ABSTRACT
This chapter begins with a description of the narrow margin by which the 1993 reconciliation bill sustained President Bill Clinton s economic program. It looks at policymaking in each of these areas—fiscal, monetary, and microeconomic policy—and at the peculiar alignment of forces that affects decisionmaking in each. Members of a president's administration often disagree about the proper course of economic policy, and those disagreements may affect their support and enthusiasm even after decisions seem to have been made. The principal instrument of US fiscal policy is the federal budget. Proponents of tax expenditures argue that they are an efficient way for the federal government to encourage certain kinds of economic activity by lowering its cost to individuals. The president's approval ratings slipped dramatically and by December an overwhelming 71 percent of surveyed voters disapproved of the president's management of economic policy.
