Full Fisking: Hillary Clinton’s Economy Speech

Hillary Weird (Jewel Samad / Getty)
Jewel Samad / Getty

Former Secretary of State and U.S. Senator Hillary Clinton, the presumptive Democratic Party nominee for president in 2016 laid out her proposed economic policy in an address to the left-leaning New School for Social Research in New York on Monday. Billed as a policy that aims to “boost the middle class,” Clinton offered a hodgepodge of policy platitudes that differed little from Obama administration policies that she admits are not working.

What follows is a “fisking” of her address–a critique, but also an effort to extract meaning from the mess.

Thank you, thank you, thank you so much. Thank you very much President Van Zandt, and thanks to everyone at the New School for welcoming us today. I’m delighted to be back.

You know, over the past few months, I’ve had the opportunity to listen to Americans’ concerns about an economy that still isn’t delivering for them. It’s not delivering the way it should – it still seems to most Americans that I have spoken with that it is stacked for those at the top.

It is amazing that someone who served in the Obama administration would acknowledge that the economy “still isn’t delivering.” Clinton hints at the fact that inequality has in fact grown under Obama, despite all the policies he has enacted aimed at redistributing wealth.

But I’ve also heard their hopes for the future: going to college without drowning in debt… starting that small business they’ve always dreamed about… getting a job that pays well enough to support a family and provide for a secure retirement.

Previous generations of Americans built the greatest economy and strongest middle class the world has ever known on the promise of a basic bargain:

If you work hard and do your part, you should be able to get ahead. And when you get ahead, America gets ahead.

But over several decades, that bargain has eroded. Our job is to make it strong again.

We hear Democrats talk about that “bargain” all of the time. Note that the terms of the bargain do not include that it is guaranteed by the government. And note that it is aimed at those who “work hard”–yet government handouts destroy the incentive to work hard.

For 35 years, Republicans have argued that if we give more wealth to those at the top – by cutting their taxes and letting big corporations write their own rules – it will trickle down, it will trickle down to everyone else.

This is not something I have ever actually heard a Republican argue, because no Republican ever has done so. Note that Clinton thinks that government “gives wealth” to the rich. Perhaps that describes the way she and her husband became mega-rich. It applies to few other people.

Yet every time they have a chance to try that approach, it explodes the national debt, concentrates wealth even more, and does practically nothing to help hard-working Americans.

Twice now in the past 20 years, a Democratic president has had to come in and clean up the mess. I think the results speak for themselves.

It takes a special kind of chutzpah to ignore the fact that the Obama administration exploded the national debt and the deficit more than any previous president–more than almost all the presidents put together, in fact. She was in the administration during the worst of those years.

Under President Clinton – I like the sound of that – America saw the longest peacetime expansion in history … nearly 23 million jobs… a balanced budget and a surplus for the future. And most importantly, incomes rose across the board, not just for those already at the top.

Eight years later, President Obama and the American people’s hard work pulled us back from the brink of Depression. President Obama saved the auto industry, imposed new rules on Wall Street, and provided health care to 16 million Americans.

Obama did not “save” the auto industry. The bailout was a George W. Bush policy. Imposing new rules on Wall Street did little to help the economy, and Obamacare actually stunted growth and job creation. Note that Clinton omits any mention of Obama’s flagship economic policy, the so-called “stimulus.” She also omits that Bill Clinton’s balanced budgets came about due to pressure from a Republican Congress.

Now today, today as the shadow of crisis recedes and longer-term challenges come into focus, I believe we have to build a “growth and fairness” economy. You can’t have one without the other.

We can’t create enough jobs and new businesses without more growth, and we can’t build strong families and support our consumer economy without more fairness.

We need both, because while America is standing again, we’re not yet running the way we should.

That sounds nice, but is fundamentally mistaken. Whenever politicians talk about fairness–other than fairness before the law–they are talking about policies that slow down growth through regulation and redistribution, removing the incentive to work and to succeed.

Corporate profits are at near-record highs and Americans are working as hard as ever – but paychecks have barely budged in real terms.

Families today are stretched in so many directions, and so are their budgets. Out-of-pocket costs of health care, childcare, caring for aging parents are rising a lot faster than wages.

Note that Clinton confines her claims to “paychecks.” Overall compensation levels, which include benefits, have risen. But she is correct that the cost of health care is rising for many–yet another knock against the Obama administration in which she served without protest.

