Crisis Atmosphere Jude Wanniski May 9, 1994

Not since President Nixon was on the ropes over Watergate has there been an equivalent atmosphere of crisis in Washington. Unless President Clinton can get the federal courts to reject the Paula Jones sexual harassment lawsuit filed against him Friday, the country faces the likelihood of a truly ugly spectacle that would drag on throughout this year and beyond. The presumption of Bill Clinton's "guilt" is so widespread, based on the information displayed on the public record by The Washington Post last Wednesday, that it is impossible for me to see how he can wiggle out of this one with a scrap of credibility, let alone dignity. If I were his lawyer, I'd recommend that he settle out of court, with a public apology to Ms. Jones and a contribution to her favorite Little Rock charity, which is all she seems to be asking to clear her name. The guessing is that he will not do this, because he does not know where it would lead. Could he function as President after having confessed to such behavior and having lied about it? Wouldn't one such admission amount to a blanket confession about all the other questions regarding his character? 

The costs of confession would be great, but the costs can only climb if he proceeds. This isn't a case where it comes down to his word versus her word. In the political world, it is not enough to be "innocent," as I continue to believe President Nixon was of a Watergate coverup. Nixon deserved his fate because he did not exercise the political skill necessary to retain the confidence of the electorate. President Aristide of Haiti is in the same boat. The United States should not risk a drop of blood to put him back into the office he squandered through incompetence. "Elections do not convey a divine right to govern," is how Irving Kristol puts it. If Bill Clinton is incapable of holding on to "the Mandate of Heaven," he will somehow be driven from office even though he was duly elected in 1992 -- by an electorate which knew he had character flaws. Nixon resigned when he knew he could not manage the responsibilities of his office, overwhelmed by the House impeachment and the prospect of a lengthy Senate trial. President Clinton is now on the edge of just such a slippery slope. 

What naturally worries all Americans is that the embattled President will not be able to manage the responsibilities of his office. The tendency will be to "circle the wagons" around the core left wing of the Democratic Party, which always places its ideological agenda ahead of reason, logic, truth or morality. Political extremes, left or right, always employ emotion to justify their ends, when the facts available cut against them. By all accounts that come to me, the White House is now being managed by Deputy Chief of Staff Harold Ickes, the most committed, visceral liberal in the administration. It was Ickes, I'm sure, who Friday pushed the President into his new anti-fact Haitian policy, not 24 hours after Senate Minority Leader Bob Dole called for a bipartisan fact-finding commission on Haiti. Ickes is a political ally of Rep. Charles Rangel of Harlem, who long ago committed himself to a return of Aristide to the Haitian presidency at any cost, no matter the evidence of Aristide's intractable political incompetence, no matter any evidence that Aristide, not General Raoul Cedras, violated the terms of the Governor's Island Agreement, no matter the incredible suffering of the Haitian people.

Former Vice President Dan Quayle was exactly right yesterday on This Week with David Brinkley, when he ridiculed the idea of "foreign policy by hunger strike," referring to Randall Robinson's tomato juice diet. This is an administration that can no longer function on facts, because it now must rely on the support of the visceral left for survival. The emotional shift in Haitian policy owes as much to Paula Jones and Whitewater as to a hunger strike. Ten days ago, the President fired his special envoy to Haiti, Lawrence Pezzullo, on the grounds that Pezzullo continues to believe a peaceful negotiated settlement could be achieved if only Aristide would be less intractable. This weekend, General Cedras was again quoted as saying he has always been ready to engage in dialogue, and was immediately met with the frigid response from President Clinton that "the time for dialogue is over." Today, we learn on Page A7 of The New York Times that Clinton's ambassador to Haiti, William L. Swing -- on April 12, for goodness sakes -- cabled the administration "that the exiled Haitian President and his supporters were exaggerating and even fabricating reports of human rights abuses." 

