerly of Goldman Sachs, Clinton’s former Treasury secretary, and then top manager of Citigroup --, was moved into position as president of the Federal Reserve Bank of New York, where in 2008 he would help JP Morgan Chase acquire Bear Stearns, prop up AIG, and launch the New York Fed’s massive liquidity and asset purchase programs that would be measured in the trillions of dollars. After propping up the global casino, Geithner would be appointed by President Obama’s to Treasury secretary. In late 2012, just before stepping down from Treasury for a lucrative position as president of Walburg Pincus, a Wall Street private equity firm, Geithner would exempt foreign exchange swaps and forwards from rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act that were intended to reduce risk and increase transparency in derivative markets. The exemption would protect a $4 trillion a day global market and one of the most lucrative sources of derivatives-trading revenue for the biggest banks.79 It would also ensure that Wall Street was well positioned to continue speculating against foreign currencies, sovereign debt, and entire countries like Greece. The U.S. responses to the crisis have had the appearance of relative success when compared with many foreign competitors. The U.S. economy has been growing faster than the Euro zone or Japan, which are only more recently beginning to embark on their own trickle-down quantitative easing monetary policies. But the relative strength of the U.S. economy masked many underlying weaknesses in the U.S. labor market and growing income inequality. The U.S. had fared better than others thanks in part to today’s financial version of

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American exceptionalism: the U.S. dollar remained the world’s main reserve and transactional currency, thereby allowing the U.S. to run higher budget and current account deficits while enjoying lower interest rates and booming capital markets. The U.S. remained the world’s safe haven, even in storms of its own making. The Washington Consensus had failed in the U.S., but in many ways it remains the model, propped up by government interventions that began in the Bush administration.

ENDNOTES 1

“Bush on Jobs: The Worst Track Record on Record,” Wall Street Journal, Real Time Economics, Jan. 9, 2009, at: http://blogs.wsj. com/economics/2009/01/09/bush-on-jobs-the-worst-track-record-on-record/; David Leonhardt, “Were the Bush Tax Cuts Good for Growth?” New York Times, Economix, Nov. 18, 2010, at: http://economix. blogs.nytimes.com/2010/11/18/were-the-bush-tax-cuts-good-for-growth/?_r=1. 2 Thomas O. McGarity, Freedom to Harm: The Lasting Legacy of the Laissez Faire Revival (Yale University Press 2013). 3 The Washington Consensus was also known as neoliberalism (mostly abroad) and market fundamentalism. Joseph Stiglitz, Globalization and Its Discontents (2002), at pp. 53-54 (referring to the consensus as market fundamentalism). The Washington Consensus has also been referred to as a Washington-Wall Street Consensus, indicating the symbiotic relationship between the state and high finance. With shades of Eisenhower’s “Military Industrial Complex,” Jagdish Bhagwati’s reference to a “Wall Street-Treasury-IMF complex” also suggests the influence and capture of federal and multilateral agencies by private financial actors. Jagdish Bhagwati, In Defense of Globalization (2004), pp. 205-206. 4 Jo Becker, Sheryl Gay Stolberg and Stephen Labaton, “White House Philosophy Stoked Mortgage Bonfire,” New York Times, Dec. 21, 2008. 5 Gretchen Morgenson and Joshua Rosner, Reckless Endangerment (2011). 6 Becker, Stolberg and Labaton, supra note __. 7 Id. 8 Id. 9 “U.S. CBO estimates $2.4 trillion long-term war costs,” Reuters, Oct. 24, 2007, at: http://www.reuters.com /article/2007/10/24/us-iraq-usa-funding-idUSN2450753720071024 (the Congressional Budget Office estimated that the interest costs alone from 2001-2017 could total more than $700 billion); Linda J. Bilmes and Joseph E. Stiglitz, The Three Trillion Dollar War: The True Cost of the Iraq Conflict (W.W. Norton, 2008). When White House economists estimated that the Iraq conflict could reach $200 billion, Defense secretary Donald Rumsfeld called the estimate “baloney” and suggested that $50 to $60 billion was an accurate estimate. Stephen Fidler, “Iraq war costs inspire shock and awe,” Financial Times, March 17, 2008, at: http://www.ft.com/intl/cms/s/0/8bb35a22-f444-11dc-aaad-0000779fd2ac.html#axzz3 QWSUgFiK. 10 Ceci Connolly and Mike Allen, “Medicare Drug Benefit May Cost $1.2 trillion,” Washington Post, Feb. 9, 2005, p. A01, at: http://www. washingtonpost.com/wp-dyn/articles/A9328-2005Feb8.html. 11 Robert Pear, “Administration Opposes Democrats’ Plan for Negotiating Medicare Drug Prices,” New York Times, Nov. 13, 2006. 12 Timothy A. Canova, “The Legacy of the Reagan Administration’s Deregulation of Banking and Finance,” ch. 8 Eric J. Schmertz, Natalie Datlof, and Alexej Ugrinsky (eds.), Ronald Reagan’s America: Vol. I (Greenwood Press, 1997), pp. 99-118. The Secondary Mortgage Market Enhancement Act (SMMEA) of 1984 spurred the growth in securitization of private, non-agency mortgages. SMEEA also delegated considerable power to the main credit rating agencies by requiring that non-agency Mortgage Backed Securities (MBS) receive a top rating from at least one Nationally Recognized Statistical Rating Organization. Jennifer Taub, Other People’s Houses (Yale University Press, 2014), at pp. 74-75, 229-230. 13 Timothy A. Canova, “Legacy of the Clinton Bubble,” Dissent (Sept. 2008). 14 Jennifer Taub, Other People’s Houses (Yale University Press, 2014), at pp. 233-235. 15 Taub, supra note __, at p. 234 (reporting that between 1992 and 2007, off-balance-sheet assets increased by 1500 percent, while on-balance-sheet assets grewe by only 200 percent).

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R. Christopher Whalen, “Dodd-Frank and the Great Debate: Regulation vs. Growth,” 2014-PB-01, Policy Brief, Networks Financial Institute, Indiana State University, Feb. 2014, at: http://papers.ssrn.com/sol3/ papers.cfm?abstract_id=2399614. 17 The Financial Crisis Inquiry Report, National Commission on the Causes of the Financial and Economic Crisis in the United States (Public Affairs, 2011), at p. 155. 18 Jennifer Taub, Other People’s Houses (Yale University Press, 2014), at p. 227. 19 The Financial Crisis Inquiry Report, National Commission on the Causes of the Financial and Economic Crisis in the United States (Public Affairs, 2011), at p. 94. 20 Sheila Bair, Bull By the Horns (2012), at p. 21. 21 Paul Kiel, “Banks’ Favorite (Toothless) Regulator,” ProPublica, Nov. 25, 2008, at: http://www.propublica.org /article/banks-favorite-toothless-regulator-1125. 22 John Hawke was also an adjunct professor at the Georgetown University Law Center, where I took his course in Federal Regulation of Banking in the Spring of 1987. 23 Andrew Martin, “Does This Bank Watchdog Have a Bite?,” New York Times, March 27, 2010. 24 Eliot Spitzer, “Predatory Lenders’ Partner in Crime,” Washington Post, Feb. 14, 2008. 25 Robert Berner and Brian Grow, “They Warned Us About the Mortgage Crisis,” Bloomberg Business, Oct. 8, 2008, at: http://www.bloomberg. com/bw/stories/2008-10-08/they-warned-us-about-the-mortgage-crisis. 26 Robert Berner and Brian Grow, supra note __. 27 Taub, supra note __, at pp. 232-233. 28 Internal risk assessment models were first introduced in a 1996 Market Risk Amendment to the Basel rules. Financial Crisis Inquiry Commission, supra __, at p. 151. 29 Floyd Norris, “Harvey Pitt’s Friendlier S.E.C.?” N.Y Times, Oct. 26, 2001. 30 Chris Suellentrop, “Harvey Pitt: Why the accounting scandals aren’t his fault,” Slate, July 5, 2002. In the year prior to his appointment as SEC chairman, Pitt earned more than $3 million representing these accounting and Wall Street interests. In spite of, or perhaps because of, these ties, U.S. Senator Charles Schumer (D-N.Y.) compared Pitt to Churchill and Zeus in supporting Pitt’s confirmation. Id. 31 Pitt was accused by dissenting SEC commissioners of not properly vetting the candidates when selecting William Webster, former director of both the FBI and CIA, to head the PCAOB. Soon after it was reported that Webster had served on the audit committee of U.S. Technologies, a company being investigated for accounting irregularities (a rather important fact that Pitt had failed to disclose to fellow commissioners or the White House), Pitt announced his resignation, followed a week later by Webster. Jake Ulick, “Webster calls it quits,” CNN/Money, Nov. 13, 2002. 32 “The backlash against business,” The Economist, July 4, 2002, at: http://www.economist.com/node/1217728. 33 Elisabeth Bumiller, “Bush Signs Bill Aimed at Fraud in Corporations,” New York Times, July 31, 2002. 34 Rebecca Leung, “Skull and Bones: Secret Yale Society Includes America’s Power Elite,” CBS 60 Minutes, Oct. 2, 20013, at: http://www.cbsnews.com/news/skull-and-bones/. 35 Randall Smith and Charles Gasparino, “Credit Suisse Unit Confirms Agreement to Acquire DLJ in a $11.5 Billion Deal,” Wall Street Journal, Aug. 30, 2000, at: http://www.wsj.com/articles/SB9675 67494108117264. 36 SEC lawyers were paid one-third less than their counterparts at the Federal Reserve and Justice Department, according to Arthur Levitt, Clinton SEC chairman, explaining why 40 percent of the SEC’s staff left the agency between 1998 and 2001. Although the SEC estimated that it takes a new employee two years to fully learn how to do the job, by 2000 more than three-quarters of its examiners had worked there less than three years. Suellentrop, supra note __. 37 Financial Crisis Inquiry Commission, supra note __, at pp. 150-154. 38 Lissa L. Broome and Jerry W. Markham, Regulation of Bank Financial Service Activities: Cases and Materials (4th ed., 2011), at p. 555. 39 Financial Crisis Inquiry Commission, supra note __, at p. 151-152. 40 Stephen Labaton, “Agency’s ‘04 Rule Let Banks Pile Up New Debt,” New York Times, Oct. 2, 2008 (includes hyperlink to audio of the April 28, 2004 SEC meeting). 41 Financial Crisis Inquiry Commission, supra note __, at pp. 153-154; SEC’s Oversight of Bear Stearns and Related Entities: The Consolidated Supervised Entity Program, Office of Inspector General, Securities and Exchange Commission, Report No. 446-A (Sept. 25, 2008), at p. 49 (reporting that the SEC Division of Market Regulation had a staff of approximately 21, split between three different sub offices, some of whose respective staff were located in different states, to supervise the big five investment banks). 42 SEC Office of Inspector General, supra note __. 43 Id., at ix; Joanna Chung and Greg Farrell, “Critics claim Cox was too slow and aimed too low,” Financial Times, Sept. 22, 2008.

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Anat Admati and Martin Hellwig, The Bankers’ New Clothes (2014). Financial Crisis Inquiry Commission, supra note __, at p. 155. 46 Annette L. Nazareth, personal biography, Davis Polk, at http://www.davispolk. com/lawyers/annette-nazareth/. 47 John Cassidy, “He Foresaw the End of an Era,” The New York Review of Books, Oct. 23, 2008, at: http://www.nybooks.com/articles/archives/ 2008/oct/23/he-foresaw-the-end-of-an-era/. According to Soros, if the SEC “could not calculate the risk, they should not have allowed the institutions under their supervision to undertake them.” 48 See 17 CFR §240.15c3-1g(b)(1)(iii)(B) (referring to the “Accountant’s Report on Internal Risk Management Control System”). 49 SEC OIG Report, supra note __, at p. 34. 50 Id. 51 “Chairman Cox Announces End of Consolidated Supervised Entities Program,” Press Release, Securities and Exchange Commission (Sept. 26, 2008), at: http://www.sec. gov/news/press/2008/2008-230.htm. 52 Chung and Farrell, supra note __. 53 Chung and Farrell, supra note __. 54 Choi and Pritchard. Securities Regulation: Cases and Analysis, 3rd ed. (Foundation Press, 2012) at 38. 55 Lynn A. Stout, “Derivatives and the Legal Origin of the 2008 Credit Crisis,” Harvard Business Law Review, vol. 1 (2011), p. 1, 3. 56 Id., at p. 11. 57 Id., at pp. 12, 17. 58 Id., at p. 19. 59 Id., at pp. 19-20. 60 Timothy A. Canova, “The Transformation of U.S. Banking and Finance: From Regulated Competition to FreeMarket Receivership,” Brooklyn Law Review, vol. 60, no. 4 (Winter 1995), pp. 1295, 1348. 61 Stout, supra note __, at p. 20. 62 Stout, supra note __, at pp. 20-21. 63 Bankruptcy Code, 11 U.S.C.A. § 362 (also providing derivative counterparties with the right to keep any payments received prior to the bankruptcy petition date, broader set-off rights, exemption from fraudulent conveyance liability, among other special protections). 64 Financial Crisis Inquiry Report, supra note __, at p. 155. 65 Michael Lewis, The Big Short (2010). 66 John Sullivan, “Tax Rebates in $168 Billion Stimulus Plan Begin Arriving in Bank Accounts,” N.Y. Times, April 28, 2008. 67 Christopher L. House, Matthew D. Shapiro and Joel Slemrod, “Bush Stimulus May Have Only Modest Effect,” Wall Street Journal, Real Time Economics, Jan. 10, 2008, at: http://blogs.wsj.com/economics/ 2008/01/10/bush-stimulus-may-have-only-modest-effect/. 68 Timothy A. Canova, “The Bottom-Up Recovery: A New Deal in Banking and Public Finance,” ch. 3 in Sheila D. Collins and Gertrude Schaffner Goldberg (Eds.), When Government Helped: Learning from the Successes and Failures of the New Deal (Oxford University Press, 2014), pp. 51, 68, 75-76. 69 Id. 70 Christopher J. Goodman and Steven M. Mance, “Employment loss and the 2007-09 recession: an overview,” Monthly Labor Review (U.S. Bureau of Labor Statistics, April 2011). 71 Michael Lewis, The Big Short, supra note __. 72 Becker, Stolberg and Labaton, supra note __. 73 Greg Gordon, “Goldman executives: We made money betting against the mortgage market,” McClatchy, April 24, 2010, at: http://www.mcclatchydc.com/ 2010/04/24/92812/goldman-e-mails-we-made-money.html (reporting that Goldman marketed $39 billion in risky mortgage securities in 2006 and 2007 without informing investors that it was secretly shorting the housing market). 74 Canova, “The Bottom-Up Recovery,” supra note __. 75 Robin Sidel and Saabira Chaudhuri, “U.S. Bank Profits Near Record Levels,” Wall Street Journal, Aug. 11, 2014, at: http://www.wsj.com/ articles/u-s-banking-industry-profits-racing-to-near-record-levels-1407773976 (including chart of quarterly total net income at U.S. banks and thrifts from 2004 to 2014). 76 Anglea Monaghan, “Greenspan to Join Paulson as Advisor,” Daily Telegraph, Jan. 16, 2008, at B4. 77 David Wessel, In Fed We Trust: Ben Bernanke’s War on the Great Panic (2009), at p. 78. 45

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Canova, “The Bottom-Up Recovery,” supra note __; Timothy A. Canova, “The New Global Dis/Order in Central Banking,” ch. in John D. Haskell and Ugo Mattei (eds.), Handbook on Political Economy and Law (Edward Elgar, forthcoming 2015). 79 “A Step Back for Derivatives Regulation,” New York Times editorial, Nov. 20, 2012, A26.

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 2

LOOKING FOR CAUSATION IN THE WRONG PLACE: WHY DECRYING GOVERNMENT DEFICITS DURING THE BUSH PRESIDENCY IS A SERIOUS ERROR Michael Meeropol1 and Joao Paulo A. de Souza2 1

Western New England University, Springfield, MA, US 2 Middlebury College, Middlebury, VT, US

ABSTRACT Despite arguments by both Democratic and Republican politicians derying the rise in federal government indebtedness under the Presidency of George W. Bush, there is no evidence that federal deficits during his Presidency had any negative impact on either real interest rates or the rate of growth of the economy. This conclusion arises from comparisons with the Clinton Administration as well as the earlier period of rising deficits, during the administrations of Ronald Reagan and George H.W. Bush. By the standards of macro-economic success, the Bush II Administration compares well with the Clinton and Reagan/Bush I administrations. The real problems for the George W. Bush Administration is that he happened to be in office when a 27-year trend of rising inequality, rising private sector indebtedness and an almost criminal refusal to regulate a growing epidemic of financial fraud reached a breaking point with the financial crisis of 2007-8. “I think there is an element of truth in the view that the superstition that the budget must be balanced at all times [is necessary]. Once it is debunked [that] takes away one of the bulwarks that every society must have against expenditure out of control. There must be discipline in the allocation of resources or you will have anarchistic chaos and inefficiency. And one of the functions of old fashioned religion was to scare people by sometimes what might be regarded as myths into behaving in a way that the long-run civilized life requires. We have taken away a belief in the intrinsic necessity of balancing the budget if not in every year, [then] in every short period of time. If Prime Minister

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Michael Meeropol and Joao Paulo A. de Souza Gladstone came back to life he would say “uh, oh what you have done” and James Buchanan argues in those terms. I have to say that I see merit in that view.”

This view was expressed by Nobel Prize winning economist Paul A. Samuelson in a movie made about Keynes. The reference to James Buchanan is to his work Democracy in Deficit1 arguing that the impact of Keynes’ macroeconomic analysis was to potentially destroy the ability of policy-makers to use the fear of budget deficits to rein in the size of government itself. As one of us has argued in Surrender, How the Clinton Administration Completed the Reagan Revolution, the arguments against budget deficits have very little to do with the dangers to the economy when the federal government spends more than it takes in and everything to do with an attempt to make it difficult for government to spend more money.2 Thus, it was politically important in the decade of the 1990s for the Clinton Administration to be “fiscally responsible” in the wake of the high budget deficits run by the Administrations of Ronald Reagan and George H. W. Bush. Remember, the centerpiece of the quixotic third party campaign of H. Ross Perot in 1992 was that government borrowing had gotten out of control and the US needed a “mechanic” to get under the hood and fix the dang thing! Perot collected 19 percent of the popular vote and virtually guaranteed the election for Bill Clinton. It is not surprising, then, that in 1994, the year after President Bill Clinton persuaded Congress to pass a major deficit reduction bill (the Omnibus Budget Reconciliation Act of 1993), over 60% of Americans polled ranked cutting the federal budget deficit as a number one priority for the President and Congress. Throughout the two terms of President Clinton, as the deficits fell, the percentage of the population considering that a high priority fell as well. In the year 2000, among Republicans, Democrats and Independents, less than 50 percent of those polled considered deficit reduction a high priority. Though there was an uptick in that percentage in the year 2001, after the 9-11 attacks all three groups reduced their concern even further. One interesting thing about that reduction is that whereas concerns were shared pretty much across the political spectrum in the 1990s (in 1994 for example, the difference between Republicans and Democrats on the priority was only seven percentage points (one was 68 percent, the other 61 percent)) that was not the case after 2001. From that year through 2009, Democrats were more concerned than Republicans about the budget deficit. This is not surprising, as the Democrats as the “out” political party made as much as they could of Bush’s tax cuts and spending programs without offsets (the creation of Medicare Part D, the prescription drug program for example, as well as funding both the Afghanistan and Iraq wars without tax increases to pay for them).3 Within the George W. Bush Administration, a somewhat cavalier attitude toward policies that increased deficits in the short run seemed to support the view of the critics that the Administration was behaving irresponsibly. In the memoir of Treasury Secretary Paul O’Neill, Vice President Dick Cheney is quoted as defending the “borrow and spend” policies of the Bush Administration, with the assertion that, “Reagan proved deficits don’t matter.”4 In all of the Economic Reports issued by the Bush Councils of Economic Advisers, there is not one where a chapter is devoted to discussion of how to reduce the budget deficit. The Republican platform of 2004 had acknowledged that the federal deficits were “unwelcome” but the platform argued they were “manageable.” The Republicans explained the existence of those deficits with reference to the recession, the necessity of homeland

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security spending after the 9-11 terrorist attacks, and reduced confidence due to recent [Enron] corporate scandals. The platform argued, however, that It is important to view the size of the deficit in relation to the size of the nation’s economy. By that measure, today’s deficit, although unwelcome, is well within historical ranges. A deficit that is 3.8 percent of GDP, as is now projected for this year, [2004] would be smaller than the deficits in nine of the last 25 years, and far below the peak deficit figure of 6 percent of GDP reached in 1983.5

Not surprisingly, the 2004 Democratic Party platform took a negative view of the Bush deficits. The platform reminded the public that “Fiscal discipline helped create 23 million new jobs in the 1990s,” and argued that because of the deficits (they called them “record” deficits) the US “face(s) unsustainable foreign borrowing and rising interest rates.” Taking a cue from the economic theory of crowding out (though they didn’t use that term) the Democrats asserted “Fiscal discipline frees up money for productive investment (a)nd over time … saves families thousands of dollars on their mortgages and credit cards.” They promised to cut the deficit in half over the next four years.6 In 2012, when President Obama was running for re-election, former Democratic National Committee chair Howard Dean asserted that the Bush Administration deficits had so damaged the economy, that the 8 percent unemployment three and a half years into the Obama Presidency could (at least in part) be blamed on those Bush deficits.7 A less politicized approach was presented years earlier by William Gale and Peter Orszag of the Brookings Institution in The American Prospect for May of 2005. Acknowledging that the right kind of tax cuts could improve incentives they nevertheless concluded that deficit spending would reduce long run growth by decreasing the pool of national savings and forcing up interest rates. Echoing a paper by Orszag, Rubin and Sinai,8 Gale and Orszag also argued that borrowing cannot increase indefinitely because at some point lenders will lose confidence in the ability of the government to pay back the loan.9 The implication is that the flow of lending will at some point cease, making it impossible for some future government to roll over the principal of loans leading to either drastic cuts in spending or increases in taxes, though this scenario is not spelled out in either paper. Thus, in both the Gale-Orszag and the Orszag-Sinai-Rubin papers, the traditional crowding out approach is supplemented by a long run problem affecting the expectations of potential lenders.

WHAT ARE THE ISSUES? – SOME BASICS Let’s start with the basics. As the Republican platform reminded us, the absolute level of a budget deficit tells us virtually nothing useful. To measure its impact on the economy, it is essential that it be expressed as a percentage of GDP. The same holds true for the National Debt which is the sum of all previous deficits less previous surpluses. Table A1 in the Appendix shows the annual budget deficit and the National Debt as a percentage of GDP beginning with the first fiscal year for which President Ronald Reagan’s administration was responsible. The reason for using the Reagan (and Bush I) years as well as the Clinton years is because the Administration of Bush II often is contrasted negatively with the reductions of deficits and few years of surpluses during the Clinton years. Since the Bush II Presidency has

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macroeconomic results that are not as positive as those for the Clinton Presidency, we think it only fair to contrast what the Bush II Administration accomplished not only with the Clinton Administration but with the administrations of Ronald Reagan and George H.W. Bush. There are two types of negative impacts allegedly associated with budget deficits. The short run “crowding out” problem (which is what Gale and Orzag are saying without using that specific language) is based on a straightforward argument that the pool of national savings is the source of both business and government borrowing. Any big increase in government borrowing, the argument goes, will lead to a rise in interest rates and some private investment projects will be “crowded out” because they will no longer appear profitable at the higher rate. Similarly, as argued by many who celebrate the Clinton deficit reduction and years of surpluses, a significant reduction in government borrowing will “make room” for more private investment because interest rates will fall. Implied in all of this is the idea that the key to economic growth is to raise private investment. Government spending (by implication if not explicitly asserted) does not promote economic growth. Despite the obvious fact that much government spending (research, infrastructure, education, even nutrition programs) are clearly investments in the nation’s future, most critics of government spending ignore or dismiss the investment element of government spending either as wasteful pork-barrel spending or as entitlement spending that saps the incentives of the population. Though we feel that such an implied or explicit argument is incorrect both empirically and theoretically, we will not make that the focus of our discussion here. Instead, we will take those arguments against deficit spending on their own terms. We will investigate if there is evidence of crowding out. To do that, one needs to measure interest rates and watch the changes in those rates as deficit spending rises or falls. It is clear from Table A1 in the Appendix that there is no consistent evidence of either crowding out as deficits climbed in the 1980s and again in the early years of the 00’s and there is also no evidence that “making room” occurred as public deficits fell (and briefly became surpluses) in the 1990s.10 Some have argued that the fall in nominal interest rates in the 1990s (even though counteracted by the even greater fall in the rate of inflation) indicates that what the Clinton people called “fiscal responsibility” did work to stimulate new investment by lowering interest rates. To believe this, however, one would have to assume that borrowers considering investment opportunities will operate under “money illusion” – ignoring price changes as they make their calculations of the “cost of capital” for their investment projects. Focusing only on nominal interest rates when rates of inflation are subject to change is bad business practice and we doubt that most business decision-makers will ignore their own expectations of future inflation when making borrowing or lending decisions. From Table A1, one can see that the deficit as a percentage of GDP under President George W. Bush though higher than under President Clinton was actually lower than in the eight years of President Reagan and the one term of the elder President Bush (as the Republican platform in 2004 made clear). In order to make the analysis more comparable, we think it best to leave out the years 1982, 1983, 1991 and 1992 in measuring the ReaganBush I period as they were either recession years or years of early recovery from a recession when deficits are usually significantly larger than in more “normal” times. For the eight years of George W. Bush, we believe the years 2002, 2003 and 2008 need to be omitted for the same reason. This leaves us with four years for the Bush II presidency and seven years of

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the Reagan-Bush I presidencies. Using all the years, including those with large deficits caused arguably by recessions and not policy, the Reagan-era deficits average higher than the Bush II deficits. When we leave out 1982, 83, 91 and 92 from the Reagan-Bush I years and 2002, 03 and 08 from the Bush II years, the Reagan-Bush I average is 4.87 percent while the Bush II average is 3.07 percent. This allows us to suggest that the Bush II presidency was hardly an example of profligate government spending and/or irresponsible tax cutting in macroeconomic terms,11 despite the complaints of many Democrats and the writers quoted earlier in this paper. Second, given the course of real interest rates during the Bush II years, it is hard to see any evidence of crowding out. The deficit as a percentage of GDP peaked in 2004 and then steadily declined through 2007. The 10-year Treasury deflated by the CPI was higher in 2008 than in 2004 and actually peaked at over 2.5 percent in 2006. Deflating by the blue chip forecast of inflation (for an estimate of an ex ante real interest rate) shows the rate rising between 2004 and 2005 staying at virtually the same rate and then falling to just below the 2004 level in 2007. Only the last year to year change is consistent with the predicted behavior of real interest rates and deficits. This brings us to the most important comparisons. How did the Bush II administration fare on the crucial standards of macroeconomic success compared to its predecessors? Our standards are: The rate of growth of real GDP per capita, the rate of growth of productivity, the ratio of gross private domestic investment to GDP, the rate of unemployment, the employment to population ratio and the rate of capacity utilization. However, before we assemble the information, it is important to identify the appropriate periods of comparison. From the time of Reagan’s inauguration through December of 1983, the economy was dominated by a deep recession. Since that recession resulted from trends that were in place before Reagan took office, it appears unfair to utilize those years as part of a judgment as to the success of failure of his administration’s economic policies. This is of course doubly true since the signature policy change – the Economic Recovery Tax Act of 1981 - phased in the key tax changes over three years. Thus we have chosen the period of recovery from that recession as a basis for comparison with the other two administrations. Similarly, the George W. Bush administration began with a recession that did not end until 2002. Thus, we believe it appropriate to only utilize the recovery from that recession for comparative purposes. (This also avoids the year 2008 when the financial crisis occurred.) Table 1 uses the quarterly data for periods designated by the National Bureau of Economic Research as “recoveries” from recessions. The quarters between the troughs (quarter four in 1982, quarter one in 1991 and quarter four in 2001) and peaks (quarter three in 1990, quarter one in 2001 and quarter four in 2007) provide our data for the comparisons. In order to avoid the impact of compounding over recoveries of different lengths, we utilize averages over the course of each recovery as the basis for comparisons. It is fortunate that almost all of these quarters occur within a single Presidential administration making it possible to compare the impact of the policies of a particular Administration.12

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Michael Meeropol and Joao Paulo A. de Souza

Initial Quarter

Final Quarter

Duration (quarters)

Growth in Real GDP per capita (%/year)

Growth in real output per hour of labor Private Fixed Investment (% GDP)

Civilian Unemployment Rate (%)

Civilian Employment to Population Ratio (%)

Capacity Utilization in Manufacturing

Table 1. Quarterly Averages Over Selected Economic Recoveries

1982q4 1991q1 2001q4

1990q3 2001q1 2007q4

31 40 24

3.10 2.18 1.64

2.09 2.25 2.67

6.91 5.58 5.29

60.85 63.03 62.69

79.21 80.85 75.98

17.8 17.14 18.09

Notes: Recoveries are defined as the period between the trough to the next peak, using NBER's classification of business cycles. Sources: Board of Governors of the Federal Reserve System (capacity utilization), Bureau of Economic Analysis (GDP per capita, private fixed investment), Bureau of Labor Statistics (real output per hour, civilian unemployment, employment to population ratio).

In straightforward macro-economic terms, the table shows that investment as a percentage of GDP averaged higher in the Bush II recovery than in the previous two recoveries (and despite praise for the Clinton era economy, investment as a percentage of GDP was the lowest in that one as opposed to the other two – though the ratio was still above 17 percent). The rate of growth of GDP per capita averaged the highest in the Reagan-Bush I period at 3.1 percent, a respectable 2.18 percent in the Clinton recovery and only 1.64 percent in the Bush II recovery. Productivity growth, however, was highest in the Bush recovery averaging 2.67 percent compared to 2.25 percent under Clinton and 2.09 percent during the Reagan-Bush I period. The civilian unemployment rate and both the employment to population ratio and the capacity utilization rate – all measures of how well the economy approximates potential output – tell different stories. Unemployment steadily declined from an unacceptable 6.91 average during the Reagan-Bush I recovery to a borderline acceptable average of 5.58 percent in the Clinton recovery to a close to acceptable 5.29 percent under Bush II.13 Capacity utilization however, rises from the Reagan-Bush I era (79.21 percent) to over 80 percent under Clinton before falling to almost 76 percent under Bush II. The employment to population ratio improves dramatically from the Reagan-Bush I era to the Clinton era and then falls slightly during the Bush II recovery. Let us again recall that because the Bush II recovery ended in December of 2007, none of the data from the Great Recession caused by the financial crisis of 2008 plays a role in creating these averages. It is also true (though not relevant to our analysis of the Bush II administration) that Clinton’s recovery numbers are harmed on average by associating with the early years of the sluggish recovery from the recession of 1990. If we left out the years 1991, 92 and 93, Clinton’s numbers would look much better. It is clear from this analysis that the idea that the George W. Bush administration represented a disaster for the US economy and furthermore that the cause of that disaster can be laid at profligate spending and irresponsible tax cuts which ballooned the deficit is totally false. This brings us to the obvious question. Is George W. Bush getting a bum rap because the financial crisis happened while he was President even though all the years leading up to 2008 were actually quite respectable compared to the previous two business cycles?

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WHAT DID GO WRONG UNDER THE BUSH II ADMINISTRATION? It is our contention that the Bush II Administration just happened to be in office when trends that had been building for at least 27 years finally reached the breaking point. We have all seen the famous Saez-Piketty diagram showing inequality trends going all the way back to 1913, reproduced in Figure 1.

Figure 1. Notes: Source: Thomas Piketty and Emanuel Saez “Income Inequality in the United States 1913-1998” Quarterly Journal of Economics 118 (1) 2003: 1-39, series updated to 2013 in Excel format, January, 2015 (available at http://eml.berkeley.edu/~saez/).

Among the most significant turning points in the diagram is the year 1979. That was the year when the trend towards a more equal distribution of income and wealth – one that had begun during the Great Depression and continued throughout the post WW II boom period – came to an abrupt end. The increase in the share of income and wealth received by and held by the top one percent of the population takes a sharp turn upwards and that trend doesn’t end until 2008. According to more recent research by Saez and Piketty, the bottom 99 percent of the population received an average annual growth of real income below one percent a year between 1976 and 2007.14 We believe that increased inequality can contribute to declining economic growth because a rising percentage of the population cannot afford to keep buying the rising output of American businesses. In this situation, the only way the majority of the population could sustain consumption growth sufficient to stimulate investment would be by going deeper and deeper into debt. It would appear that to facilitate optimism on the part of both borrowers and lenders to take on all that increased debt, the economy required bubbles of irrational exuberance (the dot.com bubble of the 1990s, the housing bubble of the 00’s) and increasing leverage in the private sector. We believe that the political focus on public deficit spending has obscured the much more serious situation of private deficit spending – and not just by

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consumers buying mortgages they couldn’t afford to service, but private businesses, especially financial businesses, using leverage to gather enormous profits creating what the economist Hyman Minsky warned about – a financially fragile economy.15 In the financial sector, the Bush II administration actually did not have to do anything as most of the dismantling of old New Deal controls on banks and other financial institutions had occurred under the previous administrations – including most famously the Clinton Administration. In the area of labor market policy and tax and transfer policy, however, the Bush II administration can definitely be faulted. Here is where the microeconomic aspects of the Bush Administration’s tax cuts become significant. Most of the benefits from the tax cuts accrued to the highest income taxpayers while those with incomes low enough to have an individual income tax burden of zero saw no increases in disposable personal income. One of the most significant tax reductions applied only to millionaires – the dramatic cuts in the estate tax (with total if temporary disappearance in the year 2011).16 The Bush Administration did not propose an increase in the minimum wage, letting its purchasing power erode due to inflation over the course of the first six years of his Presidency. When a Democratic majority took over the House in 2007, they passed a minimum wage increase. When it got to the Senate, the Republican minority filibustered it until it was “sweetened” with a business tax cut, supposedly to take the sting out of the wage increases mandated by the bill. With the tax cut included, the bill passed in 2007. Meanwhile, many blue-collar workers were subjected to increasing competition from foreign workers due to major trade deals and the high value of the dollar vis a vis the Chinese currency. Thus, the real wage growth that had briefly occurred during the late 1990s ended with the recession of 2001 and did not resume during the subsequent recovery. Evidence of the increases in inequality are presented in the Saez-Piketty article referenced above. During the Clinton expansion (1993-2000) though inequality increased, the real annual growth of income for the bottom 99 percent of the income distribution was 2.7 percent. During the Bush expansion, (2002-2007) by contrast, that real income growth was 1.3 percent. During the Clinton years, the top one percent captured 45 percent of all the income gains whereas during those Bush years, 65 percent of the gains went to the top one percent.17 Interestingly enough, the increase in inequality was not due to the rising importance of interest income as a source of personal income as it was in the period of the Reagan and Bush I administrations. Because of the Federal Reserve’s low interest policy during the years after the 2001 recession, the rise in government deficit spending during the period from 2001 through 2007 did not produce any increase in the ratio of personal interest income to personal income as it did during the decade of the 1980s. In 2001, personal interest income was 11 percent of personal income and that percentage fell through 2004. It was still below 11 percent in 2007. By contrast, between 1983 and 1989, because of the Volcker Fed’s high interest policy, interest as a percentage of personal income was significantly higher, rising from 13.9 percent of personal income to 15 percent.18 Again, the Bush deficits appear not to have been a major contributor in the rise in inequality during the period after the 2001 recession.

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WHAT WERE THE FAILURES? WHAT WERE THE CAUSES? It is obvious that the charge made by Howard Dean back in 2012 about the relationship between the Bush deficits and the struggles of the economy since the financial crisis is incorrect. It is also, we believe, an important conclusion of this research that the warnings from Gale and Orszag were misplaced. The problem was not the amount of government borrowing. That paled to insignificance in the face of the massive increases in private sector indebtedness. By 2007 as a result of the housing bubble and the need of middle income Americans to sustain increases in consumption in the face of stagnant wages, household indebtedness reached 100 percent of GDP. The indebtedness of financial corporations rose to 116 percent of GDP by the same year. By contrast, the Federal Government’s indebtedness was 34 percent of GDP in 2007.19 It is important to note that the increasing leverage in the financial sector was masked for most of the decade of the 00’s by the big increase in the value of financial assets held as a result of the housing bubble and the expansion of the many fancy credit instruments that contributed to it. Thus, until the bubble burst, the financial sector appeared to have its liabilities well covered by high valued assets. We now know, of course, that many of those assets were over-valued. Thus, once the housing bubble started to deflate many of the largest financial institutions were in danger of going bankrupt (some did of course) – a scenario predicted by Minsky’s analysis decades before. The true cause of the relative macroeconomic failures of the Bush II administration is the fact that the inequality trends finally overwhelmed the increases in borrowing and bubbleinduced enthusiasms of investors that had sustained the economy in the late 1990s and the first decade of the 00’s. It happened on Bush’s watch but the trend had been building since the 1980s. We cannot stress enough that this trend has nothing to do with rising federal indebtedness. The increase in inequality and the resort to credit by households and businesses continued during the period of deficit reduction and short term surpluses under President Clinton, just as it had under the high deficit presidencies of Reagan and both Bushes. By emphasizing federal budget deficits as the source of long run problems, economists, journalists, politicians and members of the public set the stage for an almost criminal failure on the part of policy makers when confronted by the Great Recession of 2008-2010. That crisis demanded not just expansionary monetary policy but budget deficits on a much greater scale than was politically feasible. Because budget deficits ended up being insufficient to lift the economy into a strong recovery in 2009 and 2010, that left the Federal Reserve as the only source of stimulus once the Recovery Act spending had run its course. Though the US never made the European mistake of imposing depression level austerity, the fact that so many people criticized the Bush Administration’s deficits while praising the Clinton Administration’s “fiscal responsibility” set the stage for an insufficient response to the Great Recession – the consequences of which are still being unfairly borne by the poor, the unemployed, the working poor and the vast American middle class.

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APPENDIX

Federal Government Debt (% of GDP)

10-Year Treasury Constant Maturity Rate (real, CPIadjusted), %

10-Year Treasury Constant Maturity Minus Federal Funds Rate (real, CPI-adjusted), %

10-Year Treasury Constant Maturity Rate (real ex ante, calendar year), %

10-Year Treasury Constant Maturity Minus Federal Funds Rate (real ex ante, calendar year),%

1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Federal Government:Net lending (% of GDP)

Table A1. Selected Variables by Fiscal Year

-4.11 -6.38 -5.95 -5.74 -5.73 -5.24 -4.17 -3.48 -3.75 -4.14 -5.27 -5.25 -4.04 -3.50 -2.79 -1.49 -0.41 0.45 1.12 1.19 -1.76 -3.45 -4.19 -3.32 -2.70 -2.06

25.87 30.26 31.05 33.76 36.85 38.70 38.61 38.25 39.29 42.19 45.03 46.87 46.71 47.12 45.82 43.97 41.68 38.21 33.70 30.56 31.56 33.48 34.56 34.81 34.66 34.16

8.50 7.87 7.81 7.62 6.44 3.50 4.51 4.14 2.13 4.57 4.05 3.30 3.45 4.41 3.22 4.15 4.09 2.57 2.63 2.56 3.24 1.53 1.72 -0.51 2.69 1.84

0.50 1.75 2.07 2.64 1.02 1.37 1.64 -0.40 0.10 1.65 3.10 3.04 2.78 1.33 0.89 1.04 0.06 0.40 0.22 0.24 2.92 2.64 3.11 1.44 0.11 -0.47

n/a 3.64 7.19 5.16 3.24 4.42 5.06 4.03 3.68 3.61 2.50 2.29 3.66 3.48 2.94 3.46 2.30 3.16 3.75 2.46 2.06 1.98 2.03 2.35 2.34 1.98

n/a 1.88 2.11 2.40 0.84 1.66 1.23 -0.69 0.43 2.09 3.34 2.75 2.79 0.72 1.10 0.87 -0.09 0.65 -0.20 1.10 2.87 2.83 2.86 1.06 -0.17 -0.38

Notes: All variables were computed as averaged over fiscal years, except the federal debt, which was computed as the end-of-period level, and the ex-ante interest rates, which were computed over calendar years. The ex-ante interest rates were achieved by deflating nominal rates by the 2-year blue chip CPI forecast. The federal debt is computed according to the US Flow of Funds definition, and it is comprised of the stock of federal liabilities in treasury securities (including U.S. savings securities), multifamily residential mortgages (negligible since the mid 1980s), and budget agency securities. Sources: US Flow of Funds (net lending, debt, gdp), Federal Reserve Bank of St. Louis (interest rates), Bureau of Labor Statistics (CPI inflation), and Congressional Budget Office Economic Forecasting Record 2009 Update (2- year blue chip CPI forecast).

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ENDNOTES 1

Buchanan, James Democracy in Deficit: The Political Legacy of Lord Keynes NY: Academic, 1977. “.... there is no question that many economists and business leaders believe that government spends too much money on unnecessary projects and/or undeserving people. Seen in this light, balancing the government budget is a means to an end. The end is not to stop running deficits but to reduce government spending. The economist Milton Friedman, who is a strong critic of government intervention in the economy, stated this point explicitly. “I would rather have a federal government expenditure of $400 billion with a $100 billion deficit than a federal government expenditure of $700 billion completely balanced.” Meeropol, Michael Surrender, How the Clinton Administration Completed the Reagan Revolution (Ann Arbor: U of Michigan Press, 2000): 19. 3 For details see http://www.people-press.org/2014/01/27/deficit-reduction-declines-as-policy-priority/. 4 Quoted in The Price of Loyalty George W. Bush, the White House, and the Education of Paul O’Neill (NY: Simon and Schuster, 2004): 291. 5 The platform continues the argument, “This deficit is also in line with what other industrialized nations are facing today. The U.S. deficit matches the average deficit within the Organization for Economic Cooperation and Development, and is below the levels of France, Germany, and Japan. Much more importantly, because the President and Congress enacted pro-growth economic policies, the deficit is headed strongly in the right direction. Next year’s [2005] projected deficit, at 2.7 percent of GDP, would be smaller than those in 14 of the last 25 years. As Republicans in Congress work with the President to restrain spending and strengthen economic growth, the federal deficit will fall to 1.5 percent of the nation’s economic output in 2009 – well below the 2.2 percent average of the last 40 years.” http://www.presidency.ucsb.edu/papers_pdf/25850.pdf: 46. 6 See the Platform of the Democratic Party http://www.presidency.ucsb.edu/ws/?pid=29613. 7 James Glassman “The Facts about Budget Deficits” (July 11, 2012) http://www. forbes.com/sites/jamesglassman/ 2012/07/11/the-facts-about-budget-deficits-how-the-presidents-truly-rank/ 8 Rubin, Robert, Peter Orszag, and Allen Sinai (2004). ‘Sustained Budget Deficits: Longer-Run U.S.Economic Performance and the Risk of Financial and Fiscal Disarray.’ Paper presented at the AEA-NAEFA Joint Session, Allied Social Science Associations Annual Meetings, The Andrew Brimmer Policy Forum, “National Economic and Financial Policies for Growth and Stability,” Sunday, January 4, 2004, San Diego, CA. 9 See Gale, William and Peter Orszag: “The Great Tax Shift” The American Prospect (May 2005.) 10 For the concept of “making room” as the obverse of crowding out, see Solow, Robert 2005. ‘Should we Pay the Debt?’ The New York Review of Books, 47 (15), October 5, pp. 7-9. The idea is that increased government savings (which is what running a surplus creates) means the pool from which private investors borrow will be larger – “making room” for more investment spending. The indirect evidence for making room would be a decline in real interest rates while the direct impact would be a rise in private sector investment. 11 We ignore for the moment important micro-economic criticisms of the specific tax cuts enacted by Congress during the Bush II Administration. As has been explained in many venues, the benefits were heavily skewed towards the highest income taxpayers and those with the most accumulated wealth. See, for example Gale, William and Peter Orszag Bush Administration Tax Policy: Distributional Effects” Tax Notes 27 September, 2004: 1559-1566. 12 The Reagan recovery includes one and a half years of the Bush I Administration, and the Clinton recovery also includes one and a half years of the Bush I Administration. 13 We note that none of these rates achieve the target rate of 4% mandated by the Humphrey-Hawkins Full Employment and Balanced Growth Act but those economists who believe there is a NAIRU of 5% or even higher welcome the flouting of that mandate. 14 See Piketty, Thomas and Emmanuel Saez “Top Incomes and the Great Recession: Recent Evolutions and Policy Implications” IMF Economic Review, (Vol 61 No. 3): 461 (available at http://eml.berkeley.edu/~saez/pikettysaezIMF13topincomes.pdf). It appears that the trend towards increasing inequality resumed during the years of recovery since the last trough. See Emanuel Saez “Striking it Richer: The Evolution of the Top Incomes in the United States” Updated with 2013 Preliminary Estimates, January 25, 2015 at http://eml.berkeley.edu/~saez/ 15 See Minsky, Hyman Stabilizing an Unstable Economy (NY: McGraw Hill Professional. 2008 [1986]). The idea of financial fragility is that as an economy goes through an extended period of prosperity, there is a tendency for both borrowers and lenders to agree on more and more risky indebtedness which makes the danger of a financial meltdown greater as the period of prosperity extends. 16 For a detailed analysis of the long run implications of the Bush Administration tax cuts, see Gale and Orszag (2004) 2

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See Piketty and Saez: 461. For 1983-1989, see Economic Report of the President, 1997: 330. For 2002-2007 see Economic Report of the President, 2013: Table B-29. 19 See Tables L.1 and L.2 in the Flow of Funds Accounts. For a most revealing diagram see Magdoff, Fred and Michael Yates The ABCs of the Economic Crisis (NY: Monthly Review Press, 2009): 77. 18

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 3

INTERNATIONAL TRADE UNDER PRESIDENT GEORGE W. BUSH Shahruz Mohtadi

*

Suffolk University, Boston, MA, US

ABSTRACT President George W. Bush, like every president since World War II, ran and was elected on a platform of free trade. The administration had an ambitious plan to launch a new round of global trade negotiations through the World Trade Organization (WTO). To implement the plan, the President had to gain fast-track authority from Congress. To obtain this authority and to strengthen his political base for the midterm elections of 2002, he imposed tariffs on steel and signed the 2002 Farm Bill. These policies undermined the administration’s credibility which contributed to the breakdown of the WTO’s Doha Round. The administration then began to pursue its agenda by establishing bilateral free trade agreements (FTA). By the end of the President’s second term, the administration had a remarkable record of FTA agreements, but was successful in getting only three approved by Congress. In the end, little progress was made on his plans for trade liberalization.

INTRODUCTION On June 12, 1999, in announcing his candidacy for the Republican presidential nomination, George W. Bush remarked: “We’ll be prosperous if we embrace free trade. I'll work to end tariffs and break down barriers everywhere, entirely, so the whole world trades in freedom. The fearful build walls. The confident demolish them. I am confident in American workers and farmers and producers. And I am confident that America's best is the best in the world.”1 And on November 19, 1999, in another speech, he stated; “The case for trade is not

*

The author wishes to thank Dov. S. Zakhiem and Jonathan Haughton for comments and review of the paper.

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just monetary, but moral. Economic freedom creates habits of liberty. And habits of liberty create expectations of democracy.”2 Following the election, President Bush again emphasized his support for free trade. In March 2001, he stated: “This administration will always speak for American interests, but free and open market trade is in our national interest. The world will know this, that I strongly and my administration strongly supports free trade.”3 The Bush administration then embarked on an ambitious plan to launch a new round of multilateral trade negotiations through the World Trade Organization (WTO) and to negotiate a series of bilateral and regional free trade agreements. However, the Bush administration retreated from these trade liberalizing efforts by providing protection to the domestic steel and cotton industries, by retaliating against other nations’ protectionist policies, and by signing a trade-distorting farm bill. The aim of this paper is to assess President Bush’s trade policy during his two terms as the 43rd President of the United States. First, it describes the Bush administration’s trade agenda. Second, it explores the administration’s policies during those eight years. Finally, the paper provides an assessment of the successes and failures of the Bush administration. It argues that President Bush’s trade policies were heavily influenced by political considerations both domestically and internationally.

TRADE POLICY AGENDA When President Bush came into office, the country was facing a recession, with rising unemployment. Many blamed the huge job losses on import competition and outsourcing to India and China. Congress was evenly divided over the merits of globalization and the trade deficit was reaching $500 billion per annum. In this environment, the President laid out a trade agenda with the following objectives: to ask Congress to pass “fast track” authority, renamed Trade Promotion Authority (TPA); to launch a new round of global trade negotiations; to negotiate a Free Trade Area of the Americas; to expand market opportunities for American goods, services and intellectual property; and to improve worker training, adjustment, and education.4 To carry out this agenda, the President appointed Robert Zoellick as the U.S. Trade Representative (USTR). As USTR, Mr. Zoellick became a member of President Bush's cabinet, with the rank of Ambassador serving as the President's principal trade policy adviser and chief trade negotiator. Ambassador Zoellick’s first job was to ask for TPA, which had expired in 1997 during the Clinton administration. TPA is the authority that the Congress grants to the President to negotiate and enter into trade agreements and then submits it to Congress for a vote on the agreements without any amendments.5 In Congress, the Republicans had a small majority and most of the Democrats were firmly against any trade negotiations that might be seen as threatening American jobs or help the President. Many Republicans were anxious about voting for the TPA, if it would be viewed by their constituents as threatening domestic jobs; this was especially true of the Republicans in the steel-producing districts of West Virginia, Ohio, and Pennsylvania, who had lobbied the President to help the ailing steel industry.6 At the same time, Republicans from agricultural states were demanding more subsidies for their farmers due to low farm prices.

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THE 2002 STEEL EMERGENCY SAFEGUARD MEASURES AND THE FARM BILL OF 2002 To fulfill his campaign promise to protect the steel industry, the President requested that the International Trade Commission (ITC) initiate a Section 201 investigation in the steel industry. Section 201 investigations are allowed by the U.S. Trade Act of 1974, which states that a tariff can be requested by the president, by the Congress, or a firm or union that files a petition with the ITC. The ITC then determines whether rising imports have been “a substantial cause of serious injury, or threat thereof, to the U.S. industry…”7 This was one of the few times that a president had initiated a Section 201 action; usually firms or unions in an industry apply to the ITC for import protection. The administration’s justifications for the tariffs were based on Article XIX.1 of GATT 1994 and Article 2.1 of the Agreement on Safeguards. Article XIX of GATT 1994 permits a country to impose tariffs, or remove tariff concessions, if the industry’s imports cause or threaten “serious injury” to domestic producers. The administration cited the damage being done to the U.S. steel industry by a surge in imports of 16 categories of steel products from the European Union (EU) countries, China, Japan, and other steel exporting countries. Both President Bush and Ambassador Zoellick stressed that these measures were temporary and were in response to the unfair trading practices of those steel exporters. The ITC determined that the conditions for Section 201 and Article XIX were met and recommended that tariffs ranging from 10% to 20% be placed on steel imports for the first year, to fall over time and be eliminated after three years.8 President Bush accepted the recommendation of the ITC and on March 5, 2002, announced the imposition of tariffs “…to help give America’s steel industry and its workers the chance to adapt to the large influx of foreign steel.”9 Most of the tariffs placed by the President were higher than those recommended by the ITC, ranging from 8% to 30%. These tariffs were not imposed on countries with which the U.S. had free trade agreements, namely, Canada, Mexico, Jordan, and Israel, and a number of small developing countries. Australia and South Korea were also excluded, and higher tariff quotas were set on imports from Brazil and Russia. The countries that were most affected by the tariffs were EU, Japan, and China. In response to these tariffs, the EU, joined by Brazil, China, Japan, South Korea, New Zealand, Norway, and Switzerland, brought a case against the U.S. to the WTO. The WTO established a Dispute Settlement Panel to examine the case, and ruled that the U.S. had failed to prove that the U.S. steel industry had been hurt by the increase in imports, and therefore did not have the right to put “safeguard” tariffs” in place.10 The U.S. appealed the case, but the WTO Appellate Body upheld the decision of the Panel, which in turn, permitted the EU to take retaliatory measures against the U.S. In response, the EU threatened to impose tariffs on U.S. exports of Louisiana rice, Florida citrus, California nuts, and North Carolina pajamas, states that were crucial to the 2004 presidential election. As intended, the direct effect of the tariffs was an increase in the price of steel and caused a reduction of imports from the targeted countries. The indirect effect of the tariff was to increase the cost of production of steel-consuming industries leading to lower production and layoffs. A study by Francois and Baughman found that by January 2003, the steel tariffs had cost far more jobs in the steel-consuming industries than had been saved in steel-producing industries.11 And a study by the ITC concluded that the net effect of the tariffs on the U.S.

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economy and employment was negative. Not only did it result in net job losses but it also resulted in a substantial distribution of welfare from the private sector, in terms of reduced profits, towards the US government in the form of increased government revenue.12 On December 4, 2003, the President announced that the tariffs had served their purpose and were being removed after being in place for less than two years.13 Ambassador Zoellick also maintained that the tariffs were successful in allowing the domestic industry to restructure and compete with foreign imports.14 However, he did admit that domestic politics were behind the imposition of the tariffs.15 In the midterm elections for the U.S House of Representatives in November 2002, the President needed Republicans to win the key steelproducing states of Pennsylvania, Ohio, and West Virginia.16 At the time the tariffs were placed, a combined forty House seats from these states were at stake in the midterm elections. During the 2000 campaign, President Bush had promised to remove some of the market distorting agricultural policies, specifically eliminating agricultural export subsidies.17 Yet, in May 2002, the President signed into law the Farm Security and Rural Investment (FSRI) Act of 2002, also known as the Farm Bill of 2002.18 Rather than reducing subsidies, the bill increased the funding for subsidies to US farmers. The Act also reintroduced several measures considered to have a distorting effect on production and prices, which had been discontinued under the previous Farm Bill of 1996. The bill was designed so as not to violate several provision of the WTO agreement on agriculture in terms of export subsidies and price support provisions. The bill generated a huge uproar in both developed and developing countries which claimed that such a massive increase in spending would further distort world markets for agricultural products and contribute to the impoverishment of developing countries heavily dependent on agricultural trade. It also contradicted the President’s agenda, which advocated the reduction in farm subsidy programs in order to launch a new round of trade negotiations.19

THE WTO AND MULTILATERAL NEGOTIATIONS In November of 2001, a new round of trade negotiations was launched in Doha, Qatar. The round was named the Doha Development Round, because it was primarily aimed at helping the poor in the developing countries. Rich countries promised to open their markets for farm goods and textiles, and promised to assist these countries with cash, technical assistance and special treatment. In return the developing countries promised to reduce their barriers in highly-protected economic sectors, such as agriculture and services. In September 2003, trade talks in Cancun, Mexico collapsed after four days of arguing over farm subsidies and access to markets. A group of twenty developing countries led by Brazil, China, India, Mexico, Thailand, and South Africa refused to negotiate on issues of competition, foreign investment, government procurement and trade facilitation, unless the developed countries, particularly the U.S. and the EU countries, committed to reducing their domestic agricultural production and export subsidies, and to lower their import barriers on agricultural products. This was in direct response to the US Farm Bill of 2002, and the European Union’s Common Agricultural Policy. Despite these setbacks, President Bush was committed to the completion of the talks.20 In an address to the United Nations on September 14, 2005, he stated that through the

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35

elimination of subsidies, tariffs and barriers to trade, the successful completion of the Doha Round was the to key to lifting the ‘burden of poverty’ from millions of people in the developing world.21 With two months to go before the 2005 Hong Kong ministerial meeting of the WTO, Robert Portman, Robert Zoellick’s successor as USTR, attempted to further build upon the impressive framework agreement negotiated by his predecessor with a twostage proposal for agricultural trade.22 Despite Portman’s efforts, little of real substance was achieved at the Hong Kong ministerial meeting, and in July 2006 the talks were suspended indefinitely. In 2007, with less than six months before the expiration of his TPA, President Bush again called for the talks to be reconvened, and the U.S. began a new round of meetings with trade ministers across the globe.23 However, in the mid-term elections of November 2006, the Democratic Party gained a majority in Congress and declined to renew the President’s TPA. This effectively reduced the administration’s credibility in any future trade negotiations, as other countries realized that any agreement could easily be changed by the U.S. Congress.