“I hear this everywhere I go.

The single mom who talked to me about juggling a job and classes at community college, while raising three kids. She doesn’t expect anything to come easy, but if she got a raise, everything wouldn’t be quite so hard.

The grandmother who works around the clock providing childcare to other people’s kids.
She’s proud of her work but the pay is barely enough to live on, especially with the soaring price of her prescription drugs.

The young entrepreneur whose dream of buying the bowling alley where he worked as a teenager was nearly derailed by his student debt. If he can grow his business, he’ll be able to pay off his debt and pay his employees, including himself, more too.

Millions of hard-working Americans tell similar stories.

Wages need to rise to keep up with costs.

Paychecks need to grow.

Families who work hard and do their part deserve to get ahead and stay ahead.

The defining economic challenge of our time is clear:

We must raise incomes for hard-working Americans so they can afford a middle-class life. We must drive strong and steady income growth that lifts up families and lifts up our country.

The government does not pay any of the people Clinton describes. And when the government sets wages, the result is fewer workers and less growth. The way to help all of these people is to grow the economy–which is the opposite result of most of the policies Clinton is proposing.

And that will be my mission from the first day I’m President to the last. I will get up everyday thinking about the families of America, like the family that I came from with a hard working dad who started a small business and scrimped and saved and gave us a good middle class life. I’ll be thinking about all the people that I represented here in New York and the stories that they told me and that I worked with them to improve. And I will as your President take on this challenge against the backdrop of major changes in our economy and the global economy that didn’t start with the recession and won’t end with the recovery.

This is, ultimately, Hillary Clinton’s pitch to voters: that she’s like us, that she comes from the same place, etc. Interestingly, when she lived in that middle class suburb, she was a “Goldwater Girl.” Her liberalism arose from her ideological choices, not her economic origins.

You know advances in technology and expanding global trade have created whole new areas of commercial activity and opened new markets for our exports, but too often they’re also polarizing our economy – benefiting high-skilled workers but displacing or downgrading blue collar jobs and other midlevel jobs that used to provide solid incomes for millions of Americans.

Today’s marketplace focuses too much on the short term – like second-to-second financial trading and quarterly earnings reports – and too little on long-term investments.

This is an odd point to make. Is she proposing to outlaw day trading by small investors? Does she want to ban quarterly earnings statements? The implication seems to be that public goods–“long-term investments”–are superior to the vagaries of the private sector. The record of public spending suggests otherwise–and that some of those long-term “investments” do plenty of long-term damage.

Meanwhile, many Americans are making extra money renting out a spare room, designing websites, selling products they design themselves at home, or even driving their own car. This “on demand” or so-called “gig economy” is creating exciting opportunities and unleashing innovation but it’s also raising hard questions about workplace protections and what a good job will look like in the future.

It’s only raising those questions for the unions and monopolies that are threatened. Note that previews of the speech suggested Clinton might attack the “sharing economy.” Evidently, if you remind people that they are sharing with each other, they think it’s a good idea.

So all of these trends are real, and none, none is going away. But they don’t determine our destiny. The choices we make as a nation matter. And the choices we make in the years ahead will set the stage for what American life in the middle class in our economy will be like in this century.

In other words: government ought to have the most important say in how our society changes, so we must elect someone to use that power.

As President, I will work with every possible partner to turn the tide. To make these currents of change start working for us more than against us. To strengthen –not hollow out – the American middle class.

What is this “middle class” of which Clinton speaks? We are not a society with formal or even informal class distinctions. Does focusing on the “middle” mean leaving the poor behind? Does it mean that many wealthy people–like the Clintons–might feign “middle class” status?

Because I think at our best, that’s what Americans do. We’re problem solvers, not deniers. We don’t hide from change – we harness it.

The measure of our success must be how much incomes rise for hard-working families, not just for successful CEOs and money managers. And not just some arbitrary growth target untethered to people’s lives and livelihoods.

I want to see our economy work for the struggling, the striving, and the successful.

We’re not going to find all the answers we need today in the playbooks of the past. We can’t go back to the old policies that failed us before. Nor can we just replay previous successes. Today is not 1993 or 2009. We need solutions for the big challenges we face now.

Again, this amounts to an indictment of the Obama administration’s economic policies. The “old policies that failed” include those passed in 2009, which were passed almost exclusively by Democrats, and which saw Americans’ wealth decline and opportunities narrow significantly.