Exaggeration? Rep. Kweisi Mfume, chairman of the Congressional Black Caucus, last week held a press conference to tell us that Aristide supporters were being hacked to pieces, their limbs fed to the animals. Now the President names as his special envoy to Haiti former Rep. William Gray, a one-time leader of the Congressional Black Caucus. Does anyone think that Gray will make the mistake of Pezzullo and report that a peaceful solution may be possible? Dan Quayle yesterday read into this the PR planning of a military invasion of Haiti, to demonstrate that the embattled President is, by gosh, the commander-in-chief. He may be right, as this is what the Black Caucus has wanted all along, which would again make Haiti a U.S. colony, as it was, more or less, earlier in the century.

If you did not tune in to CBS last Friday or catch Evans&Novak on CNN Saturday, you probably heard nothing about Senator Dole's proposed fact-finding committee. Dole, by the way, has recommended that the commission be composed of men and women who have no vested interest in Haiti, no axes to grind. He urged President Clinton to ask the advice of Henry Kissinger, who chaired a similar Central American commission in 1984, and recommended that Jack Kemp, who served on the Kissinger commission, be considered for Haiti. There was an item in The Washington Post, but not a word in the Times or the WSJ, and nothing on ABC or NBC. The time for dialogue is over and so, apparently, is the time for facts. 

If this is the plan for Haiti, the President can quiet the resulting uproar in the Republican Party by giving the GOP what it has been demanding in Bosnia: a unilateral U.S. decision to lift the arms embargo to permit the arming of the Bosnian Muslims, as if they were not already armed to the teeth (and in several areas on the offensive against the Serbs). Read today's Wall Street Journal editorial page, "Genocide by Embargo," by Albert Wohlstetter, for some pretty scary stuff. Wohlstetter, now nearly 80 years old, was among those who conceived the idea of destabilizing the Soviet Union by supporting the Islamic Fundamentalists in Iran, which led to the Afghanistan War that did just that. He was also a motive force behind the war in Iraq, to appease the Muslim world. He has since continued to argue for the dismemberment of the Soviet Union and Russian Empire, via this alliance with Islam. His views permeate U.S. policy in Bosnia, as he argues for support of the Muslims against the wishes of the British, French and Russians. To present his reasoning, he uses the same emotional arguments of "genocide" that we hear from the Black Caucus on Haiti, even to the point of telling us that the Iraqi invasion of Kuwait was "genocidal." To accomplish his visionary objectives, Wohlstetter does not have to observe "facts." He is a geopolitical chessplayer whom I for the most part supported during the Cold War, but whom I now consider to be a kind of Dr. Strangelove. Do we really want our country to serve as agent for the Islamic world? This is where Wohlstetter would have us go.

What does any of this have to do with the financial markets and the economy? Plenty. The talk shows are all wondering if President Clinton will be so distracted by Paulagate that he will function ineffectively. William Kristol is one smart fellow who worries that Paulagate will cause the President's conservative critics to be distracted. On Friday he sent a memo to conservative opinion leaders, urging them to keep a steady focus on the issues instead of just sitting back and enjoying the circus. He's right. Many of the best minds in the GOP will not be able to resist using this opportunity to even scores and, in their relaxed mode on policy issues, Harold Ickes and the Democratic left will advance.

The financial markets continue their sickening slide, now warning of recession ahead, as the Times and the WSJ agree that the Federal Reserve should be "tightening" -- by which they mean raising interest rates. The Journal should be urging Alan Greenspan to lower the gold price, not raise interest rates. What good does it do to hike the funds rate again and again and again and keep printing money at the same rate? Gold is exactly where it was when the rate "tightening" began. The Times is now predicting the Fed will raise the funds rate another 50 basis points, but what good will this do if it merely slows the economy? The objective is to restore the purchasing power of the dollar, which means a $350 gold price, not a 7% unemployment rate. 

Crises and anxieties abound. Reason and logic and facts are in short supply. Emotions run high. We wish we could see light at the end of the tunnel, but we're afraid Paulagate will take us lower than we expected to go with our young President.