Why Paul O'Neill had to go.

Why Paul O'Neill had to go.

Why Paul O'Neill had to go.

Politics and policy.
Dec. 6 2002 6:45 PM

That's Showbiz

Why Paul O'Neill had to go.

Tuesday afternoon, Bill Clinton told Democrats they had lost the 2002 elections primarily because they appeared to be "missing in action in national security. … If we don't have a security strategy, as long as the American people are in their present frame of mind, they will not hear us on these other issues."

Thursday night, President Bush ousted his economic team.

William Saletan William Saletan

Will Saletan writes about politics, science, technology, and other stuff for Slate. He’s the author of Bearing Right.

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There's a connection between Clinton's diagnosis and Bush's prescription. A party can do and say all it wants about issue after issue. But politically, all of that is useless if the events of the day focus public attention almost entirely on an issue about which that party seems confused or unconcerned. That's what happened to Democrats on national security in 2002. And it's what could happen to Republicans on the economy in 2004.

Like most historical arguments, Clinton's speech was more insightful at the general than at the specific level. He was right that parties must address the consuming issue of the day in order to be heard on other issues. But unless things turn around, the issue on which he focused, national security, probably won't be the consuming issue of 2004. That issue will be the economy. Anyone who worked for or supported Bush's father fears this. A president who seemed invincible on national security in 1991 was thrown out of office a year later.

The other thing missing from Clinton's analysis was issue ownership. The line he wanted everyone to remember—he repeated it twice—was, "When people feel uncertain, they'd rather have somebody who's strong and wrong than somebody who's weak and right." But the next sentence was more important: "When I went in to Bosnia or Kosovo, and some Republican leader criticized me, if I had run ads in his state against him, the Republicans would have shut down the operations of the Senate until we stopped." Clinton was contrasting this scenario with ads the GOP ran this year against Democrats who opposed Bush on details of his anti-terrorism policy.

In Clinton's scenario, why would Republicans have prevailed in such a confrontation? Because Clinton hadn't established the kind of authority on national security that allows a president to shame his opponents. Clinton never focused on national security the way George H.W. Bush did. When George W. Bush ran for president, he made strengthening the military a central issue of his campaign, even though the world seemed at peace. So when terrorists struck the United States, and Bush laid out a program to deal with them, Democrats couldn't challenge him the way Republicans had challenged Clinton. Bush owned the issue. He had earned it.

What happens if the electorate of 2004, like the electorate of 1992, turns its attention from a war in Iraq to a stalled economy? The answer is that Bush, like his dad, is in trouble. He doesn't own the economic issue. He doesn't even hold much stock in it. That's why Tom Daschle's initial slogan for beating the GOP in 2002—which was buried by national security—was "the Bush economy." It was a simple message: The economy stinks, Bush is president, end of story. And Bush gave it credibility. He treated economic problems the way Clinton often treated foreign affairs: Leave them alone, and maybe they'll take care of themselves.

Bush's treasury secretary, Paul O'Neill, personified this attitude. He believed in capitalism. My colleague Michael Kinsley once quipped that a gaffe is when a politician tells the truth. In O'Neill's case, a gaffe is when a policy-maker stands by his convictions. Today's news stories accuse O'Neill of committing gaffes by saying things such as, "Able-bodied adults should save enough on a regular basis so that they can provide for their own retirement and, for that matter, for their health and medical needs." Look at the other gaffes attributed to him. He criticized Bush's steel tariffs. He called a Republican-backed stimulus package "show business" and argued that the economy would recover on its own. When the stock market tanked last year, he shrugged, "Markets go up, and markets go down." When Enron collapsed, he said, "Companies come and go. It's ... part of the genius of capitalism."

If the economy had seemed to be recovering, O'Neill's candid capitalism might not look so bad. But Friday's Labor Department report puts the unemployment rate at 6 percent, the highest in nearly a decade. If the economy is still limping along a year from now, Bush can't afford to look like a capitalist faith-healer. He needs to put the kind of visible effort into economic recovery—PR as well as policy—that he put into national security. He needs to buy some ownership of the issue. Sorry, Paul. That's show business.