Power Broker 

Is Sen. Max Baucus the sellout the left portrays, or the savvy centrist poised to finally reform American health care?

As Sen. Max Baucus presides over America's first attempt at comprehensive health care reform in 15 years, two opposing views of the Montana Democrat emerge.

One view suggests Baucus is fulfilling his political destiny. The Montana senator, a Democrat and chairman of the powerful Senate Finance Committee, has prepared his entire 34-year career in Congress for this role. He's a savvy centrist. His political independence and the relationships he's fostered with senators on both sides of the aisle make him uniquely suited to broker intensely complicated negotiations among the most powerful people and special interests in Washington, D.C. Colleagues claim no one works harder than Baucus. He's spent more than a year—beginning well before President Obama took office and made health care reform his top domestic priority—holding hearings and educating committee members on the nuances of the issue. Baucus himself calls the process fun. He draws inspiration from the time, in early 2004, he underwent brain surgery at the Mayo Clinic in Arizona, a facility he calls "a model for how health care should be run in this country." The surgery came after he fell and smacked his head during a 50-mile marathon. Baucus got up and courageously ran the remaining 42 miles, "though my face looked like a Halloween mask by the end," he says.

click to enlarge Sen. Baucus, chairman of the Senate Finance Committee, conducts bipartisan meetings almost every day in his Washington, D.C., office. In this photo, taken July 23, (from left to right) Sen. Kent Conrad, D-N.D.; Baucus; Tom Barthold, chief of staff for the Joint Committee on Taxation; Doug Elmendorf, head of the Congressional Budget Office; Sen. Olympia Snowe, R-Maine; Sen. Mike Enzi, R-Wyo; Sen. Chuck Grassley, R-Iowa; and Sen. Jeff Bingaman, D-N.M, discuss the legislation. - PHOTO COURTESY SEN. BAUCUS’ OFFICE
  • Photo courtesy Sen. Baucus’ office
  • Sen. Baucus, chairman of the Senate Finance Committee, conducts bipartisan meetings almost every day in his Washington, D.C., office. In this photo, taken July 23, (from left to right) Sen. Kent Conrad, D-N.D.; Baucus; Tom Barthold, chief of staff for the Joint Committee on Taxation; Doug Elmendorf, head of the Congressional Budget Office; Sen. Olympia Snowe, R-Maine; Sen. Mike Enzi, R-Wyo; Sen. Chuck Grassley, R-Iowa; and Sen. Jeff Bingaman, D-N.M, discuss the legislation.

The opposing view—voiced more loudly by critics—contends that Baucus' lead role seems less political destiny and more dumb luck, like a third-string quarterback thrown into the game at the most crucial moment. He's not very well known, somewhat inarticulate and a little awkward. The state he represents has fewer people than the number of Pennsylvanians lacking health care. He's working diligently—but fruitlessly, so far—to draft a bipartisan bill, even though Democrats in the Senate have a filibuster-proof majority. His negotiation table includes everyone but single-payer advocates, whom he rejected like a patient with a preexisting condition. And the very industry he's supposedly trying to reform has given him more money than its given almost any other member of Congress. Progressives wonder whether Baucus, beholden to big money, will blow the best opportunity to pass health care reform legislation in a generation.

These extreme views of Montana's senior senator appear irreconcilable. But Baucus' career—as Montanans well know—has come to be defined by how he eschews definition, hopscotching all over the political spectrum, including on issues of health care.

Few predicted that Baucus, 67, would become health care reform's point man. As chairman of the Senate Finance Committee, charged with hammering out how to pay for an overhaul of the system, Baucus figured to play a key role in the effort. But no one thought he'd become the legislation's most prominent figure—perhaps even more prominent than the president himself.

While Baucus drives the negotiations, the two assumed to lead the effort, Sen. Ted Kennedy and former Senate Majority Leader Tom Daschle, watch from the sidelines. Kennedy, chairman of the Senate Health, Education, Labor and Pensions Committee, worked his entire career to provide health care to every American, but is currently battling brain cancer. He's missing what would have been the fight of his life to fight for his life. And Daschle, the former majority leader of the Senate, was appointed by Obama to be the Secretary of Health and Human Services, but withdrew in February because of controversy surrounding his failure to pay income taxes.

Enter Baucus, by default or design, as the de facto leader of health care reform. As Congress trudges through the minutiae of reshaping a system that makes up one-sixth of the U.S. economy, Americans hang on Baucus' every word. Asked in an e-mail interview with the Independent—the senator's first interview, e-mail or otherwise, with the paper in more than a decade—if he expected to be in this position, Baucus equivocates. He talks of the ground he laid more than a year ago, and his belief that, whoever became president, "health care reform could not wait."

