WI: a Paul Tsongas presidency

Thomas1195

Banned
Clinton promised tax cuts.
But then we saw a tax hikes that led to budget surpluses.

I figure there'd be more environmental conservation under Tsongas
Dude, this guy talked about gasoline tax.

Shifting the US towards a more pro-savings (and thus more pro-investment) model would be impactful. The US is a very low-savings country relative to many others. The material condition of many americans would be a bit tighter (due to less consumerism, less imports) and there'd be fewer flows of american capital abroad (so less growth in China, not sure about Mexico). Abundance of capital would mean real interest rates would be lower, which is good for borrowing and investing. The question is, what is that borrowing and investing going into. Houses? Manufacturing? Pharmaceuticals? Services?
He explicitly said in his book that he wanted greater investments in manufacturing and "hard" technology like applied engineering. He also wanted to expand public education.

Tsongas wanted the US, Europe, and the Pacific Rim to collectively invest in a second Marshall Plan for Eastern Europe.
Interesting. What would be the impact of this?

He'd try for something more modest and budget-friendly if he tries at all. Modest medicaid expansion? CHIP? Middle-class insurance subsidies? Paid family leave?
Could such plan have been passed ITTL?
And how about German-style national insurance?

Tsongas opposed middle class tax cuts but supported cutting capital gains taxes on stocks and bonds (but not real estate). I imagine this would extend either to (1) corporate tax rate cut as well, (2) more pro-investment loopholes like being able to carry forward losses and not pay taxes on money reinvested into the business, or (3) some combination thereof.
He actually stated that he did not support all-the-board capital gain tax cuts, but specificially short-term capital gain tax cuts.

Tsongas's mercantilism wasn't of the tariff sort. I imagine there'd be more support and funding for the Export-Import Bank, Small Business Administration, and government research.
Yes, and national investment strategy a.k.a industrial policy.

I do not want to delve too deeply into current politics, but I also get the sense that free trade neoliberalism is not particularly popular in the South and Appalachia on its own, and has to be paired with either cultural conservatism or Bill Clinton's folksy charm to be successful there.
Tsongas was more pro-business but actually less neoliberal than Clinton. Sounds weird, right? His overall economic plan was very mercantilist and dirigisme, like post-war Japan, France and Germany. This is very different from Thatcherite/Reaganite laissez-faire neoliberalism.
 
But then we saw a tax hikes that led to budget surpluses.

Tsongas would probably have a decent enough time on the deficit. The Kasich-Penny Plan put forward in 1993 would be an easy thing to get behind, and Tsongas would be pretty in-line with HW's anti-deficit measures. Lots of consistency across administrations and across party lines on what to do about the deficit.

Meanwhile Gingrich would probably be trying to lead some kind of revolt against this, just like he screwed over HW OTL. And the left-flank of the democrats would also be apoplectic.

Dude, this guy talked about gasoline tax.

Fun stuff. I imagine the GOP would make a big deal of this. Does the GOP push cap-and-trade in response?

Interesting. What would be the impact of this?

Less economic chaos in the USSR for one. I'm guessing it'd include IMF loans and a lot of debt forgiveness for the Russians. Tsongas also understood in a way that many OTL liberals didn't that the Russia sufficient organization infrastructure in its transition to capitalism, and that simple stuff like loans and food aid would be insufficient. He wanted to send western businessmen and other experts to the former eastern bloc to assist in the development of capitalist institutions. I have the relevant excerpt from A Call to Economic arms quoted at the bottom of this post.

ICould such plan have been passed ITTL?
And how about German-style national insurance?

National insurance seems broad-reaching and expensive, no? If there's health reform by Tsongas I think it'd be something incremental.

Tsongas was more pro-business but actually less neoliberal than Clinton. Sounds weird, right? His overall economic plan was very mercantilist and dirigisme, like post-war Japan, France and Germany. This is very different from Thatcherite/Reaganite laissez-faire neoliberalism.

It isn't that weird. Libertarian/Neoliberal economists and advocates tend to emphasize there being a difference between being pro-business and pro-market. Going all the way back to Adam Smith, the idea was that it's business that tends to most promote undermining free markets. Economic Liberalism emerged in opposition to Mercantilism, and it was only the rise of Socialism that sort of papered over the differences in the 20th Century.




One thing that fascinates me about Tsongas is that by the mid-90s he felt that there was a need for a third centrist party in the United States.
  • I can imagine him bringing this sort of mindset with him into the White House, except his focus would be on transforming the Democratic Party into representing his vision of a Centrist and Socially Liberal Party. He might provoke the Casey-crats even more than than Bill Clinton did. He's going to provoke the New Dealer types as well. I can see the 1996 primary being messy. Maybe Casey or Kennedy runs against Tsongas's successor.
  • He specifically felt that somebody like Colin Powell ought to run in 1996. Powell probably would get a prominent position in a Tsongas administration despite being a Republican.