So today I am proposing an agenda to raise incomes for hard-working Americans. An agenda for strong growth, fair growth, and long-term growth.

Let me begin with strong growth.

More growth means more jobs and more new businesses. More jobs give people choices about where to work. And employers have to offer higher wages and better benefits in order to compete with each other to hire new workers and keep the productive ones. That’s why economists tell us that getting closer to full employment is crucial for raising incomes.

Small businesses create more than 60 percent of new American jobs on net. So they have to be a top priority. I’ve said I want to be the small business President, and I mean it. And throughout this campaign I’m going to be talking about how we empower entrepreneurs with less red tape, easier access to capital, tax relief and simplification.

This is boilerplate, the kind of thing any Republican might say. Actually, it would be more accurate to call these lines camouflage, since they are intended to hide the state-centered policies that Clinton plans to impose in the name of improving or refining that economic growth.

I’ll also push for broader business tax reform to spur investment in America, closing those loopholes that reward companies for sending jobs and profits overseas.

Just a reminder about the loophole that sends “profits overseas”: it’s not a loophole, but a burden, that is to blame. U.S. companies prefer to earn abroad because the U.S. taxes them on both foreign and domestic earnings, and foreign corporate tax rates tend to be far lower.

And I know it’s not always how we think about this, but another engine of strong growth should be comprehensive immigration reform.

I want you to hear this: Bringing millions of hard-working people into the formal economy would increase our gross domestic product by an estimated $700 billion over 10 years.

That may be, but the country also has a fundamental national security interest in having secure borders. Adding illegal aliens to our social services costs a ton of money, and eroding the rule of law through amnesty undermines what makes America prosperous in the first place.

Then there are the new public investments that will help established businesses and entrepreneurs create the next generation of high-paying jobs.

“You know when we get Americans moving, we get our country moving.

So let’s establish an infrastructure bank that can channel more public and private funds, channel those funds to finance world-class airports, railways, roads, bridges and ports.

“Public investments”–a euphemism for government spending. The Obama administration used the term to cover its wasteful stimulus pork, which produced nothing. And an “infrastructure bank” is redundant. If a project stands a reasonable prospect of providing a return, it will eventually be undertaken by a private bank. The idea of a special “infrastructure bank” is either a gimmick or a vehicle for cronyism.

And let’s build those faster broadband networks – and make sure there’s a greater diversity of providers so consumers have more choice.

Yes, let’s–because after Net Neutrality, the private sector isn’t going to bother making capital investments it cannot recoup. Unfortunately, that “diversity of producers” is not going to materialize–but why ruin another utopian idea by introducing the element of economic reality?

And really there’s no excuse not to make greater investments in cleaner, renewable energy right now. Our economy obviously runs on energy. And the time has come to make America the world’s clean energy superpower. I advocate that because these investments will create millions of jobs, save us money in the long run, and help us meet the threats of climate change.

Like Solyndra? Government does a shocking job of investing in clean energy, or in much else. Have we learned our lesson? Clinton has not.

And let’s fund the scientific and medical research that spawns innovative companies and creates entire new industries, just as the project to sequence the human genome did in the 1990s, and President Obama’s initiatives on precision medicine and brain research will do in the coming years.

Note that one of the main new obstacles to medical research and innovation is Obamacare, which taxes medical devices, among other things.

I will set ambitious goals in all of these areas in the months ahead.

But today let me emphasize another key ingredient of strong growth that often goes overlooked and undervalued: breaking down barriers so more Americans participate more fully in the workforce – especially women.

We are in a global competition, as I’m sure you have noticed, and we can’t afford to leave talent on the sidelines, but that’s exactly what we’re doing today. When we leave people out, or write them off, we not only shortchange them and their dreams — we shortchange our country and our future.

The movement of women into the workforce over the past forty years was responsible for more than three and a half trillion dollars in economic growth.

But that progress has stalled. The United States used to rank 7th out of 24 advanced countries in women’s labor force participation. By 2013, we had dropped to 19th. That represents a lot of unused potential for our economy and for American families.

Studies show that nearly a third of this decline relative to other countries is because they’re expanding family-friendly policies like paid leave and we are not.

There is something interesting missing from this part of the speech, and it is the usual 78-cents-on-the-dollar gender pay gap that Clinton usually trots out. That statistic has been debunked–and is usually met with questions about why Clinton has paid her own female staff less.