"While I couldn't predict every detail," he says, "I knew that we needed to reform health care, and I knew that as chairman of the Finance Committee I would play a significant role in crafting the legislation. I wanted to be as ready and prepared

as possible."

But, as he drafts a bill, critics don't question how hard Baucus works. They question who, exactly, he's working for.

Pay to play

The health care industry donates millions of dollars to Baucus, most of it flowing in since 2001, when he and Sen. Chuck Grassley, R-Iowa, began swapping the chairmanship of the Senate Finance Committee. Since 1989, according to the Center for Responsive Politics, Baucus has raised more than $3.8 million from the industry, the fifth highest recipient behind only Barack Obama, John McCain, John Kerry and Arlen Specter. Health professionals have contributed more than $1.3 million to Baucus, and the pharmaceutical industry more than $1 million.

Renewed scrutiny of those contributions came this summer when talk of health care reform intensified, and it became clear that the Baucus-led negotiations in the Senate Finance Committee would be the linchpin. Lee Newspapers reported that, when combined with Baucus' Glacier PAC (political action committee), the senator raised about $3.4 million between 2003 and 2008 alone. That money comes from groups and individuals associated with drug companies, insurers, hospitals, medical supply firms, health service companies and other health professionals, and it amounted to about $1,500 per day. The Lee report began a slew of probes into who fills Baucus' coffers, casting doubt over the senator's loyalties and drawing sharp criticism from the left.

Asked by the Independent why he didn't, at least in recent years, reject money from the health care industry if he knew he'd be integral to its reform, Baucus said: "For every one of my 30 years in the Senate, I've only been influenced by one thing: What's right for Montana, and what is right for the nation. It's the same for health care reform. Money plays absolutely no role in any of my decision making."

Baucus reportedly began refusing contributions from health care political action committees—but not lobbyists or corporate executives—after June 1.

But Baucus' health care ties extend beyond money. The Sunlight Foundation revealed that five of Baucus' former staffers currently represent a total of 27 different organizations in the health care industry. The organizations include some of the industry's top lobbyists, like Pharmaceutical Manufacturers and Researchers of America (PhRMA), America's Health Insurance Plans (AHIP), Amgen, and GE Health Care. The staffers-turned-lobbyists include two former chiefs of staff, David Castagnetti and Jeff Forbes, and one former legislative assistant, Scott Olsen.

The Washington Post reported the extent to which this "revolving door" between government and private health care companies might influence the crafters of health care legislation. In early July the paper found that the nation's largest insurers, hospitals and medical groups had hired more than 350 former government staffers and retired members of Congress to influence their old bosses and colleagues. Nearly half of the insiders, the Post reported, previously worked for key committees and lawmakers, including Baucus and Grassley, the ranking Republican on the Senate Finance Committee. The Post also reported that the health care industry spends more than $1.4 million per day on lobbying as its future profits hang in the balance.

"When all is said and done," says Sidney Wolfe, director of Public Citizen and one of the country's leading single-payer advocates, "the legislation on health insurance will be legislation that is satisfactory, if not delightful, to industries such as the pharmaceutical industry and health insurance industry. But at the same time as it does that, it will not take care of the serious problem of having 48 or 49 million people uninsured, and another 25 million people underinsured, and no possibility of legislation that will be framed in such a way that it is affordable to have health insurance for people in this country."

Progressives blame the health care industry's tremendous influence, especially on Baucus, as they hear of the Senate working toward watered down legislation as opposed to real change.

"I think that Max has been a person—probably the best example of a person—who uses nebulous terms like bipartisanship to mask doing the bidding of big money interests," says political columnist David Sirota, who worked as a strategist for Gov. Brian Schweitzer's 2004 campaign. "Any proposal that comes through his committee—and particularly on health care—that takes on big money interests, you can basically guarantee that Max Baucus will try to water it down in the name of 'bipartisanship.'

"What's fascinating about this time right now," Sirota continues, "is that the argument is negated by the math in the Senate. You used to be able to make a credible argument that you need bipartisanship in order to pass anything. And now that argument is over. It's really undebatable that it's over. It's just a matter of arithmetic. There are 60 Senate votes. Max has a majority of Democrats on the Finance Committee. So what I think you're seeing now is that Max's formula underneath the deception has hit a brick wall. He can't credibly argue that he needs to water down good policy to achieve bipartisanship, because mathematically bipartisanship is not necessary."

click to enlarge Baucus rides with President Obama on Air Force One. The Obama administration charged Congress with writing health care reform legislation, its top domestic priority, and Baucus has emerged as the point man, perhaps wielding more power than the president himself. - PHOTO COURTESY THE WHITE HOUSE
  • Photo courtesy the White House
  • Baucus rides with President Obama on Air Force One. The Obama administration charged Congress with writing health care reform legislation, its top domestic priority, and Baucus has emerged as the point man, perhaps wielding more power than the president himself.

