The no-tax man.

President Bill Clinton had many flaws, some more notorious than others. But whatever Clinton's failings, he had the political backbone to defy his own party when he believed the greater good of the nation was at stake. He earned the enmity of unions by supporting the North American Free Trade Agreement and alienated liberals by signing the welfare reform bill. Perhaps most important, he moved his party back to the political middle by endorsing government spending limits and a balanced federal budget.

President George W. Bush is no Bill Clinton. In some areas that is a welcome relief. In others, it may prove disastrous. Bush seems utterly incapable of making a decision that is not calculated to bolster the most conservative factions of his party. The president's fatuous Middle East "peace initiative" is a case in point. He has demanded the ouster of Yasir Arafat and the wholesale reform of Palestinian society, before the United States will support negotiations for a Palestinian state. Such a "plan" seems designed to stroke Republican hawks eager to "get on to Baghdad" and Christian conservatives who support Israel's territorial expansion rather than to address the reality and complexity of the Palestinian-Israeli conflict.

On domestic issues the president is even more calculating. From the loosening of EPA standards and an energy policy designed by industry bigwigs to the mantra for tax cuts, Bush is corporate America's president. His feeble reaction to the WorldCom scandal was typical. Confronted with yet another multibillion-dollar case of cooked accounting books and what appears to be massive fraud, the president lamely expressed his shock--"We've had too many cases of people abusing their responsibilities"--and vowed that "those who are irresponsible" will be prosecuted.

In the wake of Enron, Global Crossing, WorldCom, and others, this shocked schoolmarm's attitude won't do. While Bush sermonizes, trust in the equity markets is evaporating, threatening to strangle an already weak economic recovery. Treasury Secretary Paul O'Neil, who seems hapless compared to his predecessors Robert Rubin and Lawrence Summers, is no help either. Reestablishing the credibility of the business community among investors and employees will take more than cheerleading and pious cliches. It will require aggressive action by the Security and Exchange Commission and new regulatory mechanisms for the accounting industry. So far the administration has done little more than talk about the former and oppose the latter.

In the meantime, the stock market plummets, the dollar's value declines, the federal deficit balloons, and foreign investors flee U.S. markets. Foreign capital, which has long helped to sustain the American economy, is investing elsewhere, driven away by U.S. corporate malfeasance and the administration's inability to wean itself from an economic policy based on the ill-conceived 2001 tax cuts. This president hasn't the political nerve or the economic sense to recognize that what is good for his political base may plunge the country, even the world, into economic crisis.

The economic situation, now stable, may well become acute by the fall. Analysts note that consumer spending is slowing, corporate investment drying up, and the profit picture for many companies is dismal. Especially ominous is the fact that the stock market is falling during an economic recovery. That hasn't happened since the 1920s. The bursting of the technology stock bubble and the depredations of corporate fraud have left millions of Americans with reduced retirement accounts and a fresh skepticism about American corporate leadership.

It is time for the president to put the nation first and the Republican Party second by stepping away from his obsession with tax cuts. A sluggish economy, a stock market free fall, and a government that can't balance its books is a potentially calamitous combination. Federal revenues are already falling far short of expectations, and budget deficits resembling those of the early 1990s are looming. This prospect makes a stock-market rebound unlikely and further encourages the flight of foreign capital.

Fiscal responsibility was an important factor in President Clinton's political popularity. If George Bush continues to place ideology above economic sense, not even a successful "war on terrorism" is likely to sustain his high poll numbers. Imagine being remembered as the president who lacked the political courage of Bill Clinton.