FREE TRADE AGREEMENTS Following the breakdown of negotiations in Cancun, the administration declared that it would focus its efforts to liberalizing trade on a bilateral and regional basis. This shift in focus was amplified by Ambassador Zoellick when he stated, “But the key division at Cancun was between the can-do and the won't-do. For over two years, the US has pushed to open markets globally, in our hemisphere, and with sub-regions or individual countries. As WTO members ponder the future, the US will not wait: we will move towards free trade with cando countries.”24 Thus began an ambitious program of free trade agreements (FTAs) by the administration. Prior to the Bush administration, the U.S. had FTAs with only three countries; Israel, Canada, and Mexico. By the end of the President’s second term, the administration had concluded negotiations and agreements with Jordan (signed by President Bush but started by the Clinton administration), Australia, Chile (January 1, 2004), Singapore (January 1, 2004), Morocco (June 15, 2004), Colombia (November 22, 2006), Panama (started in June 28, 2007, signed October 21, 2011), CAFTA-DR: (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic, August 5, 2004)) and South Korea (signed on June 30, 2007). In addition, it passed the US-Peru Trade Promotion Agreement, and began negotiations with Malaysia in 2005 (suspended in 2009), and with Thailand in 2004 (suspended in 2006). As described earlier, one of the President’s objectives was the completion of negotiations for a Free Trade Area of the Americas (FTAA). The negotiations had begun at the first Summit of the Americas, in December of 1994 in Miami, Florida, where the heads of state and governments of 34 countries in North, Central and South America and the Caribbean, except Cuba, agreed to complete negotiations for a FTAA by 2005. The goal of this agreement was to join the economies of the Western Hemisphere into a single free trade area. In a speech in Florida during his first presidential campaign, he stated, “When the next president sits at the Americas Summit in Quebec next April… Our goal will be a free trade agreement with all of the nations of Latin America.” He added that the United States should negotiate such accords in cooperation with “our NAFTA partners” as well as Chile, Brazil,

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and Argentina, and should work towards free trade with Central American and Caribbean countries. “But the ultimate goal,” Bush declared “will remain constant--free trade from northernmost Canada to the tip of Cape Horn.”25 However, at the third Summit of the Americas in Quebec City in 2001, the negotiations were met with protests. While the US had led the negotiations, it began to lose control over the goals and the vision of the agenda. The Organization of American States and other international organizations began to change the agenda and replaced it with a new set of principles and plan of action.26 In the summer of 2005, at the fourth Summit of the Americas in Mar Del Plata, Argentina, the mandates and action plans that emerged shifted away from advancing free trade as the principal means of economic development, to giving governments an increasingly more important role in programs for economic development. In a defiant move, Venezuela and the MERCOSUR countries (Argentina, Brazil, Paraguay, and Uruguay) broke from the pro-FTAA unanimity of earlier summits by inserting a dissenting statement into the Declaration of Mar del Plata, effectively ending any hopes of establishing the free trade area.27 As it did in the wake of the failure of the Doha Round, with the prospects of the FTAA fading, the administration then redirected its efforts to bilateral negotiations. Following the invasion of Iraq, on May 9, 2003, the President proposed the creation of a Middle Eastern Free Trade Area (MEFTA).28 As Ambassador Zoellick remarked in a speech outlining the MEFTA plan, the reconstruction and democratization of Iraq would provide an ‘opportunity for change’ for the countries of the Middle East. MEFTA was designed to “assist nations that are ready to embrace economic liberty and the rule of law, integrate into the global trading system, and bring their economies into the modern era.”29 With this goal in mind, the administration began to negotiate a series of bilateral agreements with the countries in the region. In 2004, it signed an FTA with Bahrain, and in 2006 with Morocco and Oman. It started talks with Egypt and reached trade and investment framework agreements with Saudi Arabia, Kuwait, Qatar, Yemen, and the United Arab Emirates (UAE). The negotiations with the UAE were supposed to be concluded it in 2006, but the Dubai Ports World controversy put an end to the talks.30

OTHER TRADE POLICIES The administration again retreated from its free trade agenda and open markets by placing tariffs and quotas on the imports of a number of its trading partners. For example, it placed import quotas on several textile items imported from China.31 Similar to the steel tariffs, the rationale for these quotas was to protect against “surges” in imports, and that China had agreed that such surges could be protected against when China joined the WTO in 2001.32 Furthermore, with the expiration of the Multi-Fiber Agreement in textiles and clothing in 2005, the U.S. experienced another surge in Chinese textile imports. In response to the surge, the U.S. signed a textile agreement with China that set annual limits on 34 different categories of clothing, running through 2008. Furthermore, the Commerce Department decided to impose countervailing duties, designed to offset foreign subsidies, on a number of paper products from China.33 It also placed similar tariffs on Canadian softwood lumber in a bid to protect American lumber jobs from allegedly subsidized Canadian imports.34

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During this administration, the U.S. placed a number of anti-dumping duties on imported shrimp from Vietnam, China, Brazil, Ecuador, India, and Thailand.35 Dumping is defined as selling a product at a lower price in the export market than in the domestic market. U.S. firms use anti-dumping petitions as a means of preventing foreign competitors from selling their products at lower prices than American goods. The administration claimed that many of these anti-dumping duties were placed in response to the investigations of the Department of Commerce, and that the administration was simply following the law. There were a number of positive developments during these years. In October 2000, Congress passed the Continued Dumping and Subsidy Offset Act (CDSOA), commonly known as the “Byrd Amendment.” This was a U.S. law providing for the distribution of import tariffs collected as a result of antidumping or countervailing duties to petitioners and other interested parties in the investigations. The CDSOA was successfully challenged in a WTO dispute proceeding brought by eleven WTO members including Canada, the European Union, and Japan; and in late 2004 most of the complaining parties were authorized to suspend tariff concessions until the United States complied, by repealing the law.36 Subsequently, Canada, the European Union, Mexico, and Japan placed tariffs on a range of American products. The controversy over the CDSOA was part of a larger ongoing debate in Congress, and in the country as a whole, on the future direction of U.S. trade policy. Proponents of the CDSOA argued that U.S. producers were facing an uneven playing field due to price discrimination and artificial competitive advantage brought about by unfairly dumped or subsidized imports. Opponents believed that the CDSOA would encourage additional antidumping or countervailing duty actions, thus introducing a greater level of economic inefficiency into the trading system. They also maintained that other U.S. industries could be damaged by higher prices for intermediate goods used in production, and that exporters could be adversely affected by retaliatory sanctions on their products. In the fiscal year 2004 budget proposal, the Bush administration urged the repeal of the amendment, referring to it as a “corporate subsidy” that effectively provided a significant “double dip” benefit to industries that already gained protection from the increased import prices provided by countervailing tariffs. Eventually Congress repealed the amendment is January 2006, although the provisions of the act remained in place until 2007 and companies continued to receive payments. President Bush also signed the American Jobs Creation Act of 2004, which repealed the Extra Territorial Income Act (ETI). The ETI allowed U.S. companies to use subsidiaries in offshore tax havens to pay lower export taxes. The EU had brought a case against the U.S. to the WTO, and the WTO had found the lower taxes were a form of subsidy, and authorized the EU to take “appropriate countermeasures” by imposing $4 billion in tariffs on imports from the U.S. While the administration had earlier placed quotas and tariffs on Chinese goods, it resisted pressure by US Senators Schumer and Graham to label China a “currency manipulator” and place tariffs on Chinese goods.37 In addition, the Administration rejected a Section 301 petition to the USTR by the China Currency Coalition, made up of a number of U.S. metals-related industries, their unions, and several members of Congress. The coalition argued that by the pegging of the Chinese yuan to the U.S. dollar at an artificially low rate, led to lower dollar prices for Chinese goods, and boosted its exports to the U.S.38

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AN ASSESSMENT President Bush, like every president after the World War II, ran and was elected on a platform of free trade. But in order to achieve his ambitious free trade agenda he needed passage of the TPA. To obtain TPA and strengthen his political base for the midterm elections of 2002, he imposed tariffs on steel and signed the 2002 Farm Bill. These policies undermined the administration’s credibility, which contributed to the breakdown of the Doha Round. With the failure of the Doha Round, the administration then began to pursue its agenda by seeking to establish FTAs bilaterally and regionally. Ambassador Zoellick termed this trade strategy one of competitive liberalization. According to this strategy, the establishment of a bilateral or regional FTA, particularly by an economic superpower like the United States, would create incentives for other countries to establish new FTAs or gain membership into an existing FTA. By the end of President Bush’s second term, the administration had a remarkable record of FTA initiatives, but was successful in getting only three approved by Congress, being forced to retreat from its free trade agenda.39 The CAFTA-DR was passed by Congress by a narrow partisan vote. Many Democrats were opposed to the agreement because it did not contain enough provisions for worker rights and environmental safeguards. It was also opposed by Republican and Democratic members from sugar beet and sugar cane-growing areas, and a host of other members who linked free trade to America's soaring trade deficits. To pacify those members, the agreement included a mechanism that allowed the U.S., at its option, to provide some form of alternative compensation to CAFTA country exporters in place of sugar imports. It also allowed the US to restrict imports eligible to enter under the CAFTA if the U.S. sugar program was threatened, and instead provided equivalent benefits to the CAFTA countries to make up for the lost access.40 When the CAFTA negotiations were concluded and the sugar industry learned that it provided for a slight increase in sugar imports, the industry responded by launching a large, ultimately successful, lobbying effort to keep sugar out of the U.S.Australia FTA.41 With the capture of Congress by the Democrats in 2006, a number of the newly- elected Democrats were opposed to any trade deals, making ratification of FTAs even more difficult. To ratify the FTAs with Peru, Colombia, and Panama, the administration and Congress reached the Bipartisan Agreement on Trade Policy of May 10, 2007.42 The administration agreed to amend the agreements that had already been signed so that trading partners would no longer be required merely to enforce their own labor and environmental laws, but were required to abide by the five core standards of the International Labor Organization. These standards prohibited the use of child labor, forced labor, labor discrimination, and the protection of the rights of workers to unionize.43 Even with these agreements, the Colombia and Panama FTAs were not ratified until 2011. The opposition to the Iraq war by many members of Congress delayed granting the President TPA which eventually expired in 2007. As a result, the Korea-US FTA, which was started and concluded by the administration, and was the most economically important FTA since the North American Free Trade Agreement, was postponed and was not ratified until 2011. Following the September 11, 2001 terrorist attacks, and the subsequent invasion of Iraq, trade policy became intertwined with national security issues. In a series of speeches and oped pieces, Ambassador Zoellick argued that trade not only had economic implications but also

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geopolitical implications for U.S. foreign policy, and would be used to promote American values and interests around the world.44 The administration used the prospects of trade agreements to help allies in the wars in Iraq and Afghanistan, and to deny trade benefits to countries that did not cooperate. For example, the administration rejected attempts by New Zealand, due to New Zealand’s refusal to allow U.S. nuclear-armed ships to dock at its ports and its refusal to support the U.S. in the Iraq war, but initiated a trade agreement with Australia, which sent troops to Iraq. The administration also delayed signing an agreement with Chile for more than six months to show its disappointment at Chile’s reluctance to support its Iraq policy at the United Nations. The agreements with Morocco, Oman, Bahrain, and the goal of MEFTA were primarily motivated by political and security rather than economic considerations. In the end, President Bush’s trade agenda remained incomplete. The Doha Round was not completed during his terms in office and his plans for the creation of the Free Trade of the Americas never materialized. The proliferation of bilateral and regional free trade initiatives led to free trade “fatigue” by Congress which resulted in increased opposition by Congress to these initiatives, especially after the 2006 elections. This in turn, forced the administration to make major concessions in order to ratify the agreements. Yet, despite these setbacks, U.S. exports and imports grew continuously during his presidency. Under his administration, the public's attitude towards trade changed dramatically. The proportion of Americans who said that trade was good for the country fell from 78 percent in 2002 to 53 percent in the spring of 2008, according to surveys by the Pew Global Attitudes Project. The decline in support for trade during this period was greater in the United States than in any other country in the world, by far.45

ENDNOTES 1

http://www.presidency.ucsb.edu/ws/index.php?pid=77819N. https://www.mtholyoke.edu/acad/intrel/bush/wspeech.htm. 3 http://votesmart.org/public-statement/5565/president-bush-discusses-the-economy-at-western-michigan-university #.VJmVS_8ysA. 4 For further details of the agenda see http://www.presidency.ucsb.edu/ws/index. php?pid=78854&st=trade. He also mentioned it in his 2002 State of the Union address. See, http://www.washingtonpost.com/wpsrv/onpolitics/transcripts/sou012902.htm. 5 For a full description see http://fas.org/sgp/crs/misc/RL33743.pdf. 6 In fact, in a campaign speech in West Virginia, vice-presidential candidate Dick Cheney promised workers that the administration would retaliate if the US trade partners violated trade rules. See, Eichengreen Barry, Irwin, Douglas, “International Economic Policy: Was There a Bush Doctrine?” Working Paper 13831, NBER. March 2008. 7 http://georgewbush-whitehouse.archives.gov/infocus/steel/, and http://georgewbush-whitehouse.archives.gov/ news/releases/2002/03/20020305-6.html. 8 Robert Read provides an extensive analysis of the origins of the tariffs and its domestic benefits and costs. Robert Read, (2005), “The Political Economy of Trade Protection: The Determinants and Welfare Impact of the 2002 US Emergency Steel Safeguard Measures,” The World Economy, 1119-1137. 9 http://georgewbush-whitehouse.archives.gov/news/releases/2002/03/20020305-6.html. 10 WTO, (2003a), United States –Definitive Safeguard Measures on Imports of Certain Steel Products, Report of the Panel (Geneva: WTO/DS248/R). 11 See Francois, J and L.M. Baughman, (2003), “The Unintended Consequences of U.S. Steel Import Tariffs: A Quantification of the Impact During 2002” Washington DC: CITAC Foundation. Also see, Hufbauer, G.C. and B. Goodrich, Steel Policy: The Good, the Bad and the Ugly, Policy Brief 03-1, Washington DC: Institute for International Economics. 12 “The Economic Effects of Significant U.S. Import Restraints, p. 88 “www.usitc.gov/.../pub3701. 2

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http://georgewbush-whitehouse.archives.gov/news/releases/2003/12/20031204-5.html. http://www.ustr.gov/archive/Document_Library/Press_Releases/2003/December/Statement by_USTR_Zoellick_ on_Termination_of_Steel_Safeguards.html. 15 http://www.nytimes.com/2002/03/14/business/us-admits-that-politics-was-behind-steel-tariffs. html?pagewanted =all&src=pm. 16 In the 2000 election, Al Gore won Pennsylvania with 51% while Bush won Ohio with 50% and West Virginia with 52% of the vote in each state. See http://uselectionatlas.org/RESULTS/datagraph.php?year= 2000&fips=0&f=0&off=0&elect=0. 17 See, http://www.4president.org/issues/bush2000/bush2000issues.html. 18 http://www.ers.usda.gov/publications/ap-administrative-publication/ap-022.aspx. 19 See the President’s Trade Policy Agenda, http://www.ustr.gov/archive/DocumentLibrary/ReportsPublications/ 2002/2002 Trade Policy Agenda/Section_Index.html. 20 See the President’s Trade Policy Agenda, http://www.ustr.gov/archive/Document_Library/Reports_Publications/ 2002/2002_Trade_Policy_Agenda/Section_Index.html. 21 http://www.presidentialrhetoric.com/speeches/09.14.05.html. 22 For details see, http://2001-2009.state.gov/e/eeb/rls/othr/2005/56976.htm. 23 The Office of the United States Trade Representative, 2007a. 24 http://archives.uruguay.usembassy.gov/usaweb/paginas/41-00EN.shtm. 25 http://www.nytimes.com/2000/08/26/us/2000-campaign-speech-bush-sets-goal-free-trade- agreements-with-latinnations.html. 26 http://www.summit-americas.org/Documents%20for%20Argentina%20Summit%202005/IV% 20Summit/ Plan%20de%20Accion/PDF/Proyecto%20Plan%20Accion%20ENG%20Nov_5%20IV%20Summit.pdf. 27 http://agecon.centers.ufl.edu/documents/FTAA3Nov06.pdf. 28 See http://georgewbush-whitehouse.archives.gov/news/releases/2004/06/20040609-37.html. 29 http://www.ustr.gov/about-us/press-office/speeches/archives/2004/october/remarks-us-trade-representativerobert-b-zoellick. 30 The Dubai Ports World controversy involved the sale of port management businesses in six major U.S. seaports to a company based in the UAE. 31 Neil King Jr. and Dan Morse, “Bush Sets Quotas on Some Imports of Chinese Goods,” The Wall Street Journal, November 19, 2003. 32 These included brassieres, bathrobes, and knit fabrics. It was interesting to note that there was no American producer of brassieres and therefore no domestic brassiere industry to protect. Some parts of the product were produced in the US but were exported to low-wage Latin American countries for final production. See article http://courses.wcupa.edu/rbove/eco338/030Trade-debt/UStrade/030815textiles.tx. 33 See, Mark Drajem, “Commerce Department Applies New Duties against China (Update 7), March 30, 2007, obtained from www.bloomberg.com. 34 U.S. Department of Commerce, International Trade Administration, Notice of Preliminary Affirmative Countervailing Duty Determination, 66 Fed. Reg. 43186 (Aug. 17, 2001). 35 http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aq4.FwewAB4o&refer=asia. 36 http://europa.eu/rapid/press-release_IP-04-1055_en.htm. 37 http://www.washingtonpost.com/wp-dyn/content/article/2005/07/28/AR2005072802040.html. 38 Section 301 of the Trade Act of 1974 give the USTR the authority, subject to the approval of the president, and the means to respond to unfair trade practices by foreign nations. 39 It initiated 20 FTAs with 14 in force, 3 approved by Congress but not yet in force, and 3 concluded but not approved by Congress. 40 http://www.ustr.gov/archive/Document_Library/Fact_Sheets/2004/Fact_Sheet_on_Sugar_in_ CAFTA-DR.html. 41 http://www.ustr.gov/trade-agreements/free-trade-agreements/australian-fta. 42 For an explanation of the agreement see http://www.asil.org/insights/volume/11/issue/15/bush-administrationand-democrats-reach-bipartisan-deal-trade-policy. 43 Goodman, Peter S. and Lori Montgomery (2007) “Path is Cleared for Trade Deals”, The Washington Post, May 11. 44 Zoellick “Countering Terror with Trade”http://www.ustr.gov/archive/Document_Library/Opeds/2001/ Countering_Terror_with_Trade.html, and http://courses.wcupa.edu/rbove/eco338/014Trade-debt/WTO/ 011108record.txt. 45 http://www.pewglobal.org/database/indicator/16/country/233/response/Bad+thing/ 14

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 4

COMMENTARY: THE ECONOMIC POLICIES OF PRESIDENT GEORGE W. BUSH* Marc Sumerlin Deputy Assistant to the President and Deputy Director, National Economic Council, 2001-2002

I started off working for then-Governor Bush in June of 1999 during the campaign. And I worked until a year after 9/11. I feel very strongly that the policy making in the Bush campaign was much more serious than in most campaigns. President Bush had an absolute rule that everything that we proposed had to have the chance of becoming law. There was nothing fantastical, there were no flat taxes or gold standards or dynamic scoring or universal health care. The policies were all very pragmatic. That’s not to say universally popular. But they were all things that, with a little bit of effort, could actually become law. We, over the course of the campaign produced two full policy books. These are things that you have not seen in more recent campaigns. And, we kept an actual CBO [Congressional Budget Office] scored budget. And, all of our proposals on taxes we had scored by the official scorers in Congress, the JCT [Joint Committee on Taxation]. So, at the point of the election in 2000, everyone knew how much the Bush tax plan would cost. They knew what the distributionals were, how much was going to the rich, how much was going to the poor. You knew about problems like the AMT [Alternative Minimum Tax]. And, none of that would say whether you would like the tax plan or not. But it was a very honest way of saying it and the details were out there. So, Governor Bush, when he was in Texas, had run on four things. And he had four accomplishments. And one of the biggest ones was cutting taxes. And so that was something that he believed in and was going to be a core part of the campaign. He assembled a team of ten very prominent outside economists. These included two past CEA [Council of Economic Advisers] chairmen and a former Federal Reserve governor. And he charged them with developing a tax plan that was something that could eventually become *

Selected commentary from “Economic Policy Making in the George W. Bush Administration” plenary forum, Conference on the George W. Bush Presidency, Hofstra University, March 26, 2015.

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law, but also something that would be bold enough to survive a Steve Forbes-like challenge from the right during the campaign season. Now, it seems a little bit crazy here in 2015 to imagine people in 1999 being scared of Steve Forbes, but he had come off the 1996 campaign as being one of the thought leaders on the right. So, we started a process that went on for about six months. And within those ten groups of economists, there were very different ideas that they wanted embedded within the tax plan. And the more philosophical conservatives started with the fundamental premise that the government was in surplus, that the surplus inherently belongs to the people who earned the money. And therefore, part of it should be returned to them. And that was the philosophical point. We also had, and people don’t often realize this, we had a number of neo-Keynesians in the group. And, for them, the focus was that the expansion was starting to get pretty long in the tooth. And, that we were in year eight or nine in the expansion. And, the idea that we are going to make it another four years without a recession seemed not to be consistent with history. And, this was something that then-Governor Bush was actually very sympathetic to, having started off in the oil patch in the 1980s. Any Texan is sensitive to the fact that there is a very pronounced business cycle. Then we also had a group who were very big supporters of reforming Social Security and they wanted to use most of the money for causes like that. And therefore, they wanted a smaller tax plan. So, that was the tension that operated. In the end, President Bush decided on a plan that would phase in marginal rate reductions over five years. Internally, we had discussions about if the economy weakened, we would speed up the tax cuts to provide more demand side support. And so, then, we get past the election and we come into office. And there’s always a little bit of tension at the beginning of an administration. And there’s a particular one with the Treasury Secretary and some of the new members of the economics team, who wanted to start clean and say, “Okay, the campaign is over. And now we have a new bigger group of people. And let’s start from scratch.” Governor Bush had a very different mindset, which is that elections matter. He was planning to govern on what he campaigned on, and he continued the theme of only developing proposals that could become law. So, we stuck with the tax plan. I was a part of a three-person negotiating team on the Hill, and we negotiated over five months. And the plan became law in May of 2001. And one of the lessons I learned during those negotiations, and this applies to all presidents, past and present, is that members of Congress are not going to take political risks that the president himself is not going to take. And so I could talk about any economic argument or tax policy argument, but at the end of the day, what the member wanted to hear was that everything about the tax plan was out in public at the point of election. And the president had survived and he had actually taken political risk. And after that point, it was not that hard to get the votes. When the bill went before the Senate, it got 63 votes. People remember it as being very partisan, but that was a Democrat-controlled Senate, including the chair of the Finance Committee, supporting the plan. And I think another lesson from history is that things have to have some amount of bipartisanship or they will be re-litigated time and time again. And that’s been a problem with the Affordable Care Act when there wasn’t a single Republican person who voted for it. Then it’s just going to keep coming up and up and up and up.

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The economy as we approached the 2000 election was clearly weakening. During the first quarter of 2001, the economy contracted one percent. It contracted another one percent in the third quarter of 2001, after the events of September 11th. The weakness was apparent as the election approached, and in November of 2000, we put the Vice President on Meet the Press and had him say that we’re on the front edge of a recession. You can actually see these things before economists will declare them, the data starts to be pretty decisive. And we then started to work on accelerating the tax cut. The only part that we could get accelerated, politically, was the low-income part. And so in August of 2001, checks went out across the nation for $600 per person. It’s very hard to tell if those worked at all because they literally went out about three weeks before 9/11, and the data got so bad for a couple of months that it either helped a bit or didn’t help at all. It’s hard to decipher. The economy then continued to be what we would call sluggish through 2002 and into 2003, in part held back by the debate about going to war. So, the President made a decision to accelerate the marginal rate cuts and was able to get that through Congress, and in May of 2003, the full strength of the tax plan hit for the first time. During the third quarter of 2003, the economy accelerated by 6.9 percent in real terms and over the two years after the tax plan took effect, it accelerated by 3.8 percent. These were the best couple of years, economically, of the Presidency, and I think fit with the historical lesson from President Kennedy and from President Reagan that tax cuts that are permanent in nature have more powerful economic effects than those that are temporary. They obviously have a much bigger cost, but you have to decide whether it’s worth it or not for their effect on the economy.

Pia M. Orrenius1 Senior Economist, Council of Economic Advisers, 2004-2005 I would like to start by pointing out that I was not a political appointee in the Bush Administration. I was a senior economist on the Council of Economic Advisers [CEA]. That said, it was a great year. I would say it was the most exciting year in my career so far. I had three chairmen in my one year at CEA, which just might be a record. I came in under Greg Mankiw, who's an amazing macro-economist, and, as you might know, a professor at Harvard. After that, it was two exceptional Princeton professors: Harvey Rosen for a period of time and then, at the end of my time at CEA, Ben Bernanke who went on to become Chairman of the Federal Reserve. So I had three amazing CEA chairmen—great economic thinkers—which made for such a rewarding year. In January 2004, we were coming out of a long jobless recovery that followed on the heels of the 2001 recession. Immigration policy, which is my field, had essentially been taken off the table in the President’s first term. Very soon after President Bush took office in 2001, he began talks with President Vicente Fox of Mexico on immigration reform and an immigration plan specifically for Mexico. Many observers, including me, got the sense that an immigration agreement with Mexico was imminent, but the big meeting between Presidents Bush and Fox was the week before 9/11. After the 9/11 terrorist attacks, 1

The views expressed here are my own and do not reflect the views of the Federal Reserve Bank of Dallas or Federal Reserve System.

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immigration reform did not come up again for two-and-a-half years. Those of us who work on immigration reform thus had one more reason to lament the events of 9/11. Reform was squashed and an important opportunity was lost. I came to CEA with high hopes that it would be the year for immigration reform, and once the President’s new term began in January 2005, we launched immigration talks in earnest within the White House and made considerable progress. We worked mostly on what a temporary worker program would look like, which was going to be the hardest part of the immigration reform and something that Congress had not really hammered out. It was gratifying to work in a field and on a topic where President Bush had very strong guiding principles. He felt very strongly about bringing workers in legally and not separating families. Being from a border state, he understood immigration very well. Bush had also enjoyed huge Hispanic support in the election (for a Republican); he had done very well because he was very close to this electorate, very close to many of their issues, and thus could provide us with great guidance. I felt empowered working on immigration under President Bush—we knew what we needed to come up with. Immigration reform never did work out. The Secure Fence Act of 2006 was supposed to pave the way for a broader bill by “securing the border” with more border and interior enforcement. But we ended up with a strict enforcement regime and no comprehensive reform. Three bills were proposed in 2005 and 2006 but all failed, as did a final attempt, the Comprehensive Immigration Reform Act of 2007, which the President fervently fought for. From then on, the situation for immigration reform deteriorated as the financial crisis struck and the economy went into recession. If you ask President Bush today, he would probably agree that we missed our small window of opportunity. He may tell you that one of his big regrets was focusing on privatization of Social Security instead of immigration reform in the beginning of his second term. I think he really means it because immigration was (and still is) an issue very close to his heart and, if we had gotten the timing right, maybe it could have passed.

PART II: SOCIAL POLICY

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 5

KICKING THE CAN DOWN THE ROAD: GEORGE W. BUSH’S FAILED CAMPAIGN TO REFORM SOCIAL SECURITY Richard Himelfarb Hofstra University, Hempstead, NY, US

ABSTRACT As president, George W. Bush pursued his long-standing goal of reforming Social Security. Fresh off a narrow but decisive reelection victory in 2004, he embarked on an intensive public relations effort to promote the issue and his main remedy, private accounts. The effort failed. Democrats charged that Bush intended to undermine Social Security, Republicans proved unenthusiastic, and the public soured on the plan as the debate progressed. Why did Bush’s effort fail and is there something he might have done differently to achieve his goal? This paper argues that the president overestimated his political capital including his popularity following the 2004 election while underestimating the difficulties attendant in reforming a program described as the “third rail” of American politics. All the same, although Bush’s effort to reform Social Security involved numerous missteps and miscalculations, it is unclear that any proposal would have won congressional passage given the institutional and political constraints of the period.

Promoting his memoir in 2010, George W. Bush surprised many when he said that his greatest failure as president was not reforming Social Security.1 Beginning in the 2000 campaign and continuing through his two terms in office George W. Bush vowed to confront Social Security’s financing shortfall and transform the program with voluntary private accounts replacing part of the program’s traditional benefits. Fresh off a narrow but decisive reelection victory in 2004 Bush proclaimed he had accumulated political capital and intended to spend it, first and foremost, on Social Security reform. Between January and April 2005, the Bush White House mounted an intensive public relations effort to promote the issue and the administration’s main remedy, private accounts. The effort failed. Democrats accused

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Bush of exaggerating Social Security’s financial problems and vehemently opposed private accounts, arguing that they were a part of a plot to destroy the program. Republicans, divided on the merits of Bush’s plan and worried about the political repercussions of changing Social Security, were unenthusiastic about taking on the issue. Most significantly, the public soured on Bush’s effort. Indeed, the more Bush tried to rally support for Social Security reform, the more the public opposed it. With Social Security reform floundering and the onset of the Hurricane Katrina disaster that September, Bush abandoned his top domestic policy priority. This paper will seek to examine George W. Bush’s failure to pass Social Security reform by addressing the following questions: Why did Bush assign the issue such a high priority? Why did Bush believe he could succeed in reforming such a popular, politically sensitive program and why did his effort fail? Is there something that Bush might have done differently to achieve his goal? Based on research developed in this paper, I argue that Bush was motivated by his sincere belief that Social Security’s problems were both large and imminent and his desire to pursue bold, ambitious ideas as president. In his 2005 attempt to reform Social Security, Bush vastly overestimated his political capital, including his popularity following the 2004 election, while underestimating the difficulties attendant in reforming a program described as the “third rail” of American politics. All the same, although Bush’s effort to reform Social Security involved numerous missteps and miscalculations, it is unclear that any proposal would have won congressional passage given the institutional and political constraints of the period.

GEORGE W. BUSH’S SOCIAL SECURITY: A FUNDAMENTALLY FLAWED PROGRAM FACING IMMINENT CRISIS Social Security is the centerpiece of social insurance in the United States. In 2005, it provided monthly benefits for almost 48 million people, one out of six Americans, including retirees, the disabled and children. That year, Social Security’s average retirement benefit was $955 per month. While relatively modest, the program is essential to the well-being of the nation’s elderly, accounting for more than half of all income received by two thirds of senior citizens. Social Security is the largest single source of income for 80 percent of Americans 65 and older.2 Social Security beneficiaries receive benefits by virtue of contributing to the program as workers (or, in the case of children, the contributions of parents who subsequently die). The payroll tax, 12.4 percent, is divided evenly between employees and employers and covers earnings up to a limit, in 2005, $90,000. The presence of this universal payroll tax leads contributors to perceive an earned right to benefits, distinguishing it from unpopular welfare programs that include no such expectation. Indeed, the belief that Social Security is an earned right likely contributes to the program’s extraordinary popularity. Social Security is the largest single program in the federal budget. At a cost of $527 billion in 20053 it accounted for over one-fifth of all federal expenditures and four percent of the nation’s GDP.4 Even though its size might make it an obvious target for budget cuts or deficit reduction, Social Security’s large constituency, including millions of elderly Americans who vote, make elected officials wary of tinkering with the program.

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The problem is that Social Security, as currently structured, is unsustainable. Since 1939, the program operates as a pay as you go system where workers’ payroll taxes deposited in the Social Security trust fund are immediately withdrawn to pay benefits for current retirees. The excess (or surplus) payments are immediately borrowed by the federal treasury and used to pay for operating costs of the federal government. In exchange, the Social Security trust fund receives federal treasury notes, essentially IOUs, or promises to reimburse the trust fund when necessary. So long as the number of workers paying into Social Security is large enough, resources are sufficient to pay promised benefits. Unfortunately, the nation’s demographics are changing in ways problematic to the program. Accelerating retirements by the baby boom generation coupled with declining birthrates mean fewer workers paying into the system while increasing life expectancies mean longer retirements and additional Social Security payments to beneficiaries. The problem is best summarized in terms of the declining workerto-beneficiary ratio: “In 1960, there were more than five workers paying into Social Security for every individual receiving benefits. Today, demographic changes have reduced the worker-tobeneficiary ratio to 3.4 to 1. By 2050, it will be 2 to 1.”5 In 2005, Social Security’s trustees projected that, without changes, the program’s retirement trust fund would be exhausted by 2043, resulting in immediate, permanent 26 percent benefit cuts for all Social Security recipients.6 Further, many, including President Bush, argued that Social Security’s problems were even more immediate. Beginning in 2018, they noted, Social Security would be paying out more each year in benefits than it collected in payroll taxes, by 2026, $200 billion per year.7 To pay promised benefits Social Security would need to withdraw money from its trust fund. Controversy surrounded these reserves because they had already been borrowed and spent by the federal government to finance yearly operations. What was the status of the federal treasury notes held by Social Security? Were they real, tangible assets or worthless paper? Those on the political left viewed them as the former, ironclad commitments by the federal government to repay the system and Social Security to pay promised benefits. Conservatives, while not disputing whether promised benefits should and would be repaid, noted that the federal government had made no provisions for repaying the Social Security trust fund. Consequently, the federal government would be required to increase taxes, reduce spending or borrow further to finance them. Even as current workers paid FICA taxes to provide benefits for current retirees, they would be forced to shoulder the additional burden of reimbursing the system for past borrowing by the federal government.

PRE-PRESIDENCY: GEORGE W. BUSH’S LONG-STANDING INTEREST IN SOCIAL SECURITY REFORM George W. Bush addressed the Social Security issue in his first political campaign, an unsuccessful run for a House seat in western Texas. In the summer of 1978 he stated that “Social Security will be bust in 10 years unless there are some changes.” The remedy, proposed Bush, “would be for Social Security to be made sound and people given the chance to invest the money the way they feel.”8 Permitting workers to invest their Social Security

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taxes in the stock market, even in “a safe mix of stock and bond funds”9 was a revolutionary idea that developed in conservative policy circles during the 1980s and 1990s.10 These individual investment accounts were intended to provide younger workers with “a better deal” than they would receive from the existing system. Bush explained his rationale in the State of the Union Address in 2005: “Your money will grow, over time, at a greater rate than anything the current system can deliver - and your account will provide money for retirement over and above the check you will receive from Social Security. In addition, you’ll be able to pass along the money that accumulates to your children or grandchildren. And, best of all, the money in the account is yours and the government can never take it away.”11 Bush’s interest in Social Security, both addressing the trust fund’s problems and permitting workers to invest a portion of their Social Security in private investment accounts, only strengthened as he prepared to run for the presidency. In 1998, conservative policy experts who visited Austin, Texas to brief Bush found that he possessed firm views on the program.12 Already well versed in the intricacies of Social Security, Bush was focused on the difficult task of persuading Americans to accept private accounts. While Bush appeared to be clearly aware of the perils of Social Security reform he relished the opportunity to fix the program described as “the third rail of American politics.”13 Indeed it fit with his view that presidents should achieve “big things”14 and solve “big problems.”15 During the 2000 campaign, Social Security was one of Bush’s top domestic priorities along with education, Medicare and tax cuts.16 Phrased in general terms, he proposed to “strengthen Social Security,” guarantee promised benefits would be paid to all retirees and those near retirement, and permit younger workers to voluntarily invest part of their Social Security taxes in personal accounts.17 In fact, Bush’s approach to Social Security during the 2000 campaign contained elements both bold and cautious. Contrary to the conventional wisdom that candidates should address Social Security only in the context of increasing benefits or refusing to change it, Bush refused to foreclose on a number of controversial policy options for fixing the program including raising the eligibility age for younger workers.18 On the other hand, Bush’s Social Security plan was set forth in only the most general terms making it difficult for opponents to attack. For example, his proposal never stated how benefits to current retirees were to be paid if the FICA taxes of younger workers were diverted to individual accounts. Additionally, it did not address what, if any, benefit cuts might be made to finance the personal accounts and restore the trust fund’s solvency. Nevertheless, any attempt to address Social Security’s fiscal problems is politically risky, particularly for Republicans who are inevitably accused by Democrats of seeking to undermine the program. During the 2000 campaign, Bush’s proposals for Social Security engendered criticism from sources as disparate as the actor Ed Asner (who recorded phone calls to Florida senior citizens asserting the Bush plan would cut their benefits)19 to Democratic nominee Al Gore who criticized Bush on the issue during their first presidential debate.20 The impact of such criticisms appears to have been minimal. While voters who mentioned Social Security as an important issue (14 percent) voted for Gore by a margin of 58-40, this arguably reflected the traditional advantage enjoyed by Democrats regarding the program. Gore would win voters over age 60 by four percentage points over Bush, identical to Bill Clinton’s margin over Bob Dole in 1996. At the same time, voters overall supported Bush’s plan to allow individual investment of Social Security taxes.21

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THE PRESIDENT’S COMMISSION TO STRENGTHEN SOCIAL SECURITY, 2001: REFORM ON BUSH’S TERMS Early in his presidency, Bush continued to endorse Social Security reform. However, the issue took a back seat to other priorities, specifically education and tax cuts, where forging consensus was easier. In an attempt to demonstrate his long-term commitment to Social Security reform and lay the groundwork for future legislation, Bush in 2001 created the President’s Commission to Strengthen Social Security. The decision was noteworthy given that in 1983, a similar vehicle had been employed to provide recommendations to address the system’s solvency problems. To fix the program, the bipartisan commission led by Alan Greenspan had recommended a package of tax increases and benefit reductions that were adopted by both parties, providing Congress and President Reagan political cover for embracing politically unpleasant policies. Bush’s commission was also bipartisan, co-chaired by retired Democratic Senator Daniel P. Moynihan and Dick Parsons, the Republican CEO of AOL-Time-Warner and consisted of equal membership from each of the two major parties. However, in contrast to the Greenspan Commission, the panel included no sitting members of Congress. The Bush administration’s aim here was “removing the commission’s policy development to the extent possible from congressional politics.”22 More significantly, all of the commission’s members embraced its mandate to reform Social Security in accordance President Bush’s principles including preserving benefits for current and near retirees, rejecting tax increases and offering personal accounts to younger workers.23 Both the commission’s make-up and purpose were criticized. Democrats complained that it excluded opponents of personal accounts and argued the commission was little more than “an ideological tool aimed at promoting the president’s agenda.”24 Republican reaction, while more positive was by no means monolithic, with some supporting “both the policy goal and the process, others the policy goal but not the process, and still others neither.”25 The commission’s final report, issued in December, 2001, included three options for Social Security reform. All contained proposals for personal accounts to be financed by a portion of workers’ payroll taxes. While one plan (Model 1) involved a “pain free” approach involving only the creation of such accounts, the others (Models 2 and 3) sought to address Social Security’s solvency problem through a number of measures including changes in how benefits were indexed.26 Issued in the aftermath of 9/11 when President Bush and Congress were focused on national security and the economic recession, the commission’s recommendations had little immediate impact.27 Assessments of their long-term effect are more controversial. Charles Blahous, the commission’s executive director, argues that it effectively fulfilled its function of “putting meat on the bones of the president’s reform principles and show how they could be upheld in a financially sustainable Social Security system.”28 On the other hand the commission’s proposals, which were denounced by a number of groups including the AARP, may have “provided an opportunity for those opposing Social Security privatization to organize politically against the Bush administration and get ready for the political battle that would take place several years later.”29

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THE 2004 ELECTION: A MANDATE FOR SOCIAL SECURITY REFORM? Following the release of the commission’s final report, Social Security receded from the national agenda. While groups in Congress, the White House and the Social Security Administration continued to study and develop proposals for reform,30 little of note occurred beyond continued statements of support from the Bush administration. The issue reemerged in the 2004 campaign although its significance is debatable. Bush discussed Social Security in his standard stump speech, typically detailing the program’s problems and reiterating his principles for fixing it.31 Social Security reform became particularly visible toward the end of the campaign and was addressed by Bush and opponent John Kerry in their final presidential debate.32 Indeed, the issue was prominent enough for the Kerry campaign to run a television commercial accusing Bush of seeking to cut Social Security benefits.33 In October, 2004 the New York Times also reported the details of a private speech given by Bush to private donors the previous month. In it, Bush said he intended to push for Social Security reform immediately after the election.34 Despite all of this, “Social Security reform seldom became a central issue during the 2004 campaign as national security and the situation in Iraq dominated the debates throughout.”35 Indeed, the Bush campaign’s strategy was to make the election a choice of which candidate was stronger on national security.36 When asked about “the most important problem facing the country today,” likely voters in an October, 2004 Gallup poll did not even mention Social Security.37 A George Washington University/Battleground poll taken a week before the election which presented voters with a list of issues and asked “which one issue do you think is most important” found only five percent choosing Social Security well below “safeguarding Americans from a terrorist threat” (27%), the war in Iraq (14%) and “creating jobs” (12%). 38Further, on Social Security voters believed Kerry not Bush would better handle the issue.39 Although it is doubtful whether Bush’s 2004 victory provided him with a mandate to pursue Social Security reform, the newly reelected president believed he possessed one. As far as Bush was concerned, he had spoken about the issue clearly and consistently and had won reelection.40 In his first post-election press conference Bush announced, “I earned capital in the campaign, political capital. And now I intend to spend it.”41 Minutes later he elaborated saying “the President must have the will to take on the issue - not only in the campaign, but now that I’m elected. And this will - reforming Social Security will be a priority of my administration.”42 Bush’s decision was made with remarkably little deliberation in the administration. While a number of White House staff and outside loyalists expressed misgivings as to whether the election constituted a mandate or Democrats could be persuaded to support reform, Bush himself was impervious to them.43 His first term legislative victories, including tax cuts, No Child Left Behind, and Medicare prescription drugs, left him confident in his ability to accomplish big things in his second term.44 Furthermore, the private accounts he advocated constituted a key element of Bush’s plan to “refashion the liberal New Deal and Great Society into his conservative Ownership Society.”45 In a policy memo to the president, adviser Peter Wehner wrote that, “ We have it within our grasp to move away from dependency on government and towards greater power and responsibility towards individuals.” Passage of Bush’s Social Security reform, he continued “can help transform the political landscape of the

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country.” From Bush’s perspective the temptation to pass such transformative legislation was irresistible and, as Wehner argued, “one battle we can win.”46 Even though no Social Security reform legislation had passed Congress since 1983, Bush intended to accomplish such a feat in five months.47

BUSH’S SOCIAL SECURITY PLAN: CANDY FIRST, BITTER MEDICINE LATER?48 Once Bush decided to pursue Social Security reform, the next question was strategic: whether to propose a specific plan or merely a set of principles. Two considerations led Bush to endorse the latter. The first involved a handful of Senate Democrats who would prove pivotal to passing the legislation. Administration officials worried that putting forth a specific plan might antagonize these moderates who “would come under public pressure to demonstrate first and foremost that they were not rubberstamping the president’s plan.”49 Karl Rove noted that setting forth broad principles had proved successful in Congress’s passage of No Child Left Behind in 2001.50 Second, there was the more direct political consideration that it would be easier to attack a specific plan than to defend it. This is particularly true in the case of Social Security “where the current law’s scheduled benefits exceed program resources by trillions.”51 Any proposed changes to attain solvency involve higher taxes or lower benefits and are subject to immediate criticism. By comparison, failing to list specific fixes would elicit criticism from the media but might also prove “a public service of sorts in acknowledging the need for such measures.”52 In other words, criticism of the absence of a specific plan was an admission of Social Security’s solvency problem and would focus attention on the need to address it. In his 2005 State of the Union Address Bush unveiled his approach to Social Security reform.53 After reassuring Americans 55 and older that the Social Security system would not change for them in any way he asserted that “the program has a serious problem that will only grow worse with time.” In 2019, he stated that Social Security “will be paying out more than it takes in.” By 2042, “the entire system will be exhausted and bankrupt,” Bush continued.54 “We must pass reforms to solve the financial problems once and for all,” said Bush before mentioning a number of proposals that effectively reduced promised benefits (changing how benefits are indexed, raising the retirement age) but never acknowledging as much. “All these ideas are on the table,” he asserted, appearing open to alternatives. His only stipulation was that he opposed increasing payroll taxes although, even here, he left it unclear as to whether this included raising the payroll tax cap (in 2005, $90,000). Bush then pivoted to the focus of his plan, a proposal to establish voluntary investment accounts. “We have a duty to make the system a better deal for younger workers, he explained, arguing that they should be given the opportunity to set aside a portion of their Social Security taxes to build “a nest egg” for their own futures. Bush explained the careful guidelines for his proposal: money could only be invested in a conservative mix of stocks and bonds; earnings would not be eaten up by Wall Street fees; options to protect investments from sudden market swings on the eve of retirement; and benefits paid as annuities. The chief virtue of the accounts, he stated, was that the money in them “is yours, and the government can never take it away.”

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Significantly, as Bush explained the accounts, Republicans began to employ a subtle but significant change in the terminology they used to describe them. Polling had found that voters “distrusted any change that has the word ‘private’ attached to it. Pollsters found privatization conveyed to people fundamental change in Social Security, one that put their retirement at the mercy of private sector forces over which they have no control.”55 Instead, Republicans were instructed to use the term “personal” in describing the accounts because this suggested “ownership and control.”56Consequently, from this point on President Bush would speak only of Personal Retirement Accounts (PRAs) even as Democrats continued to attack his plan as “privatization.” Supporters of the president’s plan argued that the charge was misleading as Bush’s proposal permitted workers to divert less than one third of their payroll taxes to the accounts. Democrats responded by noting that conservatives advocating Social Security reform had long called for privatization of the program.57 Ultimately, advocates of the Bush plan would lose this crucial battle as “the press unwittingly adopted the anti-reform rhetoric.”58 Regardless of what they were called Bush’s proposed accounts raised a number of questions. If workers diverted payroll taxes to pay for them how would Social Security pay promised benefits for current retirees? How much would workers’ Social Security benefits be reduced? Would the combination of smaller Social Security benefits plus the retirement accounts leave younger workers better or worse off relative to what they were promised under the current underfunded system? Most important, how did the personal accounts address Social Security’s solvency problem? Bush did not give answers in his State of the Union Address. More problematic were the subsequent responses of administration officials that proved unpersuasive, unpleasant, and incomprehensible to the public. One thorny issue involved the plan’s transition costs. Bush administration officials insisted that some proportion of the $700 billion workers would divert to personal accounts (over the first 10 years) would be replaced by spending reductions elsewhere in the federal budget.59 These plans, however, were poorly publicized and frequently lacking in specifics. As for whether PRAs would leave workers better off in retirement relative to the current system, Bush clearly implied this was true. However, the fine print of the Bush proposal reduced Social Security benefits by three dollars for every one dollar diverted to the accounts. This led a number of experts to doubt whether the combination of PRAs and traditional Social Security would meet, much less significantly exceed promised benefits.60 Administration officials responded that benefits under the reformed system should be compared not to what the current but unsustainable system promised but against an unreformed system where benefit reductions of more than 25 percent were implemented.61 Explaining such complexities to a public that is poorly informed about how Social Security works proved exceedingly difficult, particularly as Democrats asserted that the plans’ private accounts were an attempt “to weaken the economic security of the elderly.”62 Equally problematic was the administration’s inability to explain the link between individual accounts and Social Security’s solvency problem. Indeed, given that PRAs appeared to require the federal government to borrow $700 billion during a period of high deficits Bush’s plan was vulnerable to criticisms of fiscal irresponsibility. Administration officials sought to refute this charge by arguing that the borrowing necessitated by the personal accounts was merely a method of prefunding existing obligations under Social Security. “Whatever the value of this claim, it was a very hard sell politically,” writes

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William Galston of the Brookings Institution.63 Instead, critics would charge that Bush’s promotion of PRAs in the absence of politically painful measures to fix Social Security was tantamount to “candy first, bitter medicine later.”

THE RESPONSE: DEMOCRATS ATTACK WHILE REPUBLICANS EQUIVOCATE The Bush administration likely anticipated criticisms of its Personal Retirement Accounts. However, it was surprised by the discouraging response to its larger call for Social Security reform. When Bush, in his State of the Union address, claimed that Social Security “would be bankrupt in 40 years,” Democrats in the chamber shouted, “No, no!” Senate Minority Leader Harry Reid called reform “dangerous” and asserted Bush’s plan meant a guaranteed benefit cut of 40 percent or more.”64 An element of this hostility was partisan. Democrats had been the minority in Congress for almost all of the previous decade and were frustrated with their status. Further, Bush and congressional Republicans had antagonized moderate Democrats by courting them, winning their support and then campaigning against them in subsequent elections. 65With the defeat of a number of them in 2002 and 2004, fewer remained and those who did were wary of working with Bush. Of course, much of their hostility was philosophical. To Democrats, Social Security is “the crown jewel of the New Deal,”66 a universal program that redistributes billions of dollars to low income Americans in a manner that is dignified and effective.67 To assertions that the program is unsustainable and will become insolvent, Democrats respond that the problem is not immediate (Indeed some even deny that it exists at all.) and that only minor changes are necessary.68 Moreover, they are likely aware that inaction now favors adoption of their preferred remedy. As Social Security nears insolvency in the 2030s policymakers will be less likely to enact sudden, significant benefit cuts on retirees and those nearing retirement. Instead, it will be politically easier to impose tax increases on younger and wealthier workers. By contrast, Bush’s personal accounts would weaken redistribution within Social Security, effectively moving the system in the direction of private pensions where there is a robust relationship between contributions and payments. As those with higher incomes rely less on traditional Social Security benefits, liberals fear support for the program will decline and with it, the relatively generous returns on contributions received by those with the lowest incomes.69 Thus their adage: “A program for the poor will become a poor program.” Bush’s Social Security proposal also engendered little enthusiasm within his own party. Shortly after the 2004 elections the Wall Street Journal reported that approximately 30 House Republicans were “already inclined to oppose Mr. Bush.”70 A division emerged between members who supported only the creation of personal accounts (the “free lunch” solution) and others, just the solvency achieving measures.71 There was also the “huge political risk” involved in any attempt to reform Social Security.72 During the spring of 2005 Republicans visiting home frequently found themselves confronted by “picketers, street rallies, [and] citizens battering them with hostile questions.”73 The Bush White House minimized such problems, reasoning that their previous efforts to win congressional support had inevitably succeeded. During Bush’s first term, lobbying by the administration had led to the passage of

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numerous measures including No Child Left Behind, tax cuts and the Medicare Modernization Act. Social Security reform, they assumed, would prove no different.74

60 STOPS IN 60 DAYS: BUSH’S FAILED CAMPAIGN FOR SOCIAL SECURITY REFORM To build support for Social Security reform, Bush embarked on a national speaking tour. Dubbed “60 Stops in 60 Days” the effort took on the trappings of a political campaign with handpicked audiences of supporters interacting with the candidate, in this case President Bush, in carefully choreographed, scripted exchanges. 75The purpose of the events was twofold: first, to make the case that the Social Security program was headed towards insolvency and needed to be fixed immediately and second, that younger workers should be permitted to invest a portion of their payroll taxes in Personal Retirement Accounts. By contrast, Bush barely addressed more problematic elements of his proposal including the transition costs of personal accounts and measures, likely benefit reductions, necessary to make the system solvent.76 In response, opponents of the Bush plan mobilized to fill the void. Most significant was the nation’s largest interest group, the American Association of Retired Persons (AARP). While a number of business and conservative groups sought to make the case for Social Security reform, they were overwhelmed by AARP, an organization with 35 million members and a yearly budget of $800 million, five times that of the U.S. Chamber of Commerce.77 To counter the president’s national campaign it held forums on Social Security and organized volunteers to protest at Bush’s events and town meetings of congressional Republicans. AARP also spent millions of dollars on print and television ads attacking the Bush plan78 in what were arguably misleading and incendiary terms. For example, one of these asserted that adding personal accounts to Social Security equated to tearing down one’s home when only a repair of the kitchen sink was required. To underline its message, the ad contained images of “a family’s beloved home being reduced to rubble.”79 Another animated ad depicted those favoring personal accounts “as thieves with superelastic arms that crept and reached their way into people’s homes to steal their retirement nest eggs.”80 Other Democratic opponents sought to build on the AARP’s arguments by misleadingly asserting that Bush’s plan would require all Americans to put their money in the stock market. In fact, Bush’s PRAs would be entirely voluntary and were open only to Americans younger than 55.81 The opposition to Bush’s plan proved effective. Despite a massive public relations campaign featuring Bush and a multitude of administration officials, approval of the president’s reform plan declined. While 58 percent of Americans supported private accounts in September, 2004, only 47 percent did in May, 2005. Two factors explain the decline. First, private accounts fell out of favor as people grew cognizant that they would be accompanied by reductions in promised Social Security benefits. Second, declining support for reform was related to declining support for President Bush, who came under increasing criticism for the war in Iraq. Polling during the period found that support for Bush’s plan decreased when the proposal was identified as his.82

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BUSH’S LAST GASP: ENDORSING PROGRESSIVE PRICE INDEXING By late April, with support for Social Security reform dwindling, Bush made one last attempt to salvage the effort. For months Bush had refused to support a specific proposal to make Social Security solvent, instead saying only that he was open to any proposal so long as it did not increase payroll taxes. Democrats refused to respond with a plan of their own. Asked when House Democrats would put one forward, Minority Leader Nancy Pelosi acidly replied, “Never. Is never good enough for you?”83 Democrats remembered when Republicans gained majorities in Congress in 1994 by attacking Democrats for raising taxes, mainly on the wealthy, in the service of deficit reduction.84 Furthermore, given their belief that Social Security’s “crisis” was far in the future (if it existed at all), they adopted a strategy of attacking Bush’s plan as both unnecessary and fiscally irresponsible, arguing that it did nothing to avert the crisis he warned about and concealed his real intention to reduce benefits.85 On April 28th, Bush attempted to address the solvency issue by endorsing progressive price indexing, a proposal developed by Robert Pozen, a Democratic member of the president’s 2001 commission. Under Social Security, benefits are indexed to average annual wages which increase faster than consumer prices. Pozen’s plan would continue wage indexing for the 30 percent of beneficiaries with the lowest incomes. Benefits for the wealthiest one percent would grow only with price inflation, significantly reducing them. Everyone else’s benefits would be indexed by a combination of the two measures and fall somewhere in between. Bush argued that progressive price indexing addressed Social Security’s solvency problem - it would eliminate two-thirds of the program’s 75 year deficit86- while protecting benefits for the needy most reliant on the program: “By providing more generous benefits for low income retirees, we’ll make this commitment. If you work hard and pay into Social Security, you will not retire in poverty.”87 The president’s embrace of progressive price indexing did not mean he had abandoned his support of personal accounts. Instead, he would now argue that they represented a form of compensation for those receiving smaller benefits from a reformed Social Security program.88 In March, when Pozen wrote an op-ed promoting his proposal and visited with members of Congress, a number of moderate senators from both parties praised his approach.89 However, when Bush formally embraced it, the reception changed. Democrats immediately denounced progressive price indexing as an attack on the middle class, who they argued would suffer deep benefit cuts.90 They also renewed criticism that Bush’s intent was to diminish the importance of Social Security to this group and consequently undermine public support for the program.91 Supporters of progressive price indexing responded that the “benefit cuts” cited by Democrats “would only be from far higher benefits in the distant future that could not be paid under current law without a substantial tax increase.”92 However, explaining this was complicated by the fact that the public understands little about the details of how Social Security benefits are calculated. As the issue became muddled and indecipherable to average Americans, Bush’s endorsement of progressive price indexing failed to change the debate over Social Security reform. With its effort floundering in May and June, the Bush administration continued to seek some type of compromise with Congress. In the Senate, Finance Committee Chairman

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Charles Grassley (R-Ill.) desperately sought to find common ground among a bipartisan group of moderates. With a number opposed to personal accounts, he proposed a “solvencywithout-accounts” approach that would ostensibly include progressive price indexing and other measures such as increasing the retirement age to shore up the program.93 However, Democrats, confident they were winning the debate, refused to negotiate. Moderate Republicans, including Olympia Snowe of Maine and Gordon Smith of Oregon refused to support Grassley’s approach,94 likely fearing the political consequences of supporting a benefit cut that could not pass the Senate. Throughout the summer the Bush administration continued to hope the effort could be salvaged. The arrival of Hurricane Katrina in late August effectively ended such efforts. The most deadly and expensive natural disaster in American history “both absorbed the administration’s energy and cut deeply into the president’s support, leaving insufficient political capital to revive the Social Security reform effort.”95 Ironically, it would be House Speaker Dennis Hastert, the leader who had so reliably delivered the Republican majority on countless administration initiatives, who would deliver the news that his caucus refused to pass Bush’s plan. Although the president never formally gave up his effort, Social Security reform was dead.96

ANALYSIS Why did George W. Bush fail in his effort to reform Social Security? Was there anything he might have done differently to achieve success? Clearly, Bush overestimated his political capital. “On Social Security,” he admits, “I may have misread the electoral mandate by pushing an issue on which there had been little bipartisan agreement in the first place.”97 Karl Rove, his chief political adviser, agrees it was a mistake to press for Social Security reform at the beginning of Bush’s second term. Instead he says the administration should have pursued immigration reform, an issue where Democrats were more willing to cooperate: “That success might have produced enough bipartisan confidence to tackle Social Security.”98 Three other elements specific to the Bush presidency also undermined Social Security reform. First, there was Congress’s passage of the Medicare Modernization Act in 2003. One of Bush’s major legislative accomplishments of his first term, the law provided a prescription drug benefit for seniors while introducing market competition into the program. The problem was that it was largely paid for by deficit spending, making it an expensive, unfunded entitlement program. In this context, Bush’s arguments about an unsustainable Social Security program facing a crisis led some to question his true commitment to fiscal conservatism.99 Additionally, the AARP’s endorsement of the legislation led liberals to criticize the organization’s close ties with business and corporate interests that would benefit financially. Many speculated that AARP’s forceful attacks on Bush’s Social Security plan were recompense for this earlier decision.100 Second, Bush’s bare knuckles approach to legislating and politics earlier in his administration had left congressional Democrats in no mood to cooperate. For example, in 2002 Bush had campaigned against Senator Mary Landrieu of Louisiana even though she had supported his tax cuts.101 That same year, Senator Max Cleland of Georgia, a Vietnam War veteran and paraplegic, lost his reelection bid following attacks on his patriotism for

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supporting the right of Department of Homeland Security workers to unionize. In his memoir, Bush defends campaigning for his party’s candidates but acknowledges that his efforts likely antagonized Democrats.102 Third, and arguably most important, Bush’s popularity was declining during the period when he sought support for Social Security reform. During 2005, mounting casualties in Iraq, rising gas prices and public criticism of the administration’s handling of the Terry Schiavo case led to a steady erosion in public support for the president.103 Between January and August, Bush’s approval rating declined from 52 to 45 percent.104 As members of Congress took note of these numbers, Democrats grew more aggressive in opposing Social Security reform while Republicans became increasingly wary of supporting it. To these points, presidential scholar George C. Edwards III adds another, the increasing tendency of modern presidents to engage in what he call “the permanent campaign.”105 From this perspective, George W. Bush is just one in a line of recent chief executives who overestimated their ability to move public opinion through intense public relations efforts. In this instance, Bush’s emphasis on “governing by campaigning” not only failed to persuade the American people but actually diminished support for both him and his plan.106 Instead of attempting to win on the issue, Edwards argues that Bush should have pursued a more conciliatory, less ideological approach focused on educating the public and forging compromise with the Democrats. The model here would appear to be the 1983 Greenspan Commission, a bipartisan effort sanctioned by Ronald Reagan and House Speaker Tip O’Neill that improved the program’s solvency largely through increased revenues.107 To conservatives, these so-called compromises merely buttress a troubled program and fail to achieve their goal of sustainable solvency, changes that would permanently place Social Security on sound financial footing.108 In their view, the design of social insurance programs, where benefits are received now but costs come due in the future, make them inherently difficult to reform. It is always easier for advocates of the status quo to deny a problem exists and criticize those who do as alarmists. Further, to the extent that action is deferred, it becomes more likely that Social Security will be fixed through tax increases as lawmakers inevitably balk at abrupt and dramatic reductions in benefits.109 Thus, proposed reforms such as private accounts are politically problematic because they impose costs now for benefits in the future. According to this perspective, Bush was simply unable to surmount the difficult politics surrounding Social Security. While there is considerable truth in this perspective, an argument may be made that Bush’s specific approach to Social Security - strong advocacy for private accounts combined with soft peddling of benefit cuts necessary to make the program solvent - engendered suspicion and unnecessarily undermined his case for reform. The president’s strategy here was understandable. Politicians generally seek to win support for their initiatives by emphasizing benefits and downplaying costs. However, in this case such an approach was arguably more harmful than helpful. Bush’s emphasis on private accounts in the absence of specific proposals to address the future crisis in Social Security left him vulnerable to the charge that his intent was to undermine the program rather than save it. This was reinforced by the fact that creating private accounts would require borrowing billions of dollars. Increased federal budget deficits and debt, even if only in the short term, opened Bush to charges of fiscal irresponsibility, contradicting his argument that his pursuit of Social Security reform was an act of responsible stewardship.