The most egregious example of Baucus kowtowing to his donors, critics say, is his blunt dismissal of a single-payer health insurance plan, a nationalized health insurance program that would essentially replace the current health insurance industry. Baucus says he spent more than a year studying every option for health care reform, including single-payer.

"While carefully considering the single-payer system," he says, "it became clear that it is not a solution that could get the 60 votes health care reform legislation needs to pass the Senate."

But single-payer advocates call his reasoning disingenuous—or worse.

"Politically impossible means that he doesn't have the courage to have it be seriously considered...," says Wolfe. "Politically impossible, on this kind of issue, is just an acknowledgement of extreme cowardice."

Whatever the reason, the exclusion of single-payer from the negotiating table limits the scope of the debate and will ultimately hurt the final bill.

"The public value of hearing and giving full consideration to both single-payer and the standard, current system is that one informs the other," says Pat Williams, who served as Montana's representative in the House from 1979 to 1997 and worked on the last attempt to pass health care reform during the Clinton administration.

Baucus' rejection of single-payer may show a certain spinelessness. Or, as the senator contends, it may reflect a commitment to finding middle ground in the face of knotty political realities. Either way, the dichotomy shouldn't surprise those familiar with Baucus' career.

The chronic compromiser

In 1972, Baucus, a few years removed from Stanford Law School and living in Missoula, considered a run for the Montana Legislature. As he weighed his options, he walked into the offices of the Missoulian and posed this question to a group of editors: Which party affiliation—Democrat or Republican—did they think would give him his best chance to win?

Sam Reynolds regulated editorial board policy at the time. He couldn't be reached for this story, but Reynolds told the Independent in 2004 that he didn't recall giving the young, confident Baucus definitive guidance. But, he said, "When he did announce as a Democrat for the Legislature I was surprised."

The anecdote serves to illustrate Baucus' long-displayed fence straddling, which has come to frustrate observers who claim Baucus swings like a weathervane to the political winds of the day.

Baucus was born in Helena and graduated from Helena High School in 1959. He graduated from Stanford University in 1964 and from Stanford Law School in 1967. In 1971, he bought a house and started a law practice in Missoula. In 1973, Missoula voters elected him to the state House. A year later, he was elected to the U.S. House of Representatives, where he served until being elected to the U.S. Senate in 1978. He's served in that role ever since, gathering seniority and influence—as well as criticism from befuddled Democrats who sometimes wonder if Baucus really represents the party's values.

For example, Baucus was so crucial to passing George W. Bush's $1.35 trillion tax cut in 2001 that he flanked the president when he signed the bill in the White House. Then, two years later—and after winning reelection in a state that voted for Bush over Al Gore by 25 percentage points—Baucus voted against Bush's 2003 tax cuts.

In 2002, Baucus voted for the war in Iraq. Then, in early 2007, he gave a speech on the Senate floor urging President Bush to bring the troops home. (His nephew Philip, a Marine corporal, died in Anbar province in July 2006.)

Baucus again pivoted in 2005, leading Senate Democrats in an effort to block Bush's push to privatize Social Security. That effort, says Sirota, "at least showed that he can be convinced to fight the good fight" and "leaves open the possibility that he can be convinced to not either try to split the difference or answer only to big money."

When lined up over time, Baucus' record explains why a 2007 profile in The Nation called him a "schizophrenic figure," and why a March profile in Time said he's "known mostly for his apostasies." But his inconsistencies are revealed most clearly, perhaps, on issues of health care.

click to enlarge President Obama signs the Children’s Health Insurance Program (CHIP) in February, legislation primarily authored by Baucus and vetoed twice by President Bush. Observers say Baucus’ enthusiasm for and commitment to health care reform began with CHIP. - PHOTO COURTESY THE WHITE HOUSE
  • Photo courtesy the White House
  • President Obama signs the Children’s Health Insurance Program (CHIP) in February, legislation primarily authored by Baucus and vetoed twice by President Bush. Observers say Baucus’ enthusiasm for and commitment to health care reform began with CHIP.