We should be making it easier for Americans to be both good workers and good parents and caregivers. Women who want to work should be able to do so without worrying every day about how they’re going to take care of their children or what will happen if a family member gets sick.

You know last year while I was at the hospital here in Manhattan waiting for little Charlotte to make her grand entrance, one of the nurses said, “Thank you for fighting for paid leave.” And we began to talk about it. She sees first-hand what it means for herself and her colleagues as well as for the working parents that she helps take care of.

It’s time to recognize that quality, affordable childcare is not a luxury – it’s a growth strategy. And it’s way past time to end the outrage of so many women still earning less than men on the job — and women of color making even less.

All this lost money adds up and for some women, it’s thousands of dollars every year.

Now I am well aware that for far too long, these challenges have been dismissed by some as “women’s issues.”

Well those days are over.

Fair pay and fair scheduling, paid family leave and earned sick days, child care are essential to our competitiveness and growth.

And we can do this in a way that doesn’t impose unfair burdens on businesses – especially small businesses.

The latest fashion in left-wing entitlements is guaranteed child care, pre-K education, and paid leave. (Obamacare takes care of the “grave” part of “cradle-to-grave”; now they’re working on the cradle.) The trouble is that there is no way to provide these things without hurting the economy–either through taxes, or through employer mandates (which have had a devastating impact on full-time work in Obamacare). And, as usual, providing these things for free tends to undermine the incentives to work hard, be productive and create opportunity for others.

As President, I’ll fight to put families first – just like I have my entire career.

Well, her family, anyway.

Now, beyond strong growth, we also need fair growth. And that will be the second key driver of rising incomes.

The evidence is in: Inequality is a drag on our entire economy, so this is the problem we need to tackle.

You may have heard Governor Bush say last week that Americans just need to work longer hours. Well, he must not have met very many American workers.

Let him tell that to the nurse who stands on her feet all day or the trucker who drives all night. Let him tell that to the fast food workers marching in the streets for better pay. They don’t need a lecture – they need a raise.

This, of course, is a distortion of what Bush said (rather inartfully). He was referring to the rise of part-time work, as employers attempt to avoid the onerous provisions of Obamacare. Bush’s point was that we need to dump regulations that prevent people from working full-time.

The truth is, the current rules for our economy reward some work – like financial trading – much more than other work, like actually building and selling things the work that’s always been the backbone of our economy.

That is true of every economy in the history of human civilization. Some work creates more value for other people, even if that work does not seem as difficult or unpleasant as other jobs. Without different rewards, there is no incentive for the education Clinton spoke about earlier.

To get all incomes rising again, we need to strike a better balance. If you work hard, you ought to be paid fairly. So we have to raise the minimum wage and implement President Obama’s new rules on overtime. And then we have to go further.

In other words: we have to limit the number of entry-level jobs by artificially inflating wages, thereby denying new generations of minority youth that first step on the employment ladder, while at the same time raising the cost of living further in expensive urban areas.

I’ll crack down on bosses who exploit employees by misclassifying them as contractors or even steal their wages.

A relevant question: is Hillary Clinton paying all her interns?

To make paychecks stretch, we need to take on the major strains on family budgets. I’ll protect the Affordable Care Act – and build on it to lower out-of-pocket health care costs and to make prescription drugs more affordable.

More spending on bad policy. Clinton’s prescriptions also ignore the fact that the cost of the insurance plans themselves is spiraling out of control. By the time the next president takes office in 2017, Obamacare is likely to need radical surgery, if not outright repeal.

We’ll help families look forward to retirement by defending and enhancing Social Security and making it easier to save for the future.

Meaningless. Note the use of the word “save,” which perpetuates the delusion that Social Security is actually a savings plan. When Republicans like Paul Ryan attempt to introduce personal savings to Social Security, Democrats accuse them of throwing grandma off a cliff.

Now many of these proposals are time-tested and more than a little battle-scarred. We need new ideas as well. And one that I believe in and will fight for is profit sharing.

Hard working Americans deserve to benefit from the record corporate earnings they help produce. So I will propose ways to encourage companies to share profits with their employees.

That’s good for workers and good for business.

Studies show profit-sharing that gives everyone a stake in a company’s success can boost productivity and put money directly into employees’ pockets. It’s a win-win.

