On Monday night at the Democratic National Convention in Los Angeles, Labor Secretary Alexis Herman spoke about the nation's current prosperity.  Naturally, she gave most of the credit to the Clinton Administration.

However, Herman also gave credit to the American people, correctly citing "their sweat, their toil, their tears."  Indeed, it is American entrepreneurs, small business owners, investors and workers who have provided today's economic prosperity.

Herman went on to note that during the Clinton years, the difference was that government was on "their side again."  Well, in reality, U.S. prosperity has come despite of, not because of, what government has done over the past eight years.  For example, the 1993 tax hike (which President Clinton last night praised Al Gore for passing the tie-breaking vote in its favor in the U.S. Senate), increased regulation and increased government spending to work against entrepreneurs and workers.

Really, the only major pro-growth step taken by the federal government in recent years was the 1997 reduction in the capital gains tax.  President Clinton deserves credit for allowing that to become law, but he did so grudgingly.  After all, that was not a Clinton policy idea; it came from Congress.

In the end, Congress and the White House helped U.S. prosperity by not doing something so egregiously stupid-as government periodically does-to derail entrepreneurs, innovators, investors and workers in the private sector.  In addition, the Federal Reserve's fairly steady hand on the monetary front, resulting in low inflation, provided a solid foundation upon which the economy could function and prosper.

Raymond J. Keating
Chief Economist
Small Business Survival Committee
and co-author of
U.S. by the Numbers:
Figuring What's Left, Right, and Wrong
With America State by State