INTERVIEW WITH CLINTON CHIEF OF STAFF:
© 1996 Hedrick Smith Productions, Inc.
White House and Congress: Confrontation vs.
SMITH: Leon, you described in a caucus meeting that dramatic moment when
Gingrich said to the President, " we thought we could break you?"
PANETTA: There was kind of a self admission that the strategy that they
had designed around the budget had failed, that they basically had based
their whole strategy on the fact that the President would break. They thought
it would happen five months ago, six months ago. It didn't happen. They
continued to believe that it was going to happen if they forced a shutdown
and it didn't happen. When they had a second shutdown and engaged in negotiations,
they thought it would happen and it didn't happen. Their strategy was tied
to the President basically caving in and agreeing with the Republicans.
And it didn't happen. He just basically said, our strategy failed.
SMITH: That was about the 4th or 5th of January, very late in the game?
PANETTA:Yeah. It was in one of the Oval Office sessions and he was sitting
on the couch and it was just one of those moments that you remember for
a long time because it was a culmination of what was I think becoming increasingly
obvious to everybody that the strategy had failed. We all thought it had
failed. The shutdown strategy was not working. We kept getting rumors that
they kept hoping that, eventually the President would give in.
Refering to Shutdown in December 1995
PANETTA: What had Gingrich promised the President to do? Well, there was
an agreement that if, in fact, we would move to a set of negotiations, in
the Oval Office that they would move to do a continuing resolution.
SMITH: And reopen the government?
PANETTA: And reopen the government. What they asked was would I sit down
with John Kasich and Pete Domenici to develop an agenda for what those talks
would look like. In other words, a time frame.
SMITH: What did you think had happened? Did you think that Gingrich had
simply welshed on it or did you really think that the freshmen had stopped
PANETTA: What happened was that evening they began to have their first meetings
with the freshmen and with the members and the freshmen bolted at the idea
of, in fact giving into a CR (continuing resolution.) What happened was
we agreed on a letter that laid out what we thought would be the schedule
and I was supposed to go back in the morning and again meet with Kasich
and Domenici to kind of wrap up that viewpoint.
PANETTA: I went back there and Domenici was there, but Kasich was not there.
SMITH: I don't want to get lost in this -- Gingrich called the President?
PANETTA: Gingrich basically at that point asked to see me. I talked with
him and he basically said, "I can't deliver on this."
SMITH: He said he could not deliver because of his freshmen?
PANETTA: Yeah, he said, "I just can't -- I can't do it." Is there
a way for you to talk to them, can somebody talk to them, maybe open a line
of communications here to try to talk with them because he said, "I
honestly cannot deliver." And I mean Dole was angry about it, but the
Speaker was basically again saying, "I cannot deliver."
Newt Gingrich & The Power of the Speaker
PANETTA: He essentially came into it rallying his troops, you know, saying
we're going to do the contract, saying we're going to do the revolution,
but I think in the end never really thought out what am I going to deliver
on, what can I deliver on in reality considering I got a Senate to deal
with, I got Bob Dole to deal with, moderates to deal with. I've got a Democratic
President to deal with. What, in fact, can I deliver on that we can say
we achieved. I don't think you spend enough time strategizing that. So,
you know, while he could start the war -- while he's good at starting a
war, I don't think he was able to strategize how in the end he was going
to win the war or at least win some of the victories that would keep him
in place. I mean, he likes to use military leadership as an example. I think
what happened here is the example that -- that we often refer to as Bonaparte
going into Russia. Bonaparte, you know, moved in quickly, but then bogged
down, because he didn't look ahead at what he was going to face in terms
of the winter and the troops that were there. And I think he ran into the
same problems on Capitol Hill.
SMITH: People said that you had a seven year balanced budget scored by CBO,
essentially Tom Daschle's budget, in your pocket for quite a while before
you actually laid it on the table? Is that true? Why didn't you put it down
PANETTA: Well, that was another thing that I just -- I never quite understood
what the hell they were doing in these talks, because I'm used to a process
of negotiation, which means you sit down and it's back and forth, it's give
and you lay a part of your proposal down. The other -- I mean, both side
know you're not laying everything down, but you're in a process of negotiation,
of give and take and you try to work your way towards some compromises.
That's the way a negotiation works. I came in on that basis -- that I wasn't
going to lay down my last offer first. That's crazy. And I wa snot there
to basically engage in terms of surrender. I think the Republicans basically,
because they thought the President was going to cave, came in with the attitude
that this was not about negotiating, this was about basically working out
the terms of surrender. And, so, they expected me to basically lay down
a proposal that looked like the Republican proposal. I would -- I was never
going to do that. And, so, what I was prepared to do was to lay down incremental
steps that moved us towards a process of give and take, of negotiation,
SMITH: And they didn't want to do that?
PANETTA: They didn't want to do that?