Later this week in New Hampshire, I’ll have more to say about how we do this.

Do tell. The basic way to share profits is to provide employees with shares, either by selling them existing shares or by creating new ones to give them or sell them. These are potentially good ideas, but they all involve the interests of existing shareholders, who should be allowed to decide for themselves whether profit sharing is good for their companies–or worth the potential dilution of existing shareholder value.

Another priority must be reforming our tax code.

Now we hear Republican candidates talk a lot about tax reform. But take a good look at their plans. Senator Rubio’s would cut taxes for households making around $3 million a year by almost $240,000 – which is way more than three times the earnings of a typical family. Well that’s a sure budget-busting give-away to the super-wealthy. And that’s the kind of bad economics you’re likely to get from any of the candidates on the other side.

If it benefits the rich, it must be bad, according to Clinton. Margaret Thatcher’s valedictory speech comes to mind: they “would rather the poor were poorer, provided the rich were less rich.” Clinton isn’t really aiming to help the poor. She’s just stoking class warfare for votes.

I have a different take, guided by some simple principles.

First, hard-working families need and deserve tax relief and simplification.

Second, those at the top have to pay their fair share. That’s why I support the Buffett Rule, which makes sure that millionaires don’t pay lower rates than their secretaries.

I have also called for closing the carried interest loophole, which lets wealthy financiers pay an artificially low rate.

And let’s agree that hugely successful companies that benefit from everything America has to offer should not be able to game the system and avoid paying their fair share… especially while companies who can’t afford high-price lawyers and lobbyists end up paying more.

These are all familiar proposals. What is interesting is that Clinton is not explicitly calling for raising tax rates. She knows that to do so would provide Republicans with the fattest imaginable political target. Her socialist rival, Bernie Sanders, will take her to task for this.

Alongside tax reform, it’s time to stand up to efforts across our country to undermine worker bargaining power, which has been proven again and again to drive up wages.

Republicans governors like Scott Walker have made their names stomping on workers’ rights. And practically all the Republican candidates hope to do the same as President.

I will fight back against these mean-spirited, misguided attacks.

Evidence shows that the decline of unions may be responsible for a third of the increase of inequality among men. So if we want to get serious about raising incomes, we have to get serious about supporting workers.

This, along with Clinton’s attack on the “gig economy,” is a sop to the unions–and a sign that the Clintons that would return to the White House are radically different from the “New Democrats” who arrived in 1993. Notably, Clinton singles out Scott Walker, whose collective bargaining reforms in Wisconsin saved thousands of public sector jobs and helped revive Wisconsin’s economy. The Wisconsin reforms had nothing to do with hurting workers’ rights, and everything to do with rolling back the power of union bosses to hurt individual workers and taxpayers in general. It is no accident that right-to-work states have higher levels of growth and job creation. The fact that Clinton adopts the unions’ vicious and unfair rhetoric about Walker, “workers’ rights,” and “mean-spirited” policies shows how little she cares about growth.

And let me just say a word here about trade. The Greek crisis as well as the Chinese stock market have reminded us that growth here at home and growth an ocean away are linked in a common global economy. Trade has been a major driver of the economy over recent decades but it has also contributed to hollowing out our manufacturing base and many hard-working communities. So we do need to set a high bar for trade agreements.

We should support them if they create jobs, raise wages, and advance our national security. And we should be prepared to walk away if they don’t.

Neither the Greek crisis nor the Chinese stock market crash has anything to do with trade. (They both have something to do with failed spending and regulatory policies, both of which Democrats embrace.) Clinton is merely exploiting fear of foreign crisis to bash trade. Notably, she is backing away from free trade policies that she explicitly supported when she was Secretary of State under Obama.

To create fair growth, we need to create opportunity for more Americans.

I love the saying by Abraham Lincoln, who in many ways was not only the President who saved our union, but the president who understood profoundly the importance of the middle class, and the importance of the government playing its role in providing opportunities. He talked about giving Americans a fair chance in the race of life. I believe that with all my heart. But I also believe it has to start really early at birth. High quality early learning, especially in the first five years, can set children on the course for future success and raise lifetime incomes by 25 percent.

The only reference to the term “middle class” in a document associated with Abraham Lincoln–at least in my cursory Internet research–is a letter to Lincoln from Karl Marx, the founder of modern communism. Liberty, not class, was the essence of Lincoln’s economic vision.

