Impeachment: Bad For Business?

A partisen gridlock would stall Corporate America's agenda

Washington's nasty, brutish and oh-so-long impeachment saga is starting to grate on Jon A. Boscia. The CEO of Lincoln National Corp., a Fort Wayne (Ind.) money-management firm, isn't saying whether he wants Bill Clinton to be removed from office over the Monica Lewinsky affair, but he's "offended by the partisan nature of [impeachment] in the House." Whatever the President's fate, says Boscia, "it needs to be resolved in a bipartisan fashion...[and] sooner rather than later," lest legislative priorities such as financial-industry modernization get snarled in feuding.

Boscia isn't the only exec suffering from impeachment fatigue. While he's no Clinton fan, Homer Knost, chairman of Arkel International Inc., a Baton Rouge (La.) engineering outfit, also wants closure. Arkel has many foreign contracts, and Knost says U.S. allies "are starting to see this as a bad thing."

Business lobbyists are worried, too. The longer the President's agonies wind on, they say, the greater the risk that Congress will grind to a halt. "I'm afraid it is going to be a lost year," sighs Barry Rogstad, president of the American Business Conference, which represents midsize companies.

Despite talk of a swift censure deal, business leaders fear the impeachment won't go away. And Washington insiders who would like to see an end to partisan holy wars are concluding that such a truce is not likely yet.

PULL THE PLUG. Why? Even though Republicans don't have the 67 votes needed to convict the President, many conservatives say they aren't willing to consider a censure before a trial is conducted. "The accusations against the President are very serious," says Senator Charles T. Hagel (R-Neb.). "We're talking about breaking the law. To short-circuit the trial would set a terrible precedent."

That flies in the face of polls showing that the public wants to pull the plug on impeachment. But hard-liners aren't budging. Even though Senate Republicans are generally less ideological than the firebrands in the House, there are 20 or so GOP members of the upper chamber who are determined to pursue the trial. And all GOP senators are under pressure from conservative activists who have outsize influence in party matters--and who want Clinton out. A lengthy airing of the evidence could, the conservatives reason, erode Clinton's support, even though the House hearings and Independent Counsel Kenneth W. Starr's steamy revelations didn't.

More likely, a long Senate trial might threaten to divide the country and Congress further. An open-ended proceeding poses unknown dangers, warn constitutional experts: Such efforts take on a life of their own, as Starr's investigations did. "The longer the trial lasts, the more acrimonious it will become," says Senate Minority Leader Thomas A. Daschle (D-S.D.). "We are not immune from the same vindictive partisanship there was in the House."

All this should give President Clinton a huge incentive to cut a deal. But, there's a hitch: Clinton, according to associates, isn't ready to concede that he lied under oath--a crucial demand of many moderate Republicans and Democrats. A grant of immunity from prosecution after he leaves office would probably make a deal possible, but there's no guarantee Starr would go along.

So how might the mess be resolved? Soon after the Senate returns to Washington on Jan. 6, Senate Majority Leader Trent Lott (R-Miss.) will oversee the opening of a trial. Representative Henry Hyde (R-Ill.) and 12 other House "managers" will formally present the two impeachment charges. The White House could get up to a month to respond, and both sides will be able to call witnesses and present evidence. The drama is supposed to end with a vote on each article. But some political pros doubt it will ever get that far. "Lott won't invest much time in an effort where the results are preordained," says Daniel Meyer, former chief of staff to House Speaker Newt Gingrich.

The real action will be behind closed doors, where Lott, Daschle, and White House lawyers try to work out the language of yet another Presidential mea culpa. "There's significant support for censure, but it depends on the wording and timing of the resolution," says Daschle.

BUSINESS AS USUAL. In pushing for censure, Daschle will count on respected Democrats who can work both sides of the aisle. Among them: Senators Daniel P. Moynihan of New York and Joseph I. Lieberman of Connecticut. He can probably count on support from Utah Senator Orrin G. Hatch, a GOP conservative, and centrist Republican Senators John H. Chafee of Rhode Island, James M. Jeffords of Vermont, and Olympia J. Snowe of Maine. All three face reelection in 2000.

For now, the President is adopting a business-as-usual posture. He is already prepping for his Jan. 19 State of the Union message--to be delivered in the House chamber, where he was impeached. "It's crucial to show we're doing the nation's work while Republicans are engaging in partisanship," says an outside adviser.

As the centerpiece of his address, the President is expected to call for bipartisan action on reforming Social Security. In addition, the Administration will unveil a raft of new tax credits, including one to boost sales of fuel-efficient cars. Along with hikes in funding for his cherished education initiatives, Clinton is expected to ask for a $200 million annual increase in research funding and a 15% boost in spending on programs for the homeless. Clinton's only ambitious undertaking is fixing Social Security. But even though he is tilting toward some form of private investments, which Republicans favor, the chances of a sweeping overhaul are slim.

Meanwhile, many items on the business agenda could become casualties of impeachment. "We're concerned about the time available for business issues," frets Thomas J. Donohue, president of the U.S. Chamber of Commerce. And trust will be scarce, too. "There's cyanide in the water here," says Representative Jerrold Nadler (D-N.Y.). Items in jeopardy: financial modernization, bankruptcy reform, and renewal of fast-track trade negotiating authority. Congress may make a run at reviewing the Telecommunications Act of 1996. But with lawmakers in a partisan sulk, it will be hard to enact changes that boost competition.

Of course, business fears--not to mention voter anger--could be assuaged if the Senate cuts a quick plea-bargain with Clinton. But as matters stand, no one--not CEOs, not Hill leaders, not White House lawyers--seems willing to bet on that happening in a capital where combat, not comity, has become the norm.

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