Hillary, Clueless in NY

The politics of 2008 are here.

Apparently Al Gore is going after the Saudi vote.

Kerry has the French vote wrapped up from his last time 'round, and now Gerhard Schroeder, who's ditched his country (he used to be the German chancellor, remember) and is now working for the USSRussians, has endorsed Hillary.

Recently, Hillary criticized this president as being responsible for the worst economy---ever--- ---in the history of our country. (We know Hillary claimed to have been named for Sir Edmund Hillary before he had climbed Mt. Everest and become famous, so we know Hillary's idea of history and a timeline is very elastic, but this is a stretch even for us---doesn't the Depression loom large in 20th century history?)

So it's fair to start looking at Hillary's record, since she seems to crave attention right now. (Not Bill's record; Hillary's).

How has she done as the Senator from the great state of New York?

Amity Schlaes of Bloomberg analyzes Hillary's record in New York:

In 2000, Clinton campaigned for targeted relief for the suffering old industrial communities upstate and support for tourism. Her package placed her admirably in the progressive Democratic tradition. But it didn't have much economic meaning.

Though Clinton talked about her desire to "encourage high- tech entrepreneurs to locate here,'' you got the feeling she wouldn't know a market if it came up and shook her hand in Elmira.

Even as she was campaigning, the Dow Jones Industrial Average was dropping. Clinton's first year in office saw the equities' crash and the national economy move into recession. New York state's finances are dependent on Wall Street's, so the downturn drained state coffers. Recessions do trickle down. Subsidized day care, tourism -- the programs Clinton liked best - - were in jeopardy.

At that time, President George W. Bush argued that general tax cuts -- as opposed to targeted ones -- would be good for the economy. He liked marginal rate cuts to the income tax, and he sought cuts for lower earners. He also fought for cuts in the capital-gains tax rate and taxes on dividends.

Clinton could have gone along. She didn't. Mechanically, she questioned the premise of the Bush tax cuts: "Will we meet the challenges of our time or will we squander this moment on a budget that puts politics first and people last?''

As E.J. McMahon, an economist at the Manhattan Institute, points out, the tax cuts did turn out to put "people first.'' Lower earning households saw great savings: a single parent of two children under age 17 saw an effective 84 percent cut in tax liability. In 2005, McMahon estimates, New Yorkers got to keep $14.6 billion in earnings that they would have had to pay in taxes without the changes in the federal law.

What's more, the Bush tax cuts were followed by both market and economic comebacks, just as Treasury Secretary Robert Rubin's capital-gains rate cut was followed by the boom of the late 1990s. Federal tax rate cuts did a lot to offset state and local tax increases. Using something called the State Tax Analysis Modeling Program, a software program that tries out different tax scenarios, McMahon estimates that without the federal cuts New York City would have lost jobs. Instead employment grew.

McMahon figures that for the six-year period of Clinton's first term New Yorkers will have kept $60 billion that they would have otherwise paid in taxes. Lots of people in New York don't get a Wall Street bonus. This tax cut was their bonus. Deprive them of it, and you limit the bonuses to Wall Street. You favor the rich in exactly the way that Clinton opposes.

So far, Hillary's record is not persuasive.

Nor is her message.