I’m committed to seeing every 4-year old in America have access to high-quality preschool in the next ten years. But I want to do more. I want to call for a great outpouring of support from our faith community, our business community, our academic institutions, from philanthropy and civic groups and concerned citizens to really help parents, particularly parents who are facing a lot of obstacles. To really help prepare their own children in that zero to four age group.

80% of your brain is physically formed by age of three. That’s why families like mine read, talk, and sing endlessly to our granddaughter. I’ve said that her first words are going to be enough with the reading, and the talking, and the singing. But we do it not only because we love doing it, even though I’ll admit it’s a little embarrassing to be reading a book to a two-week old, or a six-week old, a ten-week old. But we do it because we understand that it’s building her capacity for learning. And the research shows that by the time she enters kindergarten she will have heard 30 million more words than I child from a less privileged background.

Think of what we are losing because we are not doing everything we can to reach out to those families and we know again from so much research here in the United States and around the world that the early help, that mentoring, that intervention to help those often-stressed out young moms understand more about what they can do and avoid the difficulties that stand in the way of their being able to get their child off to the best start.

We also have to invest in our students and teachers at every level.

And in the coming weeks and months, I’ll lay out specific steps to improve our schools, make college truly affordable, and help Americans refinance their student debt.

Let’s embrace the idea of lifelong learning. In an age of technological change, we need to provide pathways to get skills and credentials for new occupations, and create online platforms to connect workers to jobs. There are exciting efforts underway and I want to support and scale the ones that show results.

Note that in this long-winded paean to public education and pre-K entitlements and so on, there is not a single word about the most important education reforms on the table: charter schools, school choice, school vouchers, merit pay, an end to teacher tenure, and others. Here Clinton is showing that her supposedly pro-growth, pro-opportunity policies are canceled out by her fealty to the teachers’ unions.

As we pursue all these policies, we can’t forget our fellow Americans hit so hard and left behind by this changing economy— from the inner cities to coal country to Indian country. Talent is universal – you find it everywhere – but opportunity is not.

There are nearly 6 million young people aged 16 to 24 in America today who are not in school or at work. The numbers for young people of color are particularly staggering. A quarter of young black men and nearly 15 percent of all Latino youth cannot find a job.

We’ve got to do a better way of coming up to match the growing middle class incomes we want to generate with more pathways into the middle class. I firmly believe that the best anti-poverty program is a job, but that’s hard to say if there are not enough jobs for people that we are trying to help lift themselves out of poverty.

That’s why I’ve called for reviving the New Markets Tax Credit and Empowerment Zones to create greater incentives to invest in poor and remote areas.

When all Americans have the chance to study hard, work hard, and share in our country’s prosperity – that’s fair growth. It’s what I’ve always believed in and it’s what I will fight for as President.

This is a laudable section of Clinton’s speech, because it is inspired by Republican policies, particularly those of Jack Kemp, who pioneered the idea of Empowerment Zones. This is the one “Clintonesque” turn in Hillary’s address, in that it appropriates conservative ideas. It is just decorative, however–because, again, it fails to call for school reform, suspending minimum wage laws or easing regulations to create jobs.

Now, the third key driver of income alongside strong growth and fair growth must be long-term growth.

Too many pressures in our economy today push us toward short-termism. Many business leaders see this. They’ve talked to me about. One has called it the problem of “quarterly capitalism.” They say everything’s focused on the next earnings report or the short-term share price. The result is too little attention on the sources of long-term growth: research and development, physical capital, and talent.

Net business investment – which includes things like factories, machines, and research labs – has declined as a share of the economy. In recent years, some of our biggest companies have spent more than half their earnings to buy back their own stock, and another third or more to pay dividends. That doesn’t leave a lot left to raise pay or invest in the workers who made those profits possible or to make the new investments necessary to insure a company’s future success. These trends need to change. And I believe that many business leaders are eager to embrace their responsibilities, not just to today’s share price but also to workers, communities, and ultimately to our country and indeed our planet.

I’m not talking about charity – I’m talking about clear-eyed capitalism. Many companies have prospered by improving wages and training their workers that then yield higher productivity, better service, and larger profits.

Now it’s easy to try to cut costs by holding down or decreasing pay and other investments to inflate quarterly stock prices, but I would argue that’s bad for business in the long run.

And, it’s really bad for our country.

