Twice now, Wall Street has clearly shown its preference for President Clinton's survival. On September 11, the Dow Jones industrials came back from a beating to close up 180 points as it chewed over release of the Starr Report and found no surprises that might add to the pressures on Mr. Clinton to resign. Yesterday, as the world watched the President's videotaped deposition to a federal grand jury, it responded by turning a 180-point decline into a 37-point gain. The financial market makes judgments about risks to capital formation, not judgments about moral authority. What it saw yesterday was a sharply reduced risk that there will be a disturbance in the presidency that will upset policymaking. What President Clinton gained was a judgment that while many or most Americans think he did not tell the truth when he told the nation last January that he did not have sexual relations with "that woman," he made a persuasive case that in his own mind, he was telling the truth.
If sexual relations means sexual intercourse, by all accounts they did not happen. In the President's deposition, during which he conducted himself in composed, lawyerly fashion, we were reminded that he is a lawyer, and that even in his reckless, improper relationship with Ms. Lewinsky, he at all times seemed scrupulously careful to avoid sexual congress. Who could doubt that if he wished, he could have had "sexual relations" with her at any of their meetings? Even before the videotape was shown yesterday, a black political friend from Alabama explained to me that it is part of the culture of the poorer folks in the deep south that sexual activity that stops short of intercourse is not condemned as adulterous. This distinction may not cut any ice with Republicans who still insist he has disgraced the office and should resign, but it is clearly a workable defense should there be a Senate impeachment trial over perjury. On "Meet the Press" Sunday, Rep. Lindsey Graham of the House Judiciary Committee, a conservative South Carolina Republican, indicated a willingness to cut the President some slack when he said he had watched the videotape. He thought that while the President did a thousand dances on the head of a pin in discussing what constitutes "sex," he could see a way around the charge of perjury if the President would explain himself further before the Judiciary Committee. As of this morning, this avenue seems to be in the works, although there is of course still the real possibility of a House impeachment and a Senate trial. Wall Street aside, the American people clearly want to see some punishment meted out the President for all the grief he has caused. He's not going to be allowed to choose his own penance and still faces the possibility of removal.
The standing ovation the President got at the UN yesterday did not hurt the President. Now, if he would drop his opposition to tax cuts and start complaining about the Federal Reserve's monetary deflation, there would be little reason left to believe he would lose the support he retains in the country. The Wall Street Journal and The New York Times are still angry at Mr. Clinton this morning, but the Times is still willing to settle for censure and the Journal seems to know the great white whale once again has dodged its harpoon. The quest is not yet over, of course, but the videotape clearly helped the President more than most imagined.