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In retrospect, a more effective alternative course might have been to propose progressive price indexing in tandem with private accounts, the latter serving as a partial palliative to those who would receive benefit cuts. Essentially this would have permitted Bush to argue: “Social Security’s looming insolvency means you will receive lower benefits from the program. However, private accounts will permit you to recoup at least some (and perhaps all) of these losses. Even if you receive less under the reformed system you will at least own a portion of your retirement savings.” (Italics added) While Bush ultimately adopted this approach, he did so late in the debate and only after continuing criticism that his personal accounts did not address the program’s solvency problem. Granted, we will never know whether this would have proven more persuasive as an opening argument. But one might imagine Social Security reform consisting of progressive price indexing and private accounts, combined with some increase in the retirement age and, as a concession to Democrats some modest increase the payroll tax cap. Admittedly though, in 2005 the political environment was likely inhospitable to any such compromise.110 “Despite our efforts,” writes President Bush of Social Security reform, “the government ended up doing exactly what I had warned against: We kicked the problem down road to the next generation.”111 Still, ill fated though it was, George W. Bush deserves praise for attempting to reform a politically popular program that, without changes, is unsustainable. Bush’s efforts appear still more laudable in light of subsequent events. With the 2008 economic downturn and the slow recovery that followed, Social Security’s fiscal condition has deteriorated even further. In their most recent report, the program’s trustees project that it will be unable to pay promised retirement benefits in 2034, eight years earlier than the date cited by Bush in 2005.112 Bush’s successor, Barack Obama has made no serious attempt to fix Social Security either because he is unserious about entitlement reform or, more generously, has focused on other more pressing issues. All the same, Social Security’s solvency problem is increasingly severe and solutions to address them will necessarily be more draconian and painful than if they had been enacted during the George W. Bush presidency.

ENDNOTES 1

Becky Schlikerman, “Bush Promotes Book in Chicago,” Chicago Tribune, October 21, 2010. Virginia Reno and Anita Cardwell, “Social Security Finances: Findings of the 2005 Trustees Report,” Social Security Brief, no. 20, National Academy of Social Insurance, March, 2005. 3 Ibid. 4 Gary Sider, “Social Security: Brief Facts and Statistics,” CRS Report for Congress, Updated March 3, 2005. p. 25. Figures from 2004 Fiscal Year. 5 President’s Commission to Strengthen Social Security, Interim Report, August, 2001, pp. 10-11. 6 Board of Trustees, 2005 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Trust Fund, April 5, 2005. 7 Charles Blahous, Social Security: The Unfinished Work (Hoover: Stanford, CA, 2010), p. 12. Projections from 2009. 8 Richard W. Stevenson, “For Bush, a Long Embrace of a Social Security Plan,” New York Times, February 27, 2005. 9 George W. Bush, Decision Points (Crown Publishers: New York, 2010), p. 297. 10 Stevenson, “For Bush, a Long Embrace.” 11 Quoted in Karl Rove, Courage and Consequence: My Life as a Conservative on the Right (Threshold Editions: New York, 2010), p. 408. 12 Stevenson, “For Bush, a Long Embrace.” 2

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Ibid. See also Bush, Decision Points, pp. 296-297. Peter Baker, Days of Fire: Bush and Cheney in the White House (Anchor Books: New York, 2013), p. 49. 15 Lou Cannon and Carl M. Cannon, Reagan’s Disciple: George W. Bush’s Troubled Quest for a Presidential Legacy (Public Affairs: New York, 2008), p. 254. 16 Daniel Beland and Alex Waddan, The Politics of Change: Welfare, Medicare, and Social Security Reform in the United States (Georgetown University Press: Washington, D.C., 2012), p. 143. 17 George W. Bush for President 2000 Campaign Brochure, “Opportunity, Security and Responsibility-- A Fresh Start for America.” (http: 4president.org/brochures/ georgewbush2000brochure.htm) 18 Charles Blahous, Social Security: The Unfinished Work (Hoover Institution, Stanford, CA, 2010), p. 209. 19 Ibid., 207. 20 Beland and Waddan, The Politics of Policy Change, p. 143. 21 Gerald M. Pomper, ed., The Election of 2000: Reports and Interpretations (Chatham House, New York, 2001), pp. 138, 145-146. 22 Blahous, Social Security: The Unfinished Work, p. 213. 23 Beland and Waddan, The Politics of Policy Change, p. 144. 24 Ibid. 25 Blahous, Social Security: The Unfinished Work, p. 214. 26 Beland and Waddan, The Politics of Policy Change, pp. 145-146. 27 Ibid., 145. 28 Blahous, Social Security: The Unfinished Work, p. 215-216. 29 Beland and Waddan, The Politics of Policy Change, 146. 30 Blahous, Social Security: The Unfinished Work, pp. 224-225. Beland and Waddan, The Politics of Policy Change, p. 148. 31 Blahous, Social Security: The Unfinished Work, pp. 227-228. 32 Beland and Waddan, The Politics of Policy Change, p. 148. 33 David M. Halbfinger, “Campaigning Furiously with Social Security in Tow,” New York Times, October 18, 2014. Cited in Beland and Waddan, The Politics of Policy Change, p. 149. 34 Ibid. 35 Beland and Waddan, The Politics of Policy Change, p. 148. 36 Robert Draper, Dead Certain: The Presidency of George W. Bush (Free Press: New York), 2007, 297. 37 Roper Center Public Opinion Archives, “Presidential Election 2004.” (www.ropercenter.uconn.edu/ elections/presidential_election_html) Accessed January 21, 2015. 38 Ibid. 39 Jeffrey M. Jones, “Kerry Leads Bush on Economy, Most Domestic Issues,” Gallup News Service, October 13, 2014. (www.gallup.com/poll/13609/Kerry-Leads-Bush-Economy-Most Domestic-Issues-aspx) Accessed January 21, 2015. 40 Draper, Dead Certain, p. 297. 41 Baker, Days of Fire, p. 360. 42 Beland and Waddan, The Politics of Policy Change, p. 149. 43 Baker, Days of Fire, p. 381. 44 Draper, Dead Certain, p. 294. 45 Baker, Days of Fire, p. 381. 46 Peter Wehner, “Memo on Social Security.” Reprinted in Wall Street Journal, January 5, 2005. 47 Draper, Dead Certain, p. 298. 48 Blahous, Social Security: The Unfinished Work, p. 235. 49 Ibid. 229. 50 Baker, Days of Fire, p. 382. 51 Blahous, Social Security: The Unfinished Work, p. 229. 52 Ibid., p. 236. 53 All material from “Text of President Bush’s 2005 State of the Union Address,” Washington Post, February 2, 2005. 54 Democrats disputed Bush’s use of the term “bankrupt,” arguing that Social Security would still be able to pay roughly three quarters of promised benefits after this date. Charles Blahous, President Bush’s adviser on Social Security, defends the use of the term, arguing it applies “to a condition in which one’s assets are depleted and in which projected future income is insufficient to discharge one’s debts.” Blahous, Social Security: The Unfinished Work, pp. 268-269. 55 George C. Edwards, Governing by Campaigning: The Politics of the Bush Presidency (Pearson: New York, 2007), p. 248. 56 Ibid. 57 Ibid. 58 Blahous, Social Security: The Unfinished Work, p. 251. 14

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Ibid., p. 317. Beland and Waddan, The Politics of Policy Change, p. 153. Blahous, Social Security: The Unfinished Work, p. 252. 61 Blahous, Social Security: The Unfinished Work, p. 252-253. 62 Beland and Waddan, The Politics of Policy Change, p. 153. 63 William Galston, “Why President Bush’s 2005 Social Security Initiative Failed, and What it Means for the Future of the Program,” John Brademas Center for the Study of Congress, September, 2007, p. 5. 64 Rove, Courage and Consequence, pp. 406-407. 65 Beland and Waddan, The Politics of Policy Change, p. 150. Bush, Decision Points, p. 300. Edwards, Governing by Campaigning, p. 266-267. 66 Bush, Decision Points, p. 299. 67 The formula for calculating Social Security benefits is structured so workers with low incomes receive higher rates of return on contributions than those who earn more. However, the opacity surrounding how benefits are calculated leaves recipients unaware that they receive any subsidy at all. 68 Blahous, Social Security: The Unfinished Work, p. 245. 69 Jacobson, Governing by Campaigning, p. 226. 70 Quoted in Beland and Waddan, The Politics of Policy Change, p. 150. 71 Blahous, Social Security: The Unfinished Work, p. 249. 72 Beland and Waddan, The Politics of Policy Change, p. 150. 73 Draper, Dead Certain, p. 302. 74 Ibid., p. 294. 75 For a comprehensive description, see Edwards, Governing by Campaigning, pp. 226-242. 76 Ibid., p. 220, 268. 77 Ibid., p. 237. 78 Ibid., pp. 237-238. 79 Blahous, Social Security: The Unfinished Work, p. 252. 80 Ibid. 81 Baker, Days of Fire, p. 390. 82 Baker, Days of Fire, pp. 390-391. Edwards, Governing by Campaigning, pp. 261-264. 83 Andrew G. Biggs, “A New Vision for Social Security,” National Affairs, Number 16, Summer, 2013, p. 37. 84 Edwards, Governing by Campaigning, p. 252. 85 Beland and Waddan, The Politics of Policy Change, p. 153. 86 Rove, Courage and Consequence, p. 409. 87 Beland and Waddan, The Politics of Policy Change, 154. 88 Edwards, Governing by Campaigning, p.225. 89 Blahous, Social Security: The Unfinished Work, p. 256. 90 Beland and Waddan, The Politics of Policy Change, p. 154. 91 Edwards, Governing by Campaigning, p. 226. 92 Blahous, Social Security: The Unfinished Work, p. 258. 93 Blahous, Social Security: The Unfinished Work, pp. 262-263. Rove, Courage and Consequence, p. 409. 94 Rove, Courage and Consequence, p. 409. 95 Blahous, Social Security: The Unfinished Work, p. 263. 96 Baker, Days of Fire, pp. 415-416. 97 Bush, Decision Points, p. 300. 98 Rove, Courage and Consequence, p. 409. 99 For example, see Bruce Bartlett, Imposter: How George W. Bush Bankrupted America and Betrayed the Reagan Legacy (Doubleday: New York), 2006, Chapter 4. 100 Beland and Waddan, The Politics of Policy Change, p. 151. 101 Edwards, Governing by Campaigning, p. 266. 102 Bush, Decision Points, p. 300. 103 Edwards, Governing by Campaigning, p. 267. 104 Gallup, “Presidential Approval Ratings-- George W. Bush.” (www.gallup.com/poll/ 116500/presidentialapproval-ratings-george-bush.aspx) Accessed January 22, 2014. 105 Edwards, Governing by Campaigning, p. 285. 106 Ibid., pp. 281-288. 107 “The compromise rescued Reagan politically, bought the government twenty years of solvency, and led to relative peace between Democrats and Republicans on an issue sometimes described as the ‘third rail of politics.’“ Cannon and Cannon, Reagan’s Disciple, p. 254. 108 For an analysis of the 1983 rescue of Social Security, see Blahous, Social Security: The Unfinished Work, pp. 25-71. 60

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“For some on the left, the continued drift towards insolvency is perfectly acceptable, as they know that no solution other then raising taxes will be possible at the last minute.” Blahous, Social Security: The Unfinished Work, p. 18. 110 Blahous agrees that the failure of Bush’s plan “does not necessarily imply that a different proposal or tactical approach would have been successful.” Blahous, Social Security, The Unfinished Work, p. 264. 111 Bush, Decision Points, p. 300. 112 Board of Trustees, 2014 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Trust Fund, July 28, 2014.

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 6

MANY CHILDREN LEFT BEHIND: A CRITICAL EXAMINATION OF EDUCATIONAL POLICY DURING THE GEORGE W. BUSH ADMINISTRATION Alan Singer Hofstra University, Hempstead, NY, US

ABSTRACT As president, George W. Bush lacked an understanding of education and a clear education policy. His signature program, No Child Left Behind, established a testing regime with bi-partisan support but impossible to satisfy mandates. The Bush Administration avoided responsibility for implementing the mandates by placing responsibility for enforcement on the states and not requiring that they be met until after Bush left office. Evidence used to demonstrate the efficacy of No Child Left Behind has repeatedly been tainted by accusations of systematic cheating to boost student test scores. The law itself was revised in 2015 because states were continually forced to apply for waivers because they could not meet requirements.

Before we can assess educational policy during the George W. Bush administrations we first have to determine what it exactly was; which is not an easy task. Borrowing from Gary Trudeau’s famous In Search of Reagan’s Brain (New York: 1981), think of a giant empty airplane hanger with ghost-like images floating through the air, sometimes colliding, sometimes disappearing into nothingness. You suspect there is something that connects these images, it is just not clear what it actually is.1 In the Bush Administration airplane hanger we have No Child Left Behind and the accompanying push for high-stakes testing, Rod Paige and the Houston testing miracle that turned out to be less than advertised, testing scandals, the expansion of charter schools, Teach for America, and Teaching American History Grants. My general assessment is that educational policy during the hands-off Bush administrations was an after thought to be guided by the prejudices and interests of Bush supporters and what Condoleezza Rice liked to describe as the President’s good instincts.2

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To be fair, let us start with George W. Bush’s own assessment of his educational policy, delivered in remarks made at the General Philip Kearny School in Philadelphia, Pennsylvania on January 8, 2009. “You know, 7 years ago today, I had the honor of signing a bill that forever changed America’s school systems. It was called the No Child Left Behind Act. I firmly believe that thanks to this law, more students are learning, an achievement gap is closing. And on this anniversary, I have come to talk about why we need to keep the law strong.”3

In the Kearny speech, Bush launched into a long list of “thank yous” addressed to people who contributed to the success of his educational policy. They included, in order of mention, his wife, Laura Bush, Arlene Ackerman, Superintendent of Philadelphia Public Schools, Secretary of Education Margaret Spellings, although he could not recall her last name, his “good friend” Senator Arlen Spector, who later quit the Republican Party, Pennsylvania Department of Education Secretary Jerry Zahorchak, whose signature achievement as education secretary was the establishment of the Keystone Exams and the state’s Standards Aligned System, Ron Romer, former Democratic Governor of Colorado and head of the Gates-funded Strong American Schools, and the Reverend Al Sharpton. Bush told the audience “Now, some of you are probably about to fall out of your chair when you know that Al and I have found common ground. And by the way, it’s on an important issue. See, he cares just as much as I care about making sure every child learns to read, write, and add and subtract.”4 President Bush also emphasized the importance of adding and subtracting, and his lack of understanding of math, later in the speech when he recounted his experience as Governor of Texas. “I hope you can tell that education is dear to my heart. I care a lot about whether or not our children can learn to read, write, and add and subtract. When I was a Governor of Texas, I didn’t like it one bit when I’d go to schools in my State and realize that children were not learning so they could realize their God-given potential. I didn’t like it because I knew the future of our society depended upon a good, sound education.”5 President Bush went on to paraphrase one of his signature sound bits, a phrase developed by speechwriter Michael Gerson, the “soft bigotry of low expectations.”6 “It’s unacceptable to our country that vulnerable children slip through the cracks. And by the way, guess who generally those children are? They happen to be inner-city kids, or children whose parents don’t speak English as a first language. They’re the easiest children to forget about. We saw a culture of low expectations. You know what happens when you have low expectations? You get lousy results. And so we decided to do something about it. We accepted the responsibility of the office to which I had been elected. It starts with this concept: Every child can learn.”7 For President Bush, or at least for his allies and speechwriters, the key to higher expectations was increased testing. “How can you possibly determine whether a child can read at grade level if you don’t test? And for those who claim we’re teaching the test, uh-uh. We’re teaching a child to read so he or she can pass the test. Measurement is essential to success. When schools fall short of standards year after year, something has to happen. In other words, there has to be a consequence in order for there to be effective reforms. And one such thing that can happen is parents can enroll their children in another school. Measurement is the gateway to true reform, and measurement is the best way to ensure parental involvement.”8

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But as a Republican and former Governor, President Bush was also careful to embrace local, state, and parental initiatives. “Local schools remain under local control,” “States set standards,” and under No Child Left Behind parents had the option of transferring their children from failing schools to “another public school or charter school.”9 Among other things, in this speech President Bush endorsed annual report cards for schools and the expansion of charter schools. However, according to the President, “the most important result of the No Child Left Behind” and the one his educational program should be evaluated on is that “Fewer students are falling behind; more students are achieving high standards. We have what’s called the Nation’s Report Card. For those who wonder whether or not we should strengthen No Child Left Behind, I want you to hear this: 4th graders earned the highest reading and math scores in the history of the test. Minority and disadvantaged students made some of the largest gains, with African Americans and Hispanics posting alltime highs in several categories.”10 I like this last statement very much because it operationalizes the Bush policy providing us with a standard we can use to measure its success. To Bush’s credit, No Child Left Behind forced states and localities to de-aggregate statistics and target student populations that were performing poorly on assessment, especially minority youth. However, it also launched a national wave of school testing scandals. According to a Government Accountability Office report evidence of organized institutional cheating was confirmed for at least one standardized test in 33 states in the school years 2010-11 and 2011-2012. Thirty-two of the states decided to cancel, invalidate, or nullify test scores because of the suspected cheating. According to the introduction to the report, “In 2012, California invalidated scores from 23 schools as a result of cheating by school officials, according to a local media report”; “In Atlanta, Georgia, 82 public school teachers and principals admitted to cheating on tests administered during the 2008-09 school year”; and “Similar allegations were also investigated in other states; for example, Illinois, Maryland, Pennsylvania, Texas, and Washington, D.C.”11 As noted above, in Philadelphia, Arlene Ackerman, who won national acclaim for improving minority student performance on standardized tests and for promoting charter schools as school superintendent in Washington DC, San Francisco, and Philadelphia, was forced to resign as Superintendent of Philadelphia Public Schools, when it was discovered that in 88 Philadelphia District schools and 11 Philadelphia charter schools there were highly suspicious numbers of wrong answers that were erased and changed to the correct answer on the 2009 state standardized exams.12 In Atlanta, a Fulton County, Georgia grand jury charged Beverly Hall, the former Superintendent of Atlanta, Georgia schools and thirty-four other former and current school officials with racketeering, theft, influencing witnesses, conspiracy and making false statements in connection to a school testing scandal that was exposed in 2011. Dr. Hall had been highly honored and well paid because of supposedly miraculous improvements in student test results in Atlanta. In 2009, she was named “School Superintendent of the Year” by the American Association of School Administrators and hosted at a White House reception by the United States Secretary of Education Arne Duncan. In addition, she received more than $500,000 in performance bonuses while superintendent of the Atlanta school system.13 In 2012, when No Child Left Behind had been in effect for ten years, the state average for Math for 3rd graders on the Pennsylvania System of State Assessments (PSSA) was 80%. At the General Philip Kearny School in Philadelphia, where President Bush delivered his

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education policy assessment and claimed higher educational standards and increased testing would benefit urban minority youth, the student population was over 90% Black and Latino. Fifty-six students took the third grade math assessment with an average score of 46%, 34% below the state average score. The state average for reading in Pennsylvania was 74% in 2012. At the General Philip Kearny School, 56 students were tested in 2012 with an average score of only 45%. Scores were equally disappointing for every grade. For 8th graders, the state average for Math was 76% in 2012. The 33 students tested at this Kearny scored an average of 55%. In reading the state average score for 8th graders was 80%, at Kearny it was 64%. In Science it was 60% and 28%. In writing, the students at Kearny exceeded the state average, however, as best as I can tell from the guidebook for assessment, the writing tests were graded in the school by school staff and susceptible to subjective evaluation. In an unexplained anomaly, poor performance on these tests followed three years when students at Kearny met and sometimes exceeded average state performance.14 Ironically, but not surprisingly, the Texas test score miracle that Bush campaigned on in 2000 and was the model for No Child Left Behind, also evaporated under closer scrutiny. In Houston, where Bush’s first Education Secretary, Rod Paige, was superintendent, dropout rates supposedly plunged while test scores soared. However, a closer look by outside auditors showed something very different. For example, Sharpstown High School had reported zero dropouts in 2001-2002, although 463 students had mysteriously disappeared and been assigned a non-dropout code. Citywide, a 1.5% dropout rate turned out to be between 25 and 50% depending on how dropout was defined. In addition, a comparison of student performance on a national exam with the Texas state exam from 1999 to 2002 showed much smaller gains than proclaimed by proponents of the miracle and in some categories scores actually declined.15 The No Child Left Behind Act was proposed by President Bush on January 23, 2001 and signed into law January 8, 2002 after receiving bipartisan support in both houses of Congress. NCLB broadly expanded the federal role in public education in the United States through mandatory annual testing of students, academic progress reports, school report cards, increased scrutiny of teacher qualifications, and funding changes. Test design and standards were left to individual states. In addition, students in a variety of demographic categories in schools that received federal Title I funding had to make Adequate Yearly Progress in test scores. If this failed to happen even for small cohort groups, schools were labeled in need of improvement and required to develop improvement plans. Schools that continued not to reach expectations were designated as requiring “corrective action” which potentially meant replacement of staff, new curriculum, closing the school, or turning it into a charter school. States were mandated to have all students at proficiency level by the end of the 2013-2014 school year.16 Critics of NCLB charge that because states were free to approve widely different standards and tests, states where children performed below level on national and international assessments could set state standards so low they could still satisfy NCLB requirements. In addition, high-stakes testing requirements in general and mandatory achievement standards have been subject to sharp criticism by parents and teachers who argue that the testing regime distorts curriculum and lowers the quality of education. For critics, the major beneficiary of NCLB has been test preparation and publishing companies. Supporters of NCLB claim one of its strongest points is increased accountability. Testing and learning goals keep teachers, administrators, and district officials focused on student

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outcomes and preparing students for 21st century work and higher education that strengthens the economic prospects for the entire nation. The federal DOE cited improved student scores on NAEP tests released July 2005, as evidence of the efficacy of NCLB.17 Other aspects of the act continued to receive praise from teachers, parents, and the broader educational community. NCLB requires states to provide highly qualified teachers to all students, although once again each state sets its own standards for what counts as highly qualified. In addition, since curriculum standards must be applied to all students, states and school districts have been forced to pay closer attention to the educational needs of minority group students, students with learning disabilities, and English language learners. The biggest problem with NCLB has probably been the unrealistic goal that all students would achieve standards. This requirement coupled with a system of incentives and penalties produced a strong motivation for schools, districts and states to manipulate test results. The law itself was modified by the Obama administration when it established its own Race to the Top program. Obama proposed that NCLB lessen its accountability punishments to states and provided greater federal financial support through RTTT grants. Starting in 2011, he also issued partial waivers from NCLB requirements to a majority of the states.18 President Bush explained his support for NCLB in a speech in the East Room of the White House on September 4, 2002. In the speech Bush declared his refusal “to accept the status quo when the status quo means mediocrity for our children” and chided those in the country who believe in the “soft bigotry” of “low expectations.” According to President Bush, it was “unacceptable” that “certain kids just get shuffled through the system. Certain kids, they just get quit on. And we know who they are. They’re generally inner-city kids, kids whose parents may not speak English as a first language. It’s so much easier to walk into a classroom full of the hard-to-educate and say, ‘See you later. We’re just going to move you through.’ ” And those days have got to end, and the people up here on the stage and the people here in the White House understand - standing here, sitting here in the White House understand those days are going to end, for the good of the country. He believed that “One of the challenges is to make sure America is secure, is safe, is strong. But another one of our challenges is to make sure America is a better place for all of us, and that starts with insisting that every child get educated.”19 NCLB could never achieve these goals and it was finally replaced by new legislation in December 2015. You would expect such a stalwart defense of educational equity would be accompanied by federal dollars. In fact, after the passage of NCLB in 2002, appropriations for some federal education programs grew rapidly from fiscal years 2001 through 2004. These included Elementary and Secondary Education Act Title I Grants to Local Education Agencies and IDEA State Grants. However the rate of growth then slowed and funding actually declined in real terms from 2006 to 2008.20 Although George W. Bush has been out of office for over seven years, the fallout from NCLB continues, although he is no longer totally to blame, if he ever was. NCLB mandated that by 2014 every single student in every single school in every single community be proficient in reading and math. Since this is impossible to achieve, as of 2015, forty-three states, Puerto Rico, Washington DC, and the Bureau of Indian Affairs had waivers from NCLB mandates and two other states had requests pending.21 However, in April 2014 the State of Washington lost its waiver from NCLB because it refused to require school districts to use student scores on high-stakes standardized assessments in their evaluation of teachers. Ninety percent of Washington State public

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schools, including a number of high-achieving schools, were then placed on a federal list of failing schools which means they are required to set aside twenty percent of federal dollars for private tutoring and, if parents make the request, transport students to schools that are not on the list. Thousands of otherwise performing schools in California, Iowa, North Dakota, Vermont and Wyoming have also been declared failing because of the impossible mandate. Oklahoma also lost its waiver in August 2014 when the state withdrew from the Common Core. The state must now spend $4 million to $6 million processing paperwork for schools marked as failing instead of on the education of children.22 Even George Bush’s educational success stories have not really been that successful. In an interchange at the 2014 Conference on New York State History, Professor Kenneth Jackson of Columbia University described George W. Bush’s educational policies as not as bad as Obama’s, principally because of Bush’s support for Teaching American History grants.23 I confess I am not as good as Dr. Jackson in distinguishing between really bad and absolutely terrible educational policies. In the 2000-2010 decade the federal government tried to influence the teaching of history in secondary schools by financing staff development through the Teaching American History grant program. I participated in a number of the projects and on the local level in New York and once funding was secured they tended to be flexible in their approach to history and teaching. However, guidelines for grant applications were restrictive and insisted that funds could only be made available to programs that promote “Traditional American history.” In my experience, after the first round awards, nontraditional grant applications were denied. According to Bush Administration Secretary of Education Rod Paige, “Traditional American history … teaches how the principles of freedom and democracy, articulated in our founding documents, have shaped - and continue to shape - America’s struggles and achievements, as well as its social, political, and legal institutions and relations. Traditional history puts its highest priority on making sure students have an understanding of these principles and of the historical events and people that best illustrate them.”24 My problem is that this definition would exclude teaching about slavery, segregation, racism, the extermination of Native Americans, the internment of the Japanese, xenophobia, nativism, religious bias, imperialism, the Klan, the exploitation of workers, continuing social inequality, and any efforts to challenge them. With these non-traditional topics eliminated from the curriculum, it would be difficult to explain why this country had a Civil Rights movement, suffragists, and labor unions. Despite this, I was saddened when the program was defunded in the 2012 Federal budget. Perhaps the only success, at least in Bush’s terms, is the rapid expansion of charter schools in the United States as a result of Bush administration initiatives, although the jury is still out over whether charter schools are a real benefit to education in the United States. A publicly financed charter school is typically governed by a group or organization under a contract with the state or a local jurisdiction and is often exempt from many regulations, including class size and teacher union obligations. Between school year 1999–2000 and 201112, the number of students enrolled in public financed charter schools increased from less than half a million to over two million students and the percentage of public school students who attended charter schools increased from less than one percent to over four percent.25 But as President Bush said, the ultimate measure of his education policy is student performance on standardized tests. According to Center on Education Policy reports, while there generally were improved student scores on state designed and administered tests during

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the Bush administrations, there was only slow and uneven progress in narrowing test score gaps between racial and ethnic groups in the United States, high school test score gains lagged behind improvement in earlier grades, and achievement gains on nationally normed NAEP tests tended to be less than gains on state exams. CEP offered two potential explanations for the difference between state and NAEP exam results. One possibility was that instruction was more closely aligned to state content standards than to NAEP. However, “a less optimistic explanation is that state scores may have become inflated due to inappropriate teaching to the test.”26 Bush on Teach for America may be the best summary of his non-education policy. During the 2000 presidential campaign, George W. Bush had a private breakfast with members of Teach for America’s leadership team in Los Angeles. Wendy Kopp, the founder of TFA, was later invited to sit in the First Lady’s box at Bush’s first budget message to Congress in February 2001. Teach for America was mentioned in the 2002 State of the Union address and in January 2002, the President visited Booker T. Washington High School in Atlanta where he met with Teach for America Corps members. At the time President Bush called for the expansion of national service programs such as Teach for America, but then his administration suddenly dropped the group. I could find no other reference to Teach for America during his administration. Not only did George W. Bush lack a clear education policy, but he appears to have had a very short attention span as well.27

ENDNOTES 1

Gary Trudeau, In Search of Reagan’s Brain (New York: Holt, 1981). Evan Thomas, “The Quiet Power of Condi Rice,” Newsweek (2002, December 15). Accessed online March 1, 2016 at http://www.newsweek. com/quiet-power-condi-rice-140693. 3 George W. Bush, “Weekly Compilation of Presidential Documents,” V. 45, No. 1, (2009, January 12), 22-24. Accessed online March 1, 2016 at http://www.gpo.gov/fdsys/pkg/WCPD-2009-01-12/pdf/WCPD-2009-0112.pdf. 4 George W. Bush, Public Papers of the Presidents of the United States: George W. Bush, Book II July 1, 2008 to January 20, 2009. Washington DC: Government Printing office, 2012), 1523. 5 Ibid, 1524. 6 Associated Press, “Leading Bush Speechwriter Resigns,” Fox News (2006, January 15). Accessed online March 1, 2016 at http://www.foxnews.com/story/2006/06/15/leading-bush-speechwriter-resigns.html. 7 Bush, 2012, op. cit., 1524. 8 George W. Bush, “President Bush Discusses No Child Left Behind,” The White House, (2009, January 8). Accessed online March 1, 2016 at http://georgewbush-whitehouse.archives.gov/news/releases/2009/01/20 090108-2.html. 9 Ibid. 10 Ibid. 11 U.S. Government Accountability Office, “K-12 Education: States” Test Security Policies and Procedures Varied, Report to Secretary of Education Arne Duncan (2013, May 16). Accessed online March 1, 2016 at http://www.gao.gov/assets/660/654721.pdf. 12 Daniel Denvir, “How Pennsylvania Schools Erased a Cheating Scandal,” Philadelphia Citypaper (2013, July 18). Accessed online March 1, 2016 at http://citypaper.net/ cover/how-pennsylshyvania-schools-erased-a-cheatingscandal/; Benjamin Herold, “One-third of District Schools had Patterns of Suspicious Erasures,” Philadelphia Public Schools Thenotebook, (2011, July 11). Accessed online March 1, 2016 at http://thenotebook.org/articles/2011/07/12/one-third-of-district-schools-had-pattern-of-suspicious-erasures; Douglas Martin, “Arlene C. Ackerman, Superintendent, Dies at 66,” The New York Times (2013, February 5), B14. 2

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Alan Singer, “Pearson and the Atlanat Mess,” Huffington Post (2013, June 3). Accessed online March 1, 2016 at http://www.huffingtonpost. com/alan-singer/pearson-and-the-atlanta-s_b_3005867.html; Atlanta Journal Constitution, “A System-Wide Scandal.” Accessed online March 1, 2016 at http://alt.coxnewsweb.com /ajc/_projects_and_ planning_group/APS_investigations/APS.html. 14 Kearny Gen Philip School. Accessed online March 1, 2016 at http://www.zillow.com/ philadelphiapa/schools/kearny-gen-philip-school-68511/; General Philip Kearny, Great Schools. Accessed online March 1, 2016 at http://www.greatschools.org/ pennsylvania/philadelphia/1954-Kearny-Gen-Philip-School/?tab=testscores. 15 Diana Schemo and Ford Fessenden, “Gains in Houston Scores: How Real Are They?” New York Times (2003, December 3), A1. 16 Alyson Klein, “No Child Left Behind: An Overview,” Education Week, v. 34, n. 17 (2015, April 10). Accessed online March 1, 2016 at http://www.edweek.org/ew/section /multimedia/no-child-left-behind-overviewdefinition-summary.html. 17 U.S. Department of Education, “No Child Left Behind is working,” Accessed online March 1, 2016 at http://www2.ed.gov/nclb/overview/importance/nclbworking.html. 18 Wayne Riddle, “What Impact Will NCLB Waivers Have on the Consistency, Complexity and Transparency of State Accountability Systems?” Center on Education Policy (2012, October). 19 George W. Bush, Remarks of the Implementation of the No Child Left Behind Act of 2001 (2002, September 4). Accessed online March 1, 2016 at http://www.presidency. ucsb.edu/ws/?pid=73078. 20 New America, “Federal Budget Overview Updated: November 12, 2015.” Accessed online March 1, 2016 at http://atlas.newamerica.org/education-federal-budget#toc-department-of-education-appropriation-since-2000. 21 United States Department of Education, “ESEA Flexibility,” Accessed online March 1, 2016 at http://www2.ed.gov/policy/elsec/guid/esea-flexibility/index.html. 22 Motoko Rich, “In Washington State, Political Stand Puts Schools in a Bind,” New York Times. (2014, October 5), A21. 23 George W. Bush, Teaching Traditional American History, The White House, nd. Accessed online March 1, 2016 at http://georgewbush-whitehouse.archives.gov/ infocus/education/teachers/sect2-7.html. 24 Rod Paige, Department of Education, Part II, Federal Register 68(77) (2003, May 6), 24054. Accessed online March 1, 2016 at https://www2.ed.gov/legislation/ FedRegister/announcements/2003-2/050603b.pdf; Jonathan Rees, “What did Bush Mean by ‘Revisionist Historians?’ ” History News Network (2003, June 30). Accessed online March 1, 2016 at http://historynewsnetwork.org/article/1532. 25 United States Department of Education, The Condition of Education 2015, National Center for Education Statistics, NCES 2015-144 (2015, May), 70. 26 Carol McGraw, “Reading, Math Test Scores Edge Up in Colo., U.S.” The Gazette (2010, September 15). Accessed online March 1, 2016 at http://gazette.com/reading-math-test-scores-edge-up-in-colo.u.s./article/104698. 27 Joe Klein, Who Killed Teach for America, Time (2003, August 17). Accessed online March 1, 2016 at http://content.time.com/time/nation/article/0,8599,476274,00.html.

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 7

BIG GOVERNMENT CONSERVATISM, EXPANDING AND REFRAMING FOOD STAMPS: GEORGE W. BUSH, WELFARE REFORM AND THE 2002 FARM BILL Matthew Gritter Angelo State University, San Angelo, Texas, US

ABSTRACT George W. Bush was elected to the presidency in 2000 with a vision of compassionate conservatism. Attention has been devoted to his supply side fiscal policy and his expansionist foreign policy. However, less attention has been devoted to his social policy, particularly his expansion of the food stamp program. The 2002 Farm Bill, espoused and advocated by George W. Bush, expanded access to food stamps and restored eligibility to immigrants. In this chapter, I argue the food stamp expansion allowed George W. Bush to express his compassionate conservatism by examining the way he framed support of the program around traditional conservative themes such as the deserving poor and the need to reduce government waste and regulation.

INTRODUCTION George W. Bush was elected to the presidency in 2000 on a platform of compassionate conservatism. Attention has been devoted to his supply side fiscal policy and his expansionist foreign policy. However, less attention has been devoted to his social policy, particularly his expansion of the food stamp program (now known as the Supplemental Nutrition Assistance Program) in 2002 and his other efforts to support the program. Following the 1996 passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, enrollment in welfare programs declined and non-citizens were severely restricted from accessing social benefits. The 2002 Farm Bill, espoused and advocated by George W. Bush, expanded access to food stamps and restored eligibility to immigrants. What led George W. Bush to advocate

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these changes? With attempts in the 1990’s by conservatives to curtail the welfare system and during the Obama administration to curtail the SNAP program, what circumstances led George W. Bush to advocate expansion of this particular social benefit? In this chapter, I argue the food stamp expansion allowed George W. Bush to express his compassionate conservatism by examining the way he framed his support of the program around concepts of the deserving poor, promoting work and family and reducing governmental inefficiency and regulations. While the No Child Left Behind Act and his faith-based efforts have gained more attention, proposals for food stamps and the passage of the Farm Bill of 2002 represents an area where Bush was able to put his compassionate conservatism, included within his overall policy agenda, into practice. Bush has been characterized as both a “big government conservative”1 and a “compassionate conservative,” a phrase popularized by Martin Olasky during the 1990’s that became a theme of Bush’s 2000 presidential campaign.2 Bush discussed compassionate conservatism in his June 1999 speech announcing his candidacy for the presidency. Presidential initiatives such as the Faith Based Initiative were part of this policy agenda. The focus on food stamps examines a small scale policy success and how the Bush administration framed its support for proposed and implemented changes. As will be shown in his food stamp policies and politics, Bush’s compassionate conservatism moved away from a full scale rejection of the federal welfare state to a focus on decentralized approaches. Bush also sought to reach out to communities of color traditionally not courted by Republicans. As Milkis and Nelson note, “Bush’s compassionate conservatism promised to transcend the longstanding contest in American politics between rights-based claims to entitlement programs and the virtues of individual responsibility.”3 Compassionate conservatism animated Bush’s rhetoric and policy early in his first term. Exploring these policy initiatives provides insight into what his presidency would have looked like absent the War on Terror, with an emphasis on compassionate conservatism and domestic policy. Fortier and Ornstein note that “on the presidential campaign trail Bush defined himself as a compassionate conservative...he emphasized that conservatism was not harsh or uncaring, but that it was compassionate in a different way than the traditional welfare state model.”4 Bush’s compassionate conservatism would mold the welfare state to more conservative themes and frame assistance in a way less hostile to conservatism. “In particular, compassionate conservatism emphasized character and individual responsibility. Government might be called upon to alleviate suffering, but part of the the solution was to hold institutions responsible for improvement and to help foster better character and self-reliance in the individuals that government would help.”5 The way Bush approached Food Stamps exhibits these factors; he calls for maintaining and expanding a program often notorious for accusations of abuse in a way that affirmed both his compassionate and conservative principles. Since the 1970’s, Food Stamps have been included in the Farm Bill, historically a boon for agribusiness, which authorizes agricultural subsidies and the Women, Infant and Children (WIC) program that assists young families. Partially as a result, Food Stamps have historically had a lower political profile than welfare programs (despite a tradition of public outcry) that helped to insulate it from the drastic reforms of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. In this case, Bush was able to advocate for enhanced reforms and enhanced work requirements for welfare recipients particularly

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Temporary Assistance to Needy Families (TANF) while calling for expansion of the Food Stamp program. While TANF and its predecessors have varied tremendously by state, the Food Stamp program is far more uniform. As Christopher Howard describes the program, “the national government provides almost all the funding, sets eligibility criteria, and establishes a uniform benefit. States can choose whether to pay for individuals who are ineligible under the national guidelines, whether to spend money to boost public awareness of and participation in the program, and whether to modify a few other administrative details. By and large, the Food Stamp program operates remarkably similarly around the country.”6 As a result, Food Stamp policy is set at the federal level through the President and Congress’s negotiation of the Farm Bill. Food Stamps is considered one of the programs most responsive to economic downturns. As a Center for Budget and Policy Priorities overview notes, “after unemployment insurance, SNAP is the most responsive federal program providing additional assistance during economic downturns.”7 In 2000, the year before Bush took office, 17,194,000 people received Food Stamp benefits. As seen in Table 1, the number of Food Stamp recipients increased as did spending on the program. While Food Stamps have traditionally been responsive to economic conditions,8 the recovery from the 2001 recession did not result in a decline in spending or number of people receiving food stamps. Table 1 outlines the increase during the Bush administration, showing a 63% increase in recipients and a 111% increase in spending. Table 1. Food Stamp Recipients and Spending During the Bush Administration 2001-2008 Year

Food Stamp Recipients (in thousands of people)

Spending on Food Stamps (in thousands of dollars)

2001

17,318

17,789

2002

19,096

20,637

2003

21,250

23,816

2004

23,811

27,099

2005

25,628

31,072

2006

26,549

32,903

2007

26,316

33,174

2008

28,223

37,642

Source: http://www.fns.usda.gov/pd/SNAPsummary.htm.

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HISTORY OF FOOD STAMPS, CONSERVATIVES AND THE WELFARE STATE After several pilot programs as early as the 1930’s and expansion during the Kennedy administration, the Food Stamp Act of 1964 established the program in its present form. The Food Stamp program experienced controversy throughout its history, with large expansions in caseloads during the 1970’s.9 Food Stamps also has an interesting trajectory in terms of supporters of the program, with Senator Bob Dole supporting expansion of the program. At various points, spending caps and other reforms were passed by Congress in an effort to restrict access to the program but a major large-scale overhaul was not undertaken. During debates over the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, some Republicans called for converting Food Stamps to a block grant program. While the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 changed welfare from the AFDC entitlement to the heavily supervised and more modest TANF program, Food Stamps was largely spared from large scale changes. During debates over the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Republicans such as Richard Lugar of Indiana defended the program and it was seen by Lugar and other moderates as a safety net of last resort. Many Republican governors agreed with this prescription. Addressing food stamps, the program would be “consolidated with a number of other programs into a block grant to the states, “funded in the first year at 95 percent of the aggregate amount of the individual programs.”10 King notes that in “the House version of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 passed by the new Republican majority in March 1995, AFDC, child and foster care, school meals, and special nutrition aid for pregnant women and young children would all be transferred into block grants to the states funded at approximately current levels. Yet the block grant option intentionally was rejected for the food stamp program, which would be retained as a federal entitlement program with its expenditures capped.”11 In the end, King writes that “the food stamp program ultimately retained its standing as a full welfare entitlement.”12 Food stamps play a unique role in that many Republicans have expressed support for the program. Bob Dole supported expansion of the program during his long tenure in the Senate, Senator Richard Lugar defended the program during welfare reform debates and food stamps were even expanded during the later years of the Reagan administration.13 This tradition was in part followed in the efforts and rhetoric of President George W. Bush. Indeed, calls for SNAP reform often note that the large increase began under George W. Bush. Since Republicans have often worked to create distance from Bush since he left office, SNAP reform is a clear area where they can make their disagreement known.

GEORGE W. BUSH AND FOOD STAMPS: COMBINING COMPASSION WITH CONSERVATISM George W. Bush focused attention on Food Stamps after the program had successfully survived welfare reform. As Super notes, “As a result, in the six years from 1996 to 2002, the Food Stamp Program shed its skin, transforming from a political pariah to the beneficiary of a multi-billion dollar benefit expansion proposed by George W. Bush (at the same time he was

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attacking a host of other means-tested programs).”14 As Bush was moving to decrease parts of the social safety net, he was supporting doing more for those on Food Stamps and expanding access to legal immigrants. Bush had an opportunity to fulfill his compassionate conservatism without changing his overall policy direction. Bush’s compassionate and big-government conservatism is clearly on display in his attitude and actions toward food stamps in 2002. As Milkis and Nelson write, “Bush-style big government conservatism extended to domestic policy as well. Rather than try to curtail New Deal and Great Society entitlement programs, as President Reagan and the Gingrich-led 104th Congress had tried to do, Bush sought to recast these programs in conservative form.”15 Milkis and Nelson cited the more familiar examples of No Child Left Behind, faith based support and the expansion of Medicare. However, food stamp expansion is another example of Bush’s attempts to refashion the safety net in a more conservative light. The Bush administration’s efforts regarding food stamps were part of two larger efforts: work to revise the social safety net six years after the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 and the 2002 Farm Bill that authorized funding for food stamps, WIC and agricultural subsidy programs. As a result within programs Bush expressed his big government conservatism through generous subsidies for agribusiness and efforts to encourage work and increase marriage in social policy, marrying corporate support and an attempt to change the social safety net. An analysis of proposed changes created by the Bush administration in 2002 will be followed by speeches he gave in early 2002 allowing for an exploration of the policy steps and the way they were supported by presidential rhetoric. During early 2002, a policy brief titled “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform”16 was prepared after a great deal of consultation. Drafts were initially titled “Self-Reliance Through Work and Marriage.”17 While largely dealing with changes to the TANF program, a section on Food Stamps described the program as different than TANF in that “the Food Stamp program serves as an important support to ease the transition from welfare to work.”18 Food Stamps were characterized as a way to move people into work but “the details of program operation at the local level should facilitate participation by families that work.”19 The Food Stamp program was characterized as providing a supplement to working families. However, the report went on to say “it has become increasingly clear that the program is failing to live up to this challenge”20 and that “many single mothers struggling to earn $10,000 per year would certainly welcome the additional $2,000 in benefits that food stamps would provide.”21 While seeking to get more working people involved, the way the program was administered and regulated was also explored. As the report noted, “working families often have circumstances that make complying with the program’s procedural requirements difficult. It can be hard, for example, for working people to take time off to appear at certification interviews during working hours. But another part of the problem is that the quality control system may result in states inadvertently discouraging food stamp use by working families.”22 The Bush administration was not trying to dismantle the welfare state, instead they were attempting to make it more responsive to working families. People working and as a result taking personal responsibility were to be rewarded under this approach. Indeed, the document notes that “in general, the reforms proposed by the Administration will make it easier for states to fashion a food stamp program that is friendlier to working families.”23 The Food Stamp program and the welfare state would be adjusted rather than obliterated.

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Several ideas were raised in order to better assist working families. Proposals included efforts to improve efficiency, a reduction in penalties for errors and two methods to expand access. One would “enable working families to own reliable transportation,”24 “allowing low income individuals to own a reliable car for getting to work without losing food stamp benefits.”25 There was also a clause to “Phase-in a Higher Standard Deduction for Large Households.”26 Food stamps were characterized as a way to support families and to promote work. Improving access to food stamps for legal immigrants was also proposed. Each of these expansions promoted conservative goals of work and marriage promoted within earlier drafts of the report. The report was quite critical of many aspects of TANF but encouraged greater use and expansion of the Food Stamp program, particularly for families that were working. When George W. Bush called for support of food stamp programs, he personalized the story and delivered his remarks in a way that clearly illustrated his compassionate conservatism. Three primary documents are utilized to explore his support for Food Stamp expansion: his remarks made on February 26, 2002 regarding welfare reform, a speech delivered at St. Stephens Church in Ohio on May 10, 2002 and the May 2002 signing ceremony for the Farm Bill. Each instance included a discussion of Food Stamp expansion in the context of a larger policy discussion, piece of legislation or policy oriented speech. As a result, his calls for Food Stamp expansion should be considered as part of a larger policy effort. What makes the speeches particularly interesting is how he frames compassion while also supporting business, opposing red tape and federal authority and substantially expanding welfare reform efforts. As a result, his compassionate conservatism is not separate from his other domestic policy initiatives. Days before the Farm Bill was signed, Bush visited the state of Ohio. In a speech at St. Stephen’s Church, he personalized the issue of Food Stamps. Interestingly, he brought up the topic in the context of intense federal regulations. I’ll give you an example of some of the roadblocks that Federal regulations create, all the rules, all the fine print, Mr. Mayor, all the thick layers of booklets. The Governor’s explained to me this case, and it’s interesting. There’s a single mom with two daughters here in Ohio. One of the daughters is disabled, and the other daughter is working at— she’s 17 years old—to help the family. She’s working part time. Because she was 17 years old, her income didn’t count in the formula to decide whether or not the family was eligible for food stamps. Guess what happened on her 18th birthday? All of a sudden, her income, because of a rule or regulation, starts to count. Even though the income level of the family didn’t increase, they lost their food stamps.27

It is difficult to imagine Ronald Reagan, Newt Gingrich or Paul Ryan making this statement. George W. Bush was decrying a formula that made it more difficult for a family to access a social benefit. He framed it in the context of federal regulation, however. A lack of flexibility and rigid federal regulations were hurting the ability of the family to access food stamps. While at first glance, the above passage seems to contradict a conservative view of the welfare state, there are several factors that align it with a conservative position. The daughter whose income is counted is working; she is part of the deserving working poor rather than the mythical welfare queen so often brought up by Ronald Reagan. Bush goes on to specifically

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outline his vision of compassionate conservatism and of a compassionate but conservative America: Now, that’s not what a compassionate America is all about. When people need help, we need to help them. Now, it’s conservative to trust local people, but it’s compassionate to provide flexibility so that rules and regulations don’t prevent people from getting the help we want them to get. What ought to happen is, the State of Ohio should have the flexibility necessary to allow that young girl and her family to receive food stamps as a transition period to full-time employment. In other words, it ought to be a part of the transition from welfare to work, but that’s not the way the food stamp program works.28

Bush clearly outlines compassionate conservatism, traditional conservative ideals representing devolving authority to states, trusting people to run their own lives and avoiding excessive rules and regulations. Bush avoids that harsh rhetoric often used when Republicans and conservatives discuss public assistance. However, he also focuses on avoiding waste and excessive regulation: And I’ll tell you what else happens with a system that is too bureaucratic and too focused on rules and regulations. The administrative costs of these programs end up putting money not in the pockets of people we’re trying to help, but in—as a result of the bean counters, you know, how do you keep track of what’s going on? The more complicated the rules and regulations out of Washington, the more money States have to spend to account for the money. And I’ll give you an example. On the food stamp program here, the State of Ohio spent $192 million administering the program. The program provides $573 million of benefits. That is a high cost per dollar delivered. It’s about 25 percent overhead cost. Now, I’ll tell you, a lot of that money—with fewer rules and regulations, a lot of that money would end up going to benefit people. And that’s important for the American people to understand. The more regulations there are out of Washington, the more complex the Washington, DC, regulations are, the more likely it is money is not going to end up helping people.29

Bush avoided calling for block granting food stamps as Republicans before and after him did but he did criticize the overhead cost. He also criticized Washington. Despite these factors, he still favored expanding food stamps to a group excluded in the 1996 Personal Responsibility and Work Opportunity Reconciliation Act of 1996: legal immigrants.

BUSH, IMMIGRATION AND FOOD STAMPS As Governor of Texas, George W. Bush sought Latino voters in the 1994 and 1998 elections and supported the idea of comprehensive immigration reform, following a tradition of Texas Republicans being supportive of recent immigrants.30 The 1996 Personal Responsibility and Work Opportunity Reconciliation Act of 1996, passed during the same period when the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 was adopted, was a strong piece of immigration restriction and enforcement legislation, and was passed during a period of strong animosity towards undocumented immigrants in the United

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States Congress.31 Just as Bush was attempting to differentiate himself from the antigovernment rhetoric of the 104th Congress, he was also following up on his previous work of building a stronger relationship with Mexico and appealing to Latino voters. The Bush administration proposed the expansion in January 2002. Bush had several motivations. As the New York Times notes, “amid a recession that is hurting many immigrants, and with the government waging a war on terrorism that has targeted some immigrants, Mr. Bush is eager to show his commitment to them. He is also eager to address domestic problems -- a transition his father failed to make effectively a decade ago after the Persian Gulf War.”32 Bush could show commitment to immigrants, gain support with Latinos and also not let the War on Terror vanquish the compassionate conservatism he had run for office on. While Bush was in favor of increasing enhanced work requirements for TANF recipients, on the issue of food stamps he outlined an area where assistance could be expanded: And there’s one area that we need to improve help on: We need to restore nutrition benefits for legal immigrants. The 1996 reforms imposed a 5-year ban on most welfare benefits for new legal immigrants, including a permanent ban on food stamps, unless immigrants have worked here for 10 years or have become citizens. We’ve proposed changing this law so that legal immigrants receive food stamps after 5 years, so that those who are eligible, those who need help, like an elderly immigrant farmworker, somebody who has worked hard all his life and cannot help himself, ought to get food stamps. Or a legal immigrant who has been working here for 5 years and raising a family and all a sudden gets laid off and needs a helping hand, ought to get food stamps.33

Bush frames the issue in terms of nutrition, noting a re-framing of the issue used during his administration to encourage eligible people and families to apply for food stamps. He specifically frames it in terms of the deserving poor. An elderly farmworker, here in the country legally perhaps as a result of the legalization process included in the 1986 Immigration Reform and Control Act signed by President Reagan, is in need of assistance. Or a hardworking family is suddenly in need. Neither of these examples suggests a culture of dependency. All of the examples are hardworking people in need of nutritional assistance. When discussing both the need for further welfare reform and the Farm Bill that benefited farmers and agribusiness interests, Bush brought up this particular example. George W. Bush specifically mentioned immigrants and the Food Stamp expansion when signing the Farm Bill. He personalized the bill by highlighting a specific potential situation virtually identical to that raised: “This bill is also a compassionate bill. This law means that legal immigrants can now receive help and food stamps after being here for 5 years. It means that you can have an elderly farm worker; somebody here legally in America who’s worked hard to make a living and who falls on hard times—that person can receive help from a compassionate Government. It means that you can have a head of a family who’s been working hard, been here for 5 years, been a part of our economy, been legally working, and that person falls on hard times—our Government should help them with food stamps, and this bill allows that to happen.”34 Bush did not mince words; he once again used the phrase compassionate to denote this particular section of the Farm Bill. The remainder of the speech dealt with issues such as

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free trade and did not mention the Food Stamp program in detail beyond the expansion of benefits to an additional group of legal immigrants. There was both support and criticism of Bush’s steps from his fellow Republicans. When the change was introduced, one of the leaders in favor of cutting social benefits praised the change in the New York Times. “In an interview today, Newt Gingrich, the House speaker in 1996, said: ‘I strongly support the president's initiative. In a law that has reduced welfare by more than 50 percent, this is one of the provisions that went too far. In retrospect, it was wrong. President Bush's instincts are exactly right.’”35 The changes of the era are clear in the statements of Gingrich. The Newt Gingrich of 1995 or 2012 may not have had the same point of view; however, Bush’s compassionate conservatism and perhaps the power gained in the aftermath of September 11, 2001 helped to shift the views of at least Gingrich. In January 2002, the conservative newsletter Human Events included a discussion of the Bush administration proposal: “The Bush administration has decided to seek the restoration of food stamps for legal immigrants.”36 The newsletter aired public criticism of the policy from Congressman Tom Tancredo (R-CO) just four months after the attacks on September 11, 2001. The newsletter appears to affirm the idea that Bush could use compassionate initiatives to distance himself from the perception of his party. In a short brief entitled “Welfare for Foreigners,” it was noted that “the Bush administration has decided to seek the restoration of food stamps for legal immigrants, thus, critics say, establishing yet another reason for foreigners to come to the United States. Food stamps for aliens were repealed by the 1996 welfare reform bill.”37 Rather than compassionate conservatism, here Republicans and conservatives were arguing that access to public services would encourage further immigration. It is a bit difficult to think of a rationale where someone goes through the legal immigration process in order to in five years gain access to a relatively modest social benefit, but the rhetoric is typical of that which was used by Republicans in the mid-1990’s and was used again when Bush in his second term sought to secure comprehensive immigration reform. Tom Tancredo, who would emerge as one of the leaders of the immigration restriction movement, was already making his mark in criticizing this Bush administration policy. “It’s plain to see the president has chosen to steal a page from the Democratic playbook,” said Rep. Tom Tancredo (R-Colo.), chairman of the Congressional Immigration Reform Caucus. “His attempt to expand our base through surrendering to the Hispanic vote is usually the Democrat’s job. Votes can’t be bought with welfare. Enticing immigrants to the United States with federal benefits only discourages them to work or develop skills to sustain their own livelihood. The proposal would put 363,000 foreign nationals on the dole.”38 Each of the claims made by Tancredo and Human Events is worth further exploration. First, you can see that Bush’s attempts to gain Latino voters are roundly criticized. Another claim shows a view towards social benefits more typical of Republicans since the Reagan era. The food stamps expansion is seen as buying votes. The 363,000 comes from the Bush administration’s estimates of those eligible. However, what is obvious is that the compassionate view of Bush did not reach all in the Republican Party. Indeed, Human Events in a sense can be perceived as doing Bush a favor, since they portray him as pursuing Democratic goals when in actuality this relatively modest change is attached to perhaps the largest form of corporate welfare outside of the tax system, the Farm Bill. In recent years, conservatives and Republicans have followed the lead of Tancredo rather than George W. Bush. Trends have emerged that suggest a move away from compassionate

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conservatism on food stamps but not the end of the idea of social policy with a human face. One is states such as Missouri passing laws that restrict the type of food that can be purchased with food stamps and the increase in proposals to drug test welfare and food stamp recipients. The second trend is the rise of reform conservatism that has led many to consider the possibility of a revival of compassionate conservatism. As Peter Beinart noted: “Rand Paul is arguing for shorter prison sentences. Republican Governors John Kasich and Mike Pence are expanding Medicaid. Marco Rubio recently said it was time for Republicans to stop trying to balance “the budget by saving money on safety-net programs.” Even budget cutter extraordinaire, Paul Ryan, wants to “remove it [the fight against poverty] from the oldfashioned budget fight.” These ideas and insights differ from Bush but do show Republicans attempting to formulate compassionate social policy. In an age of drug testing and limits on steak, it is interesting to see Republicans pursuing compassionate type policies in other areas.