Workers are assets. Investing in them pays off. Higher wages pay off. And training pays off.

To help more companies do that, I’ve proposed a new $1,500 apprenticeship tax credit for every worker they train and hire.

It is not clear that Clinton knows what she is talking about. She has no track record of independent business success. Presumably, businesses and their owners or shareholders know best–or, at least, better than government. The tax credit she is proposing is not a new idea. There were similar tax credits under Obama. Most were gobbled up by companies that were already planning to hire new workers. They had little effect on employment decisions. And $1,500 is simply a laughable amount when compared to the cost of training a new employee.

And I will soon be proposing a new plan to reform capital gains taxes to reward longer-term investments that create jobs more than just quick trades.

I will also propose reforms to help CEOs and shareholders alike focus on the next decade rather than just the next day. Making sure stock buybacks aren’t being used only for an immediate boost in share prices. Empowering outside investors who want to build companies but discouraging “cut and run” shareholders who act more like old-school corporate raiders. And nowhere will the shift from short-term to long-term be more important than on Wall Street.

As a former Senator from New York, I know first-hand the role that Wall Street can and should play in our economy – helping Main Street grow and prosper and boosting new companies that make America more competitive globally.

But, as we all know, in the years before the crash, financial firms piled risk upon risk. And regulators in Washington either couldn’t or wouldn’t keep up.

I was alarmed by this gathering storm, and called for addressing the risks of derivatives, cracking down on subprime mortgages, and improving financial oversight.

Here Clinton is playing to left-wing suspicions of Wall Street. Note that in her list of causes for the 2007-8 financial crisis and crash, she leaves out the government’s role in pushing bad mortgages. Not a word about Fannie Mae and Freddie Mac, or other ways in which the government distorted the market. Instead, she is offering the discredited theory that government knows best how to operate the markets.

Under President Obama’s leadership, we’ve imposed tough new rules that deal with some of the challenges on Wall Street. But those rules have been under assault by Republicans in Congress and those running for President.

I will fight back against these attacks and protect the reforms we’ve made. We can do that and still ease burdens on community banks to encourage responsible loans to local people and businesses they know and trust.

“We also have to go beyond Dodd-Frank.

Too many of our major financial institutions are still too complex and too risky. And the problems are not limited to the big banks that get all the headlines. Serious risks are emerging from institutions in the so-called “shadow banking” system – including hedge funds, high frequency traders, non-bank finance companies – so many new kinds of entities which receive little oversight at all.

This argument can be summarized as follows: “Math is hard. Therefore I will stop math.” Financial transactions will remain complicated–not least because the increasing regulatory burden of Dodd-Frank and similar laws makes the financial world much harder to understand.

Stories of misconduct by individuals and institutions in the financial industry are shocking. HSBC allowing drug cartels to launder money. Five major banks pleading guilty to felony charges for conspiring to manipulate currency exchange and interest rates. There can be no justification or tolerance for this kind of criminal behavior.

And while institutions have paid large fines and in some cases admitted guilt, too often it has seemed that the human beings responsible get off with limited consequences – or none at all, even when they’ve already pocketed the gains.

This is wrong and, on my watch, it will change.

Over the course of this campaign, I will offer plans to rein in excessive risks on Wall Street and ensure that stock markets work for everyday investors, not just high frequency traders and those with the best – or fastest – connections.

I will appoint and empower regulators who understand that Too Big To Fail is still too big a problem.

We’ll ensure that no firm is too complex to manage or oversee.

And we will prosecute individuals as well as firms when they commit fraud or other criminal wrongdoing.

And when the government recovers money from corporations or individuals for harming the public, it should go into a separate trust fund to benefit the public. It, could for example, help modernize infrastructure or even be returned directly to taxpayers.

This is all just left-wing boilerplate, extended at length to convince the Democratic Party base that they can vote for Clinton and still get Bernie Sanders or Elizabeth Warren in spirit. The answer to “too big to fail” is not more regulation, but less–i.e. allowing firms to bear their own risk. As for prosecutions–Clinton was part of an administration that shied away from prosecuting Wall Street firms and executives, because much of what they did likely complied with the law, and perhaps because the Justice Department had close ties with Wall Street.

Now reform is never easy. But we have done it before in our country. But we have to get this right. And we need leadership from the financial industry and across the private sector to join with us.

