IN THE EARLY EVENING OF DEC. 7, A small group of economic advisers met secretly with Bill Clinton at Blair House in Washington. Their message was depressing: The long-term outlook for the nation's economy is worse than the public appreciates; the euphoria surrounding the latest growth figures is unfounded; and some of the underlying assumptions behind the economic plan Clinton embraced during the campaign are wrong. "Blair House," as it is now referred to in shorthand among a close circle of Clinton aides, was not a pleasant meeting. The President-elect feared that his advisers had misled him during the campaign, and the discussion's revelations constituted the beginning of what he himself calls his "first political crisis."
The events leading to Blair House, the session itself and Clinton's current attempts to turn its implications to his advantage offer a rare glimpse at the President-elect's leadership style and governing philosophy.
Different Presidents use their transitions differently. Clinton's has been marked by two factors: the beginning of what promises to be a drawn-out and difficult education process designed to change the way Americans think about themselves and their country, and the appointment of advisers whose primary roles will involve salesmanship and the implementation of programs more than policy development.
In choosing his top team, Clinton has been guided by three considerations: a quest for ethnic and gender diversity; an emphasis on collegiality; and, in the case of his senior economic assistants, a desire that their selection be perceived calmly by the financial markets, whose skittishness could doom his tenure even before it begins. The last two goals have been met. The first, + diversity, has been harder to achieve, but its importance has been misunderstood. Clinton in no way feels obligated to the women's, ethnic and liberal lobbying groups that seem to have driven him to distraction. To Clinton, diversity is desirable because it supports his overarching ambition: that the public turn from its traditional craving for immediate gratification to an appreciation of the pain, sacrifice and mutual obligation necessary to bring about structural economic change. Without that change, Clinton feels, the nation will not be able to continue growing in an increasingly global economy. To that end, a Cabinet that "looks like America" helps.
Thus begins the education of Bill Clinton -- and Clinton's first moves toward educating his nation. Along the way Clinton has displayed several facets of his personality: a leader feared by his aides, who attempt to shield him from some uncomfortable truths; an insightful student of economics nevertheless capable of holding to notions most economists view as errant nonsense; a man determined to set the country on a difficult path, who views every setback as an opportunity.
Blair House was inevitable. When the chore changed from campaigning to governing, Clinton had to confront the flaws in his prescriptions and the excessively optimistic projections of the institutions over which he has no control. "The bad news had to be delivered at some point," says Labor Secretary-designate Robert Reich. "It was only a matter of when and where."