CONCLUSION President Bush’s early acts of compassionate conservatism including the No Child Left Behind Act, support for Faith Based organizations, and expansion of Food Stamps did not endure as part of his domestic political agenda. The 2003 expansion of Medicare to include prescription drug coverage and the failed 2005 attempt to reform Social Security both dealt with senior citizens, who have always been considered as part of the “deserving poor.” His themes of the “ownership society39” dealt mainly with building assets. In addition, in 2005 he pushed for budget cuts in many social programs. His attempts through 2006 to secure comprehensive immigration reform do show an enduring commitment. As a result, there were few initiatives that fit into his compassionate conservative framework. As his presidency developed, his priorities shifted and in his second term he was hampered by increasing unpopularity and focused on his foreign policy goals and the emerging financial crisis of 2008. While many Republicans have distanced themselves from the Bush presidency, the early years of his presidency remain a model of including compassionate ideas within a conservative policy agenda. Unlike the symbolic moves toward compassion taken by other officials and candidates, this instance represents a specific policy initiative that had a long term impact. A Bush presidency without the strong focus on the War on Terror may have included more of these reforms as he attempted to govern and lead a closely divided nation. How successful these reforms and how consistent the message would have been can only be speculated about but as the 2016 election campaign approaches and political figures including his brother former Florida Governor Jeb Bush consider campaigns, it is intriguing to consider how they will craft their social policy and the discourse supporting their claims. Early evidence indicates a possible revisiting of the themes of compassionate conservatism, suggesting that future Republican presidencies may be influenced by the discourse and policies of Bush. The Food Stamp program is a tangible representation of compassionate conservatism and future programs could well address the same immigration and social policies supported by George W. Bush. Without abandoning their core ideals, discourse and policies could potentially be created.

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Compassionate conservatism did not endure in the Bush presidency, as attention continued to be paid to the War in Iraq and, shortly before the end of his presidency, the global financial crisis of 2008. In addition, criticisms of Food Stamps and SNAP re-emerged with renewed fervor in conservative circles. However, the 2002 Farm Bill and the welfare proposals considered by the Bush administration represent a conservative attempt to construct social policy that has failed to receive a great deal of attention. Bush was following earlier Republicans such as Bob Dole just as his more conservative detractors were following earlier efforts by North Carolina Senator Jesse Helms and California Senator S.I. Hayakawa. Within this moment, you see a key possibility for conservative social policy that preserves Food Stamps and SNAP. The 2002 Farm Bill has been rightfully criticized for the large amount of agribusiness subsidies that make the story less rosy but it still represents a possibility for social programs. However, despite the compassionate rhetoric and actions of George W. Bush in 2002, there would be renewed attacks on Food Stamps and SNAP that continues to the present day. As The Washington Post recently noted, “Sixteen years ago, George W. Bush presented to America his vision of “compassionate conservatism,” and in response he received an absolute torrent of glowing articles in the media calling him a “different kind of Republican” — conservative, to be sure, but not so mean about it. Well those days are long past. In the 2016 GOP primaries, it’s compassionless conservatism that’s in fashion.”40

ENDNOTES 1

Sidney Milkis and Michael Nelson. The American Presidency: Origins and Development 1776-2011. (Washington DC: CQ Press, 2011) for a discussion of Bush and big government conservatism. See also Brian J. Glenn and Steven M. Teles, eds. Conservatives and American Political Development. (2009) In addition, see The George W. Bush Presidency: An Early Assessment. Fred J. Greenstein, ed. (Baltimore: The John Hopkins University Press, 2003) for a discussion of Bush administration strategy and policy early in his term. 2 Martin Olasky. Compassionate Conservatism: What it is, What it Does, and How it Can Transform America. (New York: Free Press Books, 2000). For an additional discussion of compassionate conservatism see Kevin M. Kruse. “Compassionate Conservatism: Religion in the Age of George W. Bush.” in Julian Zelizer, ed. The Presidency of George W. Bush: A First Historical Assessment. (Princeton: Princeton University Press, 2010). 227-251. 3 Milkis and Nelson, 444. 4 John C. Fortier and Norman J. Ornstein. “President Bush: Legislative Strategist.” in The George W. Bush Presidency: An Early Assessment. Fred J. Greenstein, ed. (Baltimore: The John Hopkins University Press): 138-172. 146. 5 Fortier and Ornstein, 146. 6 Christopher Howard. The Welfare State Nobody Knows: Debunking Myths About U.S. Social Policy. (Princeton: Princeton University Press, 2007): 35. 7 “Policy Basics: Introduction to the Supplemental Nutrition Assistance Program (SNAP).” (Washington DC: Center on Budget and Policy Priorities.” March 28, 2013). Available at: http://www.cbpp.org/cms/ index.cfm?fa=view&id=2226. 8 Super, 2004. 9 King, 2000 for further discussion. 10 King, 1999. 11 King, 1999, 359. 12 King, 1999, 360. 13 King, 1999 and Super, 2004 for more detailed discussions. 14 Super, 2004, 1273. 15 Milkis and Nelson, 451.

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“Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum). 17 “Promoting Self-Reliance Through Work and Marriage.” Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum). 18 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 31. 19 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 31. 20 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 31. 21 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 31. 22 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 31-32. 23 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 32. 24 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 33. 25 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 33. 26 “Working Towards Independence: The President’s Plan to Strengthen Welfare Reform” February 2001. Box 2, Folder 9. White House Office of Records Management Subject Files-WE (Welfare) (George W. Bush Presidential Library and Museum): 33. 27 Remarks at St. Stephen’s Community House in Columbus, Ohio, May 10, 2002. Public Papers of the President, 2002: 768-773. 771. 28 Remarks at St. Stephen’s Community House in Columbus, Ohio, May 10, 2002. Public Papers of the President, 2002: 768-773. 771. 29 Remarks at St. Stephen’s Community House in Columbus, Ohio, May 10, 2002. Public Papers of the President, 2002: 768-773. 771. 30 Benjamin Marquez. Democratizing Texas Politics: Race, Identity and Mexican American Empowerment, 19452002. (Austin, TX: University of Texas Press, 2014). 31 Lina Newton. Illegal, Alien and Immigrant. (New York: NYU Press, 2008). 32 Robert Pear. “Bush Plan Seeks to Restore Food Stamps for Noncitizens.” New York Times. January 10, 2002. 33 Remarks on the Welfare Reform Agenda. February 26, 2002. Public Papers of the President, 2002: 288-293. 292. 34 Remarks on Signing the Farm Security and Rural Investment Act of 2002. May 13, 2002. Public Papers of the President, 2002: 780-783. 782. 35 Pear, January 10, 2002. 36 “Capitol Briefs.” Human Events. January 14, 2002. 37 “Capitol Briefs.” Human Events. January 14, 2002. 38 “Capitol Briefs.” Human Events. January 14, 2002. 39 http://georgewbush-whitehouse.archives.gov/news/releases/2004/08/ 20040809-9. html. 40 Paul Waldman. “Scott Walker wants to drug test food stamp recipients. That shows why he’ll never be president.” (www.washingtonpost.com) July 16, 2015.

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 8

COMMENTARY: THE CHALLENGES OF LEAVING NO CHILD BEHIND* Anne-Imelda Radice Director, Institute of Museum and Library Services, 2006-2010 Deputy Chairman for Programs, National Endowment for the Humanities, 2005-2006 Chief of Staff to the Secretary of the United States Department of Education, 2003-2005

No Child Left Behind was a bipartisan law. It was not perfect. And so, indeed, testing was a very important part of it. The fact that waivers were given, and I was involved with some of those waivers, because there are indeed ways that children learn that sometimes are not traditional. Perhaps this was an imperfect law, but what we should be talking about is how to embolden it, how to make changes, because indeed no child should be left behind. When President Bush decided to make education his signature piece when he was Governor of Texas, this was no small decision to take on a domestic issue and represent those who had little voice. When he chose Rod Paige to be the Secretary of Education, Rod had been the Superintendent of the Houston school system. Rod is an amazing guy. I spent two years with him as his Chief of Staff. We met at 6 in the morning for breakfast at the Department of Education, and I don’t think I said goodbye to him till 10:00 or 11:00 at night, because that was the last event we’d gone to. We traveled all over the country and I got to know him very well. This is a man who grew up in the segregated Mississippi. He knew all about the “water fountains,” and he was a great athlete, but he had to play basketball on a dirty, dirt-filled court. He wasn’t allowed to study for his Ph. D. in Mississippi, instead, he went to Indiana, where he was allowed to study. He knew all about segregation. He was not a bitter person, instead, he constantly tried to work within the system, a system that’s flawed, indeed, but still a system. When Rod and I went to Little Rock, Arkansas, and to Kansas at the time of the remembrance of Brown v. Board of Education, he got a terrible call in the middle of the night. His ex-wife, with whom he was very friendly, had been killed in a car accident. *

Selected commentary from “Education Policy in the George W. Bush Presidency” panel, Conference on the George W. Bush Presidency, Hofstra University, March 24, 2015.

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Rod could’ve just left and gone home. Instead, he didn’t, because he knew there were people depending on hearing from the first African-American Secretary of Education. And he gave that speech at that high school in Little Rock, and he was to walk up the stairs by himself, a major statement, obviously a photo op, whatever. As he was starting up the stairs, he turned to me and he said, “Would you walk with me?” I said, “But Mr. Secretary, this is for you! This symbolizes the battle.” He looked at me and he said, “No.” He said, “You and me walking up together, that’s what it’s about.” That is the kind of person who was the Secretary of Education. This is not a bureaucrat, who was out to diminish people, who was out to make sure that test scores only looked a certain way. If people cheated on test scores, if schools cheated, if the state cheated, that’s not Rod Paige and it’s not President Bush. It’s awful that some of that happened and it did, and we uncovered it, we published it. We made sure people understood. And we hope that that meant that people might try to come together and find some solutions to this, not that it would simply be used as a target to put on someone’s back. Margaret Spellings, who became the Secretary of Education after Rod, is hardly a shrinking violet. She knew President Bush in Texas, and as you heard, she’d been the domestic policy adviser in the White House, so I worked with her very closely there. And then, she later went onto become Secretary of Education. Arne Duncan, who is now the Secretary of Education was very much a part of No Child Left Behind, and he had some very serious concerns about it. The development of Common Core is really an attempt to try to fix what had happened in No Child Left Behind. So, are there things that went wrong? Absolutely. Did they go wrong because it was some sort of attempt to defraud America? Absolutely not. We had some people who were very brave, who stood up and said, “We can’t leave kids behind.” “The soft bigotry of low expectations,” that’s a very powerful statement, not something to be used in jest. It showed the hearts of the people involved with this. When you go into public service, you usually get criticized, very rarely do you get thanked, but you do it, because there’s something inside of you that makes you want to do something that might make a difference. And I know, from my own knowledge of President Bush and from my friendship, which goes back a long time with him and Mrs. Bush, and my friendship with Rod Paige, that they really tried to make it right. They perhaps did not always succeed, but the discussion is open, and now we have a chance to fix it. With any law, the law should be organic. It should be able to accept changes. And I think that’s what we have with No Child Left Behind.

Ed Rollins Senior Presidential Fellow, Peter S. Kalikow Center for the Study of the American Presidency, Hofstra University Former adviser to four U.S. Presidents (Richard Nixon, Gerald Ford, Ronald Reagan, George H.W. Bush) The one thing I always tell students when I start, it’s all complicated. Education reform is not a Republican or Democratic problem, it’s an American problem. Education is one of the foundations of this country. It’s what moves us all forward. We’ve had extraordinary opportunities in the course of our education to move people forward, but it’s still a very

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troubled area. Every major urban school district in America does not have a good education system or, certainly, an efficient educational system. And I think, to a certain extent, as we sit here trying to review President Bush’s legacy, I’m always reminded by the fact that sometimes motives are as important as the actions and sometimes imperfect people do good things and sometimes perfect people don’t do such good things. What I want to talk a little bit about is Bush and his priority and the environment that he had to do this in. My first encounter with him was probably 1982-1983, when came in to my office with his cowboy boots on. I had the old Nixon hideaway office where Nixon didn’t like the Oval Office, so he had this palatial office in the Old Executive Office Building. And because it was Nixon’s office, they let me have his desk. It was like a monument that everybody would come in and look at. This was where the taping was done and all the rest kind of things. And the first thing he did is, he sat across me, he put his cowboy boots up on my desk and he said, “I need help getting a job.” I said, “Well, first of all, you need help getting your feet off my desk. It’s a presidential desk and it’s part of the presidential museum. And if you don’t get your boots off the desk, they’ll come and take it away from me.” If I’d have known he was going to be President, I would have treated him with a lot more respect. At that point in time, he was looking for job. He was an interesting young man and he was not the Bush that was ever planning a career in politics. Jeb Bush was the son who had gone off to be a politician and gone back to Florida, and I think young George W. was … he had drinking problems as Senator [Edward M.] Kennedy had at different points in times, as did many people in the Washington scene at that point in time. He turned his life around. He had an extraordinary wife. I don’t think he set out to ever be governor of Texas or President of the United States. It was not the stories that you hear today about a family tradition where they sit at the dinner table saying, “You go first, you go second, you go third.” The father was a man who was very committed to public service, a very gentle man. And I think to a certain extent, when George W got elected and he kind of unified our party at a point in time, the mere fact that he picked education as his number one domestic issue was major, and a lot of that had come out of Texas. Texas, for a long time, it had very serious educational problems as did much of the South. And a gentleman by the name of Ross Perot had had a big education commission and spent a lot of money in Texas trying to reform education. Texas had the complication of, like many Southern places, the school systems weren’t very good. In the old days, Southern governors, particularly, didn’t get two terms, they got one term. And so you’d sort of focus on what was going to be your priority; you can be a transportation governor and you’d build roads for four years, you can be an education governor and you focus on education. In his term, even though he did get two terms, he focused on education and he basically had a bipartisan relationship with the state legislature. Which is not unusual in Texas, and the Conservative Democrats at that point in time liked him and did well. And when he came to Washington, when he got elected after a very troubled election, obviously, and a very close election, he picked the number one priority. And the two most important people in his administration, as far as he was concerned, were Rod Paige, who was the superintendent in Houston, and Margaret Spellings. The idea that you pick for your domestic policy advisor someone with an education background, was a monumental decision to be made on his part. So I think he really wanted to do this, challenging Ted Kennedy to be his co-partner that was a very, very significant effort.

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It wasn’t just the Bork issue, people forget that Ted Kennedy was the guy that sunk John Tower, who was the senior senator from Texas. His drinking buddy, the senior senator from Texas, who was going to be the secretary of defense and Kennedy took him out. So it was kind of like a family friend, the father didn’t have too good relationships with Kennedy so I think at the end of the day, to say, “I’m going to sit down with Ted Kennedy, the most important man in education, who’s Chairman of the Labor and Education Committee.” Orrin Hatch, who was the ranking member and one of the most conservative members, said, “You can deal with Kennedy, Kennedy will deal with you,” and they sat down and they made a good-faith effort to develop. And I can’t speak to the details like the others on this panel can, but I can tell you the motivation was an honorable motivation of trying to fix the educational system in America. What often happens with legislation is it ends up being imperfect and I think just as we can debate ObamaCare from one end of the country to the other, normally what happens is, you pass these big, major pieces of legislation, you go back a year later or two years later, you see what works, see what doesn’t work, and you change it. George W. Bush passed education reform after Ronald Reagan got elected and one of his priorities was to abolish the Department of Education. So the fact that he wanted to be closer to President Reagan, that he wanted to be his dad because his dad was a one-termer, and the fact that he took education and was going to make it work in America was an honorable motivation. Now, the details, obviously, become imperfect sometimes. Education is still a high priority of this country, it’s a high priority here with any of you who may want to be in education, and I think the critical thing, and I hope that you learn over the next couple days here. Everybody has strong opinions about politics and I think, to a certain extent, what you need to learn is that it’s a complicated process and it’s more partisan today than it’s ever been before and it’s partisan for one very simple reason, there’s not enough money in the federal budget. Democrats feel that there’s a way of shifting using government resources to bring poor people, disadvantaged people, and entitlement programs and what have you. You need more money to do and expand those programs. Republicans feel there are too many government programs and we can’t spend more money that we don’t have because it goes on your generation and we can’t raise more money, raise more taxes, the rich are already taxed to the point where they’re going to be dysfunctional if they continue to move forward. So I think, to a certain extent, the bipartisanship is a kind of question of resetting priorities in the country and I think for the next several years, we’re going to see this battle back and forth. But the critical thing not to lose sight of is, how we educate our young people, how do we continue to make that a high priority? Basically we’re competing in a world today in which you’re not competing as young people here, just against yourselves or other schools or Ivy Leagues. You’re competing against the world. And at the end of the day, I’ll take the best kids anywhere, any one of your group here, and put them up against anybody in the world, but we have to make sure that next generation and those early elementary schools and those early high schools have the ability to learn and move forward. I’m not an educator, I’m someone who’s been around the political process a long time, but I think, to a certain extent, and I hope some of you in this room will both go into education and some of you go into government. We need good, young people and we need good, young people in a classroom, we need good, young people in government, and I think, to a certain extent, follow the Bush story the next couple days. Pick and choose, you

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may change your mind in some places, you may not. But at the end of the day, learn more about it and remember, again, it’s all complicated. If it was not complicated, someone would fix it. Republicans had an answer, they’d get it done. Democrats had an answer, they’d get it done. The harder it is, the more it takes for people to come together. This was a perfect example, Democrats and Republicans coming together, trying to fix something. It didn’t work out quite the way that anybody had intended, still needs to be fixed, but just the idea that they worked together was important.

PART III: ORGANIZATION, STAFFING, AND NOMINATIONS

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 9

THE CHIEFS OF STAFF IN THE GEORGE W. BUSH WHITE HOUSE David B. Cohen1, Karen M. Hult2 and Charles E. Walcott2 1

2

The University of Akron, Akron, Ohio, US Virginia Polytechnic Institute and State University, Blacksburg, Virginia, US

ABSTRACT George W. Bush chose an experienced White House hand in Andrew Card to be chief of staff in an administration replete with governing experience. Initially seen as one of a troika of top advisers, Card established himself as fully in charge of most processes in a disciplined White House, though he lacked authority to interfere with Vice President Cheney’s extraordinary access and influence with Bush. Drawn to security issues after 9/11, Card left in the wake of controversy after Hurricane Katrina. Joshua Bolten, Card’s deputy, then presided successfully through the end of the Bush presidency. We conclude that while prior experience is an asset and effective organization essential, they cannot exist independent of the president’s style and preferences, nor can they guarantee political or policy success.

INTRODUCTION In the modern White House, chiefs of staff have become indispensable. They are often the first staffers whom presidents see in the morning and the last they see before returning to the Executive Residence. Chiefs of staff perform a number of important roles for presidents.1 The chief is an administrator who oversees the policy and political processes and personnel of the White House. The chief of staff is an indispensable adviser who provides the president with unvarnished policy and political advice while acting as an honest broker in reporting the views of other administration personnel. They are often a proxy for the president who uses their position to connect with the media and Congress and to speak for the president. Above all else, the chief of staff must be a guardian of the president’s political interests, which at

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times requires the chief to harm their own interests and reputation while protecting the president’s. In his eight years in office, George W. Bush hired only two individuals to serve in the high-stress position of chief of staff: Andrew H. Card, Jr. and Joshua B. Bolten. Both men were experienced Washington hands who were familiar to Bush, having served in the George H.W. Bush administration. Although Card and Bolten had distinctive styles, each was relatively successful as chief of staff. In this chapter, we explore the position and the office of White House chief of staff during the George W. Bush presidency. Although the office clearly is a linchpin of the institutional presidency and reflects the fashioning of specific presidents, the people who become chief bring their own talents, interests, backgrounds and limitations to the work. Card and Bolten differed in temperament and managerial approach as well as in their relationships with the President. Each coped with a volatile and sometimes contentious White House environment and great external challenges, and they contributed in different ways to policy and political decision making.

THE WHITE HOUSE CHIEF OF STAFF UNDER BUSH 43 ANDREW CARD: A PEDIGREE OF EXPERIENCE Andrew Card had solid background and a deep well of experience to become White House chief of staff. He began his political life as a legislator in the Massachusetts House of Representatives, serving from 1975 to 1983 including an unsuccessful run for governor in 1982. In 1983, Card joined the Reagan White House as a special assistant for intergovernmental affairs, eventually being promoted to deputy assistant and director of that office. After running Vice President George H.W. Bush’s New Hampshire presidential primary campaign, Card was deputy director of the 1988 transition. He served from 1989 to 1992 under John Sununu as deputy chief of staff, an apprenticeship that would prove to be a valuable training ground for his own stint as chief of staff. From February 1992 until the end of the administration, Card served as Secretary of Transportation, and he oversaw the transition to the Clinton presidency following Bush’s defeat.2 Bill Clinton’s election in 1992 interrupted Card’s government service. Card joined the American Automobile Manufacturers Association as president and CEO in 1993 and became vice president of government relations for General Motors in 1999. He was put in charge of the 2000 Republican National Convention in Philadelphia, which showcased his administrative ability to Governor Bush. The protracted 36 day battle of the 2000 election significantly reduced the time in which the George W. Bush administration could transition into office. Bush selected Card to be his chief of staff before the election, however, allowing Card to look for talent and begin constructing the White House machinery long before the battle for Florida began.3 This decision contrasted with the Clinton experience in which many high-level White House staff were not hired until the week before the inauguration.4 Bush’s selection of Card as chief and Vice President-elect Richard Cheney’s oversight of the transition meant that two experienced Washington hands guided the expedited process to staff the administration. Despite the

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shortened transition period, the administration swiftly took shape, with most of the major White House staff positions filled by the end of 2000.5

TROIKA REDUX? THE EARLY DAYS OF THE ADMINISTRATION Alongside Card, Bush tapped two Texans for significant roles in the White House. Karl Rove, Bush’s political guru and indispensable strategic thinker, became senior adviser and oversaw the political operation in the White House. Karen Hughes, Bush’s longtime imagemaker and confidante, had the title, Counselor to the President; she was placed in charge of the White House communications apparatus. Initial media reports indicated that with these three powerful advisers, Bush had decided to opt for a troika system similar to what was constructed during Ronald Reagan’s first term: “it’s going to be crowded in the Oval Office of President George W. Bush. Andrew Card will have the title of White House chief of staff, but in truth a troika of equals will have instant access to the president: Card, political adviser Karl Rove, and communications czarina Karen Hughes.6” To a certain extent, the comparison is understandable as all three were powerful, independent voices that had Bush’s ear and trust. Card, however, explicitly disputed this notion: “I told the President that if he wanted to have a troika, he should have a troika, but I didn’t want to be one of the three; I would be out. I felt very strongly that the chief of staff should be the chief of staff, not one of the chiefs of staff.7” Troika or no troika, the trio of Card, Hughes, and Rove would be short-lived. Citing the rigors of life in the White House and the pressures on her family, Hughes left the White House in July 2002. At the time, Card admitted that losing Hughes would potentially throw off the internal balance in the White House and make his job more difficult: That’s what I’ve been doing from the start of this administration. Standing on the middle of the seesaw, with Karen on one side, Karl on the other, trying to keep it in balance. One of them just jumped off…..I’ll need designees, people trusted by the president that I can elevate for various needs to balance against Karl….They are going to have to really step up, but it won’t be easy. Karl is a formidable adversary.8

OFFICE OF CHIEF OF STAFF IN THE FIRST TERM The Bush White House formalized the roles and responsibilities of the chief’s subordinate staff. Card split operations/administrative duties and policy responsibilities between his two deputies, Joseph Hagin and Joshua Bolten, and informally added “operations” and “policy” to their titles, respectively. According to journalist Mike Allen, Hagin’s behind-the-scenes activities were crucial: Hagin, whose middle name is the apropos “Whitehouse,” was an operational wizard who handled some of the president’s most sensitive assignments: orchestrating the President's secret trips to Iraq and Afghanistan; helping create the Department of Homeland Security; setting up a Western White House at Bush’s ranch; arranging secure briefings under chaotic circumstances on the road; and masterminding the renovation of the Situation Room, Eisenhower Executive Office Building and the press briefing room.

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David B. Cohen, Karen M. Hult and Charles E. Walcott In short, Hagin manages everything around the president and the presidency except politics and policy….Colleagues say he revolutionized the way the Secret Service, White House Military Office and the White House staff work together to support the president at the White House, Camp David, on the road and at the ranch in Crawford, Texas.9

Meanwhile, Deputy Chief of Staff Joshua Bolten was charged with overseeing the policy process in the White House—a process he had helped construct during the transition. When Bolten left the chief of staff’s office in 2003 to head the Office of Management and Budget, he was replaced by Staff Secretary Harriet Miers, Bush’s longtime legal counsel from Texas. She remained deputy chief of staff for policy until the end of the first term. (Table 1 lists the deputy chiefs of staff and their tenures during the George W. Bush administration).

THE JEFFORDS DISRUPTION Although the first few months of the administration went relatively smoothly, some avoidable mishaps did occur. Perhaps the biggest blunder resulted from a bruised ego and a political game of chicken that the White House, and chief of staff Card in particular, lost. Senator Jim Jeffords, a Republican from Vermont, had never been an ally of the Bush administration. A moderate from perhaps the most liberal state in the union, Jeffords was lukewarm to a number of Bush domestic policies, particularly the $1.6 trillion tax cut bill that was proposed in the spring of 2001. Another important piece of the President’s domestic agenda, the “No Child Left Behind” education reform legislation, also was being pushed, and Jeffords, the chair of the Education Committee, sought full funding for the Individuals with Disabilities Education Act, a law he helped pass as a House member in 1975.10 The White House denied this request. Jeffords already was angry after what he believed was a personal slight, having not been invited to an April 23 Rose Garden ceremony honoring a Vermont social studies teacher. Senator Chuck Hagel (R-NE) suggested to Card that the White House work with Jeffords and make him a partner on the education reform package, to which the Chief of Staff reportedly replied: “he doesn’t deserve that.11” Table 1. White House Chiefs of Staff and Deputy Chiefs of Staff in the George W. Bush Administration Chief of Staff Andrew H. Card, Jr. [01/20/01-04/14/06]

Joshua B. Bolten [04/14/06-01/20/09]

Data compiled by authors.

Deputy Chiefs of Staff Joseph W. Hagin (Operations) [01/20/01-07/20/08] Joshua B. Bolten (Policy) [01/20/01-06/26/03] Harriet E. Miers (Policy) [06/27/03-02/03/05] Karl C. Rove (Policy) [02/03/05-08/31/07] Joseph W. Hagin (Operations) [01/20/01-07/20/08] Blake L. Gottesman (Operations) [07/20/08-01/20/09] Karl C. Rove (Policy/Planning) [02/03/05-08/31/07] Joel D. Kaplan (Policy) [04/19/06-01/20/09]

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Around the same time, Card “hotfooted” Jeffords on the tax cut bill by phoning the Vermont bureau of the Associated Press, pitching the legislation that Jeffords opposed.12 Jeffords was not amused. On May 24, 2001, he switched his party affiliation from Republican to Independent. The Senate had been in a 50-50 balance of Democrats and Republicans, with Vice President Cheney’s tie breaking vote securing for the GOP a razorthin majority. Because Jeffords agreed to caucus with the Democrats, his switch gave the Democrats a 51-49 advantage in the Senate; control of the body was wrested away from the GOP until the 2002 midterm elections produced a two seat gain for the Republicans.

FROM 9/11 TO REELECTION On the morning of September 11, 2001, Card accompanied President Bush and a number of other White House staff to an event at Emma E. Booker Elementary School in Sarasota, Florida. Before the President sat down to read a book to second grade students, he was informed by Karl Rove that a plane had crashed into the World Trade Center.13 At the time, it was unknown what kind of plane it was, whether it was an accident or intentional, or how much damage had occurred. After speaking by phone with National Security Assistant Condoleezza Rice at the White House, Bush continued with the event. Ten minutes later, at 10:05 a.m., Card walked calmly over, leaned down, and quietly said in Bush’s right ear: “A second plane has hit the second tower. America is under attack.14” It is perhaps the most circulated photograph and best recollected moment of Card’s five and a half years of service. Perhaps no grimmer or more startling words have been uttered in the modern era by a chief of staff to the president. That moment also marks a transformation of the Bush presidency, from the relative tranquility of the post-Cold War era dominated by domestic policy to one of wartime priorities. It signaled a change for Card as well: following 9/11, he was read-in on highly classified intelligence, information to which he may not have had previous access.15 Although chiefs of staff have participated in national security policy going back to the Nixon administration, the chief now had become a central player.16 In contrast to Bill Clinton, notorious for being late and undisciplined, George W. Bush was self-disciplined and loathed, for example, when others were late for a meeting. Indeed, the President temporarily locked Secretary of State Colin Powell, who was running late, out of the first cabinet meeting.17 Like the President, the Bush White House, with Card at the helm, operated efficiently. Card and the White House also were expert at marketing the Bush agenda. From steel tariffs to tax cuts to the creation of the Department of Homeland Security to selling the wars in Afghanistan and Iraq, Card was integral. Like most modern chiefs, he spent much of his time as a proxy for Bush on the Hill where he was the lead White House negotiator on bills that were presidential priorities.18 This was the case, for example, with the 2001 tax cut legislation: I sat there with [Senators] John Breaux [D-LA] and Chuck Grassley [R-IA] and Max Baucus [D-MT]; I was up there sometimes all night. Much of the tax bill of 2001 was the

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David B. Cohen, Karen M. Hult and Charles E. Walcott result of me sitting in a room with Breaux, checking everybody else out and sitting there with napkins writing down numbers. Breaux shook my hand on the deal and we worked it out with Grassley and others from 10:00 at night until 3:00 in the morning.19

As chief of staff, Card had to broker deals within the White House as well. In a wellpublicized intramural spat between advisers on the subject of steel tariffs, Card and Deputy Chief of Staff Bolten engineered a compromise: The Bush administration’s final compromise plan emerged from a rare high-level split, with senior adviser Karl Rove and Commerce Secretary Donald L. Evans pushing for higher tariffs, and Bush’s chief economic adviser, Lawrence B. Lindsey, urging him to adhere to his free-trade principles. Vice President Cheney was closely involved although administration officials—smarting from negative reactions to his handling of the administration's energy plan—played down his role. The compromise was brokered by Chief of Staff Andrew H. Card Jr. and deputy chief of staff Joshua B. Bolten, sources said. ‘Karl’s not getting everything he wants, and Lindsey isn’t getting everything he wants,’ one White House official said.20

Card also organized the small group of officials that drafted the blueprint for a Department of Homeland Security (DHS), reversing the administration’s public opposition to creating a cabinet department. The DHS plan was constructed in secrecy, and Deputy Chief of Staff Hagin had the responsibility of ensuring that as new aides were added to the group, nothing leaked to the media. Hagin recalled: “They called me ‘The Enforcer.’… We had to keep a lid on it. Everybody in D.C. has a constituency, and we knew we would be stepping on some toes.21” According to Card, “Joe was kind of the heavy… He’d deliver the message. He carried the cattle prod.22” On April 23, 2002, Card convened what would later become known as the PEOC Group, whose initial membership included only himself, Homeland Security Adviser Tom Ridge, White House Counsel Alberto Gonzales, and OMB Director Mitch Daniels.23 The four met for ten days through early May and produced the foundation of the reorganization plan. Eventually the circle expanded to just under 20 aides; however, members of Congress as well as senior White House staffers like Hughes, Rove, and Press Secretary Ari Fleischer were unaware of the reorganization plan until shortly before it was unveiled.24 In the post-9/11 White House environment, Card was a full participant in all of the major policy debates that reached the Oval Office. The decision to invade Iraq represents perhaps Card’s biggest failure as chief of staff. The failure was not in Card’s own personal assessment of whether the United States should invade; most accounts have him supporting such a decision. Rather, neither Card nor National Security Assistant Condoleezza Rice appear to have acted as an honest broker in deliberations about whether to invade. Some contend that groupthink took over the White House.25 When President Bush asked his war cabinet whether anyone disagreed with the decision to invade Iraq, no one including Secretary of State Colin Powell, the administration’s most vocal opponent up to that point, objected.26

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For a decision as important as whether to invade a sovereign country with such obvious risks, actual unanimity seems improbable, which suggests the need for someone in the room to have questioned the decision.

CHENEY Although the White House under Card appears to have worked well in many instances, the system broke down or at least a parallel process ran amok at times. In particular, the independent role of Vice President Cheney and his office in the policy and political processes at times subverted the chief’s and deputy chiefs’ ability to be honest brokers. Numerous former Bush staffers and White House observers have noted the Vice President’s inordinate amount of influence on a host of major policy decisions, many in security policy but also in domestic areas such as federal court nominations, tax, education, and environmental policy.27 Perhaps in no area was Cheney’s subversion of the regular policy process more apparent than in the realm of national security, particularly on issues having to do with the “War on Terror.” Gellman and Becker highlight a telling incident: Just past the Oval Office, in the private dining room overlooking the South Lawn, Vice President Cheney joined President Bush at a round parquet table they shared once a week. Cheney brought a four-page text, written in strict secrecy by his lawyer. He carried it back out with him after lunch. In less than an hour, the document traversed a West Wing circuit that gave its words the power of command. It changed hands four times, according to witnesses, with emphatic instructions to bypass staff review. When it returned to the Oval Office, in a blue portfolio embossed with the presidential seal, Bush pulled a felt-tip pen from his pocket and signed without sitting down. Almost no one else had seen the text. Cheney’s proposal had become a military order from the commander in chief. Foreign terrorism suspects held by the United States were stripped of access to any court—civilian or military, domestic or foreign. They could be confined indefinitely without charges and would be tried, if at all, in closed “military commissions.” “What the hell just happened?” Secretary of State Colin L. Powell demanded, a witness said, when CNN announced the order that evening, Nov. 13, 2001. National security adviser Condoleezza Rice, incensed, sent an aide to find out. Even witnesses to the Oval Office signing said they did not know the vice president had played any part [emphasis added].28

That the vice president had been in charge of many of the initial personnel decisions for the Bush White House and succeeded in having several Cheney staffers integrated with the President’s meant that Cheney and his office were plugged into all of the critical processes.29 Indeed Warshaw argued that this was one of the keys to the Vice President’s power: Every memo circulated within the White House included the vice president’s staff on the routing list. Members of the vice president’s staff were included in all meeting arrangements and could choose whether or not they wanted to attend. Andy Card, among others, referred approvingly to the new arrangement as a single executive office.30

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Many of the 85 aides in the Vice President’s office were given commissioned spots on the White House staff. For example, Lewis “Scooter” Libby, Cheney’s chief of staff, and Mary Matalin, Cheney’s counselor, besides having the titles of “Assistant to the Vice President” also were “Assistants to the President,” making them formally equal to Card, Rove, Hughes, and others and allowing them access to crucial meetings and information.31 This integration was one-way, however: memos traversing the Vice President’s office were not subject to review by the President’s staff.32 Finally, it appears that Chief of Staff Card not only was powerless to stop Cheney’s intervention in policy processes but also at times was a willing accomplice. Perhaps the most infamous example occurred in 2004 as Cheney was pushing the Department of Justice to reauthorize the use of warrantless domestic surveillance, one of his top priorities. Known in the administration as the terrorist surveillance program, the National Security Agency administered the controversial initiative that monitored telephone and electronic communications involving anyone believed to be outside the United States, even if the other party was an American citizen. The Bush White House sought to have the program reauthorized despite the major concerns of senior officials at the Department of Justice. On March 10, 2004, Card and White House Counsel Gonzales entered the hospital room of Attorney General John Ashcroft, despite instructions that Ashcroft would not see visitors. Ashcroft, recovering from emergency gall bladder surgery, was weak and fatigued. Yet Card and Gonzales pressed the Attorney General to sign the reauthorization, something Ashcroft refused to do.33 Card later recounted that this hospital encounter was one of his biggest regrets.34

SECOND TERM BLUES After the 2004 election, Attorney General Ashcroft left the administration and was replaced by White House Counsel Gonzales. Deputy Chief of Staff Harriet Miers in turn replaced Gonzales as counsel. Karl Rove, in addition to his duties as senior adviser, replaced Miers as deputy chief for policy.35 Rove, however, was not given the complete policy portfolio that Miers and Bolten had had. Instead, Card split national security and homeland security between Hagin and himself, leaving Rove in charge of only the domestic side.36 The second term began on a high note with a President buoyed by his reelection and determined to push his domestic agenda. However, with the American public growing increasingly impatient with the conduct of the Iraq war, the abysmal response of the federal government to Hurricane Katrina, the ill-fated Dubai Ports World deal, and the administration’s failure to pass legislation reforming Social Security or get Harriet Miers confirmed as a Supreme Court justice, the second term was rocky. Particularly in the case of Katrina, the competence of the White House became a part of the story, and the inevitable finger-pointing included Card.37 Critics began to intimate that Card had grown tired and was not showing the necessary command of White House operations.38 At the same time, the Chief of Staff thought that he had been on the job long enough. As Card later conceded, if he had to do it again, he “probably would’ve left a year and a half earlier.”39 The confluence of apparent White House failures and Card’s own sense that it was time to go spelled the end of his tenure.

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Card had offered to resign previously, and Bush had always turned him down. In early 2006, Card once again suggested to Bush that he think about changing chiefs of staff. This time, the President accepted the Chief of Staff’s resignation and named Joshua Bolten as his replacement. President Bush announced: Andy Card came to me and raised the possibility of stepping down as Chief of Staff. After five-and-a-half years, he thought it might be time to return to private life, and this past weekend I accepted Andy’s resignation. Andy Card has served me and our country in historic times….I have relied on Andy’s wise counsel, his calm in crisis, his absolute integrity, and his tireless commitment to public service.40

IN COMES BOLTEN Joshua Bolten had a long history of public service in Washington. His father worked for the CIA, and Bolten graduated from St. Albans High School and went on to earn degrees from Princeton University in 1976 and the Stanford University Law School in 1980. After working in private practice, Bolten joined the Senate Finance Committee as international trade counsel from 1985 to 1989. Under George H.W. Bush, Bolten served three years as general counsel to the U.S. Trade Representative and one year as deputy assistant for legislative affairs. He then worked for five years for Goldman Sachs International in London before joining the Bush-Cheney campaign in 1999 as policy director. After the election, Card tapped Bolten as deputy chief of staff for policy where he stayed until June 2003 when he became OMB director. On March 28, 2006, Bolten, whom George W. Bush nicknamed “Yosh,” was appointed chief of staff, a position he assumed on April 17. It behooves every new chief, if they have the authority from the president, to reassign, reposition, and replace personnel, systems, and operating procedures perceived to be working ineffectively.41 Scott McClellan, who had been press secretary since July 2003, was one of the early casualties of Bolten’s purge.42 In addition, Treasury Secretary John Snow was fired and replaced by Goldman Sachs CEO Henry Paulson, Bolten’s former boss. Replacing Secretary of Defense Donald Rumsfeld was one of the new chief of staff’s highest priorities coming into the job; however, because of the politics and high visibility of the position, this had to wait until after the 2006 midterm election.43 Meanwhile, Cheney’s role in the policy and political processes of the Bush administration diminished significantly after Bolten’s arrival. By the end of the second term, the Vice President’s influence had waned to that of an average vice president in the modern era due in part to deliberate actions by Bolten.44 Another of Bolten’s initial actions was to revamp the Office of Chief of Staff, removing Karl Rove as deputy chief of staff for policy, though Rove kept the official titles of senior adviser and deputy chief of staff. Bolten believed such a move was necessary because Rove had too many responsibilities and not enough time.45 To replace Rove, Bolten turned to Joel Kaplan, with whom he had started working in the 2000 campaign. Kaplan served under Bolten as a special assistant for policy in the Office of Chief of Staff and moved with him to OMB where Kaplan was deputy director. When Rove quietly left the White House at the end of August 2007, the chief of staff’s office returned to its earlier arrangement of having only two deputies: Kaplan was responsible

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for overseeing policy, and Hagin remained in charge of operations. Hagin, the longest serving deputy chief of staff in history, left the administration in the summer of 2008 and was replaced by Blake Gottesman, Bush’s former personal aide. At 28, Gottesman was the youngest individual ever commissioned “Assistant to the President.”46

THE 2006 “THUMPING” AND SUNSET OF THE BUSH PRESIDENCY Bolten began his tenure as chief of staff during the most trying time of the George W. Bush administration. The President began the second term with a far reaching domestic agenda that included Social Security, tax, and federal immigration system reforms. By midApril 2006 when Bolten became chief of staff, the domestic agenda was long dead. With a Gallup approval rating of around 35%, Bush was as unpopular as he had ever been. An Iraq war that was going badly, with no end in sight, no doubt exacerbated the President’s problems with the public and among even his own party members in Congress. Emblematic of the challenges Bolten faced in his two and a half years as chief of staff was the midterm election of 2006, which President Bush called a “thumping.”47 The Democratic takeover of Congress effectively ended any legislative agenda that the Bush administration had, especially in domestic affairs, and forced the White House to switch from aggressively pursuing legislation to responding to crises as they emerged. Bolten himself faced criticism about a controversial effort by the White House counsel’s office and the Department of Justice to review all 93 United States Attorneys shortly after President Bush’s reelection.48 On December 7, 2006, seven U.S. Attorneys were fired, mainly for ideological reasons, two having been dismissed earlier in the year. As news reports publicized the highly unusual nature of the dismissals in what appeared to be a concerted administration effort to retaliate against certain individuals, the newly-empowered Democratic-controlled Congress utilized its oversight powers to investigate. Following failures to comply adequately with congressional information requests, evasive testimony by Attorney General Gonzales and other administration officials, and Bolten’s and White House Counsel Miers’s invocation of executive privilege after being subpoenaed by the House Judiciary Committee, the House cited Miers and Bolten for contempt.49 Only the second contempt citation against a high-ranking executive branch official in U.S. history, the matter moved into the courts.50 Eventually, a deal was reached in March 2009 under which Miers and Karl Rove testified under oath during a closed hearing before the House Judiciary Committee.51 Perhaps the biggest challenge during Bolten’s tenure as chief was the 2008 financial crisis. The collapse of the U.S. housing market began in 2006, aggravated by failing subprime real estate loans, threatened the American banking system, the overall financial stability of the United States, and the global economy. Despite numerous signs in the middle of the decade that the U.S. economy was headed for a downturn, most in the Bush administration seemed surprised when the decline began in earnest in March 2008, with the collapse of Bear Stearns and the subsequent takeover by JP Morgan Chase. A chain reaction of events followed, including the failure of IndyMac Bank, the largest American thrift ever to fail; the federal seizure of the two largest lenders in the United States, Fannie Mae and Freddie Mac; the bankruptcy of Lehman Brothers, the fourth largest investment bank in the

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country; and, the $85 billion federal bailout and 80% taxpayer takeover of AIG, then the largest U.S. insurer. By September 2008, the Bush administration understood that it had to convince Congress to adopt a comprehensive bailout package for the financial sector or the banking system would collapse. With Bolten providing leadership in the White House, notably restoring calm and initially keeping the staff out of the headlines, the policy initiative largely passed to the Treasury Department and Secretary Henry Paulson and to Ben Bernanke, chair of the Federal Reserve Board. Paulson and Bernanke sought to persuade Congress to pass the Troubled Asset Relief Program (TARP), a $700 billion dollar plan originally captured in just three pages. Congress balked initially, concerned with the cost of the program and the lack of detail in the proposed legislation. Ultimately, Congress passed the Emergency Economic Stabilization Act of 2008 (of which TARP was a part) which President Bush signed on October 3. In December the federal government loaned $13 billion to General Motors and Chrysler, forestalling bankruptcy.52

THE CLOCK RUNS OUT Joshua Bolten became chief of staff at a crossroads of the Bush presidency. Bush’s approval ratings hovered around the low 30s at the end of April 2006, roughly the same percentage they were when he left office and markedly down from the roughly 50% approval around the time of his reelection and the 90% approval in the immediate aftermath of the 9/11 terrorist attacks. The house cleaning that brought Bolten to the chief of staff job and allowed him to replace many staff and cabinet members was intended to reenergize the policy and communications processes to better serve the President. But circumstances, and Bush’s lame duck status, worked against such a revival. Although that scarcely meant that the White House operation was unimportant, it did imply that any impetus for significant policy change would emanate from reacting to events rather than from pushing the President’s policy agenda. On November 4, 2008, Senator Barack Obama won the presidential election, and the transition to a new administration began in earnest. Two days later, President Bush addressed White House staff, pledging a constructive and helpful transition.53 Clearly, Bush was sensitive to the importance of a smooth transition following the 200001 transition in which some Clinton administration personnel allegedly destroyed White House property.54 Indeed, the Bush administration began preparing for the transition more than a year prior to the inauguration, well before any previous administration in history; this allowed the Bush White House to communicate with campaign representatives of the major party nominees after the nomination campaigns concluded.55 Almost a month before the election, President Bush issued Executive Order 13476, creating a Presidential Transition Coordinating Council (TCC), chaired by Bolten with Deputy Chief of Staff for Operations Blake Gottesman serving as vice chair. The Council consisted of 16 senior White House staff and other administration officials.56

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As for his own role in overseeing the transition, Bolten noted that “It was up to me….It was explicit but not a detailed conversation [with Bush], which is the way he operated; I set the direction, I set the principles.”57 By most accounts, Bolten oversaw an efficient and effective transition.58 Although Bolten deserves much of the credit, so does his boss. President Bush’s commitment to a smooth and effective transition allowed the Obama administration to begin governing immediately.

CONCLUSION George W. Bush’s two chiefs of staff performed all four roles of modern chiefs. As with their predecessors and successors, the mix and success of their activities varied over time and across contexts. Both Card and Bolten generally were well-regarded administrators, though the former’s energy and effectiveness waned as the administration entered its second term. Both sought to be honest brokers of sometimes difficult and contentious policy decisionmaking; however, particularly in the first term, Vice President Cheney engineered end runs of established procedures. At the same time, the President evidently respected and valued the political and policy advice of both chiefs, and the two frequently served as presidential proxies in congressional negotiations and media appearances. Card and Bolten appeared sensitive as well to the need to be guardians of presidential time, attention, and energy, even though during discussions of initiating hostilities in Iraq Card (and National Security Assistant Rice) might be faulted for not assuring that opponents of an invasion of Iraq had ready access to Bush. Meanwhile, the Office of the Chief of Staff was a consistent presence. Especially when overseen by single deputies for policy and operations, the unit contributed to a mostly smooth White House process that helped the administration pursue presidential objectives. The George W. Bush White House also highlights a key lesson: a chief of staff at minimum should have some Washington, D.C. experience and, maybe more importantly, actual White House experience. Perhaps the best preparation for being a chief of staff is to serve an apprenticeship as a deputy chief of staff. Both Card and Bolten were deputy chiefs of staff earlier in their careers, and the experience helped them move into the top job. Similarly, Card’s and Bolten’s deep well of Washington and White House experience contributed to a staffing process that when running as designed, generally worked well. Vice President Cheney aside, the George W. Bush White House conformed to the advice that veterans convey: the chiefs of staff and their deputies were honest brokers, not courtiers, and they sought as best they could to protect the President’s interests. George W. Bush’s decision making has been criticized as much as any recent president, with complaints centering on his tendency to make decisions quickly and his refusal to reconsider them. It would be reasonable to ask whether his staff helped to compensate for this tendency or enabled it. The answer is probably neither. Ultimately, a staff adapts to a president’s proclivities, not the reverse. The George W. Bush White House worked well to facilitate the President’s choices; if this resulted, for instance, in too narrow a circle of advisors or in the Vice President subverting the regular policy process, then that was the President’s call. The Bush White House was especially effective in implementing and

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promoting the administration’s decisions. How later observers regard those decisions is for the most part beyond the responsibility of the chief of staff.

ENDNOTES 1

See e.g., David B. Cohen, “George Bush’s Vicar of the West Wing: John Sununu as White House Chief of Staff,” Congress and the Presidency 24 (Spring 1997): 37-59; David B. Cohen, “From the Fabulous Baker Boys to the Master of Disaster: The White House Chief of Staff in the Reagan and G.H.W. Bush Administrations,” Presidential Studies Quarterly 32 (September 2002): 463-83; David B. Cohen, Karen M. Hult, and Charles E. Walcott, “The Chicago Clan: The Chiefs of Staff in the Obama White House,” Social Science Quarterly 93 (December 2012): 1101-26; David B. Cohen and George A. Krause, “Presidents, Chiefs of Staff, and the Structure of White House Organization: Survey Evidence From the Reagan and Bush Administrations” Presidential Studies Quarterly 30 (September 2000): 421-42; David B. Cohen, Charles E. Walcott, Shirley Anne Warshaw, and Stephen J. Wayne, “The Chief of Staff,” The White House Transition Project, 2008, Report 2009-21; available at: http://whitehousetransitionproject.org/resources/briefing/WHTP-2009-21Chief%20of%20Staff.pdf (accessed August 24, 2011). 2 Steven Greenhouse, “Bush Looks to History as a Salve for Losing Office,” New York Times, November 8, 1992. 3 John P. Burke, “The Bush 2000 Transition: The Historical Context” in Martha Joynt Kumar and Terry Sullivan, White House World: Transitions, Organization, and Office Operations (College Station, TX: Texas AandM University Press, 2003). 4 John P. Burke, Presidential Transitions: From Politics to Practice (Lynne Reiner Publishers: Boulder, CO: 2000), pp.305-14. 5 Martha Joynt Kumar, “Recruiting and Organizing the White House Staff,” in Martha Joynt Kumar and Terry Sullivan, White House World: Transitions, Organization, and Office Operations (College Station, TX: Texas AandM University Press, 2003). 6 Fred Barnes, “The Second Bush White House; The Model is Gerald Ford’s ‘Spokes of the Wheel,’ not Bush I,” The Weekly Standard, December 25, 2000. 7 Interview with Andrew H. Card, Jr., by David B. Cohen, October 25, 2007, p.10. 8 Ron Suskind, “Mrs. Hughes Takes Her Leave,” Esquire, July 1, 2002. http://ronsuskind.com/mrs-hughes-takesher-leave-esquire-magazine-july-2002/ Accessed July 21, 2014. 9 Mike Allen, “Hagin Leaving the White House,” Politico, July 3, 2008. http://www.politico.com/news/stories/0708 /11507.html. Accessed July 21, 2014. 10 Robert Draper, Dead Certain: The Presidency of George W. Bush (New York: Free Press, 2007); Timothy Noah, “Did the Democrats Sucker Jim Jeffords?” Slate, December 12, 2001. http://www.slate.com/articles /news_and_politics/chatterbox/ 2001/12/did_the_democrats_sucker_jim_jeffords.html. Accessed July 21, 2014. 11 Draper, Dead Certain, p.117. 12 Patterson defines “the hotfoot” as a technique that “is employed to energize constituents in a member’s home district” when the need to round up votes is critical. [Bradley H. Patterson, Jr., To Serve the President: Continuity and Innovation in the White House Staff (Washington, DC: Brookings Institution Press, 2008), p.85.] Card similarly employed this technique with another moderate Republican Senator from the Northeast, Lincoln Chafee (R-RI), also on the tax cut bill, when he criticized Chafee in the Providence Journal-Bulletin for not backing the bill. [Barton Gellman, Angler: The Cheney Vice Presidency (New York: Penguin Books, 2008), p.75.] 13 Bob Woodward, Bush at War (New York, NY: Simon and Schuster, 2002). 14 The 9/11 Commission Report, “Final Report of the National Commission on Terrorist Attacks upon the United States,” Official Government Edition, 2004, p.38. http://www.gpoaccess.gov/911/pdf/ fullreport.pdf. Accessed July 21, 2014. 15 Lane Lambert, “Terrorist Attacks Have Changed Role Card’s Playing,” The Patriot Ledger, November 2, 2001. 16 David B. Cohen, Chris J. Dolan, and Jerel A. Rosati, “A Place at the Table: The Emerging Foreign Policy Roles of the White House Chief of Staff,” Congress and the Presidency 29 (Autumn 2002): 119-49. 17 Draper, Dead Certain, p.107. 18 Bradley H. Patterson, Jr., To Serve the President: Continuity and Innovation in the White House Staff (Washington, DC: Brookings Institution Press, 2008).