Two years ago, the head of the Chicago Mercantile Exchange, Terry Duffy, published an op-ed in the Wall Street Journal that really caught my attention. He wrote, and I quote: “I’m concerned that those of us in financial services have forgotten who we serve—and that the public knows it… Some Wall Streeters can too easily slip into regarding their work as a kind of money-making game divorced from the concerns of Main Street.”

I think we should listen to Terry Duffy.

Indeed we should, Mrs. Clinton. Too many in Washington regard their work as a kind of money-making game. Including you and Bill.

Of course, long-term growth is only possible if the public sector steps up as well.

So it’s time to end the era of budget brinksmanship and stop careening from one self-inflicted crisis to another. It’s time to stop having debates over the small stuff and focus on how we’re going to tackle the big stuff together:

How do we respond to technological change in a way that creates more good jobs than it displaces or destroys?

Can we sustain a boom in advanced manufacturing?

What are the best ways to nurture start-ups outside the successful corridors like Silicon Valley?

Questions like these demand thoughtful and mature debate from our policy makers in government, from our leaders in the private sector, and our economists, our academics, and others who can come to the table on behalf of America and perform their patriotic duty to ensure that our economy keeps working and our middle class keeps growing.

Notice what these questions do not demand, for Clinton–that government live within its means. She begins by talking about ending “budget brinkmanship”–and then diverts into talking about abstract economic debates rather than calling for serious fiscal reform. Why was the idea of a balanced budget good for Mr. Clinton, but no good for Mrs. Clinton? Or is it just to be a talking point, rather than a policy possibility?

So government has to be smarter, simpler, more focused itself on long-term investments than short-term politics – and be a better partner to cities, states, and the private sector.

Isn’t the best way to make government smarter, simpler, and more focused to make it smaller? To have it do only what it does best?

Washington has to be a better steward of America’ tax-dollars and Americans’ trust. And please let’s get back to making decisions that rely on evidence more than ideology.

It is not clear what she means by “evidence more than ideology”–perhaps that is a sop to climate change, or the old stem-cell research debate–but if Clinton is looking for evidence-based economic policies, she will have to jettison much of what she is proposing in this speech.

That’s what I’ll do as President. I will seek out and welcome any good idea that is actually based on reality. I want to have principled and pragmatic and progressive policies that really move us forward together and I will propose ways to ensure that our fiscal outlook is sustainable — including by continuing to restrain healthcare costs, which remain one of the key drivers of long-term deficits. I will make sure Washington learns from how well local governments, business, and non-profits are working together in successful cities and towns across America.

You know passing legislation is not the only way to drive progress. As President, I’ll use the power to convene, connect, and collaborate to build partnerships that actually get things done.

Because above all, we have to break out of the poisonous partisan gridlock and focus on the long-term needs of our country.

This is all meaningless waffle, but does exploit the idea that Obama has been such a divisive president that Americans are hungry for anyone–especially a Democrat, since the left is driving much of the division–who is capable of a more cooperative approach to politics.

I confess maybe it’s the grandmother in me, but I believe that part of public service is planting trees under whose shade you’ll never sit.

And the vision I’ve laid our here today – for strong growth, fair growth, and long term growth, all working together — will get incomes rising again, will help working families get ahead and stay ahead.

That is the test of our time. And I’m inviting everyone to please join me, to do your part, that’s what great countries do. That’s what our country always has done. We rise to challenges.

It’s not about left, right, or center – it’s about the future versus the past.

I’m running for President to build an America for tomorrow, not yesterday.
An America built on growth and fairness.
An America where if you do your part, you will reap the rewards.

Where we don’t leave anyone out, or anyone behind.

Thank you all. Thank you. I just want to leave you with one more thought.

I want every child, every child in our country, not just the granddaughter of a former President or a former secretary of state, but every child to have the chance to live up to his or her God-given potential.

Please join me in that mission. Let’s do it all together.

Thank you so much.

The speech ends weakly, with little idea of what Clinton wants to achieve. She acknowledges some of Obama’s failures, but provides no real break with his policies. She borrows a few good conservative ideas, more as rhetorical devices than proposals . She hews to a hard pro-union line, backs the regulatory state, and makes no commitment to repair the country’s debts or deficits.

Her only selling point seems to be that Bill Clinton did a great job–even if he governed along lines she no longer accepts. She is offering nostalgia, not policy. Sadly, that may be enough.

This post has been updated.


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