Clinton loses tax package but escapes the fire

STRUGGLING to regain a political balance shaken by the Waco tragedy, Bill Clinton suffered another blow to his young presidency yesterday when his Republican foes in the Senate effectively drove the last nail into the coffin of his ill-starred economic stimulus programme.

The de facto defeat, the worst Capitol Hill setback of the President's three months in office, came when the Republican minority again mustered enough votes to block a Democratic bid to shut down a filibuster preventing passage of the package. In a gesture of compromise at the weekend, Mr Clinton had reduced it dollars 12bn ( pounds 7.8bn) from the original dollars 16bn.

The failure leaves the President with a bleak choice: either to accept another scaled-down compromise, this time dictated by the Republicans, or to abandon the measure in its entirety. All that remained would be a dollars 4bn extension of unemployment benefits, which both parties have indicated they would be ready to approve separately.

Gone, for the time being at least, is the President who early on had Congress eating out of his hand, as he secured passage in record time of his dollars 500bn deficit-cutting package of tax increases and spending cuts. In this vital early stage of his administration, the pendulum of opinion is shifting from respect and admiration to the belief that he is a soft touch.

But the President seems to be escaping serious fall-out from the Waco inferno despite some fears that the tragedy might turn out to be for Mr Clinton what the Bay of Pigs was for John Kennedy and the botched 1980 Iran hostage rescue was for Jimmy Carter.

The real danger for Mr Clinton is one of style: that his widely perceived initial efforts to distance himself from the disastrous ending to the Texas stand-off will re-inforce the impression of political slipperiness.

If a CNN-USA Today opinion poll is to be believed, the public overwhelmingly seems to buy the administration's line that, with a fanatic like David Koresh, there was nothing to be done. Fully 93 per cent declared that Koresh was to blame, while almost three-quarters believed the FBI had acted 'responsibly' in using force to try and flush the occupants out.

Indeed, the outcome may have one unexpected beneficiary - the Attorney-General Janet Reno. Logically, as head of the Justice Department, she might have been expected to be in the front line of press fire for the botched attack.

Instead, her readiness to accept responsibility has drawn rave reviews in a country which expects all things from its politicians, except forthright honesty. Even though she had not even been sworn into office when the authorities ordered the original attack on 28 February, within hours of the ghastly denouement she was acknowledging that 'the buck stops here'. It took Mr Clinton half a day more to make the same admission.

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