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Patterson, To Serve the President, p.46. Mike Allen and Steven Pearlstein, “Bush Settles on Tariff for Steel Imports,” Washington Post, March 2, 2002. 21 Howard Wilkinson, “Real-Life ‘West Wing’ Drama: Indian Hill Native at Bush’s Side,” Cincinnati Enquirer, January 20, 2003. http://www.enquirer.com/editions/ 2003/01/20/loc_hagin.html. Accessed August 14, 2014. 22 Wilkinson, “Real-Life ‘West Wing’ Drama: Indian Hill Native at Bush’s Side.” 23 PEOC stands for Presidential Emergency Operations Center, the White House basement conference room where the Card-led group met. 24 David B Cohen and Terrence M. O’Sullivan, “Stuck in the Basement: Organizing and Reorganizing for Homeland Security in the Post- 9/11 White House,” White House Studies (January 2012), Vol. 12, No. 1, pp.89-110. 25 See e.g., Peter Baker, Days of Fire: Bush and Cheney in the White House (New York: Doubleday, 2013); John P. Burke, “The Neutral/Honest Broker Role in Foreign Policy Decision-Making: An Assessment,” Presidential Studies Quarterly 13 (June 2005); John P. Burke, Honest Broker? The National Security Advisor and Presidential Decisionmaking (College Station, TX: Texas AandM University Press, 2009), Chp.6; David J. Rothkopf, Running the World: The Inside Story of the National Security Council and the Architects of American Power (New York, NY: PublicAffairs, 2005). 26 See e.g., Baker, Days of Fire. 27 See, e.g., Baker, Days of Fire; Draper, Dead Certain; Barton Gellman, Angler: The Cheney Vice Presidency (New York: Penguin Books, 2008); Jack Goldsmith, The Terror Presidency: Law and Judgment Inside the Bush Administration (New York: W.W. Norton and Company, 2007); Jane Mayer, The Dark Side: The Inside Story of How the War on Terror Turned Into a War on American Ideals (New York: Doubleday, 2008); Scott McClellan, What Happened: Inside the Bush White House and Washington’s Culture of Deception (New York: PublicAffairs, 2008); Ron Suskind, The Price of Loyalty: George W. Bush, the White House, and the Education of Paul O’Neill (New York: Simon and Schuster Paperbacks, 2004); Ron Suskind, The One Percent Doctrine: Deep Inside America’s Pursuit of Its Enemies since 9/11 (New York: Simon and Schuster Paperbacks, 2006); Shirley Anne Warshaw, The Co-Presidency of Bush and Cheney, (Stanford, CA: Stanford Politics and Policy, 2009). 28 Barton Gellman and Jo Becker, “‘A Different Understanding with the President’” Washington Post, June 24, 2007, p.A1. 29 See, e.g., Baker, Days of Fire. 30 Shirley Anne Warshaw, “The Cheneyization of the Bush Administration: Cheney Captures the Transition,” In Robert Maranto, Tom Lansford, and Jeremy Johnson, Judging Bush (Stanford, CA: Stanford University Press, 2009), p.46. 31 Warshaw, “The Cheneyization of the Bush Administration.” 32 Gellman, Angler. 33 See, e.g., Baker, Days of Fire; Gellman, Angler; Mayer, The Dark Side. 34 Gellman, Angler, p.305. 35 Draper, Dead Certain. 36 Karl Rove, Courage and Consequence: My Life as a Conservative in the Fight (New York: Threshold Editions, 2010). 37 See e.g., Douglas Brinkley, The Great Deluge: Hurricane Katrina, New Orleans, and the Mississippi Gulf Coast (New York: Harper Perennial, 2007); Christopher Cooper and Robert Block, Disaster: Hurricane Katrina and the Failure of Homeland Security (New York: Times Books, 2006). 38 E.g., see Peter Baker, Days of Fire: Bush and Cheney in the White House (New York: Doubleday, 2013), pp.45052. 39 Katie Paul, “A Bush Chief of Staff Offers Advice for Obama,” Newsweek, November 5, 2008, http://www.newsweek.com/bush-chief-staff-offers-advice-obama-85087. Accessed July 19, 2014. 40 George W. Bush: “Remarks Announcing the Resignation of Andrew H. Card, Jr., as White House Chief of Staff and the Appointment of Joshua B. Bolten as White House Chief of Staff,” March 28, 2006. Online by Gerhard Peters and John T. Woolley, The American Presidency Project. http://www.presidency.ucsb.edu/ws/?pid =67069. Accessed July 16, 2014. 41 Press Secretary Scott McClellan confirmed that Bolten had the authority to significantly change personnel and processes in the Bush White House: “the President has given him the full authority to do what he needs to do and what he believes is in the best interest of this White House and this President.” (Jim Rutenberg, “New Chief of Staff Sends Message: The White House Exits are Open,” New York Times, April 18, 2006). 42 Scott McClellan, What Happened: Inside the Bush White House and Washington’s Culture of Deception (New York: PublicAffairs, 2008), p.299. 43 Baker, Days of Fire. 20

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See, e.g., Baker, Days of Fire. Mike Allen, “Can Josh Bolten Rescue the Bush Presidency?” Time, April 23, 2006. 46 Mike Allen, “Bush’s Personal Aide Returns at Top” Politico, July 16, 2008. http://www.politico.com/news/stories /0708/11792.html. Accessed July 15, 2014. 47 George W. Bush White House Website Archive, “Press Conference by the President,” November 8, 2006. http://georgewbush-whitehouse.archives.gov/news/releases/2006/ 11/20061108-2.html. Accessed August 17, 2014. 48 David C. Weiss, “Nothing Improper? Examining Constitutional Limits, Congressional Action, Partisan Motivation, and Pretextual Justification in the U.S. Attorney Removals,” 107 Mich. L. Rev. (2008), pp. 32223. 49 Paul Kane, “West Wing Aides Cited for Contempt” Washington Post, February 15, 2008. http://www.washingtonpost.com/wp-dyn/content/ article/2008/02/14/ AR2008021402415.html. Accessed December 22, 2014. 50 The target of the first contempt citation was President Richard Nixon during the Watergate scandal in 1974. Josh Chafetz, “Executive Branch Contempt of Congress” (2009), Cornell Law Faculty Publications, Paper 21. http://scholarship.law.cornell.edu/ facpub/21. 51 Chafetz, “Executive Branch Contempt of Congress,” Pp.1092-93. 52 For a comprehensive summary and analysis of the 2007-2009 financial crisis, see “Financial Crisis Inquiry Report: Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States,” The Financial Crisis Inquiry Commission, January 2011. http://cybercemetery.unt.edu /archive/fcic/ 20110310173545/http://c0182732.cdn1.cloudfiles.rackspacecloud.com/fcic_final_report_full. pdf. Accessed December 22, 2014. 53 George W. Bush: “Remarks to White House Staff,” November 6, 2008. Online by Gerhard Peters and John T. Woolley, The American Presidency Project. http://www.presidency.ucsb.edu/ws/?pid=84772. Accessed December 22, 2014. 54 Robert Pear, “White House Vandalized in Transition, G.A.O. Finds” New York Times. June 12, 2002. Cf. Martha Joynt Kumar, “The 2008-2009 Presidential Transition through the Voices of Its Participants,” Presidential Studies Quarterly 39, #4 (December 2009): p.839. 55 Martha Joynt Kumar, “The 2008-2009 Presidential Transition through the Voices of Its Participants,” Presidential Studies Quarterly 39, #4 (December 2009): p.838. 56 The TCC’s mission was to “assist the major party candidates and the President-elect by making every reasonable effort to facilitate the transition between administrations.” George W. Bush: “Executive Order 13476 Facilitation of a Presidential Transition,” October 9, 2008. Online by Gerhard Peters and John T. Woolley, The American Presidency Project. http://www.presidency.ucsb.edu/ws/?pid=84533. Accessed December 22, 2014. 57 Martha Joynt Kumar, Before the Oath: How George W. Bush and Barack Obama Managed a Transfer of Power (Baltimore: Johns Hopkins University Press, 2015); Kumar, “The 2008-2009 Presidential Transition through the Voices of Its Participants,” p.839. 58 E.g., see John P. Burke, “The Obama Presidential Transition: An Early Assessment,” Presidential Studies Quarterly 39, #3 (September 2009): p.574-604; Kumar, “The 2008-2009 Presidential Transition through the Voices of Its Participants,” pp.823-58; Kumar, Before the Oath. 45

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 10

THE UMPIRE STRIKES OUT: PRESIDENT GEORGE W. BUSH AND THE POLITICIZATION OF SUPREME COURT NOMINATIONS Joel K. Goldstein Saint Louis University School of Law, MO, US

ABSTRACT Although President George W. Bush voiced appreciation of the metaphor suggesting that a Supreme Court justice is like an umpire, he politicized the confirmation process and the Court by generally selecting nominees who met a strict ideological test. That outcome was not an accident but flowed from the instructions he gave those responsible for creating the list of possible nominees and the composition of the advisers he involved. Contextual factors also played a part in this outcome. Bush’s vacancies occurred in the early part of his second term when Republicans had a Senate majority, when Bush faced no electoral constraints, and when his ability to choose a less predictably conservative nominee was frustrated by Republican senators who could be less deferential to him and insist on ideological purity.

INTRODUCTION During his Supreme Court confirmation process, then Judge John G. Roberts, Jr. famously likened a Supreme Court justice to an umpire in a baseball game, a metaphor invoked to suggest the appealing ideal of judicial impartiality and modesty. Roberts had used that analogy in his job interview with President George W. Bush and the reference favorably impressed the former owner of the Texas Rangers baseball team.1 Yet notwithstanding the rhetoric of neutrality, the Supreme Court confirmation process became ideologically identified on a sustained basis during the Bush administration to a degree unmatched since the

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19th century. In less than four months during his second term, President Bush nominated three different prospective justices to fill two Supreme Court seats. Two nominees, although presenting impressive resumes, drew considerable opposition, almost entirely from Democratic senators and their supporters. A third nomination was withdrawn due largely to opposition from the President’s Republican co-partisans, many of whom questioned the nominee’s commitment to conservative judicial outcomes. Far from representing a search for justices who would apply the law impartially and modestly as the umpire imagery suggests, President Bush’s Supreme Court nominations sought to transform the Court in an ideologically significant and enduring manner. President Bush’s behavior departed from much recent practice and contributed to a contentious era in confirmation battles, one in which the “Court as umpire metaphor” lost descriptive power. Whereas most Court nominations of Presidents Ronald Reagan, George H.W. Bush and Bill Clinton went through the Senate with little opposition, a substantial part of the Senate voted against the confirmations of Roberts to be chief justice and of Judge Samuel A Alito, Jr. to be an associate justice. And the nomination of President Bush’s White House counsel, Harriet Miers, drew expressed opposition from the President’s co-partisans intense enough to force her withdrawal, a development with no analogue in the 20th or 21st centuries. The pattern of partisan opposition to highly-credentialed Court nominees has continued in the administration of President Barack Obama. The explanation for this development is partly contextual and traces both to characteristics of modern American politics as well as to transient conditions Bush encountered. Yet President Bush’s actions also contributed to the increasing pattern of ideologically divisive nominations.

THE HISTORICAL CONTEXT FOR BUSH’S COURT NOMINEES Supreme Court confirmation hearings did not first become contentious during George W. Bush’s presidency. Many nominations in the nineteenth century occasioned closely divided votes. Conservatives hotly contested Woodrow Wilson’s nomination of progressive Louis D. Brandeis in 1916 which barely emerged from committees before carrying, 47-22, with numerous abstentions.2 In February, 1930, the nomination of the great Charles Evans Hughes as Chief Justice was approved, 52-26. The following month, the Senate rejected Judge John Parker, 39-41.3 Although Parker was the only unsuccessful nominee between 1900 and 1967, three nominees (Justice Abe Fortas to be Chief Justice, and Judges Clement Haynsworth and G. Harrold Carswell) were defeated during the next five years, in part due to unusual complicating factors. William Rehnquist twice attracted significant opposition (26 negative votes when nominated for the Court in 1971, 33 in 1986 when elevated to be chief justice), Judge Robert Bork was defeated, 42-58 in 1987 and Judge Clarence Thomas scraped through, 52-48.4 Still, this history was atypical and did not anticipate the treatment of the Bush (43) nominees. From April, 1970 to June, 1986, the Senate confirmed five nominees not named Rehnquist (Harry Blackmun, Lewis Powell, John Paul Stevens, Sandra Day O’Connor, Antonin Scalia) by a collective vote of 478-1 even though Republican presidents submitted the first three nominees to Democrat- controlled Senates. Although Bork’s nomination

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encountered ideological opposition, he was also hurt by his poor performance as a witness, by a return to Democratic control of the Senate in 1987, and because Reagan’s popularity was declining due to the Iran-Contra debacle. Bork’s nomination was defeated, but every subsequent voted-on Court nominee of Presidents Reagan, Bush and Clinton for nearly two decades other than Thomas attracted little opposition. A Democratic Senate confirmed Anthony Kennedy, 97-0, when Reagan ultimately nominated him after Bork’s defeat. Three years later, a Democratic-controlled Senate approved George H. W. Bush’s choice of David Souter, 90-9, for the seat Justice William Brennan had held.5 Although Bush’s nomination of Thomas to replace Justice Thurgood Marshall attracted significant opposition, that event was an outlier. Thomas’s paper trail, as chair of the Equal Employment Opportunity Commission and in his speaking and writing, suggested an ideological agenda. His insistence that he had not thought about abortion struck many as incredible. Thomas benefitted from the sponsorship of respected Senator John Danforth (R. Mo.) but he faced a Senate the Democrats controlled, 57-43. The evenly divided vote in the Senate Judiciary Committee (7-7) reflected the perils of an ideological nominee. The allegations of sexual harassment by Anita Hill, a former subordinate, further threatened Thomas’s confirmation.6 Even so, some 11 Democrats joined 41 Republicans to support his nomination. Thomas’s near-defeat did not inaugurate a period of contentious battles. As had the two immediate predecessor nominees, Kennedy and Souter, the next two nominees, Judges Ruth Bader Ginsburg (96-3) and Stephen Breyer (86-9), experienced easy confirmations. The pattern of Senate consensus in support of Court nominations traced to presidential behavior. For instance, Bill Clinton had retreated from his early, but sometimes controversial, preferences and chose nominees in deference to cross-party consultation. When Justice Byron White announced his pending retirement in March, 1993 soon after Clinton’s first inauguration, Clinton initially sought a replacement from outside the federal judiciary. New York Governor Mario Cuomo was his favorite, but Secretary of State Warren Christopher, Secretary of Education Richard Riley and Secretary of Interior Bruce Babbitt were also approached with Babbitt emerging as a serious possibility after the others declined.7 Word that Babbitt was being considered provoked criticism from Senate Minority Leader Bob Dole and Judiciary Committee ranking member Orrin Hatch. Hatch advised Clinton that Babbitt’s nomination would be controversial and urged him to consider Judges Steven Breyer and Ruth Bader Ginsburg who were perceived as relatively moderate appellate judges.8 Having suffered several embarrassing episodes regarding nominations to important positions in the Justice Department, Clinton wanted an easy confirmation to avoid perceptions of incompetence and to preserve political capital.9 He chose Ginsburg, a selection Dole and Hatch praised.10 The following year, Clinton again considered opposing viewpoints to mitigate controversy when nominating a replacement for Blackmun. After his early choice, Senator George Mitchell, removed himself from consideration despite having Republican support, Clinton abandoned Babbitt due to Hatch’s opposition and instead nominated Breyer who Hatch and other Republicans supported.11 As David Yalof points out, “ideology played little or no role at all in the selection of Supreme Court nominees during Bill Clinton’s first term as president.”12 By the mid-1990s, the formula for uncontentious nominees seemed clear. Supreme Court nominations always turned on the interaction between the pool of available nominees, the

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context, and presidential idiosyncrasy.13 Both parties recognized that the president had the right to select a nominee and the Senate had the power to deny confirmation. Presidents generally consulted with opposing party senators, both when the president’s party was in the minority (Kennedy, Souter) and in the majority (Ginsburg, Breyer) and took those exchanges seriously to avoid ideological choices that would provoke confirmation battles. And they selected nominees whose credentials were unassailable. That formula produced confirmations with few dissenting votes, an outcome helpful to the Court’s institutional standing.

PRESIDENT BUSH’S NOMINEES President George W. Bush took a different approach. His Court vacancies came early during his second term when the Twenty-second Amendment to the Constitution precluded him from seeking another term and before his approval ratings cratered. Bush chose ideologically-screened nominees in Judges Roberts and Alito with little deference to opposing party sentiment. When he did weigh other factors, including diversity and cross-party sentiment, he chose, in Miers, someone whose relatively modest credentials made her vulnerable when Bush’s co-partisans opposed her on ideological grounds. Notwithstanding the emphasis on judicial impartiality and restraint associated with the umpire metaphor, Bush’s selection process was ideologically-driven. During his 2000 presidential campaign Bush had presented Justices Scalia and Thomas, two of the most conservative justices in American history, as models for the jurists he would seek.14 Bush later retreated to the less threatening, but coded, formulation that he would appoint “strict constructionists” not “liberal activist judges.”15 About two months before Bush nominated Roberts, White House press secretary Scott McClellan said that individuals with a “conservative judicial philosophy” were “exactly the kind of people” Bush wanted to appoint to the courts.16 In constructing the pool, the Bush administration engaged in a “careful and highly ideological” search for Supreme Court nominees.17 Before Bush’s first inauguration,18 lawyers in or destined for the White House Counsel’s office began to research prospective Supreme Court nominees.19 Bush told his counsel that he wanted “reliable conservatives,” not those like Souter who might drift to centrist positions. Alberto Gonzales promised to recommend only those likely to be predictable conservatives.20 Bush claims he “made clear there should be no political litmus test” but that he sought justices who would exercise “judicial restraint” and wanted to avoid “activist judges who substituted their personal preferences for the text of the law” since he “subscribed to the strict constructionist school.”21 The phrases Bush used are often treated as euphemisms for conservative jurists. Gonzales reported that a list of more than 100 prospects was reduced to 50 and then to 20 as some were eliminated as presenting confirmation challenges or having made “statements inconsistent with a conservative judicial philosophy.”22 Bush also instructed associates of his interest in appointing women and minorities to the bench.23 Cheney claimed that he “convened” a group early in the first term of himself, Attorney General John Ashcroft, White House Counsel Alberto Gonzales and White House aides Andrew Card, Karl Rove, and I. Lewis “Scooter” Libby to initiate a process to screen and interview candidates.24 During the second term, Miers in effect replaced Ashcroft after

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Gonzales became attorney general and she assumed his role as White House counsel. Gonzales and Miers assembled large binders on prospective nominees.25 Gonzales began meeting candidates early in the first term and continued that activity as attorney general during the second term.26 During spring, 2005, the group began to narrow the prospects. Gonzales claims that he considered factors such as qualifications, personal qualities, confirmability, intangibles and political considerations (age, health, diversity) and “most important” judicial philosophy.27 Gonzales identifies a slightly smaller group—Cheney, Gonzales, Card, Rove and Miers— who met in Cheney’s office to choose candidates and conduct the interviews.28 The group ultimately interviewed five conservative federal judges at the Naval Observatory, the vice president’s official residence— Alito, Edith Brown Clement, Michael Luttig, Roberts, and J. Harvie Wilkinson—although Gonzales suggests that Clement, the only woman on the list, was added later.29 The participation of Cheney, Rove, and Card suggested the political and ideological tenor of the process as did the fact that most involved were not lawyers. Although Gonzales claims that he and Miers did most of the questioning,30 others state that Cheney and the political advisers interrogated candidates closely about their ideology and Barton Gellman reported that Cheney spoke in Oval Office meetings regarding the importance of choosing conservative justices.31 Cheney’s memoir implies that the group sought to produce a slate of reliable conservative choices from which Bush would choose.32 In addition to the interviews and Gonzales’s private meetings with candidates, the administration frequently spoke with leading conservative lawyers regarding those under consideration.33 Inasmuch as Justice O’Connor was the Court’s swing vote on many contentious issues, her resignation presented Bush with a potential watershed. “There are huge risks for Bush no matter which way he moves,” wrote the Washington Post’s perceptive political reporter, Dan Balz, the day after her announcement.34 Conservatives immediately began mobilizing to produce a nominee who would be an ideological clone of Justices Scalia and Thomas and to prevent the nomination of Gonzales, Bush’s close friend and attorney general, who would have been the first Hispanic named to the Court.35 The anti-Gonzales campaign was sufficiently intense that Bush expressed his unhappiness with it during a press conference with Denmark’s Prime Minister amidst a state visit there.36 Gonzales had pursued a very conservative agenda as Bush’s legal counsel yet the Republican right viewed him as suspect because, as a Texas Supreme Court justice, he had followed Supreme Court precedent, as he was compelled to do, in allowing a minor to seek permission from a judge, rather than her parents, to obtain an abortion.37 The White House trumpeted the fact that Bush had consulted with more than 70 senators including 75% of Senate Democrats.38 Ultimately, Bush interviewed the five federal judges his screening group identified— Alito, Clement, Luttig, Roberts, and Wilkinson.39 Although Cheney and Miers initially had reservations about Roberts and preferred Luttig40 and Alito41 respectively, Roberts’s prospects were enhanced by his participation in the appellate decision in Hamdan v. Rumsfeld, which exempted Bush’s military tribunal plan from complying with the Geneva Convention, and he emerged as Bush’s choice after their White House interview42 where Roberts’s use of the umpire analogy “stuck with” the President.43 Roberts’s confirmation quickly became inevitable. His resume was impeccable and he handled himself with skill and grace. Journalist E. J. Dionne, Jr. aptly described Roberts as “David Souter turned on his head—a stealth candidate whose winning personality disguises intense conservatism, not moderation.”44 Republicans held 55 Senate seats and members of

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the Senate Gang of 14, a bipartisan group of centrists who held the balance of power regarding a filibuster, quickly rejected that tactic. Conservatives were comforted by the conservative views in Roberts’s memos from the Reagan administration.45 Liberals were stymied by the challenge of opposing someone as personally appealing as Roberts. Roberts’s path became even easier when the death of his mentor, Chief Justice Rehnquist, on September 3, 2005 created a second vacancy shortly before confirmation hearings were scheduled to begin. Bush withdrew Roberts as his nominee for O’Connor’s seat and nominated him to be the 17th chief justice. Bush’s approval/disapproval rating had declined from 49 percent to 48 percent in mid-July to 45 percent to 52 percent in late August46 due partly to the administration’s inept response to Hurricane Katrina.47 The Roberts nomination was part of a strategy to divert attention from that debacle and to allow the administration to benefit from associating itself with Roberts’s clear excellence.48 Roberts performed brilliantly before the Senate Judiciary Committee. Succeeding conservative Rehnquist rather than swing-vote O’Connor reduced the stakes of the Senate’s deliberation and probably caused some Democratic senators to try to enhance their credibility by supporting Roberts while reserving the possibility of opposing Bush’s next nominee. Roberts insisted that “Judges are like umpires. Umpires don't make the rules; they apply them. The role of an umpire and a judge is critical. They make sure everybody plays by the rules. But it is a limited role. Nobody ever went to a ball game to see the umpire.”49 Senate Republicans rallied to Roberts’s vision of the justice as umpire. Michael Gerhardt points out that six Republicans used that brand 16 times during the hearings and 17 used it either in the hearings, in floor statements or both.50 Roberts was recommended by the Judiciary Committee, 13-5, and confirmed by the Senate, 78-22, with the Democratic senators evenly split and the unanimous support of Senate Republicans. Those opposing Roberts generally were of the Senate’s more liberal members including Democrats running for president (Barack Obama, Hillary Clinton, Joe Biden) other than Chris Dodd. Although the available pool for the O’Connor seat in October, 2005 following Roberts’s confirmation was essentially the same as the first time (minus Roberts), the political context was quite different. Bush’s approval rating was 45 percent to 50 percent in Gallup’s late September poll.51 The bungled response to Hurricane Katrina continued to attract media attention to the administration’s detriment. Senate Judiciary Committee chair Arlen Specter had warned Bush to expect a more contentious battle for O’Connor’s seat especially owing to frustration over Roberts’s refusal to disclose his judicial views.52 Partly in response to First Lady Laura Bush’s public urging, Bush had reconsidered the desirability of nominating a woman to replace O’Connor and directed Miers to include more women candidates than Cheney’s group had recommended.53 Bush was committed to gender diversity in appointments, Cheney later wrote in a discussion that allowed the inference that he gave that goal less priority.54 Although Miers et al. cast the net widely, most prospective women were rejected either due to vetting or ideological questions.55 Senate Minority Leader Harry Reid had suggested Miers as a possible candidate and Bush liked the idea.56 Apparently some other Democrats also praised her.57 Bush’s advisers on Supreme Court nominations had mixed reactions regarding the wisdom of nominating Miers.58 Ultimately, Bush decided that Miers was his best choice because he “knew her better” than Judge Priscilla Owen, she had a better chance of confirmation, and she would bring the perspective of someone from outside the judiciary to the Court.59

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Bush’s selection of Miers reflected recognition of the President’s weakened political position and a desire to avoid a fight by placating Democrats.60 In announcing his selection, Bush rejected the idea that Miers was a polarizing choice. “I believe that Senators of both parties will find that Harriet Miers's talent, experience, and judicial philosophy make her a superb choice to safeguard the constitutional liberties and equality of all Americans.”61 Bush did not, however, anticipate the “firestorm of criticism we received from our supporters.”62 Cheney’s group had not recommended Miers and Bush knew Cheney would disagree with his decision to nominate her.63 He reportedly had Card advise Cheney of the decision rather than telling the Vice President himself.64 Cheney told Bush Miers would be a “‘tough sell.’”65 Numerous conservatives, including former Judge Robert Bork, former Senator Rick Santorum, former Bush speechwriter David Frum, William Kristol,66 George Will67 and Charles Krauthammer68 publicly criticized Miers.69 Bush repeatedly vouched for Miers’s conservative philosophy, stating that he had known her for a decade and that she shared his “philosophy that judges should strictly interpret the laws and the Constitution of the United States and not legislate from the bench.” Miers’s philosophy would not change, Bush insisted.70 Cheney found himself making the tough sell to conservatives, including during interviews with Rush Limbaugh, where he repeatedly stated that Miers had a “conservative judicial philosophy” that would please Limbaugh,71 and with Sean Hannity.72 Miers’s qualifications were also contested and some suggested the nomination reflected cronyism given the long relationship between Bush and Miers.73 Ultimately, intense opposition from right wing activists led Bush to withdraw the nomination.74 Miers’s poor performance in meetings with senators and in preparing for the hearings also eroded her prospects, especially as administration insiders saw that her unfamiliarity with constitutional law was likely to embarrass Bush and her during the hearings.75 After Bush’s unfortunate praise of FEMA’s Michael Brown’s handling of Katrina (“Brownie, you’re doing a heck of a job”), Bush could ill-afford any sign of incompetence especially by someone as close to him as Miers. The administration appropriated a suggestion from Krauthammer that it attribute Miers’ withdrawal to a separation of powers dispute over Bush’s refusal to produce documents the Senate Judiciary Committee needed.76 Even then, Bush made no pretense of his priorities, saying he had nominated Miers “because of her extraordinary legal experience, her character, and her conservative judicial philosophy.”77 Conservatives celebrated while Democratic senators lambasted Bush for succumbing to pressure from extreme elements of his party.78 Miers’s withdrawal caused Bush to turn again to those previously considered for O’Connor’s seat. Whereas Reid cautioned Bush against such a selection, conservative Republicans threatened that a Democratic filibuster would trigger a change in Senate rules to reduce the ability of a minority to resort to that tactic.79 The Bush administration had been hurt by the indictment of Libby, Cheney’s top assistant and a member of Bush’s senior staff. Bush quickly turned to Alito who had been high on the list the Cheney group had prepared. During 15 years on the federal court of appeals, Alito had compiled a record which made him popular with movement conservatives. Whereas Republicans praised Alito’s credentials, judicial experience and demeanor,80 Democrats lamented that Bush had made a “needlessly provocative nomination” rather than selecting someone who would unite the Senate and the country.81 The Alito nomination was widely seen as triggering a battle over judicial ideology.82 Although Alito lacked Roberts’s charisma, he generally made a favorable impression as a thoughtful jurist and decent person. Whereas 49 percent had favored his confirmation before

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hearings began, after their conclusion he was favored, 54 percent to 30 percent with a filibuster being viewed as unjustified, 48 percent to 38 percent.83 The Senate Judiciary Committee reported Alito’s nomination favorably, 10-8, on a straight party line vote.84 A filibuster by some liberal Democratic senators failed, 25-72 as nineteen Democrats joined 53 Republicans in opposition to that tactic.85 Ultimately, Alito was confirmed, 58-42, with 54 (of 55) Republicans and only four Democrats supporting his nomination. The 42 negative votes reflected far greater Democratic unity than evident four months earlier against Roberts.

THE FUTURISTIC CONTEXT OF BUSH’S COURT NOMINATIONS Like the story of Court nominations prior to the Bush (43) administration, the experience of Bush’s successor also provides useful context for Bush’s behavior. Obama was presented with two Court vacancies during his first two years in office, roughly four to five years after Bush acted, when first Souter, then Stevens, announced their intentions to retire. Although both retiring justices had been appointed by conservative Republican presidents, both were considered part of the Court’s liberal block. Obama had some advantages which might have mitigated the controversy surrounding his nominations. First, since Obama was replacing “liberal” justices his nominations seemed unlikely to shift the Court’s alignment. Second, the Senate was heavily weighted in his favor, with 60 senators who caucused with the Democrats when Souter resigned and 59 a year later when Stevens did. Although Obama was certainly disposed to appoint like-minded justices, like Clinton he was interested in avoiding controversy to preserve political capital for other battles. His nominees, Judge Sandra Sotomayor and Solicitor General Elena Kagan, seemed less ideologically divisive than some other choices he might have made. Sotomayor had been appointed to the federal district court by President George H. W. Bush and would be the first Hispanic on the Court, factors which should have made her more palatable to Republicans or at least tempered their commitment to a fight. She presumably appealed to Obama as a “first” who might help bring Hispanic voters into the Democratic party and because her life story mirrored the narrative of his own unlikely rise to power.86 Kagan, too, was a less pleasing choice to liberals than some others on Obama’s list.87 Sotomayor and Kagan had impressive credentials comparable to those of other successful recent nominees. Yet the response to Obama’s nominations more closely resembled that to Roberts and Alito than to O’Connor, Scalia, Kennedy, Souter, Ginsburg or Breyer. On the day Souter’s retirement became public before Obama had announced a decision, a representative of a leading conservative organization was quoted as saying “‘I hope for and I expect a fight.’”88 Although columnist E. J. Dionne characterized Sotomayor’s judicial record as “moderate” and called her the “most conservative choice … Obama could have made,”89 31 of 40 Republicans opposed Sotomayor; her nine Republican supporters included four senators who were not seeking re-election and the two moderate Republican women senators from Maine. Kagan received only four Republican votes-Senators Olympia Snowe and Susan Collins of Maine and Senators Richard Lugar and Lindsey Graham who had also supported Sotomayor. In the aftermath of the Sotomayor and Kagan confirmations, five of the nine members of the Court, the four most recent nominees and Thomas, had been confirmed over the opposition of 22 percent to 48 percent of the Senate, a situation without precedent since the

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1830s and 1840s. Almost all opposing votes came from the nominating presidents’ rival party. Looking only at the four justices Bush (43) and Obama appointed, only two senators opposed a nominee put forward by a president of his or her party. And relatively few crossparty votes were cast for confirmation. Only Roberts received “aye” votes from 50 percent of the other party’s senators (51%) with Alito (9%), Sotomayor (23%), and Kagan (12%) receiving little cross-party support. In each case, the votes to confirm came overwhelmingly from the president’s party (Roberts, 70%, Alito, 93%, Sotomayor, 87%, Kagan, 92%). What has emerged is a Court on which, as Richard Hasen has pointed out, the justices’ ideological alignment now coincides with their partisan associations. Put differently, with the departure of moderate or liberal justices who Republican presidents appointed (O’Connor, Souter, Stevens) and of conservative, Democrat—appointed Justice Byron White, the Court’s conservatives were appointed by, and associated with, Republican presidents and its liberals were appointed by, and associated with, Democratic presidents. “The more people think of the Justices as dividing on partisan lines and deciding cases the same partisan way in which legislators decide on legislative actions (whether or not that is an accurate characterization), the easier it will be for senators to oppose judicial nominations on ideological and partisan grounds.”90 Politicians may use the umpire metaphor but increasingly justices are chosen to be, and perceived as, partisans.

THE UMPIRE STRIKES OUT Notwithstanding his rhetoric of judicial neutrality, President Bush emphasized ideology in his Supreme Court nominations. He was certainly not the first president to do so.91 Presidents generally try to appoint justices who share their general outlook and, Lee Epstein and her colleagues report, increasingly they do.92 Yet President Bush emphasized ideology to an unusual extent. He initially identified as models for his judicial appointments the two most committed conservatives on the Court. He increased the likelihood of a strict ideological test by involving Vice President Cheney and Karl Rove in the screening process and by instructing Gonzales of his interest in reliable conservative nominees. Not surprisingly, Bush’s ideologically-oriented selection group recommended only candidates who were favorites of the Republican right. Although Bush consulted broadly, there is no indication that the counsel of Democratic senators made any difference regarding the two successful nominees, Roberts and Alito. Whereas Clinton and Obama sought to avoid controversial choices, Bush was willing to risk confirmation battles in order to place Roberts, and ultimately Alito, on the Court. To be sure, ideology was not all Bush considered. He also wanted to diversify the Court and felt some call to name a woman to O’Connor’s position. That desire was not strong enough to deter him from initially choosing Roberts or ultimately Alito. As his position weakened, he did seek a woman nominee after shifting Roberts to the Rehnquist vacancy. Bush apparently saw his options as limited. In all likelihood, Bush thought Miers would be a reliable conservative vote on the Court. He vouched for her ideological purity. Although Cheney questioned the decision, he described Miers as in the mold of Scalia and Thomas93 and said shortly after her nomination that Bush would have surpassed his predecessors in shaping the Court by appointing justices with his judicial philosophy.94 Perhaps Cheney was

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just being a good soldier but the strength of his comments suggests that he thought she shared Bush’s conservative dispositions even though she might not be as reliable as Luttig, Alito or Roberts over the long haul. Indeed, Miers had worried that Roberts might not be conservative enough, indication, perhaps, of her bona fides. To be sure, the general political environment encouraged ideological behavior in Court nominations. The proliferation of interest groups committed to ideological outcomes on judicial issues has driven both parties from the middle. Many of these groups see Court nominations as occasions to engage, not only because of their commitment to particular outcomes but because confirmation battles offer opportunities to mobilize supporters and expand influence. Obviously, some “hope” for a fight even before identification of the nominee indicates whether one is merited. The parties have taken positions on litmus test issues consistent with those advocated by their affiliated groups. And the transparency of much political behavior in an information age gives many senators, especially those in oneparty states, incentive to respond to the preferences of their bases to inhibit primary challenges. Of course, Obama and to some extent Clinton operated in a similar political environment yet they made less ideologically-driven Court nominations than Bush. Clinton twice chose nominees he had cleared with influential Republicans. Obama avoided the more polarizing options for his first two vacancies. Perhaps they were simply less ideologically-oriented than Bush, or relied on less ideological screeners, or the Democratic party was less focused on Court litmus tests than the Republican party. Yet Bush also encountered a unique political context that probably contributed to his inclination and ability to make ideological choices. The Court’s decision in Bush v. Gore95, ending the Florida recount and resolving the 2000 presidential election, probably reduced the likelihood that any justice would voluntarily leave the Court during Bush’s first term. The timing of the vacancies, in Bush’s second, rather than first, term increased the likelihood of ideologically-driven nominations. As a second-term president, Bush was freer to pursue an ideological agenda than he would have been in his first term. Although it is conceivable that he might have sought to placate his base during his first term, it seems more likely that electoral concerns might have caused him to reject more ideological choices to avoid alienating centrist voters. The partisan composition of the Senate was also more favorable to Bush during the second term, thereby encouraging ideological nominations. The Senate’s partisan makeup fluctuated slightly during Bush’s first term but was essentially evenly divided whereas the 2004 elections gave Republicans a 55-45 advantage. Finally, Republican senators and conservatives were probably more willing to insist on a strict ideological test in Bush’s second term. Their reluctance to weaken Bush during his first term encouraged deference to him. During the second term, they had more reason to demand the spoils of victory, partly in response to their base, and less concern about weakening someone who would never run again for office. The confluence of Bush’s inclinations and the political context caused him to use strict ideological criteria in choosing Supreme Court nominees. With 55 Republican senators, he was able to succeed so long as he nominated very able and presentable candidates such as Roberts and Alito. His only defeat came when conservatives objected on ideological grounds to Miers. Republican senators may have been hard-pressed to oppose a nominee with greater knowledge of the Court and its work than Miers even if that person was less ideologicallypredictable. Unlike Clinton or Obama, Bush did not give senators that chance.

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Bush succeeded in shifting the Court’s ideological composition to the right. That was a goal of his selection process. That achievement came at cost to the image of judicial impartiality that the administration championed. It also signaled the beginning of a period in which Supreme Court nominations are likely to be divisive to the detriment of the Court’s institutional standing. Ultimately, President Bush and his associates did not seek simply an umpire but one who would call the game based on conservative rules and principles.

ENDNOTES 1

George W. Bush, Decision Points (New York: Broadway Paperbacks, 2010), 98. Henry J. Abraham, Justices, Presidents and Senators: A History of U.S. Supreme Court Appointments from Washington to Bush II, 5th ed. (Lanham, Md.: Rowman and Littlefield, 2008), 142-143. 3 Ibid., 156-158. 4 Ibid, 29, 253, 276, 283, 299. 5 Ibid. 283, 285, 291-292. Reagan announced his intent to nominate Judge Douglas Ginsburg after Bork’s defeat but Ginsburg withdrew from consideration following revelations that he had used marijuana while a law professor. 6 Abraham, Justices, Presidents and Senators, 297-299. 7 Bernard Nussbaum, interview with Russell L. Riley et al, September 24, 2002, William J. Clinton Oral History Project, Miller Center, University of Virginia, Charlottesville, 70-71 (http://web1.millercenter.org/poh /transcripts/ohp_2002_0924_nussbaum.pdf). 8 Ibid., 72; Orrin Hatch, Square Peg: Confessions of a Citizen Senator (New York: Basic Books, 2002), 180. 9 George Stephanopoulos, All Too Human: A Political Education, (Boston: Little Brown, 1999), 168-170. 10 Paul Richter, “Clinton Picks Moderate Judge Ruth Ginsburg for High Court,” Los Angeles Times, June 15, 1993, (http://articles.latimes.com/1993-06-15/news/mn-3237_1_judge-ginsburg). 11 David A. Yalof, Pursuit of Justices: Presidential Politics and the Selection of Supreme Court Nominees (University of Chicago Press, 1999), 203-205; Abraham, Justices, Presidents, and Senators, 309-311. 12 Yalof, Pursuit of Justices, 196. 13 Joel K. Goldstein, “Choosing Justices: How Presidents Decide,” Journal of Law and Politics, 26, no. 4 (Summer, 2011): 425. 14 Alberto R. Gonzales, “In Search of Justice: An Examination of the Appointments of John G. Roberts and Samuel A. Alito to the U.S. Supreme Court and Their Impact on American Jurisprudence, William and Mary Bill of Rights Journal, 22, no. 3 (March, 2014): 647, 648-649. 15 Transcript, First Bush-Gore Presidential Debate, October 3, 2000, Commission on Presidential Debates, (http://www.debates.org/index.php?page=october-3-2000-transcript). See also Transcript, Second Bush-Kerry Presidential Debate, October 8, 2004, Commission on Presidential Debates, (http://www.debates.org/ index.php?page=october-8-2004-debate-transcript). See Jeffrey Toobin, The Nine: Inside the Secret World of the Supreme Court (New York: First Anchor Books, 2007), 260. 16 Press Briefing by Scott McClellan, May 17, 2005, (http://georgewbush-whitehouse.archives.gov/news /releases/2005/05/20050517-2.html). 17 David A. Strauss, “Memo to the President (and His Opponents): Ideology Still Counts,” Northwestern University Law Review Colloquy, (2007): 49, 53, (http://scholarlycommons.law.northwestern.edu/nulr_online/84/). 18 Gonzales, “In Search of Justice,” 647. 19 Bush, Decision Points, 97. 20 Gonzales, “In Search of Justices,” 649 21 Bush, Decision Points, 97. 22 Gonzales, “In Search of Justice,” 651. 23 Bush, Decision Points, 97; Toobin, The Nine, 261; Dick Cheney with Liz Cheney, In My Time: A Personal and Political Memoir (New York: Threshold, 2011), 323-324; 24 Cheney, In My Time, 322; Press Briefing by Scott McClellan, October 3, 2005, (http://georgewbushwhitehouse.archives.gov/news/releases/2005/10/20051003-2.html). 25 Cheney, In My Time, 322. 2

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Peter Baker, Days of Fire: Bush and Cheney in the White House (New York: Doubleday, 2013), 387; Jan Crawford Greenburg, Supreme Conflict: The Inside Story of the Struggle for Control of the United States Supreme Court (New York: Penguin, 2007), 189. 27 Gonzales, “In Search of Justice,” 653-654. 28 Ibid., 651-652. But see Greenburg, Supreme Conflict, 190 (identifying Libby but not mentioning Card as present at Roberts’s interview); Toobin, The Nine, 273 (including Card and Libby but omitting Miers). 29 Gonzales, “In Search of Jutsice,”651-652. 30 Ibid., 652. 31 Barton Gellman, Angler: The Cheney Vice Presidency (New York: Penguin, 2008), 358-359; Greenburg, Supreme Conflict, 293. But see Gonzales, “In Search of Justice,” 652 (claiming he and Miers asked most questions). 32 Cheney, In My Time, 322-324. 33 Toobin, The Nine, 275-276; Baker, Days of Fire, 388-389. 34 Dan Balz, “Nomination Could Be Defining Moment for Bush,” Washington Post, July 2, 2005, (http://www.washingtonpost.com/wp-dyn/content/article/2005/07/01/AR2005070101832.html). 35 Peter Baker and Susan B. Glasser, “Activists Gear Up for Nominee Fight,” Washington Post, July 3, 2005, (http://www.washingtonpost.com/archive/politics/2005/07/03/activists-gear-up-for-nominee-fight/0323757d649b-4847-9439-45d34b042aaf/). See also Thomas B. Edsall and Dana Milbank, “The Right’s Moment, Years in the Making,” Washington Post, July 3, 2005, (http://www.washingtonpost.com/wp-dyn/content/article /2005/07/02/AR2005070201312.html). 36 The President’s News Conference With Prime Minister Anders Fogh Rasmussen of Denmark in Kongens Lyngby, Denmark July 6, 2005, Public Papers of Presidents of the United States: George W. Bush, 2005 (Washington,: Government Printing Office, 2009), 1189, 1195. 37 Toobin, The Nine, 269-270; Baker, Days of Fire, 398. 38 Press Briefing with Scott McClellan and Dan Bartlett on the President’s Supreme Court Justice Nominee,” July 19, 2005, (http://georgewbush-whitehouse.archives.gov/news/releases/2005/07/20050719-11.html). 39 Bush, Decision Points, 98. 40 Ibid. 41 Toobin, The Nine, 275. 42 Ibid., 274-278. 43 Bush, Decision Points, 98. 44 E. J. Dionne, Jr. “A Right Turn With a Smile,” Washington Post, July 21, 2005, (http://www.washingtonpost.com /wp-dyn/content/article/2005/07/20/AR2005072002091.html). 45 Toobin, The Nine, 280-281. 46 “Presidential Approval Ratings--George W. Bush,” Gallup Poll (http://www.gallup.com/poll/116500/presidentialapproval-ratings-george-bush.aspx). 47 Toobin, The Nine, 279-280. 48 Baker, Days of Fire, 417. 49 “Statement of John G. Roberts, Jr., Nominee to be Chief Justice of the United States,” in United States Senate, Committee on the Judiciary Confirmation Hearing on the Nomination of John G. Roberts, Jr. to be Chief Justice of the United States, 109th Cong., 1st sess., September 12, 2005, 55. 50 Michael J. Gerhardt, “Constitutional Branding,” Hofstra Law Review, 40, no. 3(Spring, 2012): 655, 676-677 and nn. 122 and 123. 51 “Presidential Approval Rating--George W. Bush,” Gallup Poll. (http://www.gallup.com/poll/116500/presidentialapproval-ratings-george-bush.aspx). 52 Charles Babington and Amy Goldstein, “Senate Panel Endorses Roberts,” Washington Post, September 23, 2005, (http://www.washingtonpost.com/wp-dyn/content/article/2005/09/22/AR2005092200796.html). 53 Baker, Days of Fire, 417-418. 54 Cheney, In My Time, 322-324. 55 Baker, Days of Fire, 417. 56 Toobin, The Nine, 283, 286-287; Baker, Days of Fire, 418. 57 Press Briefing of Scott McClellan, October 3, 2005, (http://georgewbush-whitehouse.archives.gov/news /releases/2005/10/20051003-2.html#a). 58 Bush, Decision Points, 100. 59 Bush, Decision Points, 101; Baker, Days of Fire, 417-418. 60 Dan Balz, “A Bid for Confirmation, Rather Than Convictions,” Washington Post, October 4, 2005, (http://www.washingtonpost.com/wp-dyn/content/article/2005/10/03/AR2005100301467.html).

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Remarks Announcing the Nomination of Harriet E. Miers To Be an Associate Justice of the United States Supreme Court October 3, 2005, Public Papers of Presidents of the United States George W. Bush,(Washington: Government Printing Office, 2009), 1502, 1504. 62 Bush, Decision Points, 100-101. 63 Cheney, In My Time, 324. 64 Press Briefing by Scott McClellan, October 3, 2005; Gellman, Angler, 360. But see Cheney, In My Time, 324 (describing conversation with Bush which may have been Cheney’s first notice of the decision). 65 Cheney, In My Time, 324. 66 Balz, “Bid for Confirmation, Rather Than Convictions”; Howard Kurtz, “Revolt on the Right?’ Washington Post, October 4, 2005, (http://www.washingtonpost.com/wp-dyn/content/blog/2005/10/04/BL2005100400385 .html). 67 George F. Will, “Can This Nomination be Justified?” Washington Post, October 5, 2005, (http://www.washington post.com/wp-dyn/content/article/2005/10/04/AR2005100 400954.html). 68 Peter Baker and Dan Balz, “Bush Rejects Calls to Withdraw Miers,” Washington Post, October 8, 2005, http://www.washingtonpost.com/wp-dyn/content/article/2005/10/07/ AR2005100701822.html. 69 Alex Markell, “Why Miers Withdrew as Supreme Court Nominee,” NPR, October 27, 2005. 70 The President’s News Conference, October 4, 2005; The President’s Radio Address, October 8, 2005 (saying Miers would be “good, conservative judge”); Interview with Matt Lauer of NBC’s “Today” Show in Covington, Louisiana, October 11, 2005 (saying Miers’ philosophy would not change on bench), Public Papers of Presidents of the United States: George W. Bush (Washington: Government Printing Office, 2009), 1504, 1506, 1537, 1540. See also Press Briefing by Scott McClellan, October 24, 2005, (http://georgewbushwhitehouse.archives.gov/news/releases/2005/10/20051024-3.html#n) (McClellan referring to Miers’ “conservative judicial philosophy”). 71 “Rush Interviews Vice President Cheney on the Nomination of Harriet Miers to the Supreme Court,” October 3, 2005. 72 David D. Kirkpatrick, “Conservatives are Wary Over President’s selection,” New York Times, October 3, 2005, (http://www.nytimes.com/2005/10/04/politics/politicsspecial1/ conservatives-are-wary-over-presidents-selection.html?_r=0). 73 Press Briefing of Scott McClellan, October 3, 2005. 74 Michael A. Fletcher and Charles Babington, “Miers, Under Fire From Right, Withdrawn as Court Nominee,” Washington Post, October 28, 2005, (http://www.washingtonpost.com/wp-dyn/content/article/2005/10/27/ AR2005102700547.html); David Stout and Timothy Williams, “Miers Ends Supreme Court Bid After Failing to Win Support,” New York Times, October 27, 2005. 75 Baker, Days of Fire, 422-423; Greenburg, Supreme Conflict, 278-284. 76 Charles Krauthammer, “Miers: The Only Exit Strategy,” Washington Post, October 21, 2005, (http://www.washingtonpost.com/wp-dyn/content/article/2005/10/20/AR2005102 001635.html). 77 Statement Announcing the Withdrawal of the Nomination of Harriet E. Miers To Be an Associate Justice of the United States Supreme Court, October 27, 2005, Public Papers of Presidents of the United States: George W. Bush (Washington: Government printing Office, 200_ ) 78 Greenburg, Supreme Conflict, 268. See e.g., 151 Congressional Record S11954 (2005) (statement of Sen. Harry Reid) (urging Bush not to “reward the bad behavior of his rightwing base.”); 151 Congressional Record S11964 (2005) (statement of Sen. Edward Kennedy) (criticizing “extreme factions” of Republican party for applying litmus test) 79 David D. Kirkpatrick, “Parties Set Stage for a Showdown on Court Choice,” New York Times, October 31, 2005, A1, A16. 80 151 Cong. Rec. S12059 (October 31, 2005) (statement of Sen. Mitch McConnell). 81 151 Cong. Rec. S12060 (October 31, 2005)(statement of Sen. Patrick Leahy). Greenburg, Supreme Conflict, 300301; Michael A. Fletcher, “A Rapid Response on All Sides,” Washington Post, November 1, 2005. 82 Peter Baker, “Alito Nomination Sets Stage for Ideological Battle,” Washington Post, November 1, 2005, (http://www.washingtonpost.com/wp-dyn/content/article/2005/ 10/31/AR2005103100180.html). See also Dan Balz, “With a Pick From the Right, Bush Looks to Rally GOP in Tough Times,” Washington Post, November 1, 2005, (http://www.washingtonpost.com/wpdyn/content/article/2005/10/31/ AR2005103101665.html).

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“Poll: Alito Should Sit on High Court,” CNN, January 23, 2006 (http://www.cnn.com/2006 /POLITICS/01/23/alito/). 84 David D. Kirkpatrick, “On Party Lines, Panel Approves Alito for Court, New York Times, January 25, 2006, 1, A16. 85 Charles Babington, “Democrats Split Over Filibuster on Alito,” Washington Post, January 27, 2006, (http://www.washingtonpost.com/wp-dyn/content/article/2006/01/26/ AR2006012601955.html); U.S. Senate Roll Call Votes #1, 109th Cong., 2nd sess., (http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=109&session=2&vote =00001). 86 Scott Wilson, “Making History Was but One Factor in Sotomayor Nomination,” Washington Post, May 28, 2009, (http://www.washingtonpost.com/wp-dyn/content/article/2009/05/27/AR2009052703467.html). 87 Dana Milbank, “In Kagan, Obama Picks a Nominee, Not a Fight,” Washington Post, May 11, 2010, A2. 88 Adam Nagourney and Jeff Zeleny, “Washington Prepares for Fight Over Any Nominee,” New York Times, May 2, 2009, A10. 89 E. J. Dionne, Jr. “Sonia Sotomayor is No Leftist Nominee,” Washington Post, May 28, 2009, (http://www.washingtonpost.com/wp-dyn/content/article/2009/05/27/AR2009052702906.html). 90 Richard L. Hasen, “End of the Dialogue? Political Polarization, the Supreme Court, and Congress,” Southern California Law Review, 86, no. 2 (January 2013): 205, 244. 91 Lee Epstein, Jeffrey A. Segal, and Chad Westerland, “The Increasing Importance of Ideology in the Nomination and Confirmation of Supreme Court Justices,” Drake Law Review, 56, no. 3 (2008): 609, 615; David A. Strauss, “Memo to the President (and His Opponents): Ideology Still Counts,” 102. 92 Epstein, et al, “Increasing Importance,” 620. 93 David D. Kirkpatrick, “Conservatives are Wary over President’s Selection, New York Times, October 4, 2005, A24. 94 “Rush Interviews Vice President Cheney on the Nomination of Harriet Miers to the Supreme Court,” October 3, 2005. 95 531 U.S. 98 (2000).

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 11

COMMENTARY: SCHEDULING PRESIDENT BUSH Bradley A. Blakeman Deputy Assistant to the President for Appointments and Scheduling, Vetting and Research, Correspondence and Surrogate Scheduling, 2001-2004

Let me give you the structure of the White House, you’ve heard about the Staff Secretary. The Staff Secretary handles all the paperwork of the Presidency, I handled all the President's time. And as a matter of fact, the suite of offices in the West Wing reflect the symbiotic relationship between the President’s time and his paper, because we shared a suite. I worked directly with the Staff Secretary on a daily basis of merging the President’s time with the President’s paper. So, the structure of the White House is you have approximately 16 members in the President’s senior staff, mostly all of them are called assistants to the President. They are the most senior advisors to the President. Then come the deputy assistants to the President. I was deputy assistant, but I was a member of the President’s senior staff. Only two deputies were members of this President’s senior staff. All the others were assistants to the President. And then below that you have special assistants to the President. Those are the commissioned officers of the President. The President directly hires, and you are deemed then a commissioned officer of the President. So there’s about, I don't know, maybe 60 between special assistants, deputy assistants, and assistants to the President. Now of course we all remember the 2000 recount. We were, “cheated” out of 37 days of a transition. I will say that the Clinton-Gore people were not real happy with us to arrive. They thought they would have an easy transition where just Gore basically walks down the hallway. Of course that did not happen. And as a matter of law, the commissioned officers of the President are responsible for handing over a transition book to successors. I never received a transition book. I had one meeting with Stephanie Street who was my counterpart with Clinton, and basically, I went in her office and she told me “good luck,” and did not hand over a transition book. And because 

Selected commentary from “White House Staff and the Executive Branch” panel, Conference on the George W. Bush Presidency, Hofstra University, March 26, 2015.

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of Andy Card's experience, and Joshua Bolton’s experience and Joe Hagin’s experience, we really didn't need to be lectured on a transition or counseled on a transition, but it would have been nice for continuity because of the difference in time and how White House has changed between the time of their experiences and what we inherited. So the first thing I did when I went to work is I put my staff on the task of providing a transition book. Even though we hope to be there for eight years, it was important to start from day one with the institutionalization of our office so that it could be passed on to my successor. I served from 2001-2004. And my successor was Melissa Bennett from Andy Card’s office. Basically Andy said to me, he said, privately, it’s either me or you who goes first and it’s not very pretty. So there is no room for screw-ups. There is no room for getting it wrong and you have to get it right, and you have to serve for the right reasons. We served the President of the United States. We were told that our service was an opportunity, not a career. We had a finite existence. The typical tenure of a White House staff person at a senior level is about 18 months. I stayed three years, and I got out. And like Andy, I went up to the President, I said, “It's time for me to go,” he says, “Don’t go,” and I said, “I'm going and I’ll help you in other ways from outside the White House.” But I was at my desk every day at six a.m. and done around nine p.m., and came in on the weekends and didn’t even think twice about it. I couldn’t believe that I was given the honor of even working there. But the institutionalization of the White House, Andy Card had a great idea of how to start. And I had my own ideas, so I listened, Andy took his counsel, and then what I understood is the President has a finite period of time during the day. And we had a rule that was Andy Card’s rule that became my rule, and this was the rule: If you want to see the President, you’ll never see the President. If you need to see the President, you always will. A lot of people want to see the President, but because the President’s finite period of time that he’s available, and the needs of the President, we had to come up with a system, or I had to come up with a system that got the President the people he needed to see when he needed to see them and create an atmosphere by which the President could feel comfortable, and predictable, in his office. I came to talk to the President and asked, “Mr. President, what do you want to see in your daily life? How do you envision your life here at the White House?” He says, “Well, I'm going to come in to the office by seven a.m. every day. And I like to have lunch around noon, and I like to exercise, and I like to go home at six, six-thirty.” So right then I had the parameters of the President. What his day is going to look like. And then we filled in the blanks. There were standing meetings, there was a standard lunch every Wednesday with the Vice President. There were standing meetings with the Secretary of State and Treasury. And then there were pockets of times during the day: domestic policy time, national security time, and others, which were inherently built into the schedule so the President predictably knew from the card I gave him, that he had in his pocket, it’s only about that big, listed, the events of that day. For the President, a lot of the schedule was in his head. The other thing I came up with was a system by which to ask for the President’s time. There are sixteen assistants to the President. Only an assistant to the President can request the President's time. So they had to petition my office on a one-page document. The assistant to the President requests the President’s time for this. “What is it? How much time is it going to

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take? Is there a press component?” And then I could fit it into the schedule and see if it would work. And then, we had an appeals process if it was denied. But none of the other senior staff knew that that request was denied, obviously to save face and everything else, so that was all internalized. The President knew immediately who requested his time. So the President wasn’t calling me and saying, “Why am I meeting with this person?” He knew the accountability was always at the assistant to the President level. The President knew who asked for the time. It was on his briefing papers. It was very clear who asked for the time, why they asked for the time, and it created a responsibility at the highest level of the White House. So, if anybody else wanted to petition for the President’s time, they had to find an assistant to the President and make that sale. Cabinet members who didn’t have standing meetings had to go through Cabinet Affairs to see the President unless it was an emergency, and they could pick up the phone to Andy Card, but there was discipline in the White House, and the discipline was that this is the system. Nobody gets around the system. The system is fair and equitable, and it’s what the President needs to do, when he needs to do it, seeing the people he needs to see. I also was smart enough that if I thought a meeting was something that the President wanted to go overtime because we operated on Bush time. We’re on time all the time. I backed up those meetings to his personal time, so that he knew that if he was taking more time in a meeting, it was his time that he was taking and not eroding into somebody else’s time. So, the predictability in creating a system by which we had a time system, and we had a paper system with a Staff Secretary, it made it very seamless. The other idea I had was from the day we entered the White House, January 20th, 12:01, the President was fully scheduled for 21 days. President asked me, “Why 21 days?” I said, “ ‘Cause 30 is too much.” But here’s why I did it. The world revolves around the President, right? But yet the staff and foreign leaders and other things, they have their own lives to contend with: children, birthday parties. So, what I did was by creating a 21 day window for the President at all times, it created predictability, not only for the President, but for the people who worked for him. The only time the schedule changed is when events changed that were outside our control like 9/11. 9/11, we threw out the schedule, and we didn’t get back to the 21 days for about 30 days, and it was literally minute by minute, hour by hour. But the predictability, and Andy signed onto this immediately, and the President loved it, was the predictability of knowing what we were doing, and then augmenting that with vision, the President’s vision. So, we had a meeting, in addition to scheduling meetings, of course, we had a meeting on vision that happened once a week, and we had a board that was closed in the Deputy Chief of Staff’s Office, and we would look at three months out, and we would determine, what do we want to do in these three months? And very few people, we also compartmentalized information in the White House ‘cause there’s very few people in the White House that have the keys to the kingdom, who know everything. There are people who know what they need to know, and if they don’t need to know, they don’t know it. And so, there are very few people, maybe I could count five in the White House, that really know everything, and then there are people who know what they need to know. The other thing I will say is it’s true that Dick Cheney had carte blanche. His schedule basically was the President’s schedule. He was welcomed in on every meeting when I was there, 2001 to 2004.

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The other thing I found out when I came to the White House was that everything was on paper. So 118 people got the President’s schedule every day. Every time the President’s schedule was changed, even for the most minor change, those schedules had to be collected, destroyed, and reissued. It was ridiculous. It was a waste of man power, a waste of time. So, within the three months I was there, I initiated a computer based system called Time Piece that depending on your clearances, got you further into the system, so the 118 people who got the President’s schedule every day, got the President’s daily schedule. And it was changed, it was erased, a new schedule popped up on their screen. And if you could get further into the schedule, you got the block schedule which was the month schedule. And if you had further clearances, you got the three-month schedule and you got Mrs. Bush’s schedule. So we’re always looking at the President’s time, which is really the coin of the realm for the President in his decision-making process. In addition to the paper, is maximizing the President’s time and also the vision of what the President wants to do and controlling the destiny of the President as much as you can in a world that’s changing. So the access to George Bush when I was in the White House, was clear. And that was, if you needed to see him, you always would and you always did. And the diverse voices within the White House were clear inside and outside the White House. And the system that we created was, again, a system of fairness and equity that people got a fair shake, and the President got to see and hear the necessary voices he needed to hear.

PART IV: POLITICS AND THE PRESS

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 12

THE BIRTH OF A NEW POLITICAL ERA Daryl A. Carter East Tennessee State University1, Johnson City, TN, US

ABSTRACT This essay examines the ways in which the presidency of George W. Bush shifted the United States into a new, more unstable era. Economic changes swept the American landscape as deindustrialization and income inequality roiled the American people. Cultural and racial developments underscored the changing dynamics brought on by economic transformation. Moreover, the peace and contentment of the postwar Cold War era fell as issues of inequality and global upheaval forced Americans to confront uncomfortable truths as to the state of the nation.