Also, the 1994 Midterms are going to be different here. Perot voters OTL broke for the GOP pretty significantly. TTL I don't see that happening since Tsongas plays to their economic protectionism a bit (via mercantilism) and to the matter of balanced budgets.







It is essential here to understand two fundamental points.
First, a Soviet Union in transition will always pose a certain danger to
us but that danger is not the risk of advancing Warsaw Pact armies
preceding a carefully planned nuclear attack. It is the danger of an
unstable leadership which happens to be well armed. It is the danger,
not of miscalculation, but unbalanced desperation. As long as nuclear
weapons exist in such vast numbers they cannot be allowed to drift from
our consciousness.
Second, it is in everyone's interest to make the Soviet
transition as smooth as possible. The less the economic chaos, the less
will be the risk of political extremism. The Western nations must help
demonstrate to the Soviet people that there is a light at the end of the
democratic tunnel. Economic deprivation makes freedom less relevant to
a people. We must ensure that economic hope is not extinguished within
the minds of the Soviet citizenry.
This means a coalition of North American, EEC and Pacific Rim
nations meeting at an economic summit with the Soviets (and the East
Europeans) and hammering out Marshall Plan II. This will be a Marshall
Plan not to contain communism but to keep it in its grave (the hard
view) or to enable a long suffering people to enjoy the fruits of
freedom at long last (the benign view). Instead of arraying our forces
of war against the East, let us demonstrate the genius of democracy by
unleashing the true generosity inherent in free nations. This
generosity will involve the usual forms of assistance but it must
include as well the transfer of knowledge. The task here is to bring

Page 51
into being the organizational infrastructure necessary for economic
reforms to succeed. This is not just a matter of letters of credit or
food aid. It is fundamentally a matter of providing skills and
experience and management. These are human talents that can only be
transferred by other human beings. It obviously involves the deployment
of various Western corporate and academic entities. But it also means
Western experts such as retired business executives and consultants on
leave devoting themselves to the great task of the 1990's and beyond -
the full integration of the former Warsaw Pact into the commonwealth of
nations. Such an integration will also enable us to have a greater
capability to influence the outcome of the independence movements in the
republics.
 
The big question that keeps coming up in this thread is... who is Tsongas's running mate and successor?

Given that he's a white ethnic from the northeast, I imagine that he'd need somebody from middle america or the south. I also think that he would pick somebody moderate-to-conservative in the Democratic Party. To me that pretty much means Gore, Nunn, or Gephardt. Maybe David Boren or Zell Miller. Boren would be fun given that Goldwater said he ought to have been elected President. Evan Bayh might also be a possibility, though he's still pretty green at this point. Two young Indianan VPs in a row would be amusing.

Well, in the most technical sense, the smartest move for Southern centrist Bill Clinton would have been to balance his ticket with some Northeastern liberal, but he actually doubled down and picked Al Gore as his running mate and did not really suffer politically for it. Sometimes folks are driven to defy conventional wisdom.

Now, do we have any evidence that Paul Tsongas was such an individual? Not necessarily, but according to his Wikipedia article...

In late 1994, Tsongas briefly led an effort to establish a third party, to be led by someone with "national authority", suggesting General Colin Powell for that role.

Might he lobby Powell to become his running mate in this scenario? Possibly. After all, to quote Powell's Wikipedia article...

Powell's experience in military matters made him a very popular figure with both American political parties. Many Democrats admired his moderate stance on military matters, while many Republicans saw him as a great asset associated with the successes of past Republican administrations. Put forth as a potential Democratic Vice Presidential nominee in the 1992 U.S. presidential election[43] or even potentially replacing Vice President Dan Quayle as the Republican Vice Presidential nominee,[44] Powell eventually declared himself a Republican and began to campaign for Republican candidates in 1995.

The issue is that, in any case, Powell seems to have been entirely uninterested in running for office.

That said, would it be a stretch to suggest that Tsongas might be open to selecting another African-American running mate? If so, this would virtually assure the United States a black president before the year 2000.
 

Thomas1195

Banned
Tsongas would probably have a decent enough time on the deficit. The Kasich-Penny Plan put forward in 1993 would be an easy thing to get behind, and Tsongas would be pretty in-line with HW's anti-deficit measures. Lots of consistency across administrations and across party lines on what to do about the deficit.
If the economy still recovers like OTL, he might probably be able to push forward the "tax cuts are unnecessary" narrative, since his platform never had tax cut agenda (No Santa Claus). If this narrative successfully takes hold, perhaps America would be better off compared to OTL.

He's going to provoke the New Dealer types as well. I can see the 1996 primary being messy. Maybe Casey or Kennedy runs against Tsongas's successor.
Not really if large infrastructure investments occur, which was quite in line with his economic platform. After all, his pro-business stance was Hamiltonian rather than neoliberal.

Also, his healthcare plan might have actually succeeded, unlike Clinton IOTL.
 
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