The Need for Bipartisanship & Compromise
PANETTA: Let me tell you what I -- what I basically said when we began these
discussions is -- I laid out what I said is the key to whether or not we
can get an agreement. I think I put about ten items on a board. And I basically
said, look, these are the issues that you have to confront in these negotiations,
things like medicare and medicaid, discretionary spending, welfare reform,
about ten items. And I said, to get an agreement, both sides have to be
able to claim some wins. And both sides have to be willing to say we split
on some other things. That's the way you do things if you really want to
put a package together. So, I basically went down the list and I said, look,
you know, on -- on balanced budget, seven years, we're moving to you. on
CBO we're moving to you. On medicare, you got to move to us. And I went
down the list. And, so, what I came down was -- I said, you win on three,
we win on three, we split the difference on the others. That's the way you're
going to get a deal.
SMITH: What does Armey say to that? What does Gingrich say to that?
PANETTA: They say we put too much into -- we've put too much into winning
these issues. They started talking about we got to have entitlement reforms.
I said, entitlement reforms, who are we kidding. You got 200 billion in
tax cuts that you want to pass out. Don't give me the line in entitlement
PANETTA: Dole was not the problem.
SMITH: Did he ever say anything in response to these entreaties of yours?
PANETTA: I think -- Bob Dole is a guy who understands the legislative process
and knows what it takes to make it happen. So, I -- you know, the Senate
has never been the problem. The House -- the House Republicans were the
Clinton: Learning the Presidency and Relations
PANETTA: It's been a learning process. I mean, for any President who comes
into this town, you know, he came from a small state. He had worked with
the legislature in his state and just developed, you know, that kind of
idea about he would work the legislative process there obviously as Governor
-- much more power and much more control over the legislature, greater ability
to influence the public in terms of putting pressure on the legislation
because -- by virtue, of the Governor's position.
PANETTA: I mean, the President has this -- this sense that given enough
time he can convince anybody about the logic of his position, anybody. And
that, you know, whatever it is, whatever hang-up it is that he's -- he's
absolutely certain that he can change their minds in some way. And I think
particularly when it came to Southern members, because there was obviously
some kind of -- of deeper relationship there because -- coming from the
South -- that he thought for sure there were members that would not bolt
on him, that they were members that he could work with.
PANETTA: I think the -- you know, the first shock came on the stimulus package,because
I think there was a sense that the stimulus package would be a way to try
to address current needs in the economy. And I think that was kind of the
first shock that -- uh -- that the Congress wasn't willing to go along with
PANETTA: Well, I think -- I mean, I think the -- the President's concern
after the first two years, despite, you know, I think a very good record,
is that he did not want to be trapped into being a prime minister and that
so often it was -- you know, you got so wrapped up in the -- in the issues
that were up there and working the issues and working what was going on
and having to deal with the leadership up there that sometimes he felt he
-- he basically had -- had not kind of protected the power base of the Presidency.
And I think he learned that. And I think he -- he is much better at balancing
how you operate as President in relationship to the Congress, that it is
important sometimes to say to the American people, look I've made my proposal,
this is what I believe. It's up to the Congress to now respond. Ronald Reagan
was very good at that. And I think, you know, the country understood the
difference between President as President and a President as someone who
gets lost in the -- the Congressional give and take.
Presidency: Power and Myth
SMITH: Do you think he was shocked that this was a weaker office, the Presidency
was a weaker office?
PANETTA: I think what, what was tough for him to get a handle on was how
there really is-- these different centers of power in this town.
PANETTA: I think there was a sense that a new Democratic President, Democratic
agenda, Democratic Congress -- uh -- that there was a real opportunity here
to just move an agenda through and that it would be, you know, I think an
easier process of getting it down, because there was a feeling that we were
riding a wave and that it would happen that way. I mean, a lot of us I think
cautioned that, you know, it wasn't that simple. You're dealing with a lot
of different egos. You're dealing with a lot of people who have their own
power base, Democrats as well as Republicans, but principally Democrats
who are Chairmen. You had to deal with all of that. You had to be, you know,
sensitive to that in order to make this work. And it's quite -- it's a learning
process. And I think the President, you know, as he worked with that began
to learn that it wasn't just, you know, the legislature in Arkansas, it
was very different. And that you had to work with the different power bases
that were up there.
PANETTA: You aren't just dealing with a power center at all, you're dealing
with a whole series of different power centers and personalities and egos
and turfs and jurisdictions and people who have their own political ax to
grind one way or another. And you've got to be sensitive to all of that
and somehow you've got to work with it and then eventually bring it together.
It is -- it's a tremendous challenge. It isn't easy.
Newt Gingrich & The Power of the Speaker
SMITH: How do you size up Newt Gingrich.... as a leader in terms of his
ability to move the House and then to bargain and negotiate?
PANETTA: I think the Speaker is -- is someone who's very good at rallying
a force together. He knows how to basically get members worked up about
an issue -- uh -- to kind of pull them into take control of the mob, if
you will, kind of approach. And he knows what it takes to kind of give them
the spirit of revolution, if you will...while -- you know, as a -- as a
minority leader and someone who virtually was willing to bring down the
House in order to gain power -- you could essentially spend your time tearing
an institution down, but not having the responsibility of delivering it.
It's much easier to do that.
© 1996 Hedrick Smith Productions, Inc.