It began inauspiciously enough in 2007. As George W. Bush’s presidency solidified its lame duck status, the Democratic Party began its presidential campaign in earnest. New York Senator Hillary Rodham Clinton was the presumptive frontrunner. Former North Carolina Senator John Edwards was also a strong contender. But the most exciting yet seemingly quixotic candidate was first term Illinois Senator Barack Obama. Senator Clinton had been the favorite of many Democrats nationwide. She had even developed the infamous aura of “inevitability” that would do so much to damage her candidacy in the early primary season of 2008. Barack Obama had secretly gained the support of key Democrats in Washington and around the country. Party leaders such as Harry Reid, Charles Schumer, Barbara Boxer, Kent Conrad, Bryon Dorgan, Edward Kennedy, and Illinois Senate colleague Richard Durbin, provided crucial encouragement and support to Obama.2 Political backstabbing and a lack of unity within the Democratic Party was nothing new historically. The Democratic Party had a long history of trying to balance different voting blocs, people and ideas. From Dixiecrats to academics to minority groups to believers in an activist federal government, the Democratic Party was more diverse than its counterparts, the Republican Party. Even after Barack Obama shocked the political world by handily defeating Hillary Clinton in the Iowa caucuses in January 2008, nothing major seemed to be changing

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within the economic, political, or social universes that made up an increasingly complex United States. Moreover, while President Bush’s political fortunes had taken a nosedive, many people believed that it was simply the result of the prolonged and controversial military campaigns in Iraq and Afghanistan.3 Yet everything was changing. Major demographic, political, economic, and cultural trends were about to come into the open. And the consequences of those trends will likely guide American political life for the next generation. There had been warning signs since the first quarter of 2008 that the American economy was slowing down. A booming housing industry, which fed into other sectors of the economy, such as finance, insurance, construction, real estate, and others, led to dangerous financial products and practices. Subprime mortgages, fraud, and individual irresponsibility led to a perilous situation for the United States. As early as March 2008, there were clear signs trouble was ahead. The Federal Reserve was forced to inject more than $30 billion as Bears Stearns, a major investment firm, became “functionally bankrupt.”4 J.P. Morgan assumed what was left of Bear Stearns. The Fed, as it is popularly known, began looking at shoring up other major firms, such as Lehman Brothers, Morgan Stanley, and Goldman Sachs. American bankers and financiers and their counterparts in Europe were also experiencing economic anxiety. Furthermore, new economic data at the Fed showed that the United States had officially been in a recession since December 2007. By the fall of 2008 the gruesome wound on the economic body of the United States would be visible for everyone to see.5 The Republican brand was badly damaged. President Bush and his Cabinet held meetings to discuss the situation and think of ways to limit the damage. By January 2008, the administration had been looking for ways to stave off a recession. Bush sent officials to negotiate with Democratic leaders Nancy Pelosi, Speaker of the House, and Harry Reid, Senate Majority Leader. Despite tax rebates for American families by the end of spring the economy was still heading for collapse. As President Bush noted, “I was wrong. The foundation was weakening, and the house of cards was about to come tumbling down.”6 And with it any Republican hopes to retain the White House. Equally important, the tanking of the economy and the election of the nation’s first African American president unleashed the pent up frustrations of millions of Americans dissatisfied with racial and culture change, financial elites, globalization, years and years of unending war, and growing economic inequality. The presidency of George W. Bush represented the decades worth of anger, dissatisfaction, and resentment toward these monumental changes in the American landscape. This paper explores the ways in which President George W. Bush and his years in the White House finally broke the back of American bliss and complacency which filled the American landscape in the years after the end of the Cold War. The turn away from tawdry scandals and culture wars was swift as matters of national security and economic change sucked up all the political energy. This would be a new era in which the roosters of the previous five and a half decades came to roost. At the beginning of the Bush years in 2001 the United States was anxious and pensive as the years since the end of the Cold War had brought about significant technological and economic change. The Clinton years saw the rise of a strong black middle class. Immigration issues began to cause friction within the American body politic. Supply side economics and federalism were embraced by nearly all Republicans. Many Democrats, including Bill Clinton, accepted key elements of Republican economic orthodoxy. Family values and morality were frequently debated as the scandals of the Clinton era provoked consternation and unease among millions of Americans uncomfortable about a decline in the nation’s morality. Bush promised an ethical administration and strong, moral

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personal conduct. Moreover, President Bush promised that his administration would be stronger in foreign policy than his predecessor, restoring trust and honor to the United States. Finally, the president was determined to unleash the awesome powers of the marketplace to improve the lives of millions of Americans supposedly suffering under the boot of a government that was too involved in their lives. But the Bush years came to symbolize a nation at war with itself as technology, economics, race, culture, foreign threats and partisanship grew to dangerous levels. Consequently, the United States became unhinged as the distance, between blacks and whites, the affluent and the poor, coastal residents and Southern and heartland dwellers, increased exponentially, leading to political instability.

ECONOMIC TRANSFORMATION Since 1969, America had been engaged in deindustrialization. Industrial America, with its large workforce, powerful labor unions, and sizable political influence, shifted as new technologies and finance spurred new technological advancements that allowed manufacturers to make products faster and cheaper than ever before. With these innovations it was no longer necessary to employ as many people. Moreover, as the Third World matured, corporations and companies increasingly looked to outsource manufacturing to countries with fewer labor laws, cheaper workers, and few, if any, meaningful regulations regarding the environment. Consequently, American employers laid off workers and indirect beneficiaries of major industries, such as automotive, also lost their jobs. Cities around the country suffered as a result. In Boston, Philadelphia, Pittsburgh, Cleveland, Dayton, Toledo, Detroit, Chicago, Kansas City, Los Angeles, New York, Milwaukee, and many other locales, especially in the so-called Rust Belt, declined as a result. As the economy changed so did the nation’s politics.

RAPIDITY OF CHANGE The rapidity of economic change was frightening as millions grappled with an increasingly complex economic environment in which security looked more and more like something of the past. These trends coincided with the rise of the Sunbelt. As early as the 1930s Americans and businesses began relocating to the South and Southwest. The combination of cheap land, World War II, the Cold War, movement of high tech firms, often with strong ties to the federal government and its armed forces, proved lucrative and dynamic. Earlier arrangements between labor and management were unsettled by these new developments as management gained more financial and political influence. Equally important, decades of political activism by Republicans, Libertarians, and Conservatives, was reshaping the political landscape. Organizations, such as the U.S. Chamber of Commerce and its’ state level affiliates, began distributing educational materials to schools that promoted the free market and free enterprise. Corporations and wealthy individuals gave tens of millions to educate young people and support academic programs sympathetic to conservative ideas at colleges and universities around the country.7 The actions and activities of these organizations and individuals led to backlash among voters towards the perceived liberal excesses of the 1960s.8 By the late 1980s, public distrust of

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liberal solutions had skyrocketed. And with it George W. Bush became increasingly aligned with New Right politics.

ECONOMICS AND TECHNOLOGY In the 1990s, the internet and computerization more drastically changed how Americans lived and worked. Silicon Valley produced a product that allowed human beings to streamline communications, commerce, and manufacturing. As a result many people became millionaires as Microsoft, Apple, and older stalwarts such as IBM created new, faster ways in which to make money. Also, the North American Free Trade Agreement accelerated these economic dynamics as companies in India, Mexico, Vietnam, China, Korea, and companies in other countries partnered with American corporations to mass produce products for American and Western consumption. George W. Bush believed wholeheartedly in the economic transformation underway. Bush was a businessman from a long line of businessmen who felt that it was imperative to fully unleash the power of the marketplace. And government would be used to do just that. As governor of Texas, Bush promoted the ideas of supply-side economics, free enterprise, and the free market. James Patterson, the noted historian, has pointed out that “There was little doubt in 2000 where Bush stood on fiscal issues: strongly in step with Republican activists, who since the late 1970s had begun demanding large-scale tax cuts.”9 It was a central element of his campaign against Vice President Al Gore in 2000. And he was aided by the Clinton Administration’s deft handling of the economy from 1993 to 2001.10 Due to the strong economy Bush’s advisers, not to mention many conservatives around the country, urged him to pursue tax cuts and return money back to the people.

A NEW PUSH FOR REPUBLICAN DOMINANCE: TAXES Shortly after the United States Supreme Court stopped the recount in Florida, effectively handing Bush the presidency, Bush moved aggressively to secure congressional approval for his economic policies. The Congressional Budget Office projected in January 2001 that the government would have $5.6 trillion in baseline surpluses from 2002-2011.11 The administration informed the Congress and the public that a projected $125 billion dollar surplus for fiscal year 2001 existed. Despite strong opposition from Democrats the Congress passed the Economic Growth and Tax Relief Reconciliation Act of 2001.12 In a signing ceremony in the East Wing of the White House President Bush remarked, “Tax relief expands individual freedom. The money we return, or don’t take in the first place, can be saved for a child’s education, spent on family needs, invested in a home or in a business or a mutual fund or used to reduce personal debt…The surplus is the people’s money, and we ought to trust them with their own money.”13 The legislation reduced tax rates for those paying income taxes, created a new 10 percent tax bracket, doubled the child tax credit to $1,000 by 2010, reduced the so-called marriage penalty, gave greater education incentives through tax deductions, and increased limits on retirement savings vehicles such as IRAs and 401(k)s.14 By targeting middle class and well-to-do voters Bush ensured political support for his

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administration as well as his economic policies. Shortly after the president’s signing ceremony, the government mailed out checks in the amounts of $300 and $600, respectively, to American taxpayers. Bush’s conservative instincts to cut taxes were also good politics. Historically it has been politically difficult to end a tax cut, once implemented for both political parties. Moreover, the public often has a tough time understanding that tax cuts are a form of public spending because it deprives the federal government of revenue needed to fund programs, returns money to the states, and pays for military and national security operations. Americans simply saw money not going to the government and, in a conservative mood to not contribute further government spending and debt, strongly supported President Bush’s first major legislative accomplishment. But the consequences of this tax cut and future government spending would help lead to the Great Recession of 2007-2009. The president’s tax cutting, however, was not over. Less than two years later President Bush once again pushed hard for a new round of tax cuts. Due to a weak economic outlook Bush asked Congress to double down on the 2001 tax cuts to help strengthen the economy. In January 2003, the Bush Administration rolled out a massive tax plan to cut hundreds of billions of dollars in taxes on American earners. “Administration officials produced statistics to show that the tax cuts would benefit millions of middle-income workers. Ari Fleischer, the White House spokesman, said that the plan would provide 92 million taxpayers with an average tax cut of $1,083 this year and that a family of four with $39,000 in earnings could save about $1,100.”15 The central idea behind the tax cuts was to strengthen the economy after the dot.com bust, September 11th, and weak economic growth. Bush’s proposal promised more than $660 billion in tax cuts that would help America’s families and workers. Moreover, the 2003 tax cut was yet another way in which to limit the ability of government to spend money and jumpstart the free market. With the president and the Republican Party firmly in control of Congress and the White House, with strong public support for its major policies, even if some of them were controversial, allowed for a smoother process than the tax cuts of 2001. In addition, PAYGO or “pay-asyou-go,” a budget rule dating back to the Budget Enforcement Act of 1990, which demanded that Congress and the president cut spending in entitlement programs and tax cuts be paid for with spending cuts and/or revenue increases, expired in 2002 and Congress did not renew it. The combination of PAYGO, Clinton tax policies, and the economic boom of the 1990s helped to improve most Americans’ economic future. It also improved the government’s balance sheets as revenue and spending cuts shored up the government’s public debt and budget deficit outlook.16 Without the constraints of PAYGO there was nothing to stop the Administration and its allies in Congress from passing the legislation. In May, Congress passed the Jobs and Growth Tax Relief Reconciliation Act of 2003.17 President Bush signed JGGTRA into law in the East Room of the White House. As Bush noted, “That’s what America’s all about, providing opportunity. The bill I’m going to sign provides opportunity for millions of Americans across this country. And the more opportunity there is, the more likely it is somebody is going to find work in this country.”18 The theme of “tax relief” was important to the president. The new law would reduce the top tax rate on dividends and capital gains to fifteen percent, further reduce tax rate reductions, expand the ten percent tax bracket, increase the child tax credit to $1,000, reduce the so-called marriage penalty, and increase bonus depreciation for businesses to fifty percent through 2004.19 What is noteworthy here is that President Bush was pushing a second tax cut at the same time he

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was prosecuting a war in Afghanistan and leading the United States into a second war in Iraq, which began in March 2003. Previously, Washington had raised taxes to pay for war activities. This time Bush was banking on an idea that did so much to destroy President Lyndon Johnson’s presidency: America could have guns and butter. And there would be more spending.

HEALTH CARE The Republican Party historically was not supportive of providing health insurance and medical care. The GOP mocked Medicare when it was proposed in the early 1960s. Before that the GOP labeled any attempt by Democrats to enact legislation as a power grab designed to bring “socialized medicine” to the United States. Their firm belief in the power of the free market and sincere concern over costs made passage of any legislation fraught with political risks. In a brief liberal moment between 1963 and 1966 President Lyndon Johnson secured passage of the Great Society, which included the passage of the Social Security Act Amendments of 1965.20 Ronald Reagan, the icon of conservative Republicanism, was famously against Medicare as dangerous and “socialized medicine.” The American Medical Association (AMA) and its doctors were against the plan. They had serious ideological arguments against the plan, but were also concerned with how the plan might hurt their pocketbooks. Elderly Americans often lacked even basic health care. Johnson understood that it was important, for both humanitarian and political reasons, to deliver some health security to these Americans. As historian Randall Woods has noted, “LBJ was innately empathetic with the afflicted particular those who were dependent. Memories of his paralyzed and wheelchair-ridden grandmother who had had to live with him and his family still haunted him. More than this, however, LBJ wanted to define health care—like education, a healthy diet and adequate shelter—as a basic right.”21 The Social Security Amendments of 1965 made substantial changes to the Social Security system, including the following: establishment of a national health insurance program for the aged, establishment of a national health insurance program for the poor and needy, including those with disabilities, and grants for health care for children.22 Upon signing the landmark legislation into law in July 1965, LBJ remarked, “There is another tradition that we share today. It calls upon us to never to be indifferent toward despair. It commands us never to turn away from helplessness. It directs us never to ignore or to spurn those who suffer untended in a land that is bursting with abundance.”23 Consequently, Medicare became a third rail of American politics. Since Medicare was an earned benefit—American workers and employers contributed to the trust funds either every pay period or through quarterly taxes—most Americans liked the plan. Workers knew that when they retired Medicare would replace the private insurance offered through their employers. Moreover, workers could supplement their Medicare coverage with private insurance to cover remaining costs. As a result many Americans were able to live longer and with more dignity. In fact, most Americans saw Medicare more as an earned entitlement than a government program designed to help the poor and irresponsible.24 Those receiving Medicaid—the twin brother program for the poor and disabled—however, has been more controversial.

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OWNERSHIP President Bush promoted heavily, from the beginning of his presidency, the idea of an “ownership society.” To Bush this meant that Americans should have the opportunity to participate in purchasing goods such as insurance, homes, education, etc. One of the most important policy developments was the creation of the Health Saving Accounts (HSA). The plan allowed for workers to put money aside in private accounts for the purposes of health care needs. Workers could put their money into these accounts just like they put money in accounts for retirement, such as Individual Retirement Accounts (IRA), 401(k)s, 403 (b)s, and Roth IRAs. Further, these accounts could be transferred to new jobs and had nice tax incentives. It was a way to drive consumers of health care into the private market while undermining traditional government programs such as Social Security and Medicare. The unqualified belief in the marketplace led to policy decisions which directed Americans to the private sector for their health care, education, and consumer needs instead of the state and federal governments.25 Realizing that the health care and insurance situation in the United States was getting worse, Republicans, led by the president, supported this new plan hoping to prevent a groundswell of public demand for health insurance run by the government.26 In addition, the president also put forward pharmaceuticals in the bill. Drugs had not been part of the original Medicare law; therefore, it was important to both political parties to improve Medicare by including a program to address that deficiency. Republicans created what was called “Part D.” All participants had to buy their prescription drugs from private companies through various plans created by the law. Equally important, while this created a new government program, it did not allow for the federal government to lower prices by buying drugs in bulk or negotiating with pharmaceutical companies, a key set of criticisms Democrats made against the law. Increasingly, President Bush and mainstream conservatives found themselves at odds with a loose-knit group of Americans who eventually became known as the Tea Party. A new government program with expensive new entitlements meant that the Grand Old Party was accepting a key piece of liberal orthodoxy: activist government. On December 8, 2003, President Bush signed the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 into law.27 He said at Constitution Hall, “The challenges facing seniors on Medicare were apparent for many years, and those years passed with much debate and a lot of politics and little reform to show for it... This year we met our challenge with focus and perseverance.”28 There is no doubt that it was a landmark achievement for President and his Administration. But it was also a watershed moment for American politics as it became clearer than ever before that the Grand Old Party had accepted a central tenet of American liberalism: activist government. Noted political historian Julian Zelizer has made clear Republicans have become supporters of big government as long as they control the reins. Zelizer said, “Recent events have confirmed how conservatism and presidential power have become intertwined since the 1970s…The relationship is more than the Left, has been a much more vociferous champion of an all-powerful White House.”29 Bush’s acceptance of big government, even if to promote the private sector, angered conservatives. Some distanced themselves away from Bush Administration priorities and legislative plans. Other complained bitterly at the expansion of both power and spending by the president and his allies in Congress. Using their power to push a conservative agenda

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oriented toward the private sector appeared contradictory. Yet it was this push that did so much to help lay the groundwork for the dramatic shift in the American body politic and political environment, one which the nation is still grappling with today. But economics and esoteric debates about the size of government and presidential power were not the only major events happening during the Bush era. Other actions, events, and discussions would, in part, lead to the election of the first black president, the rise of the Tea Party Movement, and the most conservative Congress in nearly a hundred years. Further, Bush’s actions on domestic policy matters and the conduct of the wars in Iraq and Afghanistan would allow individuals previously relegated to the sidelines of American politics to emerge at the forefront.

MINORITIES RISING A major development of the new century was the growth and influence of minorities in the United States, especially African Americans and Latinos. When Congress passed and President Lyndon Johnson signed into law the Civil Rights Act of 1964, it was a watershed moment for African Americans. The law banned segregation in public accommodations, prohibited sex discrimination and broke the back of Jim Crow in the American South.30 It was the first major piece of civil rights legislation to pass the Congress since the Civil Rights Act of 1875, nearly one hundred years before.31 The very next year, after “Bloody Sunday” in Selma, Alabama, Congress passed the Voting Rights Act of 1965.32 Within a few short years African Americans in the South and other places were registering to vote in record numbers. Consequently, African Americans were able to not only participate in the political process, but become part of the political process as numerous African Americans were elected to offices around the United States. By the early 1980s, the new laws themselves appeared sacrosanct as more and more Americans rallied around the landmark bills that ended American apartheid. Even though many Americans rejected civil rights, and the accompanying legislation that came with it, others celebrated it. This included many conservatives who were appalled by the lack of opportunity, denial of basic constitutional rights, and costs to the state and federal governments in maintaining such a system. George W. Bush was one of those conservatives. He did not like interference into the private sector but recognized the need for the federal government. In addition, Bush was, like countless others then and now, a supporter of the idea of colorblindness. The Rev. Dr. Martin Luther King, Jr. preached often about judging people on the content of their character, not the color of their skin. Conservatives, liberals, libertarians, and others soon adopted colorblind language. It made it easier and less contentious than the racially overt language used in the past. Plus, colorblind language also prevented people from being labeled racist for their ideas. For instance, one could say that government should not provide welfare because the poor should be more responsible and develop a stronger work ethic. Since welfare was code for black racially charged language did not need to be used. This statement is benign but also carries a dog whistle as many could interpret it as saying African Americans are lazy and should simply take care of themselves. Lee Atwater, the infamous former chairman of the Republican National Committee and head of George H.W. Bush’s 1988 campaign, once remarked famously:

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You start out in 1954 by saying, ‘Nigger, nigger, nigger,’ By 1968, you can’t say ‘nigger’—that hurts you. Backfires. So you say stuff like forced busing, states’ rights, and all that stuff. You’re getting so abstract now [that] you’re talking about cutting taxes, and all these things you’re talking about are totally economic things, and a byproduct of them is [that] blacks get hurt worse than whites.33

In fact, as the Democratic Party became the political home of African Americans, more and more white Americans, who were racially conservative and/or hostile to African Americans and other minorities, became supporters of the Republican Party. Richard Nixon openly courted angry whites. Ronald Reagan made clear his sympathies for the South. Many southern politicians switched from the Democratic Party to the Republican Party. By the 1990s, the GOP was less diverse than ever before during the modern era. George Bush, however, remained a member of the mainstream of the GOP. He also saw that minorities were a potential voting bloc for the Republican Party. During his administration he would make inroads with some African Americans. But he would also anger many others as he appeared tone deaf to events such as Hurricane Katrina. Bush especially became interested in the growing Latino community, which was changing the political culture in Texas and other areas of the country. Since Lyndon Johnson signed into law the Hart-Cellar Act in 1965 Latinos had steady grown in size and power.34 Major cities, such as Los Angeles, San Diego, Las Vegas, Phoenix, Dallas, San Antonio, Austin, and many other locales, watched as their respective populations grew due to immigration, both legal and illegal. As those populations grew so did conservative angst as nativist fears of a diverse melting pot became more pronounced. This was nothing new; in the last two decades of the 19th century and the first three decades of the 20th century, many Americans protested immigration, or designed legislation and ordinances to limit and/or curtail the rights of immigrants and their families. At its worst, terrorist organizations, such as the Ku Klux Klan, targeted immigrants for violence and intimidation. Progressive and liberal groups also got in on the act as reformers, such as Margaret Sanger, pushed for birth control and, later, abortion rights so at to limit the number of immigrant children and so-called undesirables born in this country. Beginning in the 1960s, Democrats saw immigration as a humanitarian issue, one to be dealt with in the fairest way possible for those newcomers to America. President Ronald Reagan was even forced to deal with the issue in 1986. During his governorship Bush made inroads with the Latino community in Texas. As president Bush tried mightily to make the Republican Party open to Latinos. Latinos had many things in common with the Republican Party. Both groups were culturally and socially conservative. Moreover, Latinos were very much tied to the Church. While their association with the Catholic Church separated them from the Baptists, especially Southern Baptists, organizations that were a key element in the southern-based Republican Party, they were tied to Jesus Christ, God, and morally conservative outlooks and behavior. Furthermore, both groups believed in free enterprise, hard work, and self-reliance. There were some differences in terms of policy, none more so than immigration policy. Millions of Latinos from Mexico, Cuba, El Salvador, Belize, Guatemala, and South America, had been traveling to the United States in search of economic opportunity and a better life. While immigrants typically did not enjoy voting rights, their children, born in the United States, were American citizens, with all the rights guaranteed by the U.S. Constitution. In an era of deindustrialization and globalization, economic competition for jobs created resentment

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among many American workers. Big corporations wanted the cheap labor. Small firms wanted cheap labor. But allowing a so-called “broken system” of immigration to continue would serve only to encourage abuse of workers in plants, factories, and fields. Bush decided to act and in doing so further strained the social fabric of the country. Lastly, his partnership with key members of Congress, such as Senator Edward M. Kennedy, D-Massachusetts, created schisms within the Republican Party that would be laid bare in just a few short years. One of the most contentious issues facing immigration reform was whether immigrants who came to the United States illegally should be allowed to stay here. Further, should those human beings be allowed access to a path to citizenship? Bush’s efforts to improve the Republican Party’s appeal to Latinos took a devastating hit in 2005 when his poll numbers fell and House Republicans, sensing that the president was losing power passed a harsh immigration bill which would have made illegal immigration a felony. Any real effort to move immigration reform forward was gone by 2007. With Democrats in control of the House and Senate and conservative Republicans bucking the president’s leadership, little success was to be found by President Bush.35 The increasing distance between President Bush and his party led to millions of Latinos moving to the Democratic Party. Demographic changes were linked to economic transformation. As African Americans, Latinos, and Asian Americans grew in strength so did the opposition to them in American society. What was once an understood privilege for white Americans where whites were the first admitted, first hired, and last fired, gradually disappeared as the law and multiculturalism dictated greater freedom and competition. Opposition often manifested itself in lawsuits against affirmative action, absurd complaints of reverse racism, and campaigns with often ugly undertones to mandate English as the national language and get-tough policies on immigration. The election of President Barack Obama demonstrated how racial and cultural animus was very much a part of contemporary America. The Great Recession and shrinking proverbial economic pie strained the fabric of the United States in ways not seen since the height of the 1960s.

CONCLUSION The presidency of George W. Bush was a historic one. President Bush’s decision to implement two huge tax cuts, without corresponding spending cuts, and a major expansion of the Medicare program led to huge public debts and budget deficits. In addition, the president’s effort to reform the so-called broken education system in the United States—In 2001 President Bush and Senator Edward M. Kennedy worked together to pass into law the No Child Left Behind Act—created federal mandates that arguably have done little to help the overall prospects of America’s youth, especially African Americans and Latinos. The rising tensions within American society—cultural, racial, economic, political, and international—of the last forty years boiled over during the Bush presidency and exploded during the Obama years. Barack Obama’s election as the 44th president of the United States was a watershed moment for the country. An African American in the White House was so unexpected and unnerving that Americans are still trying to get a hold on its meaning. Even without the collapse of the markets and the two wars, Obama’s election, in hindsight, appeared more

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likely than previously thought. The economic, political, and social tectonic plates were shifting. While there is no doubt that President Obama benefitted tremendously from the Great Recession and the perceived failures of the Bush years, those forces were already in motion years before. The importance of the Bush Presidency was that it unleashed those forces. It created a new political order in which partisanship became extreme. A new political order of extremists exists within the Republican Party that has forced conservatives like House Speaker John Boehner and Senate Majority Leader Mitch McConnell to at least rhetorically accept the harsh demands of a far right group of activists and politicians. We saw this with the numerous debt ceiling, appropriations, and sequestration debates and actions. Now the Democratic Party is shedding its centrist wing, which not that long ago dominated the party. The use of technology to create separate groups of like-minded people and the rapidity of change has created an unstable political environment. President Bush ushered the United States into a new political era which will last for at least a generation. And in the years to come, I predict, many political historians, such as myself, and commentators will note that the Bush Presidency was historic for more than just military adventurism, compassionate conservatism, or the Great Recession. It was historic because it completely broke the back of not only the postwar world and the interwar years between 1991 and 2001, it completed the political, social, and economic transformation that began in the 1960s.

ENDNOTES 1

It is with immense gratitude that I acknowledge the support of the East Tennessee State University Office of Research and Sponsored Programs, and Vice Provost William R. Duncan, for major financial support that allowed me to write this paper, travel to Hofstra University, and present my work to the George W. Bush Presidency Conference. 2 John Heilemann and Mark Halperin, Game Change: Obama and the Clintons, McCain and Palin, and the Race of a Lifetime (New York: Harper, 2010), 37. 3 Many journalists and pundits, such as Chris Matthews, Lawrence O’Donnell, Bob Herbert, Tim Russell, and others, believed that President Bush’s controversial decisions to the declare war on Iraqi leader Saddam Hussein in 2003 had badly damaged the Republican brand. Furthermore, the creation of new government entities, massive tax cuts, and increased government spending, which put huge strains on the Department of the Treasury and, consequently, left many holes in the general welfare unfilled, created a tremendous opening for Democrats as they moved to win back the White House. 4 Nell Irwin, The Alchemists: Three Central Bankers and A World on Fire (New York: The Penguin Press, 2013), 133. 5 Irwin, The Alchemists, 132-134. 6 George W. Bush, Decision Points (New York: Crown Publishers, 2010), 452. 7 Kim Phillips-Fein, Invisible Hands: The Businessmen’s Crusade Against The New Deal (New York: W.W. Norton, 2009), 204-205. 8 Millions of Americans became bitterly dissatisfied as the Civil Rights Movement, Environmentalism, Women’s Rights, and other liberal individuals, politicians, and policymakers, changed the United States in ways both small and profound. Conservative activists somewhat manufactured and seized upon those Americans’ unhappiness both promoting conservative solutions to matters of public policy. 9 James Patterson, The Presidency of George W. Bush: A First Historical Assessment, ed. Julian Zelizer (Princeton: Princeton University Press, 2010) 114. 10 President Bill Clinton and his Administration moved aggressively during the 1990s to shore up the weak economy inherited from President George H.W. Bush in 1993. Moreover, Clinton raised taxes in 1993 and moved quickly to reduce federal debt and the federal deficit. In fact, President Clinton negotiated and signed into the law the Balanced Budget Act of 1997, which helped to eliminate the budget deficit and give tax relief to working and middle class families. According to the U.S. Department of the Treasury, the public debt was a little more than $5,674,178,209,886.86 when Bush became president in 2001. When Bush left office in 2009 the public debt was a little more than $10,024,724,896,912.49. The Office of Management and Budget notes

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that federal budget had a surplus of $236,241 (in millions) in 2000. In 2009, the federal budget had a deficit of $1,412,688 (in millions) in 2009. A combination of war spending, new federal programs, and major tax cuts in 2001 and 2003, contributed to the federal government’s ever increasing debt under President George W. Bush. 11 US Congress, Congressional Budget Office, 2012. “Changes in CBO’s Baseline Projections Since January 2001.” June 7, 2012. Accessed February 1, 2015, http://www.cbo.gov/sites/ default/files/06-07ChangesSince2001Baseline.pdf. 12 Economic Growth and Tax Relief Reconciliation Act of 2001. Public Law 107-16. 107th Congress. 115 STAT. 38. June 7, 2001. 13 President George W. Bush, “Remarks on Signing the Economic Growth and Tax Relief Reconciliation Act of 2001,” June 7, 2001, Public Papers of the Presidents, 2001, 622. 14 “President Bush Helped Americans Through Tax Relief: President Bush Trusted Americans With Their HardEarned Money, Providing $1.7 Trillion in Relief Through 2008.” Accessed February 1, 2015, http://www.georgewbush-whitehouse.archives.gov/infocus/ bushrecord/factsheets/taxrelief.html. 15 Edmund L. Andrews, “Bush and The Economy: The Overview; White House Aides Launch A Defense of Bush Tax Plan,” The New York Times, January 7, 2003, Accessed February 1, 2015, http://nytimes.com/2003/01/07/us/bush-economy-overview-white-house-aides-launch-defense-bush-taxplan.html. 16 Budget Enforcement Act of 1990. 101st Congress. 17 Jobs and Growth Tax Relief Reconciliation Act of 2003. 108th Congress. 18 President George W. Bush, “Remarks on Signing the Jobs and Growth Tax Relief Reconciliation Act of 2003,” May 28, 2003, Public Papers of the Presidents, 2003, 547. 19 “President Bush Helped Americans Through Tax Relief: President Bush Trusted Americans With Their HardEarned Money, Providing $1.7 Trillion in Relief Through 2008.” Accessed February 1, 2015, http://www.georgewbush-whitehouse.archives.gov/infocus/ bushrecord/factsheets/taxrelief.html. 20 Social Security Act Amendments of 1965. 89th Congress. Public Law 89-97. 21 Randall Woods, LBJ: Architect of American Ambition (New York: Free Press, 2006), 569. 22 Wilbur J. Cohen and Robert M. Ball, “Social Security Amendments of 1965: Summary and Legislative History,” Social Security Bulletin, September 1965, 3. 23 President Lyndon B. Johnson, Remarks with President Truman at signing in Independence of the Medicare Bill, July 30, 1965. Accessed February 2, 2015, http://www.presidency. ucsb.edu/ws/?pid=27123. 24 During the debate over the Affordable Care and Patient Protection Act of 2010 some conservative opposition in the grassroots mistakenly demanded that the Obama Administration and Congress “keep your government hands off my Medicare.” 25 Nelson Lichetenstein, “Ideology and Interest on The Social Policy Home Front,” in The Presidency of George W. Bush: A First Historical Assessment, ed. Julian Zelizer (Princeton: Princeton University Press, 2010), 185. 26 Lichetenstein, “Ideology and Interest on The Social Policy Home Front,” 186. 27 Medicare Prescription Drug, Improvement, and Modernization Act of 2003, 108th Congress. Public Law 108173. 28 President George W. Bush, “Statements on Signing the Medicare Prescription Drug, Improvement, and Modernization Act of 2003,” December 8, 2003 Public Papers of the Presidents, 2003, 1698. 29 Julian Zelizer, “How Conservatives Learned to Stop Worrying and Love Presidential Power,” in The Presidency of George W. Bush: A First Historical Assessment, ed. Julian Zelizer (Princeton University Press, 2010), 37. 30 Civil Rights Act of 1964, 88th Congress, Public Law 88-352. 31 Civil Rights Act of 1875, 43rd Congress, 18 STAT. 335. 32 Voting Rights Act of 1965, 89th Congress, Public Law 89-110. 33 Bob Herbert, “The Ugly Side of the G.O.P.,” The New York Times, September 25, 2007, Accessed February 2, 2015, http://www.nytimes.com/2007/09/25/opinion/25herbert. html?_r=0. 34 Immigration and Nationality Act of 1965, 89th Congress, Public Law 89-236. 35 Gary Gerstle, “Minorities, Multiculturalism, And The Presidency of George W. Bush,” in The Presidency of George W. Bush: A First Historical Assessment, ed. Julian Zelizer (Princeton: Princeton University Press, 2010), 274-275.

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 13

A C STUDENT IN THE WHITE HOUSE: CONSERVATIVES AND THEIR REPORT CARDS ON THE GEORGE W. BUSH PRESIDENCY Christopher Hickman Tarleton State University, Stephenville, Texas

ABSTRACT The presidency of George W. Bush (2001-2009) became a contested one. The administration’s critics did not just count themselves as liberals. American conservatives also contributed to the criticisms of the administration. The “compassionate conservatism” of Bush’s 2000 campaign, let alone the other variants on modern conservatism to reside in the Bush White House, seemed to have expired even before the inauguration of Barack Obama in January 2009. Part of that expiration involved how his presidency, particularly on matters of domestic policy and priorities, had let down and often divided conservatives. Conservatives and their discontent with Republican presidents is nothing new. Indeed, since Dwight Eisenhower’s presidency (1953-1961), American conservatives have snipped at, if not openly revolted against, various presidential administrations. Bush’s presidential tenure, however, revealed not only the continued volatility of American conservatism but also the difficulty any Republican White House encounters, particularly as it governs in the lengthened, though often ahistoric shadow, of the Ronald Reagan presidency.

*** The 2008 Republican National Convention exhibited the standard fare. Convention attendees pinned buttons to their lapels and clothing. Expected messages arrived with those buttons. Some censured the Democratic Party and the recently nominated Barack Obama; others simply championed the John McCain-Sarah Palin ticket. Above eye level, banners at the Excel Center in St. Paul, Minnesota recognized a fresh Republican Party demographic that featured “hockey moms for Palin.” Decisively low-tech buttons and banners featured alongside the contemporary visuals that sought to link the party to a celebratory, cohesive

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past of GOP greats. High-definition video displayed Theodore Roosevelt and Ronald Reagan as reminders of such a past - never mind the developments that had defined (and re-defined) the Republican Party since Roosevelt’s finals days in the White House just over a century before. Be that as it may, to expect the complications of the past to intrude upon a convention would be to ask a lot of either major American political party. Even so, the symbols and paraphernalia revealed a political party that had plenty of current complications before it. In St. Paul a few scattered buttons said “Thanks W!” These examples did not carry the visage of George W. Bush; they did, however, feature Chief Justice John Roberts and Associate Justice Samuel Alito. While the permanence of those two appointments to the Supreme Court will likely remain an entry in future efforts to settle the accounts of the Bush administration, solid and generally agreed upon conservative entries seemed more difficult to identify in September 2008. On the whole, the Roberts and Alito appointments earned the sitting president passing grades from conservatives. The 43rd president’s other contributions, however, had left many conservatives likely pleased that the president had not made the trip to Minnesota.1 He did appear via video. And Senator McCain, in his acceptance speech, made sure to laud the 43rd president for keeping the country safe in the years after 9-11. But Bush’s physical absence served as telling evidence of the perceptions of his presidency, even the perceptions of his erstwhile supporters. Many of the persons, publications and politicians who busied themselves attempting to define the American conservative brand had tired of the Bush presidency. Bush and much of his administration’s record had run afoul of the expectations put upon it. Those expectations certainly involved the back and forth about public policy; they also linked up to how influential conservatives, even before the Bush tenure, have often sought out versions of the American past that have made it almost impossible for occupants of the White House to the right things to please all conservatives. Most prominently, this has connected to Ronald Reagan and a cultivated legacy of that pivotal political figure. The putative perfection of the Reagan years has made it nearly impossible for the Republican Party and that party’s recent father and son occupants of the White House to earn anything near lasting acclaim. This collective paean to Reagan serves also as an anachronistic lodestar, making it difficult for his forbearers to earn inclusion in the conservative ranks no less than his successors. Since the beginnings of their restoration project amidst the post-Second World War era and later clearer identification with the Republican Party, American conservatives have experienced a near habitual disappointment with insufficiently conservative presidents and candidates for the office. Reagan’s reputation with later generations all but ensures that his predecessors do not measure up, which further validates the original disappointments with these GOP presidents. Influential members of the tribe felt unease about Dwight Eisenhower, who seemed a beneficiary but not a steward of the growing movement. Richard Nixon, even before his transgressions that led to his resignation, turned from their policy goals, enough so that key conservative intellectuals chose to withdraw their support for Nixon even before his 1972 re-election campaign.2 Gerald Ford had the impossible burden of inheriting the White House after Nixon and Lyndon Johnson, but the Reagan primary challenge to Ford in 1976 tells us much about not just that period in American history but perennial unease on the Right. George W. Bush became just the most recent Republican occupant of the White House to fail to live up to near impossible expectations. The orthodox wisdom then of the later George W. Bush presidency sounded off about conservatism in trouble.3 Books such as David Frum’s Comeback: Conservatism That Can

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Win Again (2007) recognized these troubles as something the Republican Party had to overcome if it hoped to remain a party in power.4 And by the time of that 2008 Republican Convention, Congress had been under control of the Democratic Party for 1 ½ years, the economy had slipped into a recession, and the troop surge in Iraq had produced results but hardly those that allowed the administration to boast of a clearly stable Iraq. American troop presence in Iraq had peaked less than a year before, but American public opinion had long since turned against the war -- or at least come to think it a war not worth fighting. Bush’s physical appearance at the GOP convention would have reminded attendees and nonattendees alike of a presidency in tatters. A Bush visit to St. Paul would also remind conservatives that one of their own had let them down. Election results have a way of helping to accentuate (or minimize) allegiance to higher principles. They can quickly lead to upset partisans who easily misplace both recent electoral triumphs and pleasing political and policy developments. One prominent declension narrative thus relies upon the 2006 mid-term losses for the Republicans as a both evidence and conclusion. (The Democratic Party following those election results came to control both houses of Congress, doing so for the first time since the start of the 104th Congress, which had been the result of the mid-term elections in 1994 that had made Newt Gingrich (R-GA) a household name.) As historian David Greenberg put it after the mid-term results from 2006, the second-guessing and abandonment of Bush was not because the president “is an imperfect conservative. It’s that he’s an unsuccessful one.”5 The unsuccessful Bush White House still too easily gets bound up in November vote tallies. Positioning electoral losses as the sine qua non of Bush’s fading reputation with conservatives merits further scrutiny. Indeed, his tenure had been troubling for many conservatives before those November 2006 election setbacks. *** The mantra of “compassionate conservatism” from the campaign trail in 1999 and 2000 represents one place to begin. The slogan scarcely provided clear policy direction once the five determinative votes had been cast in Bush v. Gore (2000). Updating conservatism, after all, offers as much risk as reward. Arguably, the most prominent area of early White House led policy arrived with the program that worked around the perennially supple wall that is supposed to separate Church and State. The Bush administration promoted a White House Office of Faith-Based and Community Initiatives (OFBCI).6 It exemplified the Bush update to conservatism. OFBCI also fizzled. The program had seemed a safe bargain, particularly because of its emphasis on allowing sectarian organizations to compete for federal dollars for supposedly non-sectarian policy ends. Yet, any monies that would flow to sectarian social helpers hardly seemed a vindication of the administration’s conservative contributions, let alone evidence that “compassionate conservatism” could put a genuine new face on the conservative weltanschauung that often has endorsed a non-intervention in most social affairs and a miserly guardianship of the public purse. Criticism directed at the OFBCI arrived from the usual suspects such as the American Civil Liberties Union and Americans United for Separation of Church and State. Expected criticism met with even more newsworthy examples from within the policy effort. The onetime deputy director of the OFBCI, J. David Kuo, not only left his position in 2003 but also took to criticizing the administration for its insufficient interest in supporting the program.7

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Kuo’s criticisms were, in large part, a result of his relative political inexperience. How things work (and do not work) in Washington, D.C. is not for everyone. What is harder to shrug off is that the OFBCI, evaluated with even meager historical perspective, hardly made the Bush White House appear an innovative center of operations in the effort to ensure that the faithful exercised novel public policy influence. The program had precursors of sorts during the William Jefferson Clinton presidency. And another Democrat’s community organizing, the evils of Chicago politics, and the helping ethic of liberalism that supposedly privileged secular agents, hardly persuaded President Barack Obama to dismantle the program. In fact, in 2013 the Obama administration took the program international in appointing Shaun Casey as a special representative for Faith-Based and Community Initiatives at the State Department. Because of a mild consensus endorsing faith-based programs as worthy conduits for federal funds, funneling Bush era monies to these religious organizations, even if those organizations had staff and supporters who put faith in faithhealing or owned well-worn copies of Tim LaHaye and Jerry Jenkins’ Left Behind series, came up short as the saving grace for an administration that sought to appease, in particular, moral, Christian conservatives. It seemed insufficient even in Bush’s first term; the program has not seen its reputation improve in the years since. “Compassionate conservatism” let supporters down on other fronts. It seemed a gimmick, at best a rhetorical relic of the initial Bush presidential campaign.8 At least early on, however, Bush and his party lived up to one vital part of what had long ago become compulsory for conservatives. The summer 2001 presidential signature on the Economic Growth and Tax Reconciliation Act confirmed that the administration had compassion for taxpayers -- some of them more than others. Cutting tax rates on a host of income levels and filing categories provided the administration an early victory, one undoubtedly pleasing to most conservative activists, writers, and sources of opinion. All the same, few other victories followed. The returns on the early Bush presidency suggested a directionless tenure, one that left the president comfortably acceptable but not popular, and largely without major achievements. In what approximates the standard narrative on the Bush turnaround, the September 11 attacks, and soon after a war against stateless terrorists and their state sponsors in Afghanistan, rescued the Bush presidency from the burden of minimal relevance. These events, in short order, gave his presidency a focus that appealed to national-security conscious conservatives. Operation Iraqi Freedom, which commenced in March 2003, further put the administration on a path that delighted many (though not all) conservatives, from the neoconservative Project for the New American Century types to John and Jane Q citizen who just wanted to see the country use its military to take the fight to enemies in the Middle East. Yet, what a wartime presidency gives in terms of soaring popularity it can just as easily take away. On board the USS Abraham Lincoln in May 2003 Bush declared some version of a “mission accomplished.” Never again, however, would his Gallup approval numbers reach the level attained right after this aircraft carrier proved itself a poor venue for the administration’s careless bravado. Bush’s own reelection the next year, which featured allegations of mischief and irregularities in Ohio in particular, hardly revealed a clear-cut endorsement of the incumbent. Because of policy and electoral setbacks, not to mention the conspicuously poor handling of the aftermath to Hurricane Katrina in August 2005, the administration seemed to make its real mission accomplished one that imperiled the GOP brand—a brand that had become nearly synonymous with the expectations that its members hew to conservative principles and policy goals. But, as general disapproval for Bush

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increased into his second term, so too did the questioning of whether or not his eight years in the White House would likely earn passing grades on the report cards that conservatives had already begun to fill out for the hydra-presidency of one Yale graduate and his Yale dropout Vice-President, Dick Cheney. A host of conservatives distanced themselves from Bush far earlier than others. Some of this frustration involved the continued tensions directed to the neoconservative influences on the foreign policy actions of the Bush realm.9 But matters of domestic policy promoted far more persistent dismay. Allowing the prominent conservative worries and reactions to speak for themselves allows us to engage the problems of a still unsettled American ideological brand. *** As Hoover Institution fellow Peter Berkowitz put it in 2011: “conservatism in America has squandered the reputation for reform that it earned in the 1980s and 1990s.”10 In leaving aside the last decade in his assessment of when things worked, Berkowitz made it clear that the last decade had been a disastrous one. The Bush White House therefore stood at the center of this squandering. There is some irony in the Berkowtiz assessment, even as it still hints at the continued relevance of substantive divisions in the conservative ranks. Bush certainly thought of his administration as one promoting reform, a point to which this essay will return when it assesses the significance of the No Child Left Behind Act. Before any focus, however, on what may well have been the signal domestic policy of the Bush years, it is important to note that this squandering thesis must include the national security policies and military misadventures of the Bush tenure.11 The discontent, in some circles, with the administration involved far more than just the remnants of the underinterventionism that had such influence in American political life before the cold war rendered all but the most idiosyncratic liberal and conservative politicians into competitors for foreign policy hawkishness. Huge reform efforts beyond American shores during the Bush tenure, which most conservatives could endorse for a variety of reasons, became a drag on his popularity at home and took administration attention away from domestic policies. As William Lind and the late Paul Weyrich put it in their book The Next Conservatism (2009): “One of the causalities of the Bush administration was the conservative movement.” They wrote to rescue conservatism from its recent disasters. But, as these authors argued, adventurism abroad in pursuit of grand re-ordering and democratic enlargement or democratic capitalism “was as true under President Bill Clinton as under George W. Bush.”12 The problems that developed in the occupation of Iraq and in media sniping over the war on terror only helped weaken popular support for the administration, which in turn hindered larger policy reaches across Bush’s presidency.13 One of the recurrent reactions to the Bush administration turned on its embrace of socalled big-government conservatism. Whatever the explanatory merit (or selective sense of history) of such playful terminology, the term does not need to hold up to substantiate that worries over what government does and how it does it mattered to those who had some claim on conservatism. Certainly the war on terror and the dual wars in Afghanistan and Iraq mattered on this front, even as the more clearly domestic side carried greater weight in hurting the reputation of the Bush White House with conservatives. Thus, on one level these objections featured the overreach of the national security apparatus that had evolved since 9/11. Libertarian-conscious commentators did take notice, if sometimes belatedly. One such

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example on this front is Harvard Law professor Jack Goldsmith’s mild mea culpa The Terror Presidency: Law and Judgment Inside the Bush Administration (2009).14 (Goldsmith, at one time, headed the Office of Legal Counsel for the Bush Administration.) True to its etymological formulation, libertarianism and its ethos have often had fleeting durability within American conservatism. What government does with data mining, snooping, and the evisceration of the Fourth Amendment registers (and has registered) far less frequently in the larger conservative public discourse. More recent revisions to the rules to guide the National Security Agency have had far more to do with public disclosures, leaks, and the passage of time than any ideological insistence on keeping the country safe but even more so safe and free from unsavory snooping. What registered instead involved the far more widely shared worries involving the tax code and overall spending. As economist and affiliate of the Cato Institute, Daniel Mitchell bluntly stated: “any president who doubles the burden of federal spending in just eight years is disqualified from being a conservative -- unless the term is stripped of any meaning and conservatives no longer care about limited government and constitutional constraints on Washington.”15 Mitchell’s reading of Bush out of the conservative camp came from 2011. His complaint in no way registers as the lone voice from the insider establishment; the worries about the size and reach of government, particularly on matters of regulation and spending, served as an orthodox conservative lament. Within this lament, the tax cuts from 2001 and accelerative tax legislation from 2003 found their way to the historical dustbin. What is more, a GOP-controlled Congress for ½ of Bush’s tenure, and years of recognition of the merits -across the often narrow American political spectrum -- of fiscal restraint, all but ensured that Bush earned a place as a disappointment. No war on terror, let alone negotiations with corporate-backed Democrats who meekly fought to strengthen America’s modest social safety net, could justify increases in federal spending. This expectation for many conservatives thus brings to mind David Mamet’s Reagan era stage play and later film Glengarry Glen Ross. Just as Blake (portrayed by Alec Baldwin in the 1992 film), the aggressive, successful sales charmer who visits the uptown office to badger a room of undermotivated real estate salespersons to “Always Be Closing” or else to “hit the bricks,” a similar rough-edge commandment guides conservatives who monitor other conservatives. In this formulation Grover Norquist takes on the role of the pushy salesperson, mimicking the Mamet character through monitoring the activities of those potential taxing and spending deviants at work in the White House and Congress. “Always be cutting, taxes and spending,” the mantra has become. The appearance of doing nothing, let alone endorsing an increase in spending, is the type of apostasy that guarantees exclusion from the ranks. Yet this is but part of the standard selective reading of evidence from the policy record. Downplaying, when convenient, the Economic Growth and Tax Reconciliation Act, approved cuts in capital gains taxes from 2003, allowances for small business expensing from the same year, and a bevy of other measures across Bush’s tenure became a part of an insistence on an absolute allegiance to some higher order of things. Bush putting his signature to the Medicare Modernization Act in 2003 did not help him with small-government types either. He had not gone the way of his father in making an absolute enemy of Norquist’s Americans for Tax Reform, but keeping taxes low, then lower, and government small, then smaller, were in every way a bedrock requirement necessary to please conservatives. The two terms of the 43rd president had come up well short.

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Thus, from the banal musings on the campaign trail in 2000 to White House press releases on the topic, “compassionate conservatism” never had the edge, the anti-government sentiment that had defined conservative national political figures from Barry Goldwater and Phyllis Schlafly to Ronald Reagan and Newt Gingrich. It certainly did not have the necessary persuasive heft to justify deviations from the important expectations about taxes and curtailing what government does. What is more, George W. Bush did not have the excuse of being a Democrat from Arkansas making peace with an American political landscape Ronald Reagan had helped to reconfigure. Bush seemed to want to accept that conservatives could be doers, even if it meant Washington, D.C. did the heavy lifting. The failure to keep spending low, taxes even lower, and the leviathan at bay hence became the largest X on W’s back. This activism of his tenure, not to mention policies that seemed to borrow from differently constructed ideological playbooks, did have its defenders. Former administration speechwriter Michael Gerson remained one of the few prominent conservative voices who doubled-down on the administration’s record. Gerson remained on the White House staff until 2006. The following year, his book Heroic Conservatism: Why Republicans Need to Embrace America’s Ideals (And Why They Deserve to Fail If They Don’t) served up evidence of just how contested the administration had become. Of the many things the book attempts to convey, its significance lies in the charges Gerson defended Bush against. Indeed, at times the text is more so directed at Bush’s mercurial conservative backers than his liberal enemies. As such, Gerson addressed the triad of domestic demons: runaway spending, the prescription drug benefit, and the era’s education reforms. He defended all of these developments in glowing terms. But whether these terms were grounded in an actual conservative core is assuredly an open question. He addressed these domestic happenings -- notably the prescription drug effort -- as within the “justice and fairness of American society.” (In a sense, he was still busy attempting to graft a policy philosophy on to the long decayed corpse of “compassionate conservatism.”) Elsewhere, he argued that caring about the disaggregation and accountability that education reform required was “both admirable and unprecedented” for a GOP president. As if that was not enough, higher government spending existed as part of “an active, reforming conservatism.”16 One could easily imagine Bush’s trademark grin and “attaboy” comments as reactions, if the president indeed found the time to read through Gerson’s book. Gerson and other compassionate types, let us presume, believed these ostensible apostasies. Many other observers rejected such justifications. Those rejections arrived from a variety of conservative sources. For example, consider long-time activist Richard Viguerie. He provided his own entry on the 43rd president’s contributions in Conservatives Betrayed: How George W. Bush and Other Big Government Republicans Hijacked the Conservative Cause (2006). Viguerie’s polite conspiracism intervened page after page. What else, for instance, could explain the continued existence of the Department of Education except to consider it as a payoff to powerful teacher’s unions? But the godfather of direct-mail outreach to conservative Americans also gives us evidence of orthodoxy. He relied upon repeated myths and moralistic invocations that fit with the common, often ahistorical, citations of the glory days of the 1980s or even 1950s, both golden ages that conservatives depend upon in their frequent lamentations of whatever ills appear in the contemporary headlines. The bill of particulars against Bush that Viguerie escorted before readers remains, on the whole, decisively representative. Those charges against the Bush White House did not arrive either as some updated version of complaint available a half-century before in any number of

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publications from Robert Welch’s John Birch Society. Welch and his wild charges against political heavyweights from Earl Warren to Dwight Eisenhower in the 1950s and 1960s do not have an analogue every time this or that pundit decides to safeguard the political spectrum for the rest of us. Instead, Conservatives Betrayed offered an emerging conservative conventional wisdom when it cited expansive federal spending, the continued expansion of the national debt, partnerships with Ted Kennedy (D-MA) “that further[ed] the federal takeover of local schools,” the botched High Court nomination of Harriet Miers, the near nomination of the “moderate” Alberto Gonzales to the same position, and over one full term of a White House that had done nothing to get rid of wasteful federal programs and agencies.17 Lumping together conservative sources and voices ought to raise concerns; perhaps, however, we might at least entertain the notion that between some sensible crowd and everything else on the fringe remains a core bound up in two important themes. The Bush presidential tenure further animated these themes. For one, an enforced history of the 1980s, in particular around the deification of Ronald Reagan, remains; it all but ensures doom for Reagan’s GOP successors (and even predecessors), whether they win the White House or not. Recent unsuccessful nominees for the Republican Party have also been unable to escape Reagan’s shadow. Second, there are largely accepted values, which differ in emphasis and intensity on matters of the so-called culture wars, but still come together firmly on a host of matters involving fiscal priorities and the reflexive worry about big-government. As such, mistrust for social spending, regulations of the financial sector, measures to protect the natural environment, and affirmative policies to protect, if not promote, historically disadvantaged populations, all earn easy denunciation simply because they have a price tag and will necessitate more Office of Personnel Management background checks on new federal workers. These core components of conservatism caused much of the trouble for Bush and his reputation. They remain operative even as some self-identified conservatives have little interest in battles, particularly at the national level, on culture war type issues. Likewise, they remain even as paleoconservatives feud with neoconservatives -- or just less thoughtful national-security hawks -- over the prerogatives of American foreign policy. Placing these core items then through a historiographical spin cycle, it remains true that conservatism does indeed have some unity. But what comes out in the end is that while the cold war once created cohesion for disparate conservative groups, as George Nash and nearly every historian who studies the American Right repeats as ritual, the veneration of Ronald Reagan and ill-fitting allegiances to an economic libertarianism is now what at least approximates to what the cold war once provided.18 From the radio airwaves to established conservative citadels and publications, these allegiances remain. These allegiances bring in to focus the problems of an all-too-easy focus on some supposedly under-representative, unhelpful, out-of-step fringe. They are worth keeping in mind, even as the 2016 GOP field has apparently cut loose any of its possibly viable, centrist candidates or even its careerist politicians. We might keep in mind that Ann Coulter’s books bear a Random House imprint as often as they are the output of the publishing outfit Henry Regnery founded not long after the Second World War. Even the polite educational institution Hillsdale College invited Rush Limbaugh to address its December 2008 Churchill Dinner in Washington, D.C. Followers of the television airwaves can encounter the otiose attempts to reclaim the culture of cool by Fox News faux-culture

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warrior Greg Gutfeld. Mainstream publishers, educational institutions, and even television news outrage help confirm that an establishment, safe, practical, deal-making Right exists as a category that has its usefulness wax and wane depending on the political context. The same can be said about whatever earns placement on the angry fringe.19 The commentariat hence might consider putting invocations of the fringe versus the real operatives on the shelf every so often, particularly when the fun in finding modern day analogues to massive resisters, avowed racists, and the conspiratorial-minded causes observers of whatever variety to miss out on central agreements on the American Right to which so-called extreme, outlandish elements do more than just casually grant endorsements.20 *** W’s reputation took its most serious and sustained criticism because of what even the president thought his most high-profile policy achievement with the No Child Left Behind Act (NCLB). NCLB serves as evidence of a measure decisively of the first term. The interventionist side of Bush might not have surprised his supporters who then became detractors had they realized what had happened to the politics of American public education since the Second World War. Too many political dividends existed for the taking when it came to ensuring American schoolchildren, but more importantly the teachers and schools that serve them, are held to account.21 Policy options such as vouchers, let alone de-regulation to help out home-schoolers, just could not compete with the quick-fix power of tests and federal mandates. Its tough-going because it requires consulting the Congressional Record and actually taking some political posturing seriously, but to get at the splintering on the Right we might recall (and grant some salience to the fact) that one of the reasons some House GOPers showed early discontent for what became NCLB was its lack of placement for vouchers.22 What became NCLB, itself a re-authorization of the Elementary and Secondary Education Act of 1965, represents what may very well be the most clear-cut Bush era violation of conservatism’s core. Here the contrast to Reagan remains telling. After all, Reagan at least gave lip service to abolishing the Department of Education, even if true to form he never delivered. Likewise, the 1983 publication of A Nation at Risk, itself a culmination of the work of the National Commission of Excellence in Education established under Reagan’s watch, called for incentive based reforms for teacher pay, better assessment metrics, and at least updated the alarm about schools that had been a regular feature in the United States at least since the 1950s. A Nation at Risk was an even more important force for the continued evisceration of the liberal ethos bound up in the Great Society. While it scarcely called for an intergovernmental stick and carrot approach that has defined education policy since NCLB’s adoption, the rhetorical interventions and education scare of the 1980s at least partially explains the public policy terrain the Americans have come to occupy. Yet, Bush chose a different path than Reagan had on education. He remained certain of his choices even after leaving the White House. In his group-project memoirs Decision Points, which doubled as a pep talk for others to learn from the “decider,” Bush explained that he had hoped to be “the education president.”23 NCLB had to be big since he had read up on (and wanted to model) presidents such as Theodore Roosevelt. Where Bush truly exists in Decision Points is tough to decide, but whether these are his sentiments or the historical accouterments of his memoirs team, there is an avowed fondness for action, which then

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relates to his dual need for acclaim and big accomplishment.24 As Decision Points put it, Bush evidently “admired presidents who used their time in office to enact transformative change.” Even TR’s pursuits, which seemed regulatory in every way, mattered less, the book contended, than that this early 20th century model president hoped to bring about reform. Bush too wanted to bring about reform, arguing that he wanted to change a “national education debate [that] had bogged down in modest proposals like school uniforms and unrealistic calls to abolish the Department of Education.”25 When Bush signed NCLB in early 2002 he might have done well to realize that all of the emphasis on results, even his commendable aspiration that the legislation would appear a civil rights measure, hardly could hide that it still involved regulations, resources, and relying upon a Department of Education that good conservatives had long hoped to chop into pieces. Oddly perhaps, alliances in public discourse, from Left and Right, against NCLB, Common Core, and the arguably worse Race to the Top program of the Obama tenure, became the norm. The passage of the Every Student Succeeds Act in 2015, in part, reveals a bipartisan agreement to at least meddle with the heavy-handed federal interventions of NCLB. Education policy remains a central component of the 43rd president’s legacy. When many liberals and conservatives find common ground, this undoubtedly pleases the media class that clamors for some chimerical past when politicians just got things done. But such a bending together of the never too far apart poles of the American political spectrum will not sit well with conservatives gatekeepers who would likely support a supplemental appropriation for the National Park Service if such money were to support adding Ronald Reagan’s chiseled visage to Mt. Rushmore. NCLB’s intrusiveness links up to the problematical presumption that conservatives, even allowing for their own deviations, will favor non-Washington, D.C. policy solutions far more consistently than their political opponents. As any casual reader of either the Washington Post or Washington Times during the Bush presidency would likely recognize, the Bush administration engaged in efforts that mixed conservative sounding ends with decisively nonconservative means. Whatever the varied disappointments to conservatives, the Bush Administration made many moves that ought to remain part of the report cards that at least historians will assuredly keep. As such, the aggressive use of signing statements, withholding filling spots at the Department of Justice Civil Rights Division -- a division that had long had some consensus behind its existence -- and the use of preemption to interfere with progressive environmental measures that originated far from the nation’s capital exist as prominent examples. The perennial elevation of state and local power as having no more loyal friend than conservatives in the nation’s capital clearly has had its notable limits, which the Bush tenure displayed time and again. From state, city and local efforts to interfere with predatory lending to those progressive environmental policies, a progressivism flowing up the intergovernmental food chain has been a regular feature as of late. Nevertheless, the Bush White House and Republican Congress frequently had an appetite for getting in the way of such progressive ventures, doing so either through preemption or other invocations of federal supremacy.26 The takeaway then is of the continued tensions and expedience that remind us that sound principles rarely get in the way of preferred policies.27 Finding serious discussions of intergovernmental relations and federalism outside of scholarship or the work of groups such as the National Governor’s Association, is perhaps a lot to ask; yet, any fair assessment of Bush’s tenure ought to at least acknowledge its Janus-faced approach that led it to privilege decisively non-conservative means to accomplish ends conservatives frequently favored.

