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Businessweek Archives

Gore Is Beginning To Feel Clinton's Pain

Washington Outlook


Bill Clinton may be on the hottest seat in America these days, but Al Gore is the one who's sweating. Sure, the President is under siege over the Monica Lewinsky scandal, and a global slump has his economic nirvana at risk. But hey, he's not running for office again. Meanwhile, the Justice Dept. is examining Gore's role as a 1996 campaign fund-raiser, and he no longer looks as though he'll be taking an express train to the 2000 Democratic Presidential nomination.

But unlike Vice-President George Bush, who laid low in 1987 amid Reagan Administration scandals and a stock market crash, Gore is embarking on an aggressive survival strategy to boost his fortunes. He's raising his profile with a series of public events on topics ranging from children's health to environmental protection. He's underscoring his role as a key adviser on foreign crises such as the turmoil in Russia. And to cement his relations with the party faithful, Gore is raising tons of money and stumping for Democratic candidates from coast to coast.

While building up chits with friends, Gore is also courting critics. Many business execs view him as an environmental extremist, so his staff is lining up private meetings with CEOs and drafting speeches that stress his belief in the promise of a high-tech economy. Not very sexy. But that's precisely the point at a time when Washington is obsessed by a sordid scandal. "The more the focus is on issues, the better it is for the Vice-President," says one Gore adviser.ENCOURAGING POLL. Despite all the careful planning, Gore faces several crucial threats beyond his control. The paramount one: the economy. If the meltdowns in Russia and Asia trigger a recession, the booming U.S. economy and the first federal budget surplus in three decades--the Clinton-Gore team's proudest accomplishments--would be wiped out.

A Clinton collapse following the release of Independent Counsel Kenneth W. Starr's report to Congress could also put Gore in political jeopardy. "For better or for worse, Gore is lashed to the mast of this Administration and rises or falls with it," says a veteran Democratic consultant. "If the President is at 35% job approval rather than 65% when we get into the primaries, then Gore is in trouble." That's not lost on Gore's brain trust. "If this became a problem for all Democrats, it would be a problem for him," concedes Gore consultant Robert D. Squier. "But I don't see it."WILL SHE? In fact, so far Gore seems unscathed by the scandal. An Aug. 21-23 CNN/USA Today/Gallup Poll indicated that 63% of Americans found Gore "honest and trustworthy," while just 31% would say the same of Clinton. Still, four recent national polls show Gore trailing Texas Governor George W. Bush in a hypothetical 2000 match-up. And the smell of blood has emboldened potential Democratic challengers, including House Minority Leader Richard A. Gephardt of Missouri, Senators Bob Kerrey of Nebraska, John Kerry of Massachusetts, Paul Wellstone of Minnesota, and former New Jersey Senator Bill Bradley.

Gore's Presidential prospects will dim if Attorney General Janet Reno seeks an Independent Counsel to investigate the Veep's campaign fund-raising. Any probe almost certainly would drag into the 2000 campaign and threaten a valued Gore asset: his Boy Scout image.

Gore's advisers are confident that their man's staid reputation will enable him to ride out any political storm. "On balance, he profits from whatever extra attention he receives," says Chief of Staff Ronald A. Klain. Maybe. But if the economy tanks--or Clinton's popularity plummets--Gore's methodical survival strategy may not be enough to save him from the undertow.EDITED BY OWEN ULLMANNReturn to top


A weakened President Clinton and sagging stocks are boosting the odds of a modest tax cut this year. Capitol Hill lawmakers are likely to provide tax relief of about $75 billion over five years. That's far less than the 11-year, $1 trillion cut House Speaker Newt Gingrich promoted just two months ago. But it's enough to give the GOP a strong campaign issue for November and put a little extra cash in the pockets of consumers spooked by Wall Street's gyrations.

Democrats are now expected to back a small tax cut. Clinton had opposed one, saying Social Security should be bolstered first. But that was before all the flak over lying about his relationship with Monica Lewinsky. Worried about handing Republicans more ammo, he has told top aides to quietly canvass Hill Democratic strategists for counterproposals to GOP tax breaks.

Republican congressional leaders plan to get together on Sept. 9 to draft the outline of a bill. It's expected to include a narrowing of the "marriage penalty" that forces some two-earner couples to pay higher taxes than they would as singles. The bill may also include relief for farmers, working seniors on Social Security, and small-business owners who buy health insurance. Corporations will likely get little beyond an extension of the tax credit for research and development.

Gingrich is still pushing a capital-gains tax cut. But other Republicans want to scuttle that idea, fearing it will trigger Democratic charges that the GOP is pandering to the rich.EDITED BY OWEN ULLMANNReturn to top

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