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Clinton Addresses Economy, Deficit in Cleveland Speech

By Edward Walsh
The Washington Post

President Clinton claimed credit Monday for an improving economy and announced a sharp drop in the federal budget deficit amid signs that more of the public is beginning to see his economic policies as beneficial to the country.

Clinton warned in a speech to the City Club of Cleveland that the economic accomplishments of his administration would be jeopardized by a return to the "easy promises and superficial attraction" of Republican policies of the 1980s.

Clinton's comments came as a new Washington Post-ABC News poll showed that more Americans are encouraged about the state of the economy, and give Clinton at least partial credit. Clinton's overall performance rating increased, and his approval ratings for handling of the economy improved for the first time in six months.

In Washington, however, the leak over the weekend of a memo from Budget Director Alice Rivlin to Clinton outlining a variety of spending cuts and tax increasesput the Clinton administration on the defensive, with several of its top officials asserting the Democrats would not cut Social Security or trim Medicare, except as part of health care overhaul.

Vice President Gore, in a lunch with reporters and television interviews, and White House Chief of Leon Panetta made that point in denying the memo had any relationship to actual White House policy. Republicans, meanwhile, touted the memo as proof the White House had tax increases and entitlement cuts in mind but won't say so until after the election.

Clinton's speech in Cleveland contrasted sharply with Clinton's campaign of two years ago, when he seldom mentioned the deficit while promising an activist government that would tackle the nation's promblems and provide a middle class tax cut. But the deficit reduction of the last two years is seen as one area where Democrats can appeal to a public grown increasingly sour toward government policies.

Clinton took aim at the Republican "Contract with America," the series of campaign promises devised by House Minority Whip Newt Gingrich, R-Ga., for Republican congressional candidates. He called the document, calling for tax cuts, increased military spending and a balanced budget, among other pledges, "cynical" and "a trillion dollars in promises" that would "indulge the present instead of preparing for the future."

But at the beginning of a question and answer session, Clinton's criticism of the contract was challenged by freshman Rep. Martin R. Hoke, R-Ohio, one of the document's signers.

By the luck of a draw administered by City Club officials, Hoke was awarded the right to ask the first question and he used it to assail Democratic descriptions of the GOP promises as a "Contract on America." As many in the audience jeered, Hoke demanded to know why, with public fear of violent crime on the rise, Clinton would use such "inflamatory" language to attack his critics.

The president replied that he agreed with some elements in the contract, including the line item veto, middle class tax relief and and overhaul of the welfare system. But speaking of Republican promises to balance the budget while simultaneously enacting tax cuts and increasing defense spending, he said "I do think that's a contract on our future."

In his speech, Clinton said the Treasury Department's preliminary estimate of the budget deficit for the fiscal year that ended Sept. 30 was $203 billion, about $100 billion less than had been projected two years ago, and he predicted that the deficit would continue to decline to about $170 billion in the current fiscal year.

Much of Clinton's speech sounded similar themes that could easily have been voiced by a Republican president. He said his administration was "shrinking government" and had cut the number of federal employees by 70,000 and he credited administration trade policies and passage of the North American Free Trade Agreement with boosting U.S. exports.

Clinton's stops here and in Cleveland came at the end of a three-day campaign swing for some of his party's beleagured candidates in the November elections. He attended a fundraising reception here for Rep. Tom Sawyer, D-Ohio, who is leading in his race and has not tried to avoid the president as have some other Democrats, and in Cleveland spoke at a luncheon for Ohio Attorney General Lee Fisher. But it is one measure of the problems facing Ohio Democrats that Fisher is considered the party's only likely winner in a statewide race this year.