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Along the culture wars front various indices provide a Bush era legacy that speaks to tentative wins, if that is these culture wars possess the salience that the Red and Blue state dichotomy suggests. His report card seems incomplete without some placement for these issues. He might even deserve greater acclaim than Reagan. For instance, the passage of the Partial-Birth Abortion Ban Act (2003) fits in along side his two successful appointments to the United States Supreme Court.28 Both of those appointees cast votes to endorse that very abortion ban in Gonzales v. Carhart (2007). The policy, constitutional and political signals sent back and forth from Washington, D.C. to state capitols has influence not just on what happens in Kansas but in what matters in states across the country, from Ohio to Mississippi to Texas, that continue to pursue a variety of measures to eliminate abortion clinics and make abortions excessively difficult to obtain. On another front, though not on their surface culturewar cases, Crawford v. Marion County Election Board (2008), Citizens United v. FEC (2010), Shelby County v. Holder (2013) and McCutcheon v. FEC (2014) all featured both of Bush’s appointments joining majority or controlling opinions. If anything, whether it is the exorbitant price tag for campaigns or this generation’s updated version of Jim Crow with voter identification restrictions, the end result becomes a status quo that helps ensure that some policy issues get play while others gets played out. Neither of Bush’s appointments could prevent culture war defeats for moral conservatives in United States v. Windsor (2013) or Obergefell v. Hodges (2015); Chief Justice Roberts even avoided assisting the litigant’s efforts to assert their legal standing to support California’s Proposition 8 in an opinion he wrote in Hollingsworth v. Perry (2013). Roberts’ larger apostasy, however, occurred in NFIB v. Sebelius (2012) and King v. Burwell (2015), rulings that saved critical portions of the Patient Protection and Affordable Care Act. His own deviations, since 2005, from the outcomes most conservatives would expect have diminished the sterling reputation of this veteran of the Reagan White House and the federal bench. Roberts’ protected tenure on the Court has not shielded him from criticisms from the tough, no compromising Right associated with the likes of Ted Cruz (R-TX). But more sober assessments ought to reveal that both Roberts and Alito remain as evidence to the truth of what Richard Nixon said in announcing the Supreme Court nominations of William Rehnquist and Lewis Powell. Nixon called these actions “the most important appointments he [referring to a sitting president] makes.”29 Nixon at least spoke the truth on this matter back in 1971; the passage of time hardly counsels any different assessment of the importance of Supreme Court appointments. Before prominent High Court rulings just become a source for debate in classrooms, they just might remain a prominent part of the Bush record. The rulings involving abortion, electioneering, preclearance, and health care policy fit in next to District of Columbia v. Heller (2008) and McDonald v. Chicago (2010). Those two rulings provided jurisprudential validation to what scholars had long debated but many Americans took for granted about the Second Amendment. Visitors to the chambers of either Bush appointee likely will not find a copy of America’s First Freedom, a National Rifle Association (NRA) publication, yet the two Bush appointees joined narrow 5-4 rulings that gun-owners may not read but Wayne LaPierre and the NRA will not soon forget. In the end the niceties of any of these high-profile Court rulings matter less than that Bush had at least not appointed an Earl Warren, William Brennan, John Paul Stevens, even a Sandra Day O’Connor -- all of whom are just prominent examples of Republican administration Supreme Court appointees who came to displease conservatives.

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But it will likely take more than buttons of Alito and Roberts, let alone narrow Supreme Court victories, to revive the reputation of the 43rd president. Both before and after the declaration of his candidacy for the 2016 Republican nomination, Jeb Bush served as one source for any revival efforts. He contended, for instance, in June 2012 that even Ronald Reagan could not find a place in the contemporary Republican Party. That party, Bush intoned, “doesn’t allow for disagreement.”30 Allowing for some disagreement might permit his brother’s presidential tenure to come up for a few grade changes. The former Florida governor had been quite willing to defend his brother’s record while he sought the same office. Even still, in a September 2015 appearance on The Late Show with Stephen Colbert, Jeb Bush admitted that his brother had not done enough to rein in taxing and spending. Surely the 43rd president and his reputation with conservatives had something to do with his brother’s failed campaign. Perhaps the country will find out precisely how forgiving conservatives happen to be if “W” appears at the 2016 gathering in Cleveland, Ohio -- though such an appearance seems unlikely following Jeb’s expensive but fruitless nomination effort and the likely nomination of Donald Trump. With George W. Bush and some other Republicans likely to skip the proceedings, perhaps the Republican Party could consider a display of digitally remastered footage of past party icons. Herbert Hoover might suffice. There is sure to be footage from his visit, 80 years before to, of all places, Cleveland for the Republican nominating convention.

ENDNOTES 1

Select information in this description of the 2008 GOP convention comes from “The Maverick and the Hockey Mom; The Republican convention.” The Economist 6 Sept. 2008. Biography in Context. Web. Accessed, November 12, 2014. 2 Richard Nixon had not been one of them amidst his presidency, perhaps even further back in time than the infamous Compact on Fifth Avenue from the 1960 campaign when Nixon met with Nelson Rockefeller, seeming as such “a supplicant” in handing over influence over the GOP platform to Rockefeller. He wasted little time disappointing his supporters once he did win the White House. While Richard Nixon could boast to his emissary Patrick Buchannan that hanging tough in Vietnam should have mattered more with conservatives, they had turned against him well before the Watergate cover-up and his resignation from the White House in August 1974. But his presidency—well before his resignation—had angered conservatives, even if over the long-term he also helped provide a playbook, appeals to voters, and tactics that would help conservatives further identify what they would and would not support in the movement against liberalism. See W. J. Rorabaugh, The Real Making of the President: Kennedy, Nixon, and the 1960 Election (University of Kansas Press, 2009), p. 109. Also, for the conservative disenchantment with Nixon and formal suspension of support in 1971, see Sarah Katherine Mergel, Conservative Intellectuals and Richard Nixon (New York: Palgrave Macmillan, 2010), pp. 131-152. Mergel’s book provided an indispensable model for my own research and thinking about the 43rd president. 3 See, for instance, George Packer, “The Fall of Conservatism,” New Yorker, May 26, 2008 (www.newyorker.com/magazine/2008/05/26/the-fall-of-conservatism). As Packer put it, even if a bit prematurely, “little lift is left in the movement that Goldwater began, Nixon brought into power, Ronald Reagan gave mass appeal, Newt Gingrich radicalized, Tom Delay criminalized, and Bush allowed to break into pieces.” 4 David Frum, Comeback: Conservatism That Can Win Again (New York: Doubleday, 2008). 5 David Greenberg, “Why Conservatives Hate Bush,” The Washington Monthly, December 2007, pp. 28-31 (quote at 29). 6 Historian Kevin Kruse positions the compassionate conservatism move along side Bush’s declarations of fidelity not only to a higher power but also to evangelical Christians. He could appeal to that crowd while still endorsing a role for government. But the faith-based initiatives already had some consensus support from the

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1990s—even if they came to be thought of as a Bush cornerstone. Kevin Kruse, “Compassionate Conservatism: Religion in the Age of George W. Bush,” in Julian Zelizer, The Presidency of George W. Bush: A First Historical Assessment (Princeton: Princeton University Press, 2010), pp. 227-251. 7 Kuo did the media rounds upon publication of his 2006 book Tempting Faith: An Inside Story of Political Seduction (New York: Free Press, 2006). 8 His short-duration speechmaker David Frum -- he of “axis of evil” infamy -- certainly had his doubts about the compassionate conservatism notion, if not Bush also. The label, in Frum’s later published analysis, “sounded less like a philosophy than a marketing slogan. Love conservatism but hate arguing about abortion? Try our new compassionate conservatism—great ideological taste, now with less controversy.” David Frum, The Right Man: The Surprise Presidency of George W. Bush (New York: Random House, 2003), pp. 8-9. 9 For an early, highly critical assessment of the Bush tenure, done in large part from a strong libertarian perspective, see James Bovard, The Bush Betrayal (New York: Palgrave Macmillan, 2004). On the other hand, the neoconservative hopefulness in Bush and in the Iraq mission was on full display in John Podohretz’s paean to Bush in that re-election year. See John Podohretz, Bush Country: How Dubya Became a Great President While Driving Liberals Insane (St. Martins Press, New York, 2004). 10 Peter Berkowitz, “Conservatism and the Spirit of Reform,” The Wall Street Journal, June 19, 2010, p. A13. 11 Of course, many neoconservative voices hung tough with Bush, particularly on matters pertaining to the ongoing war in Iraq and media coverage of both the war and the administration. See, for instance, James Bowman, “Smug Self-Righteousness,” New Criterion (September 2004), pp. 53-57; James Bowman, “We Vote for Brand X,” (February 2007), pp. 55-59. Support from neoconservatives ought not surprise us. Whatever their perennial attention to supposedly discarded social reform efforts, and their derision for the negative (even if not always anticipated) consequences of such reform efforts, the same sort of skepticism did not often meet the societal re-creation project in Iraq. There was very little caution in Iraq—something that did not seem to fit with the caution and care that neoconservatives had advocated since the divided 1960s. Neoconservatives, even more than conservatives of the traditional bent, can have amnesia to what has gone wrong. And let us not forget that there will always be some tension in a movement of ideas, one that took Richard Weaver’s pithy comment to heart, in still embracing a president who, in his own words, did not do nuance. Put differently, on the trail from Irving Kristol to Harold Bloom to James Q. Wilson, one would not necessarily expect those breadcrumbs to be picked up by an Ivy League educated frat boy who found himself, even amidst his presidency, called back to Texas. We might just as easily question how seriously they care about ideas. One wonders if any of the writers associated with The Weekly Standard, New Criterion, or even David Brooks will be thought of as seriously as, say, Daniel Patrick Moynihan or Irving Kristol in the years to come. Neoconservatism has diminished some of its more recent adherents place in history simply because of the alliance with the Bush presidency. 12 Paul M. Weyrich and William S. Lind, The Next Conservatism (South Bend, IN: St. Augustine’s Press, 2009), p. 134 and 84 respectively. 13 For instance, Bush’s advocacy of the Comprehensive Immigration Reform Act (2007), earned derision across the Right as just short of treason. Whatever the humane, political, and sound reasons for Bush to endorse reform, the sharper portions of the legislation found little favor. What did earn conservative disapproval were those components that granted more visas, provided greater protection for undocumented guest workers, and a path to citizenship for some illegal aliens. It remains easy enough to connect this pushback to a new political environment, or even a lack of earlier courage on behalf of the White House, but in a bit of counterfactual speculation one might wonder what would have become of such legislation had Bush used his proverbial political capital much earlier in his presidency. Put differently, instead of just focusing on November 2006 and the setbacks then, we might re-order our chronology a bit to recognize that setbacks in the occupations of Iraq and Afghanistan had for some time put a drag on domestic policy options, and equally, if not ironically, opened up the space enough for Bush to earn ridicule from conservatives. 14 Jack Goldsmith, The Terror Presidency: Law and Judgment Inside the Bush Administration (New York: W.W. Norton and Company, 2009). 15 Daniel Mitchell, “George W. Bush Was no Conservative,” March 20, 2011, (www.forbes.com/sites/betlway /2011/03/20/george-w-bush-was-no-conservative/). Mitchell further vented that this was just domestic spending, including such ventures as the “no-bureaucrat left behind bill,” by which he meant NCLB. 16 Michael Gerson, Heroic Conservatism: Why Republicans Need to Embrace America’s Ideals (And Why They Deserve to Fail If They Don’t) (New York: Harper Collins, 2007), p. 154-155. 17 Richard A Viguerie, Conservatives Betrayed: How George W. Bush and Other Big Government Republicans Hijacked the Conservative Cause (Lost Angeles: Bonus Books, 2006), p. 221.

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Though updated since, and in many ways indebted to the prescriptions, not descriptions, of Frank Meyer, Nash’s arguments from 1976 remain a standard that still oddly, given the liberal academy, earns widespread assent. See George Nash, The Conservative Intellectual Movement in America Since 1945 (New York: Basic Books, 1976). 19 Greg Gutfeld, Not Cool: The Hipster Elite and Their War on You (New York: Crown Forum, 2014). 20 Sam Tanenhaus provided his own binary of the reasonable and the unhelpful conservatives, all amidst a supposed environment in which movement conservatism had met its demise. Sam Tanenhaus, The Death of Conservatism (New York: Random House, 2009). 21 On this argument see Patrick J. McGuinn, No Child Left Behind and the Transformation of Federal Education Policy, 1965-2005 (Lawrence, KS: University Press of Kansas, 2006). 22 Donald Critchlow, The Conservative Ascendancy: How the Republican Right Rose to Power in Modern America, 2nd edition, (Lawrence, KS: University Press of Kansas, 2011), p. 264. 23 The best run-down on the Bush attempt at a memoir remains Eliot Weinberger’s unsettling meditation on authorship, responsibility, and the American electorate. I shamelessly borrow from his derision for a memoir project that he deemed the work of “Team DP.” See Eliot Weinberger, “Damn right, I said,” London Review of Books, January 6, 2011, pp. 3-5. 24 On this theme I lean on Dan P. McAdams, George W. Bush and the Redemptive Dream: A Psychological Portrait (Oxford University Press, New York, NY: 2011). His arguments about Bush and his lack of what psychologists label “integrative complexity” are worth consulting before just blithely considering Bush a mental lightweight. 25 George W. Bush, Decision Points, (New York: Crown Publishers, 2010), pp. 272 and 274. NCLB appears predominantly in his chapter on “Leading.” 26 For background on the administration’s inconsistent record on intergovernmental relations, see Tim Conlan and John Dinan, “Federalism, the Bush Administration, and the Transformation of American Conservatism,” Publius: The Journal of Federalism, Volume 37, Number 3, pp. 279-303. 27 See, for instance, David J. Barron, “Blue State Federalism at the Crossroads,” Harvard Law and Policy Review, Volume 3 (2009), pp. 1-7. 28 The Bush White House empowered a host of conservative organizations to get a voice in judicial selection, and relied upon the advice and counsel of Edwin Meese and C. Boyden Gray in making nomination selections. Writing early in the post-war years, British specialist on U.S. law Robert McKeever judged Bush’s two High Court nominees, at best, new blood for settled positions. Roberts and Alito “only firmed up the conservative bloc” as he put it. Robert J. McKeever, “Bush, the Judiciary, and the Conservative Constitutional Counterrevolution: Close but No Cigar,” in Iwan Morgan and Philip John Davies, Assessing George W. Bush’s Legacy: The Right Man? (New York: Palgrave MacMillan, 2010), p. 85. In fairness, however, the wider contest of constitutional politics and the American conservative brand counsels something other than just McKeever’s blasé reaction to those appointments. 29 The text of Nixon’s October 21, 1971 address is reprinted in “Role of the Supreme Court-Nixon Gives His Criteria,” U.S. News and World Report, November 1, 1971, p. 62. 30 Jim Rutenberg, “Jeb Bush Questions G.O.P.”s Shift to the Right,” New York Times, June 12, 2012, p. A 16.

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 14

PRESS RELATIONS IN PRESIDENT GEORGE W. BUSH’S TREASURY DEPARTMENT Kara Alaimo Hofstra University, Hempstead, NY, US

ABSTRACT This study examines whether the Obama or Bush administration was more forthcoming with the press. Using interviews conducted with reporters who covered the Treasury Department during both administrations as well as with presidential political appointees who served as Treasury spokespeople during both administrations, the study finds no evidence that the Bush administration provided more information to the press than did the Obama administration. However, this study finds that Bush administration officials offered more explanations to reporters and provided journalists with greater access to senior officials. The findings suggest that Republican political operatives may work harder than Democrats to shape media coverage, in an effort to overcome a perceived liberal media bias.

INTRODUCTION In his 2008 memoir, President George W. Bush’s Press Secretary, Scott McClellan, admitted that, when questioned by the press, Bush administration aides would “reflexively manipulate, hide, and distort the truth.”1 McClellan acknowledged that “of course, deception in politics is nothing new. What’s new is the degree to which it now permeates our national discourse.”2 Like many reporters, former New York Times columnist Frank Rich likewise described the Bush White House as “obsessed with news management and secrecy” and accused administration officials of “demonizing, stiffing, and spinning the press.”3 However, a 2014 Politico survey of reporters who cover the administration of President Barack Obama found that 41 percent believe that the Bush administration was more forthcoming with the press than the Obama administration, while just 5 percent believe the Obama administration is more forthcoming.4 This study examines how forthcoming Bush

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administration officials were with the press by comparing the press relations of a key cabinet agency – the Department of the Treasury – during the Bush and Obama administrations. It reports on the results of interviews conducted with reporters who covered the Treasury during both administrations as well as with presidential political appointees who served as Treasury spokespeople during both administrations. The reporters who were interviewed for this study likewise indicated that the Bush administration was more forthcoming with reporters than the Obama administration. However, this study finds no evidence that the Treasury provided more information to the press during the Bush administration; rather, Bush appointees appeared to offer journalists more explanations of their thinking and decisions and greater access to senior administration officials. The study proposes two key explanations for this differential. First, a significant number of the Bush administration officials appeared to make a particularly strong effort to explain their positions to the press because they perceived a liberal media bias which they felt they needed to overcome. Second, the fragile economy which the Obama administration inherited may have made officials more cautious when interacting with the press, because they feared that their statements could negatively impact markets. The findings offer two fascinating propositions worthy of future research: that Republicans may make greater efforts than Democrats to explain their positions to the press and that a previously unappreciated outcome of national crises may be restricted exchanges with the press.

LITERATURE REVIEW The framers of the U.S. Constitution were clear that they intended for the American people to hold their elected representatives accountable. In order to do so, the people require information about the state of their government and the economy. For example, the Declaration of Independence makes clear that governments derive “their just powers from the consent of the governed.” The intention of the Framers is also evident in The Federalist #51, which states that “a dependence on the people is, no doubt, the primary control on the government.”5 The Constitutional mechanisms providing for a unitary executive and eligibility for re-election were also designed to foster the accountability of government leaders to the American people.6 Of course, citizens cannot hold their leaders accountable without knowing what the officials have done. Therefore, during the Constitutional Convention, in arguing for a Constitutional provision that both houses of the Legislature be required to publish their proceedings, James Wilson noted that “the people have a right to know what their Agents are doing or have done.”7 In his Report on the Virginia Resolutions, James Madison wrote that the “right of freely examining public characters and measures, and of free communication among the people thereon … has ever been justly deemed the only effectual guardian of every other right.”8 Former Senator Thomas C. Heninngs, Jr. also noted that the Preamble to the Constitution states that “We the People” establish the Constitution. According to Hennings, since, under our theory of government, sovereignty resides in the people, it logically and necessarily follows that the people have a right to know what the Government – which they themselves established – is doing, and that government officials properly may interfere with the free exercise of that right only to the extent the people themselves

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consent. Thus, while it is not mentioned, the people’s right to know is an implicit part of the Preamble of the Constitution.”9

Of course, this right to information is not absolute. Farrand’s debates make it evident that the Framers recognized the need for the suppression of information regarding matters such as military activities. For example, according to Madison’s account of the Constitutional Convention, on August 11, 1787, Elbridge Gerry and Roger Sherman proposed a clause in the requirement that the houses of the Legislature publish their proceedings which would exempt matters related to “treaties and military operations.”10 Alexander Hamilton also made clear that he believed “secrecy” to be vital to the executive branch when he argued in The Federalist #70 that a plural executive would reduce the executive branch’s capacity for it.11 The Founders ultimately settled on the clause in the Constitution that “each House shall keep a Journal of its Proceedings, and from time to time publish the same, excepting such Parts as may in their Judgment require Secrecy” – clearly recognizing the legitimacy of suppression when it was required. Obviously, national security concerns will at times preclude government disclosure; otherwise, the very existence of the nation would be at stake. It may also be necessary for the government to withhold more information during emergencies, though the Constitution says little about this issue. Likewise, it may be counterproductive for government officials, like the Framers, to share the minutiae of deliberations and negotiations before they have been finalized and are ready for public deliberation. However, every American president promises to run an open government.12 This study assesses how forthcoming a key cabinet agency was with the press during the administration of President George W. Bush by comparing the practices of its public affairs staff with those who served under the Obama administration.

METHODOLOGY I interviewed seven journalists who reported on the Treasury during the administrations of Presidents Obama and Bush. All of the members of the press reported or report on the Treasury for major wire services or newspapers which I consider to be among the most influential media outlets in the United States. In order to protect their identities, I will not disclose the specific outlets for which they work or worked. I also conducted detailed, confidential interviews with five political appointees who served in the role of Spokesperson for the Department of the Treasury during the administration of President Bush and with five political appointees who served or are serving in the role of Spokesperson for the Department of the Treasury during the administration of President Obama. The most recent edition of Policy and Supporting Positions indicates that five appointees worked as Treasury spokespeople in 2012 – although, due to turnover, over the course of a presidential term, more than five individuals will serve in such roles.13 Therefore, the sample size of this case study should be a sufficient representation of Treasury spokespeople who served during both administrations.

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The Treasury was selected for this case study because it was responsible for communicating particularly critical information regarding the nation’s response to the 2008 financial crisis during both of the administrations studied. As a former Treasury spokesperson in President Obama’s administration, I used my personal contacts to secure the interviews with the Obama appointees. I was introduced to most of the Bush appointees through a former Bush administration official with whom I worked in a prior position. These connections helped me to establish access to and trust with my interview subjects. All of the interviews were conducted in person in 2013, with the exception of one interview conducted by telephone because the personal circumstances of my interviewee precluded an in-person meeting. To promote honesty and candor in my interview subjects, I pledged to keep their identities confidential. I therefore refer to my research subjects by title (appointee or reporter) and number in this article. As a further measure to protect the identities of my research subjects, I refer to every interviewee in this publication as “he,” regardless of his or her gender. I selected masculine language because the majority of my research subjects were male. To determine whether there was a differential in the amount of information that both administrations withheld from the press, I began by asking the Treasury spokespeople whether it is ever appropriate for someone in their position to withhold information requested by the press. I then asked under what circumstances it would be appropriate, and whether this happened often or rarely in their work. Next, I asked the reporters how helpful the Treasury appointees who they worked with were at getting them the information they needed, and whether there was a difference between the Bush and Obama appointees. I then asked the reporters what they thought explained the differences between the Bush and Obama appointees. Finally, because many of the reporters expressed a belief that the Bush spokespeople worked harder to explain their positions in an effort to overcome a perceived liberal media bias, I asked the Bush spokespeople whether this was the case. I enjoyed a warm, comfortable rapport with every interview subject with the exception of Bush Appointee 5, who appeared suspicious of my questions and guarded in his responses. However, I accounted for this judgment when drawing my overall conclusions. I otherwise felt that my interview subjects were forthcoming in their responses. While the fact that I had served in a Democratic administration might have been expected to make the Bush administration officials more guarded in their responses, many of my interview subjects admitted throughout the course of my interviews to regularly withholding information from the press, a practice which might be considered to be controversial. This left me confident that my interview subjects were generally forthcoming and candid in their responses.

RESULTS The following sections summarize the results of appointees’ views on withholding information from the press; reporters’ explanations of the differences between how the Obama and Bush administrations engaged with the press and the reasons they attributed to these differences; and the Bush appointees’ views of the major explanation proposed by reporters for the differential.

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Appointees’ Views on Withholding To measure whether the Bush and Obama spokespeople had different norms regarding the withholding of information from the press, I first asked them whether it is ever appropriate for someone in their position to withhold information requested by the press. I then asked under what circumstances it would be appropriate, and whether this happened often or rarely in their work. There were no significant differences between the responses of the two groups. Both groups generally reported that it is acceptable to withhold information when it does not serve the president’s interests to release it. Obama Appointee 1 was clear that “you might omit a data point … you don’t want to make someone else’s case for them. Political communications is different from detached academic analysis in which you would have the responsibility to not omit relevant data points or factual assertions. You have a job to do, in terms of advancing a particular viewpoint. You shouldn’t view the job as a platonic ideal of searching for truth.” Obama Appointee 2 likewise indicated, “you don’t have to tell the whole truth.” He stated that “if there’s information I’m aware of that would result in a negative story, there’s no way I would make that available to a reporter.” Obama Appointee 3 reported, “I’m under no obligation to give out information unless it’s, like, obviously in the public domain. If it’s in a press release, you have to share. If it’s not, you’re under no obligation.” Obama Appointee 4 explained that withholding is acceptable “in a situation where it could potentially be a very damaging story, where there are numerous Congressional investigations and we’re timing out the release of information, knowing that it will probably get out eventually, but holding while we figure out all the facts and a strategy.” Obama Appointee 5 stated that “that’s kind of what the job is. I tried to be as upfront and transparent as I could, but I think there are legitimate times when it doesn’t make sense to offer up everything.” Similarly, Bush Appointee 1 explained that withholding is “fine” because “you’re trying to implement a strategy and showing all your cards at any given time is not the way to go about it.” Bush Appointee 2 initially said that it is appropriate to withhold information when “lives are at stake, it’s a sensitive or classified issue, that kind of genre,” but, when pressed, he indicated that it is also acceptable if “something was not primed for market.” Bush Appointee 3 indicated, “it’s a public affairs spokesperson’s job to guide a reporter in the right direction. Don’t lie, but it’s not their job to be open kimono and tell them everything.” Bush Appointee 4 indicated, “there are lots of times when it might be appropriate” to withhold information. He explained, “let’s say you know a person will be nominated for a job tomorrow. Just because you ask a question doesn’t mean it’s right for me to give the announcement today.” Bush Appointee 5 responded, “no, of course you don’t have to tell a reporter everything they ask you.” Thus, there were not significant differences in the views of the two groups. The spokespeople who served in both the Bush and Obama administrations appeared to uniformly believe that they were not under an obligation to provide information requested by reporters if they did not believe that it served the president’s interests to do so.

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Reporters on Differences between Obama and Bush Administration Engagement with the Press As an additional measure of whether the Bush and Obama spokespeople had different norms regarding the withholding of information from the press, I asked the reporters to describe how helpful the Treasury appointees who they worked with were at getting them the information they needed, and whether there was a difference between the Bush and Obama appointees. Reporters overwhelmingly indicated that they believed that the Bush administration engaged more actively with the press than did the Obama administration. Reporter 1 indicated that he had greater access to Treasury Secretaries and Undersecretaries under the Bush administration than under the Obama administration. Reporter 2 likewise indicated that “the Bush public affairs people across the administration were generally more forthcoming about what they knew and more willing to share that with reporters … [In the Obama administration there was] less fruitful conversation on the front end to shape stories and thinking than there is in other administrations, where you’re just kind of talking back and forth.” However, Reporter 2 believed this to be the case because senior Bush administration officials “were more frequently interested in spinning and shading the truth than the Obama officials.” Reporter 3 indicated that, in comparison with the Bush administration, the Obama administration had greater “reluctance to put us on the phone with an Assistant Secretary or people in the trenches or [a] Deputy Assistant Secretary just to explain issues.” Reporter 7 indicated that “the Bush people were so much more engaged with reporters on a day to day basis.” Reporter 5 indicated that the Obama administration is “incredibly touchy; they would call and argue about adjectives [he used in stories]; the Bush folks didn’t do that.” He believed that the Bush administration was better at sharing information during the 2008 financial crisis “because they had to be,” given the severity of the situation. However, he indicated that while he wished that the Obama administration were faster to explain issues, the Bush administration had not been better at doing so and the problem had been present in “administrations for a long time.” Similarly, Reporter 4 indicated that both administrations had withheld vital information from him, particularly during the financial crisis. Reporter 6 had not engaged significantly enough with the Bush administration to draw comparisons.

Reporters’ Explanations: Republican Perceptions of a Liberal Media Bias I next asked the reporters to explain why they believed there were differences in the practices of the Bush and Obama appointees. Reporter 1, a veteran Treasury reporter, indicated that he believed that reporters have better relationships with Republican administrations than with Democratic administrations, because Republicans perceive a liberal media bias: With a Republican administration, there’s a sort of understood adversarial relationship; sometimes with the Democratic administrations, we [would] get the feeling that they want us to give their side and they don’t want to argue with us, they just want to

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tell us. It’s easier to clarify a position by arguing it; a reporter is just naturally adversarial. We sometimes felt Democratic administrations didn’t understand the value in an adversarial position as did the Republican administrations, and therefore it took longer and was sometimes more contentious to sort out and get a full understanding of any issue.

Reporter 7 concurred that “in some ways, Republicans on a superficial level play the press game a bit better … Which is odd, given the fake belief that the media has a liberal bias. Maybe it’s compensation for that, or something.” Reporter 4, who worked for a media outlet popularly perceived as liberal, agreed with the hypothesis that the adversity Republicans assumed they would face from a more liberal press actually resulted in better relationships with members of the media: Republican administrations tend to view the media as more adversarial from the outset and to treat it – to have a more formal relationship with it … Democrats tend to regard the media as friendly, or think it ought to be friendly, and to respond with disappointment and anger when it behaves otherwise. They like the idea and hate the reality of the media with more intensity than Republican administrations. Republican appointees tend to have a transactional relationship with the media … They believe you are not on their side and aren’t therefore as angry when you are not on their side. The emotional content of the relationship is much lower with Republican administrations. There is less expectation, less disappointment, less emotional volatility in the relationship. They understand each other in a way more accurately. … Republicans don’t expect to have that relationship as a potential ally, so to the extent we’re less adversarial than they expect, that works to our advantage, whereas with a Democratic administration we were inevitably a disappointment, because there’s that expectation of shared sympathies, goals, and worldview, but the realization that the media has different goals tends to come as a perpetual shock.

Of course, another possibility not mentioned by the journalists is that, if it is indeed true that the media has a liberal bias, reporters themselves were predisposed to like the Obama administration, and therefore were more surprised and angered when the Obama appointees withheld information than they would have been with a Republican administration. If this were the case, reporters’ criticisms of the Obama administration might be exaggerated. Interestingly, Reporter 2, who worked for a media organization popularly perceived as conservative, was especially critical of the Bush appointees. As previously reported, he believed that higher-level Bush appointees (who did not work in public affairs) “were more frequently interested in spinning and shading the truth than the Obama officials” and their spokespeople would convey these points on behalf of their principals and also provide more opportunities for their principals to make their cases directly to reporters. Reporter 2 suggested that Republican operatives may have worked harder to influence the press because they were “trained with the idea of media bias early on” and felt that they needed to try especially hard to overcome it. For Reporter 2, this was not a good thing. He speculated about whether the Bush administration was “so good at spinning, even on financial and economic issues, that they prevented bad coverage even when the economy was turning and looking bad,” which caused the media to fail to report earlier warning signs of the impending 2008 financial crisis.

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Reporter 5, a veteran Treasury reporter, rejected the explanation of a perceived liberal media bias. He argued that differences between the administrations were likely due to differences in the personalities of individual public affairs staff members. As previously discussed, Reporter 6 had not engaged significantly enough with the Bush administration to discuss the matter; Reporter 3 had likewise worked less frequently with the Bush administration and was therefore not well positioned to explain the differential he perceived.

Bush Appointees on Perceptions of a Liberal Media Bias To determine whether the reporters were correct that perceptions of a liberal media bias by Republicans could explain the differences between the practices of the two administrations, I asked the Bush spokespeople whether they perceived a liberal media bias and how this impacted their work. Bush Appointee 3 was adamant that Republican political operatives work harder to influence the press because they perceive themselves to have a disadvantage. The appointee argued that being a Republican is “like being a woman. You have to work twice as hard being a Republican, because there’s already a prevailing narrative … so we try to overcompensate.” This appointee believed that the impact of such Republican efforts was ultimately limited, however, because the media would “still … prefer Dems at the end of the day.” However, the appointee indicated that Bush appointees were very social with the press, indicating that “we had a lot of fun with them. We had our own DMZ [de-militarized zone] … where we could hang out. That was us helping them help us.” Bush Appointee 1 concurred that “we had to work harder to convince the media of the Bush [administration’s] positions, as the media is obviously perceived as liberal.” This appointee argued, “think about it – the only member of the media to join the Bush admin. was Tony Snow, [while] half the D.C. press corps joined the Obama admin.!” Bush Appointee 2 agreed with the assertion that Republican press aides work harder to influence the press, arguing that “whether it’s actual or perceived bias, we always try to work harder because we thought that we had to explain [our] policy positions.” He also acknowledged that President Bush’s “popularity was not that high and didn’t provide enough political capital to get things done. When an administration’s unpopular, you have to end up working harder to get things done.” Of course, one problem with the argument that the Bush appointees were fighting an uphill battle in the press is the fact that their economic views were actually broadly popular. Gallup polls from 2001, when President Bush took office, through 2013, show that Americans have always been more likely to describe their views on economic issues as conservative than as moderate or liberal. In 2013, 41 percent of Americans described their economic views as conservative – a record low for this time period which was still significantly above the 37 percent of Americans who described their economic views as moderate and the 19 percent of Americans who described their economic views as liberal.14 This likely made it easier for the Bush appointees to promote their views, though this advantage would have been diminished if the reporters who were their interlocutors themselves had more liberal views – a question which falls outside of the scope of this project.

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Bush Appointee 4, however, disagreed with the contention that Republicans work harder to overcome a liberal media bias, describing the idea as “bullshit.” He argued that the differences in access and reporter satisfaction between the two administrations were likely attributable to “differences in talent at the top.” Bush Appointee 5 likewise indicated that he would attribute differences to the talent and working relationships of Treasury officials.

DISCUSSION The findings of this study provide greater granularity to the Politico survey which found that many reporters believe that the Bush administration was more “forthcoming” with the press. In the case of the Treasury, a close reading of the descriptions of reporters makes clear that the Bush public affairs officials seemed to make greater efforts to explain their positions to reporters and to give journalists access to senior administration officials. However, there is no evidence that the Bush officials actually provided more information to journalists. Indeed, there were no differences between the responses of the Bush and Obama appointees to the question about withholding information; both groups were clear that they did not disclose information unless they believed that it served the president’s interests to do so. There are a variety of possible explanations for the complaints of reporters that the Bush Treasury was more open than the Obama Treasury. First, these complaints need to be approached with some degree of skepticism. As Obama Appointee 5 explained, reporters will always say you’re not doing a good enough job so you will do more for them. There’s a certain level of almost manipulation that has to happen in these transactional relationships and we need to protect and advocate for our principals. They’re never going to think it’s all done great. … If they weren’t saying you’re doing a bad job, then reporters would be doing a bad job.

However, the alleged differential between the two administrations was so widely described that it nevertheless likely has some degree of merit. It may be true that some Republican press operatives perceive themselves to have a disadvantage that compels them to work harder to explain their positions. Nevertheless, to the degree that the greater access they provide simply represents greater efforts to “spin” the press – as Reporter 2, who worked for an outlet popularly perceived to be conservative, alleged – it is unclear that this difference redounds to the benefit of the American people. The fragility of the U.S. and global economy during the period in which the Obama appointees served is another possible explanation for any differential that may have existed in the level of access accorded to the press under both administrations. For example, in his memoir of his response to the financial crisis, Obama administration Treasury Secretary Timothy Geithner described his first speech as Secretary, which he delivered during market hours. Geithner noted that “stocks plummeted more than 3 percent before I even finished talking and nearly 5 percent by the end of the day.” He admitted that the speech was responsible for “rattling confidence at a bad time.”15 The Treasury is generally considered to be one of the more conservative press shops in Washington; amidst a still shaky economic recovery, and with the knowledge that a single statement could damage that recovery by

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diminishing confidence, it is unsurprising that the Obama appointees would have approached interactions with the press particularly cautiously. Of course, it is unclear whether this caution served the interests of the American people. Releasing information with care in order to avoid roiling markets is good for the American people; yet the American people also have a great interest in receiving as much information as possible about an administration’s thinking and policies and the state of the economy. To be sure, there is strong precedent in American history for presidents of the United States to restrict the rights of citizens during times of emergency. This has especially been the case during times of war; President Lincoln started the Civil War without Congressional authorization, expanded the Army and Navy, suspended the writ of habeas corpus, and declared martial law in parts of the country. In his letter to Albert G. Hodges, Lincoln argued that “measures, otherwise unconstitutional, might become lawful, by becoming indispensable to the preservation of the constitution, through the preservation of the nation.”16 There is also certainly precedent for the expansion of presidential power during economic crises. In response to World War I, for example, President Wilson expanded his control over the economy by fixing prices and regulating industries. However, this study suggests that the Treasury may have responded to the 2008 financial crisis in part by being less forthcoming with the press. While many scholars have charged the government with over-classifying information, particularly during times of emergency, the withholding of non-classified information or explanations for the protection of the country has not previously been identified or discussed in the literature.17 The findings of this study suggest that, during times of crisis, government agencies may respond in part by being less open with the press – a proposition that should be tested with additional case studies. Likewise, the question of whether there are broader partisan differences in press tactics would require additional evidence outside of the scope of this project, including data from other Democratic and Republican administrations. Nevertheless, it is a question worthy of future research.

CONCLUSION This study found that reporters believed that Treasury spokespeople who served during the Bush administration were more forthcoming with the press than those who served during the Obama administration. Although interviews with reporters and appointees did not generate evidence that Bush appointees actually provided more information to journalists, reporters believed that the Bush appointees made more of an effort to provide members of the press with explanations and access to senior officials. Many reporters believed this to be the case because Bush appointees perceived a liberal media bias and therefore worked harder to explain their positions to reporters. Interviews with the Bush appointees confirmed that many indeed perceived this bias and attempted to compensate for it. Further research should explore whether this represents a broader phenomenon that distinguishes Democratic and Republican communicators. A second explanation for this finding is that the Obama appointees inherited a much more fragile economy than did the Bush administration and were therefore more cautious in their communications, in order to avoid roiling markets. Further research should

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likewise study whether restricted exchanges with the press are a broader phenomenon that occurs during other national crises.

ENDNOTES 1

Scott McClellan, What Happened: Inside the Bush White House and Washington’s Culture of Deception (New York: PublicAffairs, 2008), p. 88. 2 McClellan, What Happened, p. xiii. 3 Frank Rich, The Greatest Story Ever Sold: The Decline and Fall of Truth in Bush’s America (New York: Penguin Books, 2006), pp. 162, 166. 4 Ken Walsh, “Reporters Say Obama White House ‘Most Secretive’ Ever,” U.S. News and World Report, 2014 (http://www.usnews.com/news/blogs/ken-walshs-washington/ 2014/05/01/reporters-say-obama-white-housemost-secretive-ever). 5 Alexander Hamilton, James Madison and John Jay, The Federalist Papers (New York: Penguin, 1987), p. 320. 6 Hamilton, Madison, and Jay, The Federalist Papers, pp. 344-345, 413, 405-406. 7 Max Farrand, ed. The Records of the Federal Convention of 1787, Vol. 2 (Yale University Press, 1911), p. 260. 8 James Madison, “Report on the Virginia Resolutions,” 1800 (http://presspubs. uchicago.edu/founders/documents /amendI_speechs24.html). 9 Thomas C. Hennings, Jr., “Constitutional Law: The People’s Right to Know,” American Bar Association Journal, vol. 45 (1959), p. 669. 10 Farrand, The Records of the Federal Convention of 1787, Vol. 2, p. 256 11 Hamilton, Madison, and Jay, The Federalist Papers, p. 403. 12 Michael Baruch Grossman and Martha Joynt Kumar, Portraying the President: The White House and the News Media (Baltimore: Johns Hopkins University Press, 1981), p. 273. 13 See U.S. House of Representatives Committee on Oversight and Government Reform, “Policy and Supporting Positions,” 2012 (http://www.gpo.gov/fdsys/pkg/GPO-PLUMBOOK-2012/html/GPO-PLUMBOOK2012.htm). 14 Andrew Dugan, “Fewer Americans Identify As Economic Conservatives in 2013,” Gallup, 2013, (www.gallup.com/poll/162746/fewer-americans-identify-economic-conservatives-2013.aspx). 15 Timothy F. Geithner, Stress Test: Reflections on Financial Crises (New York: Crown Publishers, 2014), p. 13. 16 See Abraham Lincoln, “Letter to Albert G. Hodges,” 1864 (www.abrahamlincoln online.org/lincoln/speeches/hodges.htm). 17 E. Herman, “A post-September 11th balancing act: Public access to US government information versus protection of sensitive data,” Journal of Government Information, vol. 30 (2004).

In: The George W. Bush Presidency. Volume II Editors: Meena Bose and Richard Himelfarb

ISBN: 978-1-63485-557-0 © 2016 Nova Science Publishers, Inc.

Chapter 15

COMMENTARY: THE CHALLENGES OF STAYING ON MESSAGE* Ron Christie Special Assistant to the President and Director of Policy Initiatives and Intergovernmental Affairs, 2002-2004 Deputy Assistant to the Vice President for Domestic Policy, 2001-2002

I started in day one in the George W. Bush White House as the deputy domestic policy adviser to Vice President [Dick] Cheney, before moving over to be a special assistant to President George W. Bush in 2002. And from day one, what we try to do is we try to define how the President would communicate his policies to the American people who had elected him, as well as our friends and allies around the world. And the way that we tried to do this, in the opening days, Karl Rove who is the president’s senior adviser, he had an organization that he brought together on a fairly regular basis of all the senior staff in the White House. He nicknamed the group, or he dubbed the group, “the Blair House group.” And if you have to ask why, yes they did actually meet in the Blair House. What they did is, they sat down and they looked at the President's policies. They looked at his messaging. They looked at all sorts of things-- how are we positioning President Bush for success, and how do we make sure that we keep him there and keep him on message? And again, these were the most senior folks, the folks with the title of assistant to the President, which in a White House, the folks who are at the most senior level, the assistant to the President, which would be the national security adviser, the press secretary, all those folks would gather around. But Karl Rove was pretty smart. He recognized that those who sit around the senior staff table in the White House every morning, might not necessarily give him the most candid advice and a candid approach. So he dubbed and brought together a second group, of which I was a part of, called “the conspiracy of deputies.” And he figured, well, the deputies have nothing to prove except of course, giving their candid counsel to

*

Selected commentary from “White House Communication in the George W. Bush Presidency” forum, Conference on the George W. Bush Presidency, Hofstra University, March 26, 2015.

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Rove, they might be little bit more forthcoming about really, where are we? Is the President really messing up or is the President doing a good job? Now I bring this up because, in one of the earliest meetings that we had, “the conspiracy of deputies,” we sat down and we thought, what does the George W. Bush Presidency look like? This is early of course in 2001. How are we going to make our mark? How are we going to communicate to the world who we are? The first thing that we sought to do and we talked about is, we wanted to be a different kind of Republican. We wanted to position the President as a different kind of Republican and communicate that as such. And to do this, we wanted to look at new ways to communicate our policies, we wanted to offer new solutions, and of course we want to look to try to find different coalitions that we could build upon beyond our traditional base that had elected him to office. And second, one of the things that we wanted to do is to make sure that President Bush could try to change the tone in Washington, and communicate that he sought to change the tone in Washington. Here, we argued over things like how do we stress personal responsibility? How do we share credit for success with our allies? And of course, how can we treat others with dignity and respect rather than attacking one another? And concurrent to these efforts that I just mentioned, we also sought to deliver on what we promised. And for President Bush that meant, of course, number one: reforming public education; number two: finding ways to have institutions of faith to work together, to modernize Social Security, and of course to find a prescription drug benefit as part of the Medicare program. I’ll let the historians assess our specific track record of success, but I think if you look at many of the domestic accomplishments that we sought to do, I think that we did a fairly good job. Before I close, I want to really give you sense very briefly on how we communicated internally to make sure that our message was being articulated properly to the country and to the world. Twice a week, Karl Rove and Karen Hughes would bring together a group called “the message meeting,” and in case you’re wondering, yes, we talked about the message. But what was the message? We would talk about President Bush’s calendar, the day following, the day we’re sitting in a meeting, and we would go three months out and we would talk about everything from who he would meet, where he would travel, what he would visit and what he would say, and to make sure that we were on message. Do we have a strong theme? Did we have a purpose and of course, for the President of the United States, the most valuable commodity that they have is their time. Were we properly utilizing his time? Now beyond this, we would sit and we would say, “We need to make sure that his policy time, the policies that he’s articulated, when you look at No Child Left Behind, when you look at modernizing Social Security, that time was well spent as well.” And if message meetings were those to sort of take it beyond the walls of the White House, I think the most difficult meeting that I had to be a part of, was something called the policy deputies and Josh Bolten, who was then our White House deputy chief of staff, would bring together every single policy deputy in the White House policy organizers. That’s the Domestic Policy Council, that’s the Homeland Security Council, those are the folks at the National Security Council, and we’d say, “I need time on the President’s calendar next week.” We had these big easels that were on Josh’s back wall, and they would say, “Monday, there’s 20 minutes available. Tuesday, there are 10 minutes available.” And literally, Josh would let the policy deputies fight it out. “I need five minutes of the President’s time because X.” And then another deputy might say, “Well, Ron that doesn’t make sense

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because the theme of the message that we have this week, that’s off message. That’s not what the President is seeking to talk about.” From an internal perspective of making sure that we really zealously guarded his time, so that he could prepare for his speeches and prepare to go out and to interact with the American people as well as our internal discussions of dealing with folks of if you’re going to get to the Oval Office, you have to make sure that you’re utilizing that time properly. We felt that in the first term of the Bush Administration, this was the best way for us to move forward beyond the podium, beyond the Press Secretary. There is so much more of a complex apparatus at play in a White House, and particularly this George W. Bush White House of, are we on message? Are we communicating? And are those communications resonating?

Howard B. Dean III Senior Presidential Fellow, Peter S. Kalikow Center for the Study of the American Presidency, Hofstra University Former U.S. presidential candidate (2004 election), chairman of Democratic National Committee, and governor of Vermont; practicing physician I’ve never been inside a White House press operation, and certainly not the Bush White House press operation, so I’m going to take a slightly different tack. I think that most people here know that I have extremely strong views about this particular President’s administration, and his successes, or lack of same, both foreign and domestic, which I don’t see a lot of point in reiterating. But I do want to make some observations that I think are fair, and will be surprising to most of you. First of all, I knew President Bush for six years, while he was Governor, and I was Governor, and he’s a good guy, and I liked him a lot, and he was quite a stand-up guy, he kept his word on some business dealings between Vermont and Texas that he didn’t have to do, refunded us some money that we thought we were owed, and he was probably within his legal rights not to pay. So I like him as a human being. And he had some personal interactions with my family that caused me to do that. He was also a very good politician, and he doesn’t get a lot of credit for being a great politician because he followed, in my view, the greatest politician since Franklin Roosevelt, in terms of his political skills, which is Bill Clinton. You won’t see another Bill Clinton in your lifetime, and I’m talking to the students here. The last one with his talent was not Jack Kennedy, it was Franklin Roosevelt, and we don’t see people like that very often. Bush was a very good politician, he was good with people, he related to people well, and I tell you these two things as context because I think the relationship between the media and George W. Bush was not a great one, although it often isn’t, with presidents, it’s not particularly good one now. And it’s probably because of the character of the media, which I want to spend the bulk of my time on. I divide the Bush Presidency from a PR [public relations] point of view into four. The first is the post-election phase, he really. . . . The election was a disputed election -- in fact I would argue that Al Gore actually won, but the Supreme Court decided to do something different. And I say that because there actually is a mechanism to elect the president when the election is in dispute, and it has nothing to do with the Supreme Court, it’s Congress, and my view is that Gore was partly responsible for what happened with Bush v. Gore because he

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could have just said, “Well, we appreciate the Supreme Court’s views, but the Congress has the ultimate say.” And we might have lost that anyway. I think his numbers after he got to be president were not as good as most presidents would be because it wasn’t this sort of coronation, it was a really ugly process. Then there was the post-9/11 and his [approval] numbers were in the 90s; but for the same reason that every president who presides over a country that has been attacked, or a president who presides over a country where troops are sent, in America’s interest, their numbers are great, and everybody wants to support the president, regardless of how far away they may be in their political views. Then came the Iraq War, and initially of course there was a huge surge of support for the president because these were our troops, and everybody conflates supporting the troops and supporting their president. That began to be a liability, after it had been there for a while. And finally, and I think in some ways that he never recovered from this, was [Hurricane] Katrina. And I’d love to know, because I have no idea whose idea it was to send him looking out of the jet down on a thousand people or however many were on the ground. But again, I want to reiterate by this by saying, I like George W. Bush as a human being, and I don’t think that he meant any of things that people accused him of meaning. I think it was a PR blunder, and it probably wasn’t his fault.

Ed Rollins Senior Presidential Fellow, Peter S. Kalikow Center for the Study of the American Presidency, Hofstra University Former adviser to four U.S. Presidents (Richard Nixon, Gerald Ford, Ronald Reagan, George H.W. Bush) Can you imagine, every day you get up and you go to work at six or seven o’clock in the morning. Every single day you’ve got world crises to deal with, you’ve got economic crises to deal with, you basically start a day, most of the White House staff comes in at seven, eight o’clock you have a senior staff meeting. The president starts having meetings all day long and 60, 70 percent of your time dealing in international events, probably higher today. You do a very effective job, you keep trying to make big decisions all day long. And the people who are going to interpret what you’ve done are the press corps. So, it’s not that we try and manipulate you and if you look around this room, this is about the size of what a press corps is every day. And a press secretary steps out front and stands up and says, “Here’s what the President did today and here’s why we did it," and what have you. Then you try and coordinate the message. I think President Bush, whom I’m a big fan of and I think obviously had as troubled a Presidency as any man, in the sense that he inherited things that came into the environment. I think he learned a lot from his dad and he didn’t want to duplicate his dad, he wanted to duplicate a lot of what the Reagan administration did, and I was a part of the Reagan administration. And we stepped in and our premise, and it was a much different environment to deal with in those days, was that we was going to control our own story. We weren’t going to let the national media, you had a job to do and we understood you had a job to do and you were not going to write our press releases.

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So, how can we basically drive our message, our story and do it in a very coordinated way? Now, unfortunately for the first President Bush (41), when he got elected, he thought, “Okay, I’m going to do it differently than President Reagan did. I’m not going to have the coordinated effort, I’m not going to have the story of the week, I’m not going to have everybody talking in the same page. I’m going to go out and meet with the press, throw anything at me that you want to throw at me.” And he did, and unfortunately when you do that, if each and every one of you is writing a story and it’s not a controlled story and you ask questions, then basically you go in 25 different directions. I think to a certain extent, even though, 41’s Presidency is being re-examined and given much higher marks than it was when he left office, but to the Bush people, Bush W., his father had lost. A very good man had lost and why did he lose? And when they went back and looked at things, part of it was that they weren’t able to tell their stories effectively. They had an extraordinary woman in there by the name of Karen Hughes and Karen had been one of President Bush’s closest advisors, she’d been a news world woman, an anchor in Texas. She came up with him. And she was clearly one of the real strengths of his administration initially. Ari Fleischer, who was the first press secretary, had not been a Bush person, he’d been Elizabeth Dole’s person. But Karen had a great relationship with the President and could put real discipline into it. And she wasn’t afraid of Karl Rove, and Karl Rove obviously had to tread carefully around her. Unfortunately, she left after two years in the administration to go back home. She had a young family and there was pressure for her to go back. She came back in the administration later as a deputy secretary of state. But I think when she was there, there was a real discipline. I think they lost a little of that discipline. And, obviously, when you got stories like the bombings and the Trade Centers and the Pentagon, you sort of lose track of whatever it is that you want to be. You want to talk about education, everybody else wants to talk about something else. Equally as important, I don’t think you can ever underestimate the difference in the media today, we take it all for granted and young people don’t know any different, but when we were in the Reagan White House, which was sort of the beginning of the modern, how do you control television, world, I can’t even control the story. Others tried it before, but I think we did it pretty effectively. We had CBS, NBC, ABC, PBS. CNN in 1981 first came into existence and the White House did not accredit them. They had to go to federal court and the four networks went against them. Said they weren’t a legitimate news agency and a federal judge basically said they are news agencies, we had to accredit them. The world changed dramatically. And by the time you got to Bush 43, you didn't just have CNN, you had Fox, you had CNBC, you had MSNBC, you had the main cable stations, and it was the beginning of the blog era. So, it used to be you could control your story, whatever the New York Times, the Washington Post, published that morning, your job all day long was to make sure your story didn’t get complicated by what they were covering, and your battle was to make sure what was on the network news that night, going from a million people reading it in the New York Times and the Washington Post to 30 or 40 million watching them on TV. So, you had an entire day to basically manipulate, manage -- I don’t like manipulate -- but manage your story. Today, it’s instant. Today, something breaks, 15 seconds later, it’s on a blog, 30 seconds later it’s on one of the networks, it’s on one of the cable news networks. And I think when the Bush people came in, particularly after the feeding frenzy that went on during the Clinton administration -- I agree with Howard [Dean], Bill Clinton is the most gifted politician I’ve

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seen in my lifetime and I’ve worked for a couple of pretty good ones. But he understood politics very, very well. Didn’t control his message all the time very well. And I think to a certain extent, a lot of what the Bush people wanted to do is really control the message-- make sure what we thought was important, but again not writing your press release or your stories, but we thought was important that we will try to get out there. Also, and I think you can never underestimate this, George W. Bush would literally go nuts about leaks and so they really had a no-leak policy. I mean there was a great discipline in that White House about not leaking stories. And every time there was a leak, and I never wanted to get one, so many Reagan stories -- one time, [Director of Central Intelligence] Bill Casey came into the senior staff at the White House which is about 12-14 people, to complain about CIA [Central Intelligence Agency] stuff getting leaked. Fifteen minutes after he left, Ann Devroy, who was the White House correspondent for the Washington Post said that eight people in that meeting had called to say Bill Casey was in there, briefing about leaks. They had leaked the story. We had a pretty good leaky shift in our administration and I think obviously, the other administration recognized that problem. So, I think that discipline was there, I think the team was good, I think a lot of the problem was the press had changed dramatically. And it’s there today. It’s now forever, even though we lost a lot of the great editors and the great entities that used to be we can’t consider mainstream media today. You’ve got so many fundamental differences out there today and those 17,000 journalists that get displaced, unfortunately, all now can write blogs or do whatever without an editor trying to make sure the stories are there. So, I think, the Bush administration was affected more by the lack of ability to control that environment. You don’t control wars, you don’t control terrorism, you don’t control the economic breakdown, and as much as they attempted to do all that, and I think they were pretty good at it, but the stories are just overwhelming. So, I give them great credit. I think the American public never got to see the George W. Bush that a lot of us had saw. He was an extremely personable man, and he was a smart man, a much smarter than people gave him credit for. Obviously, he had a very big player that we’ve talked about with Dick Cheney as his Vice President. Cheney also didn’t deal with the press, but he had a very capable person and Mary Matalin, who was one of his assistant senior advisers, who knew the media as well as anybody. I think at the end of the day, it was more the circumstances and the changing in the environment of the national news media that had some real impact on the presidency. Not that decisions that were made didn’t have an impact on the end point but I think it’s awfully hard to sell good stories on wars. It’s awfully hard to sell good stories in an economic crisis. But I think he in a different environment with a different economy would have been sitting here, and we would be praising a President who obviously understood the media, understood the country, very, very well.

