WASHINGTON -- The municipal bond market would be better off if Arkansas Gov. Bill Clinton is elected President.

Here's why.

As Washington Bureau reporter Joan Pryde pointed out in a well-researched front-page story last Wednesday, there are fundamental differences between Mr. Clinton and President Bush on municipal finance.

An those differences hold the key to how municipal finance may fare at the hands of the federal government during the next four years.

Mr. Bush has no personal experience with municipal finance and knows only what his advisers and Treasury bureaucrats tell him.

Mr. Clinton, however, has hands-on experience as governor of Arkansas in dealing on a daily basis with economic problems faced by business and communities in his state. His track record of using bond financing for public improvements and economic development is strong.

Mr. Bush's policy on municipal bonds is a moving target that appears to be more motivated by politics and expediency than economic policy.

In 1989 the Bush administration advocated eliminating the use of tax-exempt mortgage bonds and small-issue industrial development bonds, terming them "unnecessary and inefficient."

The White House then softened its stand in 1991 under pressure from Republican senators and governors who wanted use of the bonds to continue. And this year, in what Ms. Pryde aptly described as an apparent election year conversion, Mr. Bush did an about-face and proposed an 18-month extension for mortgage bonds and IDBs for first-time farmers.

Then, shortly after the Los Angeles riots, Mr. Bush proposed expanding the use of tax-exempt bonds for the first time by creating a new kind of bond that could be used in enterprise zones. The Bush Treasury has also taken significant steps to ease and simplify its regulations on bonds.

Some argue this indicates that Mr. Bush is beginning to recognize municipal bonds' importance. They believe his administration will continue to liberalize their use.

But Mr. Bush's failure to develop any kind of comprehensive economic plans this year is a sign that his embrace of bonds is more likely a one-night stand than the beginning of a love affair. His only aim is winning re-election.

Gov. Clinton, however, has been consistently pushing for a responsible easing of the tax law curbs on the bonds as way to generate more investment and create more jobs.

He has also focused more in his campaign on economic issues than Mr. Bush has and, if elected, appears to be far more likely to develop an integrated economic plan that will make public finance an important partner in his attempt to revitalize the nation's economy.

Mr. Clinton has a critically needed vision for municipal finance. Mr. Bush does not.

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