LIST OF CONTRIBUTORS *Positions for officials who served in the George W. Bush administration are listed before each speaker’s commentary in the volume.

KARA ALAIMO is Assistant Professor in the Department of Journalism, Media Studies, and Public Relations at Hofstra University. Her research focuses on international and political public relations. BRADLEY A. BLAKEMAN is Principal of The 1600 Group in Washington, D.C. He also is an award-winning adjunct professor at Georgetown University, where he lectures in the Semester in Washington Program. Before working in the George W. Bush administration, he was active in the Bush 2000 campaign, organizing media events in key battleground states. He also served on the senior staff in the George H.W. Bush administration. Before his political career, he was a litigator in New York for 13 years. MEENA BOSE is Executive Dean of Hofstra University’s Peter S. Kalikow School of Government, Public Policy and International Affairs, and the Director of Hofstra’s Peter S. Kalikow Center for the Study of the American Presidency. She is the author or editor of many books on the American presidency and American politics. TIMOTHY CANOVA is Professor of Law and Public Finance at the Nova Southeastern University Shepard Broad College of Law in Fort Lauderdale, Florida. His work crosses the fields of law, economic history, and public finance, and has been published in dozens of book chapters and journals in the U.S. and abroad. DARYL A. CARTER is Associate Professor of History at East Tennessee State University, where he teaches American political history and African American history. He is the author of Brother Bill: President Clinton and The Politics of Race & Class (University of Arkansas Press, 2016) and the forthcoming Racism and the American Presidency: How Presidents Have Handled Racial Issues—From Washington to Obama.

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RONALD I. CHRISTIE is CEO of Christie Strategies LLC, an independent media and political strategy firm. He previously served as vice president of Navigators Global LLC, a strategic consulting and communications firm. He also served as executive vice president and director of global government affairs at Ruder Finn and Of Counsel at the Washington, D.C., law firm Patton Boggs, LLP. Before serving in the George W. Bush administration, he briefly served as counsel to U.S. Senator George Allen (R-VA). He was a senior advisor to then-House Budget Committee Chairman John Kasich from 1992-1999. DAVID B. COHEN is Professor of Political Science and Fellow in the Ray C. Bliss Institute of Applied Politics at The University of Akron. He has authored and edited numerous books, book chapters, and scholarly articles on the American presidency and is a frequent media contributor on national and Ohio politics. HOWARD B. DEAN III is a Senior Presidential Fellow at Hofstra University’s Peter S. Kalikow Center for the Study of the American Presidency. He is a former Democratic National Committee chairman, U.S. presidential candidate, six-term governor of Vermont, and practicing physician. He is a senior strategic adviser and independent consultant, focusing on health care and alternative energy, for the government affairs practice at Dentons LLP, an international law firm. JOAO DE SOUZA is Assistant Professor of Economics at Middlebury College. He holds a Ph.D. in Economics from the University of Massachusetts-Amherst, and his research and teaching interests focus on the intersection of macroeconomics and economic development. JOEL K. GOLDSTEIN is Vincent C. Immel Professor of Law at Saint Louis University School of Law. He is the author of numerous books and articles on the presidency, vice presidency, presidential succession and inability, constitutional law, and the Supreme Court. His most recent book is The White House Vice Presidency: The Path to Significance, Mondale to Biden (Kansas, 2016). MATTHEW GRITTER is Assistant Professor of Political Science at Angelo State University. He is the author of Mexican Inclusion: The Origins of Anti-Discrimination Policy in Texas and the Southwest (Texas A&M University Press, 2012) and The Policy and Politics of Food Stamps and SNAP (Palgrave Macmillan 2015). He received his B.A. from Wheaton College (Massachusetts) and his M.A. and Ph.D. from the New School for Social Research. CHRISTOPHER HICKMAN is Assistant Professor of History at Tarleton State University, a member university in the Texas A&M system. He has taught at the University of North Florida and the University of Mississippi. He is currently working on a manuscript about the Warren Court and its many enemies during its lifespan.

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RICHARD HIMELFARB is Associate Professor of Political Science at Hofstra University. He is the co-editor (with Rosanna Perotti) of A True Third Way? Domestic Policy and the Presidency of William Jefferson Clinton (Nova Publishers, 2014) and Principle Over Politics? The Domestic Policy of the George H.W. Bush Presidency (Praeger, 2004). He is also the author of Catastrophic Politics: The Rise and Fall of the Medicare Catastrophic Coverage Act of 1988 (Pennsylvania State University Press, 1995). KAREN M. HULT is professor of political science and chair of the Center for Public Administration and Policy at Virginia Tech. She is the author or co-author of four books and numerous articles and book chapters on the U.S. presidency and executive branch design and dynamics. She is a past president of the American Political Science Association’s Presidency Research Group and a former book review editor for Presidential Studies Quarterly, and she serves on the editorial boards of Congress & the Presidency and Presidential Studies Quarterly, among others. MICHAEL MEEROPOL is Professor Emeritus of Economics at Western New England University. He is the author of Surrender: How The Clinton Administration Completed the Reagan Revolution (Michigan, 2000), and (with Howard Sherman) Principles of Macroeconomics: Activist Versus Austerity Policies (M. E. Sharpe, 2013). SHAHRUZ MOHTADI is Associate Professor and Chairman of the Economics Department at Suffolk University. He has published in academic journals and other edited volumes. PIA M. ORRENIUS is Vice President and Senior Economist at the Federal Reserve Bank of Dallas. She is a labor economist, focusing on regional economic growth and demographic change. She manages the regional group in the Dallas Fed Research Department. She is coauthor of the book Beside the Golden Door: U.S. Immigration Reform in a New Era of Globalization (AEI Press, 2010). Her scholarly research examines the labor market impacts of immigration, unauthorized immigration, and U.S. immigration policy. ANNE-IMELDA RADICE is Executive Director of the American Folk Art Museum in New York City. She has worked as a curator, administrator, and director in cultural and nonprofit organizations throughout her career. Before serving in the George W. Bush and Barack Obama administrations, she was the first Director of the National Museum of Women in the Arts; Curator of the U.S. Capitol, Office of the Architect of the U.S. Capitol; and Assistant Curator, National Gallery of Art. EDWARD J. ROLLINS is a Senior Presidential Fellow at Hofstra University’s Peter S. Kalikow Center for the Study of the American Presidency. He managed President Ronald Reagan’s 49-state landslide re-election campaign in 1984, and has had major managerial roles in nine other presidential campaigns. He served in the administrations of four U.S. presidents (Richard Nixon, Gerald Ford, Ronald Reagan, and George H.W. Bush), including two tours of duty as assistant to the president, the highest staff appointment in the White House. In 2010, he was inducted into the American Association of Political Consultants Hall of Fame.

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ALAN SINGER is a Social Studies Educator and Historian in the Department of Teacher Education Programs at Hofstra University. He is a graduate of the City College of New York and has a Ph.D. in American history from Rutgers University. He taught at a number of secondary schools in New York City, including Franklin K. Lane High School and Edward R. Murrow High School. Dr. Singer is the author of Education Flashpoints (Routledge, 2014), Teaching to Learn, Learning to Teach: A Handbook for Secondary School Teachers, 2nd edition (Routledge, 2013), Social Studies For Secondary Schools, 4th Edition (Routledge, 2014), Teaching Global History (Routledge, 2011), and New York and Slavery, Time to Teach the Truth (SUNY, 2008). He writes a regular blog on educational issues for Huffington Post. MARC SUMERLIN is Managing Director of Evenflo Macro, a business that integrates analyses of economics and foreign affairs with assessments of political realities. He founded the company in 2013. He previously served as managing director of the Lindsey Group, a global economic consulting firm. Before advising the George W. Bush presidential campaign and serving in the administration, he worked for the U.S. Senate Budget Committee. CHARLES E. WALCOTT is Professor Emeritus of Political Science at Virginia Tech. He is author or co-author of numerous articles and books on the presidency and related subjects, former co-editor of the journal Congress and the Presidency, and a former President of the American Political Science Association’s Presidency Research Group.

INDEX # 2001 recession, 26, 43, 75 2008 financial crisis, 102, 158, 160, 161, 164 20th century, 137, 150 21st century, 69 9/11, xi, xii, 41, 43, 51, 93, 97, 98, 103, 105, 106, 125, 145, 170 9/11 Commission, 105

A AARP, 51, 56, 58 abuse, 74, 138 academic progress, 68 access, xiii, 9, 34, 38, 73, 76, 77, 78, 81, 93, 95, 99, 100, 104, 126, 138, 155, 156, 158, 160, 163, 164, 165 accommodations, 136 accountability, 68, 69, 125, 147, 156 accounting, 7, 15, 48 Ackerman, Arlene, 66, 67 activism, xiii, 131, 147 activists, 120 actuality, 81 adjustment, 32 administrative efficiency, xiii administrators, 68, 104 advocacy, 59, 153 affirmative action, 138 Afghanistan, vii, xi, 4, 20, 39, 95, 97, 130, 134, 136, 144, 145, 153 African American(s), 67, 86, 136, 137, 138 age, 50, 82, 113, 118 agencies, 6, 7, 14, 164, 171 agriculture, 34 AIG, 6, 8, 11, 13, 103

Alito, Samuel, 142 American Bar Association, 165 American Civil Liberties Union, 143 American History, 65, 70, 72 American Presidency, viii, xii, xiii, 83, 86, 106, 107, 169, 170 Americans for Tax Reform, 146 amnesia, 153 amortization, 5 anger, 130, 137, 161 antidumping, 37 anxiety, 130 appointees, 151, 155, 156, 157, 158, 160, 161, 162, 163, 164 appointments, 6, 114, 117, 142, 151, 154 appropriations, 69, 139 Argentina, 36 armed forces, 131 Ashcroft, John, 100, 112 Asian Americans, 138 aspiration, 150 assessment, vii, xii, 32, 65, 66, 67, 68, 98, 145, 149, 150, 151, 153 assets, 3, 5, 8, 14, 27, 49, 61, 71, 82 Associate Justice, 121, 142 atmosphere, 124 Attorney General, 100, 102, 112 audit(s), 9, 15 authority, 6, 8, 9, 10, 11, 31, 32, 40, 78, 79, 93, 101, 106

B backlash, 15, 131 bad behavior, 121 Bahrain, 36, 39 balance sheet, 5, 133 ban, 80, 151

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bank charter, 6 bank holding companies, 7, 9, 10 bankers, 12, 130 banking, 4, 5, 6, 16, 102, 103, 134 bankruptcy, 11, 16, 102 banks, 3, 5, 6, 7, 8, 9, 10, 11, 13, 15, 16, 26 barriers, 31, 34, 35 Barron, David J., 154 base, xii, 31, 38, 81, 118, 121, 168 Baucus, Max, 97 Bear Stearns, 8, 9, 10, 13, 15, 102, 130 bending, 150 beneficiaries, 48, 49, 57, 131 benefits, 26, 29, 38, 39, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 59, 60, 61, 62, 75, 77, 79, 80, 81 benign, 136 Berkowitz, Peter, 145 Bernanke, Ben, 6, 13, 16, 43, 103 Bhagwati, 14 bias, xiii, 70, 155, 156, 158, 160, 161, 162, 163, 164 Biden, Vice President Joseph, 114 bilateral, 31, 32, 35, 36, 38, 39 birth control, 137 Blahous, Charles, 51, 60, 61 blame, xii, 7, 8, 69 blogs, 14, 16, 165, 172 blue-collar workers, 26 Bolten, Joshua B., 94, 96, 98, 106 bonds, 5, 7, 11, 53 bonuses, 67 Bork, Robert, 110, 115 borrowers, 5, 22, 25, 29 bottom-up, 12, 13 brassieres, 40 Brazil, 33, 34, 35, 36, 37 breakdown, 31, 35, 38, 172 Breaux, John, 97 Buchanan, James, 20 budget cuts, 48, 82 budget deficit, 20, 21, 22, 27, 59, 133, 138, 139 Bureau of Indian Affairs, 69 Bureau of Labor Statistics, 24, 28 Bush v. Gore (2000), 143 Bush, George H.W., 19, 22, 86, 94, 101, 110, 136, 139, 170 Bush, George W., v, vi, vii, viii, ix, xi, xiii, 3, 19, 20, 22, 23, 24, 29, 31, 41, 47, 48, 49, 58, 59, 60, 61, 62, 65, 66, 69, 70, 71, 73, 76, 78, 79, 80, 81, 82, 83, 84, 85, 88, 93, 94, 95, 96, 97, 101, 102, 104, 105, 106, 107, 109, 110, 112, 120, 121, 123, 129, 130, 132, 136, 138, 139, 140, 141, 142, 145, 147, 152, 153, 154, 155, 157, 167, 168, 169, 170, 172 Bush, Jeb, 82, 87, 152, 154

Bush, Laura, 66, 114 Bush, President, vi, xii, 4, 6, 7, 8, 9, 13, 22, 32, 33, 34, 35, 37, 38, 39, 41, 42, 43, 44, 49, 51, 54, 56, 60, 61, 62, 66, 67, 68, 69, 70, 71, 81, 82, 83, 85, 86, 87, 97, 98, 99, 101, 102, 103, 104, 110, 112, 117, 119, 123, 130, 131, 132, 133, 135, 138, 139, 140, 157, 162, 167, 168, 169, 170, 171 Bush, President George Herbert Walker, 20, 111, 116 Bush, President George Walker, v, vi, vii, viii, ix, xi, xiii, 3, 19, 20, 22, 23, 24, 29, 31, 41, 47, 48, 49, 58, 59, 60, 61, 62, 65, 66, 69, 70, 71, 73, 76, 78, 79, 80, 81, 82, 83, 84, 85, 88, 93, 94, 95, 96, 97, 101, 102, 104, 105, 106, 107, 109, 110, 112, 120, 121, 123, 129, 130, 132, 136, 138, 139, 140, 141, 142, 145, 147, 152, 153, 154, 155, 157, 167, 168, 169, 170, 172 business cycle, 24, 42 businesses, 4, 13, 25, 27, 40, 131, 133 buttons, 141, 142, 152

C Cabinet, 125, 130 cabinet members, 103 Camp David, 96 campaigns, 41, 82, 103, 130, 138, 151 Cancun, 34, 35 candidates, 15, 50, 59, 82, 107, 113, 114, 117, 118, 142, 148 capital flows, 4 capital gains, 133, 146 capital inflow, 5 capital markets, 14 capitalism, 3, 145 Card, Andrew, xiii, 93, 94, 95, 112 Caribbean, 35 Caribbean countries, 36 cartel, 4, 12 case studies, 164 case study, 7, 157, 158 cash, 9, 34 Catholic Church, 137 caucuses, 129 CBS, 15, 171 central bank, 3, 12, 13 certification, 77 CFR, 16 Chad, 122 challenges, 69, 94, 102, 112, 118, 135 Chamber of Commerce, 56, 131 chaos, 19 Cheney, Dick, xiii, 20, 39, 119, 125, 145, 172

Index Cheney, Richard, 94 Chicago, 60, 105, 119, 131, 144, 151 chicken, 96 Chief Justice, 110, 114, 120, 142, 151 Chief of Staff, 85, 94, 95, 96, 98, 100, 101, 103, 104, 105, 106, 125 child labor, 38 children, xii, 48, 50, 66, 67, 68, 69, 76, 85, 125, 134, 137 Chile, 35, 39 China, 4, 32, 33, 34, 36, 37, 40, 132 Christians, 152 Chrysler, 103 CIA, 15, 101, 172 cities, 137 citizens, 48, 50, 55, 73, 80, 82, 137, 156, 164 Citizens United v. FEC (2010), 151 citizenship, 138, 153 civil rights, 136, 150 Civil War, 164 class size, 70 classification, 24 classroom, 69, 88 Cleland, Max, 58 Clement, Edith Brown, 113 clients, 11 Clinton Administration, 19, 20, 22, 26, 27, 29, 132 Clinton, Hillary Rodham, 129 Clinton, President William Jefferson (, 5, 20, 22, 27, 119, 139, 144 Clinton, Senator Hillary, 114, 129 Clinton, William Jefferson, 144 clone, 113 clothing, 36, 141 CNN, 15, 99, 122, 171 Colbert, Stephen, 152 Cold War, 97, 129, 130, 131, 145, 148 College Station, 105, 106 colleges, 131 Colombia, 35, 38 commerce, 132 commercial, 5, 7, 8 commercial bank, 5, 7, 8 commodity, 168 common law, 10 communication, 156 communities, 74 community, 69, 137, 144 compassion, 78, 82, 144 compensation, 38, 57, 161 competition, 6, 26, 32, 34, 58, 137, 138 competitive advantage, 37 competitors, 13, 37, 145

179

complexity, 154 complications, 142 composition, 109, 118, 119 computer, 126 computerization, 132 conference, vii, viii, ix, xi, xii, 52, 106, 113 conflict, 4, 14 Congress, xi, 5, 9, 10, 11, 20, 29, 31, 32, 33, 35, 37, 38, 39, 40, 41, 42, 43, 44, 51, 52, 53, 55, 57, 58, 59, 60, 62, 68, 71, 75, 76, 77, 80, 93, 98, 102, 103, 105, 107, 122, 132, 133, 135, 136, 138, 140, 143, 146, 150, 169 Congressional Budget Office, 14, 28, 41, 132, 140 consensus, vii, 3, 12, 14, 51, 111, 144, 150, 152 consent, 156, 157 conservative principles, 74, 144 conspiracy, 67, 167, 168 constituents, 32, 105 Constitution, ix, 72, 112, 115, 135, 137, 156, 157 constitutional law, 115 construction, 130 consulting, 149, 154 consumers, 10, 26, 135 consumption, 3, 4, 25, 27, 132 controversial, vii, xi, xiii, 50, 51, 100, 102, 111, 117, 130, 133, 134, 139, 158 convention, 142, 143, 152 cooperation, 35 corporate governance, 7 corporate scandals, 21 cost, 4, 22, 33, 41, 43, 48, 79, 103, 119 Costa Rica, 35 Coulter, Ann, 148 counsel, viii, 96, 100, 101, 102, 110, 112, 113, 117, 124, 154, 167 countervailing duty, 37 covering, xiii, 11, 171 CPI, 23, 28 cracks, 66 Crawford v. Marion County Election Board (2008), 151 credentials, 112, 115, 116 credit rating, 7, 8, 14 crises, 102, 156, 164, 165, 170 criticism, xii, 50, 53, 56, 57, 59, 60, 68, 81, 102, 111, 115, 143, 149 cronyism, 115 crowding out, 21, 22, 23, 29 crown, 55 Cruz, Ted, 151 Cuba, 35, 137 culture, 66, 80, 130, 137, 148, 151 currency, 4, 11, 14, 26, 37

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Index

current account, 4, 14 current account deficit, 4, 14 curriculum, 68, 69, 70

D danger, 27, 29 Daniels, Mitch, 98 data mining, 146 database, 40 debts, 61 decision-making process, 126 deficiency, 135 deficit, 20, 21, 22, 23, 24, 25, 26, 27, 29, 48, 57, 58, 139 deflate, 5, 27 deflation, 13 deindustrialization, 129, 131, 137 democracy, 32, 70 Democrat, 9, 42, 81, 110, 117, 144, 147 Democratic Party, 21, 29, 35, 129, 137, 138, 139, 141, 143 democratization, 36 democrats, 40, 105 demographic change, 49 denial, 136 Denmark, 113, 120 Department of Commerce, 37 Department of Education, 66, 72, 85, 88, 147, 149, 150 Department of Homeland Security (DHS), 59, 95, 97, 98 Department of Justice, 100, 102, 150 Department of Justice Civil Rights Division, 150 Department of the Treasury, 139, 156, 157 depreciation, 133 depression, 13, 27 Deputy Chief of Staff, 96, 98, 100, 103, 125 deregulation, 3, 5, 6 derivatives, 5, 6, 10, 11, 12, 13 despair, 134 destiny, 126 destruction, 10 developed countries, 34 developing countries, 33, 34 dichotomy, 151 dignity, 134, 168 disadvantaged students, 67 disappointment, 39, 142, 146, 161 disaster, 24, 48 disclosure, 10, 157 discrimination, 37, 38, 136 dissatisfaction, 130

distribution, 25, 34, 37 distribution of income, 25 District of Columbia, 151 District of Columbia v. Heller (2008), 151 diversity, 112, 113, 114 Dodd-Frank Wall Street Reform and Consumer Protection Act, 13 Doha, 31, 34, 35, 36, 38, 39 Dole, Elizabeth, 171 domestic agenda, xi, 96, 100, 102 domestic industry, 34 domestic investment, 23 domestic issues, xi, xiii domestic policy, xii, 48, 74, 77, 78, 86, 87, 97, 124, 136, 141, 145, 153, 167 Domestic Policy Council, 168 Dominican Republic, 35 donors, 4, 52 drug testing, 82 drugs, 135 Dubai Ports World, 36, 40, 100 dumping, 37 Duncan, Arne, 67, 71, 86 durability, 146

E earnings, 4, 7, 8, 48, 53, 133 economic boom, 133 economic change, 130, 131 economic crisis, 172 economic development, 36 economic downturn, xii, 3, 60, 75 economic growth, xii, 3, 10, 22, 25, 29, 133 Economic Growth and Tax Reconciliation Act, 144, 146 economic policy, xii economic problem, xii economic theory, 21 economic transformation, 129, 132, 138, 139 economics, xi, 4, 9, 14, 16, 42, 130, 132, 136 Ecuador, 37 editors, 172 education, vii, xi, xii, xiii, 22, 32, 50, 51, 65, 66, 68, 69, 70, 71, 72, 85, 86, 87, 88, 96, 99, 132, 134, 135, 138, 147, 149, 171 education reform, vii, xi, xiii, 88, 96, 147 educational institutions, 149 educational materials, 131 educational policy, 65, 66 educational system, 87, 88 Edwards, George C., 59, 61 Egypt, 36

Index Eisenhower, Dwight David, 141, 142, 148 El Salvador, 35, 137 election, 4, 20, 21, 32, 33, 40, 41, 42, 43, 44, 47, 48, 52, 61, 82, 87, 94, 100, 101, 102, 103, 116, 118, 130, 136, 138, 142, 143, 153, 156, 169 electronic communications, 100 elementary school, 88 eligibility criteria, 75 e-mail, 16 emergency, 11, 100, 125, 164 Emergency Economic Stabilization Act, 103 Emergency Economic Stabilization Act of 2008, 103 employees, 48 employers, 48, 131, 134 employment, 23, 24, 34, 79 encouragement, viii, 129 enemies, 144, 147 energy, 58, 98, 104, 130 enforcement, 9, 44, 65, 79 enlargement, 145 enrollment, 73 environment, 6, 32, 60, 87, 94, 98, 118, 131, 136, 139, 148, 153, 154, 170, 172 environmental policy, 99 epidemic, 19 Equal Employment Opportunity Commission, 111 equality, 115 equity, 11, 13, 69, 126 erosion, 59 ethnic groups, 71 Europe, 130 European Union, 8, 33, 34, 37 Evans, Donald L., 98 evidence, 19, 22, 23, 29, 67, 69, 82, 142, 143, 146, 147, 149, 151, 155, 156, 163, 164 evil, 153 exclusion, 146 executive branch, 102, 157 Executive Order, 103, 107 Executive Order 13476, 103, 107 exercise, 11, 112, 124, 156 expenditures, 48, 76 expertise, viii exploitation, 70 export market, 37 export subsidies, 34 exporters, 33, 37, 38 exports, 33, 37, 39 exposure, 6, 11 extremists, 139

181

F factories, 138 fairness, 126, 147, 154 faith, 74, 77, 88, 144, 152, 168 Faith Based Initiative, 74 families, 12, 21, 44, 74, 77, 78, 80, 130, 133, 137, 139 Fannie Mae, 4, 102 far right, 139 Farm Bill, v, xii, 31, 33, 34, 38, 73, 74, 75, 77, 78, 80, 81, 83 farmers, 31, 32, 34, 80 FBI, 15 FDIC, 6, 7 fear(s), 20, 55, 137 FEC, 151 Federal Convention, 165 federal funds, 144 federal government, 4, 12, 19, 20, 27, 28, 29, 49, 54, 70, 100, 103, 129, 131, 133, 135, 136, 140 federal judiciary, 111 federal mandate, 138, 149 Federal Register, 72 federal regulations, 78 Federal Reserve, 5, 6, 9, 11, 12, 13, 15, 24, 26, 27, 28, 41, 43, 103, 130 Federal Reserve Board, 6, 103 federalism, 7, 130, 150 Federalist Papers, 165 FEMA, 115 fidelity, 152 financial, xiii, 3, 4, 5, 6, 8, 9, 10, 11, 12, 13, 14, 19, 23, 24, 26, 27, 29, 44, 48, 53, 59, 69, 82, 83, 102, 103, 107, 130, 131, 139, 148, 158, 160, 161, 163, 164 financial crisis, 3, 6, 10, 12, 19, 23, 24, 27, 44, 82, 83, 102, 107, 158, 160, 161, 163, 164 financial firms, 8, 10 financial fragility, 29 financial institutions, 4, 5, 6, 9, 13, 26, 27 financial markets, xiii, 10 financial sector, 26, 27, 103, 148 financial stability, 102 financial support, 69, 139 financial system, 4, 8, 12 fiscal policy, 4, 73 fiscal year, 21, 28, 37, 69, 132 flexibility, 72, 78, 79 food, xii, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 84, 150 food chain, 150 Food stamps, 76, 78, 81

182

Index

force, 40, 110, 149 Ford, 72, 86, 105, 142, 170 Ford, Gerald, 86, 105, 142, 170 Ford, Gerald Rudolph, 86, 105, 142, 170 foreign affairs, vii, xii foreign exchange, 13 foreign investment, 34 foreign nationals, 81 foreign policy, xi, 39, 73, 82, 131, 145, 148 formula, 62, 78, 111 Fortas, Abe, 110 foundations, 86 Fourth Amendment, 146 Fox News, 71, 148 fragility, 163 France, 29 fraud, 19, 130 Freddie Mac, 4, 102 free trade, xii, 31, 32, 33, 35, 36, 38, 39, 81 Free Trade Agreement, 35, 38, 132 free trade area, 35, 36 Free Trade Area of the Americas, 32, 35 freedom, 31, 70, 132, 138 Frum, David, 115, 142, 153 funding, xii, 9, 12, 14, 20, 34, 68, 69, 70, 75, 77, 96 funds, 10, 50, 70

Gore, Al, 40, 50, 132, 169 Gottesman, Blake L., 96 government budget, 29 government expenditure, 29 government intervention, 14, 29 government procurement, 34 government spending, 22, 23, 29, 133, 139, 147 governments, 35, 36, 156 governor, xii, 6, 13, 41, 87, 94, 132, 152, 169 grades, 71, 142, 145 grand jury, 67 grants, 32, 69, 76, 134 Grassley, Charles, 58 Great Depression, 3, 12, 25 Great Recession, 3, 12, 24, 27, 29, 133, 138, 139 Greece, 13 groupthink, 98 Grover Norquist, 146 growth, 5, 7, 14, 19, 21, 22, 23, 24, 25, 26, 29, 69, 136 GSEs, 4 guardian, 93, 156 Guatemala, 35, 137 guidance, 44 guidelines, 7, 53, 70, 75 guiding principles, 44 Gulf Coast, 106

G H Gallup Poll, 120 gambling, 10 GATT, 33 GDP, 21, 22, 23, 24, 27, 28, 29, 48 GDP per capita, 23, 24 Geithner, Timothy, 13, 163 General Motors, 94, 103 General Philip Kearny School, 66, 67 Geneva Convention, 113 genre, 159 Georgia, 58, 67 Germany, 29 Gerson, Michael, 66, 147 Gingrich, Newt, 78, 81, 143, 147, 152 Ginsburg, Ruth Bader, 111 Glass-Steagall Act, 5 global economy, 102, 163 global trade, 31, 32 globalization, 32, 130, 137 God, 66, 137 Goldman Sachs, 8, 9, 11, 13, 101, 130 Goldsmith, Jack, 106, 146 Gonzales v. Carhart (2007), 151 Gonzales, Alberto, 98, 112, 148

Hagel, Chuck, 96 Hagin, Joseph W., 96 Hall, Beverly, 67 Hamilton, Alexander, 157 Hastert, Dennis, 58 Hatch, Orrin, 88, 111, 119 healing, 144 health, 41, 113, 134, 135, 151 health care, 41, 134, 135, 151 health insurance, 134, 135 hedging, 10 helplessness, 134 hemisphere, 35 high school, 71, 86, 88 higher education, 68, 69 Hillsdale College, 148 Hispanics, 67 history, 4, 8, 42, 58, 67, 70, 76, 101, 102, 103, 110, 112, 129, 142, 145, 148, 153, 164 holding company, 8 Hollingsworth v. Perry (2013)., 151 homeland security, 21, 100 homes, 56, 135

Index homogeneity, xiii Honduras, 35 honesty, 158 Hong Kong, 35 Hoover, Herbert Clark, 3, 152 host, 38, 77, 99, 144, 145, 148, 154 hostilities, 104 hostility, 3, 55 House, xiii, 8, 16, 26, 34, 49, 55, 57, 58, 59, 61, 69, 76, 81, 84, 93, 94, 95, 96, 97, 98, 100, 102, 103, 104, 105, 106, 112, 113, 123, 124, 125, 126, 130, 133, 138, 139, 141, 142, 143, 148, 149, 152, 153, 154, 157, 165, 167, 168, 169, 172 House of Representatives, 34, 94, 165 housing, xi, 4, 5, 6, 7, 11, 12, 16, 25, 27, 102, 130 Hughes, Karen, 95, 168, 171 human, 82, 132, 138, 169, 170 Hurricane Katrina, vii, 48, 58, 93, 100, 106, 114, 137, 144 Hussein, Saddam, 139 hypothesis, 161

I icon, 134 ideal(s), 79, 82, 109, 159 identification, 118, 142, 151 ideology, 111, 113, 117 idiosyncratic, 145 illegal aliens, 153 imagery, 110 image(s), 56, 65, 95, 119 IMF, 14, 29 immigrants, 73, 77, 78, 79, 80, 81, 137, 138 immigration, xii, 43, 44, 58, 79, 81, 82, 102, 137, 138 Immigration and Nationality Act, 140 imperialism, 70 import prices, 37 imports, 33, 34, 36, 37, 38, 39 improvements, 67 inauguration, 23, 103, 111, 141 income, xii, 3, 4, 13, 16, 25, 26, 27, 29, 43, 48, 55, 57, 61, 78, 129, 132, 133, 144 income distribution, 26 income inequality, xii, 3, 4, 13, 129 income tax, 4, 26, 29, 132 independence, 3, 77, 84, 140, 156 India, 32, 34, 37, 132 indirect effect, 33 individuals, viii, 12, 52, 74, 75, 78, 94, 102, 112, 131, 136, 139, 157 Individuals with Disabilities Education Act, 96

183

industries, 32, 33, 37, 131, 164 industry, 3, 7, 8, 9, 11, 12, 16, 33, 38, 40, 130 IndyMac Bank, 102 inefficiency, 19, 37, 74 inequality, 19, 25, 26, 27, 29, 70, 129, 130 inevitability, 129 inflation, 3, 4, 12, 22, 23, 26, 28, 57 infrastructure, 4, 12, 22 injury, 33 insecurity, 4 institutions, 7, 10, 16, 70, 74, 149, 168 integration, 100 integrity, 101 intellectual property, 32 intelligence, 97 interest groups, 118 interest rates, 5, 11, 14, 19, 21, 22, 23, 28, 29 interference, 136 international trade, xii, 101 intervention, vii, 100, 143 intimidation, 137 investment, 4, 5, 7, 8, 9, 10, 11, 13, 15, 21, 22, 24, 25, 29, 36, 50, 53, 102, 130 investment bank, 5, 7, 8, 9, 10, 11, 13, 15, 102 investments, 4, 22, 53 investors, 6, 10, 11, 16, 27, 29 Iowa, 7, 70, 129 Iran, 111 Iraq, vii, xi, 4, 14, 20, 36, 38, 52, 56, 59, 83, 95, 97, 98, 100, 102, 104, 130, 134, 136, 143, 145, 153, 170 Iraq War, 170 irony, 145 Israel, 33, 35 issues, 34, 38, 40, 44, 52, 60, 80, 93, 99, 113, 118, 129, 130, 132, 138, 148, 151, 160, 161, 162

J Jackson, Kenneth, 70 Japan, 13, 29, 33, 37 Jay, John, 165 Jeffords, Jim, 96, 105 job creation, 3 jobless, 12, 43 John Birch Society, 148 Johnson, Lyndon Baines, 134, 136, 137, 142 Johnson, President Lyndon B., 140 Jordan, 33, 35 journalists, vii, xi, 27, 139, 155, 156, 157, 161, 163, 164, 172 JP Morgan Chase, 13, 102 judiciary, 114

184

Index

Judiciary Committee, 102, 111, 114, 115, 116 jurisdiction, 8, 70

K Kagan, Elena, 116 Kaplan, Joel D., 96 Kennedy, Edward Moore, 121, 129 Keynes, 20, 29 Keynesian(s), xii, 42 King v. Burwell (2015), 151 Korea, 38, 132 Kuo, J. David, 143 Kuwait, 36

L labor market, 12, 26 Landrieu, Mary, 58 landscape, 52, 129, 130, 131, 147 LaPierre, Wayne, 151 Latin America, 35, 40 Latinos, 80, 136, 137, 138 law enforcement, 7 laws, 38, 82, 115, 131, 136 lawyers, 15, 16, 112, 113 layoffs, 33 leadership, vii, viii, 71, 103, 138 Leahy, 121 leaks, 146, 172 learners, 69 learning, xii, 66, 68, 69 learning disabilities, 69 legislation, xii, 51, 53, 58, 69, 72, 78, 79, 88, 96, 97, 100, 102, 103, 132, 133, 134, 136, 137, 146, 150, 153 legislative authority, 8, 10 Lehman Brothers, 7, 8, 9, 102, 130 lender of last resort, 11 lending, 4, 5, 6, 7, 9, 12, 21, 22, 28, 150 Libby, I. Lewis, 112 liberalism, 135, 144, 152 liberalization, 3, 5, 10, 38 Libertarian, 145 liberty, 32, 36 lifetime, 169, 172 light, 29, 60, 77 Limbaugh, Rush, 115, 148 Lincoln, Abraham, 144, 165 Lind, William, 145 Lindsey, Lawrence B., 98 liquidity, 9, 12, 13

loans, 5, 7, 21, 102 lobbying, 8, 38, 55 Louisiana, 33, 58, 121 low risk, 6, 11 lower prices, 37, 135 Luttig, Michael, 113

M machinery, 94 Madison, James, 156, 165 majority, 25, 26, 32, 35, 58, 69, 76, 97, 109, 112, 151, 158 Malaysia, 35 management, 4, 10, 40, 131, 155 manipulation, 163 manpower, 9 manufacturing, 131, 132 marijuana, 119 marketing, 97, 153 marketplace, 131, 132, 135 marriage, 77, 78, 132, 133 Marshall, Thurgood, 111 martial law, 164 Maryland, 67 mass, 132, 152 Matalin, Mary, 100, 172 matter, 20, 42, 102, 113, 123, 151, 162 McCain, John, 141 McCain, Senator John, 141 McClellan, Scott, 101, 106, 112, 119, 120, 121, 155 McCutcheon v. FEC (2014), 151 McDonald v. Chicago (2010), 151 media, xiii, 53, 67, 83, 93, 95, 98, 104, 114, 145, 150, 153, 155, 156, 157, 158, 160, 161, 162, 163, 164, 169, 170, 171, 172 Medicaid, 82, 134 medical, 134 medical care, 134 Medicare, xi, 4, 14, 20, 50, 52, 56, 58, 61, 77, 82, 134, 135, 138, 140, 146, 168 Medicare Modernization Act, 56, 58, 146 medicine, 55, 134 melting, 137 membership, 38, 51, 98 mentor, 114 MERCOSUR, 36 metals, 37 metaphor, 109, 110, 112, 117 Mexico, 33, 34, 35, 37, 43, 80, 132, 137 Miami, 35 Microsoft, 132 middle class, 27, 57, 130, 132, 139

Index Middle East, 36, 144 Miers, Harriet E., 96, 121 military, vii, 99, 113, 130, 133, 139, 144, 145, 157 minimum wage, 26 minorities, 112, 136, 137 minority groups, 129 mission, 107, 144, 153 Missouri, 82 Mitchell, Daniel, 146 Mitchell, George, 111 models, 7, 8, 15, 112, 117 moderates, 53, 58, 76 mold, 74, 117 monetary policy, 5, 27 money illusion, 22 morality, 130 Morocco, 35, 36, 39 mortgage-backed securities, 4 motivation, 69, 88 multiculturalism, 138 multilateral, 34 multimedia, 72 music, 5

N NAEP, 69, 71 Nash, George, 148, 154 National Center for Education Statistics (NCES), 72 national debt, 148 National Economic Council, 41 National Park Service, 150 National Rifle Association, 151 national security, xi, 38, 51, 52, 97, 99, 100, 124, 130, 133, 145, 157, 167 National Security Agency, 100, 146 National Security Council, 106, 168 Native Americans, 70 natural disaster, 58 needy, 57, 134 neglect, 10 negotiating, 4, 42, 135 negotiation, 75 neoliberalism, 14 New Deal, 5, 10, 16, 26, 52, 55, 77, 139 New England, 19 New Zealand, 33, 39 next generation, 60, 88, 130 NFIB v. Sebelius (2012), 151 Nicaragua, 35 Nixon, Richard, 86, 107, 137, 142, 151, 152, 170

185

No Child Left Behind, xii, 52, 53, 56, 65, 66, 67, 68, 71, 72, 74, 77, 82, 85, 86, 96, 138, 145, 149, 154, 168 No Child Left Behind Act, xii, 66, 68, 72, 74, 82, 138, 145, 149 Nobel Prize, 20 nominee, 50, 109, 110, 111, 112, 113, 114, 117, 118, 120 North America, 38, 132 North American Free Trade Agreement (NAFTA), 35, 38, 132 Norway, 33 NPR, 121 nutrition, 22, 76, 80

O O’Connor, Sandra Day, 110, 151 Obama Administration, 140 Obama, Barack, xiii, 60, 103, 107, 110, 114, 129, 138, 141, 144, 155 Obama, President Barack, xiii, 5, 12, 13, 21, 60, 103, 107, 110, 114, 129, 138, 141, 144, 155, 157, 158 Obergefell v. Hodges (2015), 151 Office of Chief of Staff, 95, 101 Office of Faith-Based and Community Initiatives, 143 Office of Management and Budget (OMB), 96, 98, 101, 139 Office of the United States Trade Representative, 40 officials, vii, viii, xi, xii, xiii, 7, 48, 53, 54, 56, 67, 68, 82, 98, 100, 102, 130, 133, 155, 156, 157, 158, 160, 161, 163, 164 oil, 42 Oklahoma, 70 oligopolies, 12 opacity, 62 open markets, 35, 36 operating costs, 49 Operation Iraqi Freedom, 144 operations, 10, 49, 95, 102, 104, 133, 144, 157 opportunities, 22, 32, 86, 118, 161 optimism, 25 Organization for Economic Cooperation and Development, 29 Organization of American States, 36 outsourcing, 32 oversight, 5, 7, 8, 9, 10, 94, 102 ownership, 54, 82, 135

186

Index

P Pacific, 13 Paige, Rod, xii, 65, 68, 70, 85, 86, 87 pain, 51 palliative, 60 Panama, 35, 38 Paraguay, 36 parallel, 99 parental involvement, 66 parents, 48, 66, 67, 68, 69, 70, 113 Partial-Birth Abortion Ban Act (2003), 151 participants, 135 patriotism, 58 Paulson, Henry, 8, 13, 101, 103 payroll, 48, 49, 51, 53, 54, 56, 57, 60 peace, 62, 129, 147 pegging, 37 penalties, 69, 78 Pentagon, 171 permit, vii, 9, 50, 60, 152 perseverance, 135 Persian Gulf, 80 Persian Gulf War, 80 personal accounts, 50, 51, 54, 55, 56, 57, 58, 60 personal contact, 158 personal qualities, 113 personal responsibility, 77, 168 personality, 113 Peru, 35, 38 pharmaceutical(s), 135 Philadelphia, 66, 67, 71, 94, 131 platform, 20, 21, 22, 29, 31, 38, 73, 152 playing, 37 policy, vii, xii, xiii, 3, 10, 11, 12, 20, 23, 26, 27, 29, 39, 40, 41, 43, 50, 51, 52, 65, 67, 68, 70, 71, 72, 74, 75, 77, 78, 81, 82, 83, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 135, 137, 142, 143, 144, 145, 146, 147, 149, 150, 151, 162, 168, 172 policy choice, vii policy initiative, 74, 82, 103 policy issues, 151 policy making, 41 policy options, 50 policymakers, 27, 55, 139 political instability, 131 political parties, 133, 135 political party, 20, 142 political power, 11 Politico, 105, 107, 155, 163 politics, vii, xii, xiii, 3, 34, 40, 47, 48, 50, 51, 58, 59, 62, 74, 87, 88, 96, 101, 105, 110, 120, 121, 131, 132, 133, 134, 135, 144, 149, 154, 155, 172

poor performance, 68, 111, 115 popular support, 145 popular vote, 20 population, 13, 20, 22, 23, 24, 25, 68 portfolio, 4, 99, 100 portfolio capital, 4 potential output, 24 poverty, 35, 57, 82 Powell, Colin, 97, 98 Pozen, Robert, 57 precedent, 113, 116, 164 predictability, 125 preparation, 68, 104 prescription drugs, xi, 52, 135 preservation, 164 presidency, vii, viii, xi, xii, 22, 23, 29, 39, 50, 51, 58, 60, 72, 73, 74, 82, 83, 93, 94, 96, 97, 103, 106, 107, 110, 129, 130, 132, 134, 135, 138, 140, 141, 142, 144, 150, 152, 153, 172 presidential campaign, 35, 71, 74, 112, 129, 144 Presidential Transition Coordinating Council, 103 price changes, 22 price index, 57, 58, 60 principles, xii, 3, 36, 51, 52, 53, 70, 98, 119, 143, 150 private investment, 22, 50 private practice, 7, 101 private sector, 12, 19, 25, 27, 29, 34, 54, 135, 136 private sector investment, 29 privatization, 3, 44, 51, 54 producers, 31, 33, 37 profit, 13 project, 60, 142, 149, 153, 154, 162, 164 proliferation, 4, 6, 10, 39, 118 proposition, 164 prosperity, 29 protection, 6, 10, 11, 32, 33, 37, 38, 153, 164, 165 public affairs, 157, 159, 160, 161, 162, 163 public assistance, 79 public awareness, 75 Public Company Accounting Oversight Board, 7 public debt, 133, 138, 139 public domain, 159 public education, xii, 68, 149, 168 public finance, 70 public opinion, 59, 143 public policy, vii, xii, 139, 142, 144, 149 public schools, 70 public sector, 12 public service, 53, 81, 86, 87, 101 public support, 57, 59, 133 publishing, 68, 148 Puerto Rico, 69

Index purchasing power, 26 purity, 109, 117

Q qualifications, 68, 113, 115 quality control, 77 questioning, 145 quotas, 33, 36, 37

R race, 6, 131 Race to the Top, 69, 150 racing, 16 racism, 70, 138 racketeering, 67 radio, 148 ratification, 38 reactions, 98, 114, 145, 147 reading, 67, 68, 69, 72, 146, 163, 171 Reagan, Ronald, 9, 14, 19, 20, 21, 59, 78, 86, 88, 95, 110, 134, 137, 141, 142, 147, 148, 150, 152, 170 real estate, 3, 4, 102, 130, 146 real income, 25, 26 real terms, 43, 69 real wage, 26 reality, 161 reasoning, 55 recall, 24, 66, 149 reception, 57, 67 recession, 12, 16, 20, 22, 23, 24, 26, 32, 42, 43, 44, 51, 80, 130, 143 recognition, 115, 146 reconstruction, 36 recovery, 22, 23, 24, 26, 27, 29, 43, 60, 75, 163 redistribution, 4, 55 reelection, 47, 52, 58, 100, 103, 144 reformers, 137 reform(s), xii, 5, 6, 8, 43, 44, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 66, 73, 74, 76, 77, 78, 79, 80, 81, 82, 84, 86, 87, 96, 102, 135, 138, 145, 146, 147, 149, 150, 153, 165 Regnery, Henry, 148 regulations, 5, 70, 74, 78, 79, 131, 148, 150 regulatory agencies, 6 Rehnquist, William, 110, 151 Reid, Harry, 55, 114, 121, 129, 130 reimburse, 49 rejection, 74 relevance, 144, 145 relief, 132, 133, 139

187

religion, 19 reporters, xiii, 155, 158, 159, 160, 161, 162, 163, 164, 165 Republican Party, 4, 66, 81, 129, 133, 134, 137, 138, 139, 141, 142, 143, 148, 152 reputation, 94, 142, 143, 144, 145, 148, 149, 151, 152 requirement(s), 7, 8, 9, 65, 68, 69, 74, 77, 80, 146, 157 resentment, 130, 137 reserves, 49 resources, 9, 19, 49, 53, 88, 105, 150 response, vii, 8, 9, 12, 27, 33, 34, 36, 37, 40, 55, 56, 83, 100, 114, 116, 118, 158, 163, 164 restoration, 81, 142 restrictions, 5, 151 retirement, 48, 49, 50, 53, 54, 55, 56, 58, 60, 111, 116, 132, 135 retirement age, 53, 58, 60 revenue, 13, 34, 133 rhetoric, 54, 74, 76, 77, 79, 80, 81, 83, 109, 117 Rice, Condoleezza, 65, 97, 98, 99 Rice, Secretary of State Condoleezza, 65, 97, 98, 99 Ridge, Tom, 98 rights, 16, 38, 74, 136, 137, 164, 169 risk assessment, 7, 15 risk management, 9 risk(s), 5, 7, 8, 9, 10, 13, 15, 16, 42, 55, 99, 113, 117, 134, 143 Roberts, John, 142 Romer, Ron, 66 Roosevelt, Franklin Delano, vii, 8, 12, 169 Roosevelt, Theodore, 142, 149 Rove, Karl C., , 53, 58, 60, 95, 96, 97, 98, 100, 101, 102, 112, 117, 167, 168, 171 rule of law, 36 rules, 4, 6, 8, 13, 15, 39, 78, 79, 114, 115, 119, 146 Rumsfeld, Donald, 14, 101 Russia, 33

S safe haven, 14 safety, 76, 77, 82, 146 sanctions, 37 Sarbanes-Oxley Act, 7, 8 Saudi Arabia, 36 savings, 21, 22, 28, 29, 60, 132 Scalia, Antonin, 110 scholarship, 107, 150 school, 4, 65, 66, 67, 68, 69, 70, 71, 72, 76, 85, 86, 87, 88, 131, 148, 149, 150 scope, 6, 12, 162, 164

188

Index

Second World, 142, 148, 149 secondary schools, 70 Secret Service, 96 Secretary of Defense, 101 securities, 3, 4, 5, 7, 8, 9, 10, 16, 28 security, 39, 52, 54, 93, 99, 131, 134, 144, 148 segregation, 70, 85, 136 self-discipline, 97 self-regulation, 8, 9 sellers, 6, 11 Senate, 8, 26, 42, 53, 55, 57, 76, 97, 101, 109, 110, 111, 112, 113, 114, 115, 116, 118, 120, 122, 129, 130, 138, 139 September 11, 38, 43, 81, 97, 133, 144, 165 services, 32, 34, 157 sexual harassment, 111 shareholders, 4 Sharpton, Reverend Al, 66 Shelby County v. Holder (2013), 151 shortfall, 47 showing, 25, 75, 100, 159 signals, 151 signs, 102, 130, 161 Silicon Valley, 132 Sinai, 21, 29 Singapore, 11, 35 slavery, 70 small business, 146 Smith, Gordon, 58 Snow, John, 4, 13, 101 Snowe, Olympia, 58, 116 social benefits, 73, 81 social fabric, 138 social policy, 73, 77, 82, 83 social programs, 82, 83 Social Security, v, xi, xii, 42, 44, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 82, 100, 102, 134, 135, 140, 168 Social Security Administration, 52 society, 19, 66, 135, 138, 147 Solicitor General, 116 solution, 55, 63, 74 Sotomayor, Sonia, 122 South Africa, 34 South America, 35, 137 South Korea, 33, 35 sovereignty, 156 specific tax, 29 Spector, Arlen, 66 speculation, 10, 11, 153 speech, 13, 31, 35, 36, 39, 40, 52, 66, 67, 69, 74, 78, 80, 86, 142, 163 Spellings, Margaret, 66, 86, 87

spending, xiii, 4, 20, 21, 22, 24, 25, 26, 27, 29, 34, 49, 54, 58, 75, 76, 133, 134, 135, 138, 140, 146, 147, 148, 152, 153 stability, 10 staff development, 70 staff members, 9, 162 staffing, xiii, 104 state laws, 7 State of the Union address, 39, 55, 71 state(s), 3, 7, 11, 14, 15, 32, 33, 34, 35, 40, 44, 65, 66, 67, 68, 69, 70, 75, 76, 77, 78, 79, 82, 86, 87, 96, 113, 118, 129, 131, 133, 135, 136, 137, 144, 150, 151, 156, 164, 171 statistics, 67, 133 steel, xii, 31, 32, 33, 34, 36, 38, 39, 40, 97, 98 steel industry, 32, 33 Stevens, John Paul, 110, 151 stimulus, 6, 12, 16, 27 stock, 8, 10, 11, 28, 50, 56 stock price, 11 stress, 27, 94, 168 structure, 123 student populations, 67 style(s), 77, 93, 94 subprime loans, 7 subsidy, 34, 37, 62, 77 sugar beet, 38 sugar industry, 38 Sununu, John, 94, 105 supervision, 8, 10, 16 supervisor, 8 Supplemental Nutrition Assistance Program (SNAP), 73, 74, 75, 76, 83 suppression, 157 Supreme Court, vi, xi, xiii, 100, 109, 110, 111, 112, 113, 114, 117, 118, 119, 120, 121, 122, 132, 142, 151, 152, 154, 169 Supreme Court nominee, 111, 112, 118 surplus, 29, 42, 49, 132, 140 surveillance, vii, 100 survival, 13 Switzerland, 33

T tactics, 152, 164 takeover, 102, 148 talent, 94, 115, 163, 169 target, 29, 48, 67, 86, 107 tariff, 33, 37,, 106 tax credits, 12 tax cuts, vii, xi, xiii, 6, 20, 21, 24, 26, 29, 42, 43, 50, 51, 52, 56, 58, 97, 132, 133, 138, 139, 140, 146

Index tax deduction, 132 tax incentive, 12, 135 tax increase, 20, 51, 55, 57, 59 tax policy, 42 tax rates, 132, 144 tax system, 81 taxes, 21, 37, 41, 49, 50, 51, 53, 54, 56, 57, 63, 88, 133, 134, 137, 139, 146, 147 taxpayers, 133, 144 TCC, 103, 107 Teach for America, 65, 71, 72 teachers, xii, 67, 68, 69, 72, 149 Teaching American History Grants, 65 technical assistance, 34 technological advancement, 131 technologies, 131 technology, 131, 139 television commercial, 52 temperament, 94 tension(s), 42, 138, 145, 150, 153 tenure, 76, 100, 102, 124, 141, 142, 143, 144, 145, 146, 147, 148, 150, 151, 152, 153 terrorism, 80, 99, 172 terrorist attack(s), 21, 38, 43, 103 terrorist organization, 137 terrorists, vii, 144 test scores, 65, 67, 68, 86 testing, 65, 66, 67, 68, 85 Texas, xii, 41, 49, 50, 66, 67, 68, 73, 79, 84, 85, 86, 87, 88, 96, 105, 106, 109, 113, 132, 137, 141, 151, 153, 169, 171 textiles, 34, 36 Thailand, 34, 35, 37 theft, 67 Third World, 131 Thomas, Clarence, 110 threats, 131 thrifts, 7, 13, 16 Title I, 68, 69 trade, xi, 3, 4, 5, 6, 8, 26, 31, 32, 34, 35, 36, 37, 38, 39, 40, 98 trade agreement, 31, 32, 35, 39 trade benefits, 39 trade deficit, 32, 38 trade liberalization, 31 trade policy, 32, 37, 38 Trade Promotion Authority (TPA), xii, 32, 35, 38 trade union, 3 trading partners, 36, 38 training, 32, 94 trajectory, 76 tranches, 5, 11 transactions, 10

189

transcripts, 39, 119 transformation, 97 transition period, 79, 95 transparency, 13, 118 transport, 70 transportation, 87 Treasury, vi, xiii, 4, 11, 13, 14, 20, 23, 28, 42, 101, 103, 124, 155, 156, 157, 158, 160, 162, 163, 164 Treasury Secretary, 20, 42, 101, 163 treaties, 157 treatment, 34, 110 Troubled Asset Relief Program (TARP), xi, 13, 103 Trudeau, Gary, 65 Trump, Donald, 152 trust fund(s), 49, 50, 60, 63, 134 turnover, 157 tutoring, 70

U U.S. Bureau of Labor Statistics, 16 U.S. Department of Commerce, 40 U.S. Department of the Treasury, 139 U.S. economy, 12, 13, 34, 102 U.S. history, 102 U.S. labor market, 13 U.S. Supreme Court, 119 unemployment insurance, 75 unemployment rate, 12, 24 unhappiness, 113, 139 unions, 33, 37, 70, 131, 147 United Nations, 34, 39 United States, 15, 25, 29, 32, 35, 37, 38, 39, 48, 61, 67, 68, 70, 71, 80, 81, 85, 87, 98, 99, 100, 102, 105, 107, 115, 120, 121, 124, 129, 130, 132, 134, 135, 136, 137, 138, 139, 149, 151, 157, 164, 168 United States v. Windsor (2013), 151 universities, 131 urban, 68, 87 Uruguay, 36

V vacancies, 109, 112, 116, 118 validation, 151 variables, 28 vehicles, 132 veneration, 148 Venezuela, 36 venue, 144 Vice President, xiii, 20, 43, 93, 94, 97, 98, 99, 100, 101, 104, 115, 117, 121, 122, 124, 132, 167, 172

190

Index

Vietnam, 37, 58, 132, 152 Viguerie, Richard, 147 violence, 137 vision, 36, 73, 79, 83, 114, 125, 126 volatility, 141, 161 vote, 32, 38, 40, 48, 81, 97, 110, 111, 113, 114, 117, 122, 136, 143 voters, 50, 52, 54, 79, 81, 116, 118, 131, 132, 152 voting, 32, 129, 137 Voting Rights Act, 136, 140 vouchers, 149

W wage increases, 26 wages, 3, 4, 27, 57 waiver, 69 war, 14, 38, 39, 43, 52, 56, 80, 98, 100, 102, 130, 131, 134, 139, 140, 143, 144, 145, 146, 148, 151, 153, 154, 164 War on Terror, xi, 74, 80, 82, 99, 106 war years, 154 Warren, Earl, 148, 151 Washington, 3, 5, 12, 14, 15, 39, 40, 52, 61, 67, 69, 71, 72, 79, 83, 87, 94, 101, 104, 105, 106, 107, 113, 119, 120, 121, 122, 129, 134, 144, 146, 147, 148, 150, 151, 152, 163, 165, 168, 171, 172 Washington Consensus, 3, 12, 14 Washington, George, 52 waste, xii, 73, 79, 126 water, 85 watershed, 113, 135, 136, 138 weakness, 43 wealth, 25, 29 welfare, 34, 48, 73, 74, 76, 77, 78, 79, 80, 81, 82, 83, 136, 139 welfare reform, 76, 78, 80, 81 welfare state, 74, 77, 78 welfare system, 74 well-being, 48 West Wing, 99, 105, 106, 107, 123 Weyrich, Paul, 145

White House, vi, viii, xi, xiii, 6, 9, 12, 14, 15, 29, 44, 47, 52, 55, 61, 67, 69, 71, 72, 84, 86, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 107, 110, 112, 113, 120, 123, 124, 125, 126, 130, 132, 133, 135, 138, 139, 140, 141, 142, 143, 144, 145, 146, 147, 148, 149, 150, 151, 152, 153, 154, 155, 165, 167, 168, 169, 170, 171, 172 WIC, 74, 77 Wilson, Woodrow, 110 withdrawal, 110, 115 witnesses, 67, 99 work ethic, 136 worker rights, 38 workers, 4, 12, 26, 31, 33, 38, 39, 44, 48, 49, 50, 51, 53, 54, 55, 56, 59, 62, 70, 131, 133, 134, 135, 138, 148, 153 workforce, 131 working class, 3 working families, 77, 78 working hours, 77 World Trade Center, 97 World Trade Organization (WTO), 4, 31, 32, 33, 34, 35, 36, 37, 39, 40 World War I, 3, 31, 38, 131, 164 worldview, 161 worry, 148

X xenophobia, 70

Y Yale University, 8, 14, 15, 165 Yemen, 36 young people, 88, 131, 171 yuan, 37

Z Zahorchak, Jerry, 66