In 2003, Baucus played a critical role—he was one of only two Democrats invited to the negotiating table—in helping Republicans pass a $400 billion, industry-friendly Medicare prescription-drug bill. The measure provided billions of dollars in subsidies to insurance companies and health maintenance organizations, and was considered the first step toward privatizing Medicare. Montana Democrats denounced Baucus for caving in to the Republican-led Congress. He acknowledged the bill was far from perfect, but argued that his involvement made it better, especially for rural Montanans.

Then, more recently, Baucus was the lead author and advocate of a bill to renew the Children's Health Insurance Program (CHIP). It was twice vetoed by then-President Bush. President Obama finally signed it into law in February, providing health insurance for some 30,000 uninsured Montana children. Democrats roundly praised Baucus' effort.

"By working on legislation like (CHIP)," Baucus says when asked how he's prepared for health care reform, "you learn how to bring folks together to pass legislation that will help thousands of Montanans."

Baucus talks of other experiences that have prepared him for the health care reform effort. Growing up on a ranch, he says, he learned things like "common sense and hard work." Hitchhiking around the world taught him "that there is always a way to get to 'yes.'" He also cites the lessons of collaboration gleaned from his mentor, former Congressman Mike Mansfield, who served Montana in the House from 1943 to 1953, and in the Senate from 1953 to 1977, the last 16 of those years as senate majority leader. Mansfield, ironically, ushered the passage of Medicare, the program Baucus was complicit, critics say, in stripping down.

"It's funny," Baucus says, "I don't know if it would be more accurate to say I've prepared my entire career for health care reform, or if my entire career has prepared me for it. And to be quite frank, it could be my whole life that has prepared me for this moment."

As Baucus, the chronic compromiser, leads Democrats toward the party's most elusive goal, some say his approach is the only way to achieve it.

Baucus' big table

John Flink, vice president of the Association of Montana Health Care Providers, a group supporting an array of reforms, including health insurance coverage for all Americans, has been traveling between Helena and Washington, D.C., since May. He expects to continue the trips well into the fall as he works with Baucus' staff on health care reform.

"He keeps saying to people, 'When you hear a new idea don't make a judgment immediately. Wait 15 minutes and think about it and then let's talk about it,'" Flink says. "He has said everything is on the table. I think he's done a masterful job of keeping the process moving forward. We're at a very tough part of the process right now."

Count Flink among the people who believe the senator's bipartisan approach to health care reform is a necessity, not a luxury. He points to the fact that of the three similar bills that have, as of press time, passed out of House and Senate committees, none had the support of a single Republican. A handful of moderate Democrats didn't support them, either. Meanwhile, Baucus works to lasso moderate Democrats and Republicans within his Senate Finance Committee, creating a bill that might ensure a filibuster-breaking 60 votes if and when it goes to the Senate floor. Observers say the current bipartisan negotiations also serve to allay opposition from sectors of the health care industry, potentially diffusing a multi-million-dollar public perception campaign that could occur during Congress' August recess.

The Obama administration recognized Baucus' influence over its top domestic priority early on. Instead of foisting a health care reform bill on Congress as the Clinton administration did, it charged Congress with crafting its own. That meant the man who leads the committee with the broadest jurisdiction on Capitol Hill would be crucial to seeing a bill through to the president's desk. In fact, The New York Times speculates that Obama Chief of Staff Rahm Emanuel hired Baucus' long-time chief of staff and protégé (and University of Montana graduate) Jim Messina as Obama's deputy chief of staff in part to give Baucus "a close ally in the White House and the president an influential advocate" on health care.

With or without Messina, Baucus seems a perfect middleman for the Obama administration. As the president likes to say (and Voltaire before him), "Don't let the perfect be the enemy of the good." Or, as Emanuel tells his staff: "The only nonnegotiable principle here is success. Everything else is negotiable."

"The interesting thing about Max as I have watched him over the years," Flink says, "is he has always been about doing what's possible to do in the legislative process."

What's possible today, Baucus has concluded, can only be realized by working closely with the special interests that have the influence—and have proved it—to make reform impossible. It's a lesson, he says, learned from the Clinton administration's reform attempt that ran aground in 1994.

click to enlarge The Sunlight Foundation recently revealed that five of Baucus’ former staffers currently represent 27 different organizations within the health care industry, including top lobbying organizations. The industry spends more than $1.4 million per day lobbying Congress. - PHOTO BY CHAD HARDER
  • Photo by Chad Harder
  • The Sunlight Foundation recently revealed that five of Baucus’ former staffers currently represent 27 different organizations within the health care industry, including top lobbying organizations. The industry spends more than $1.4 million per day lobbying Congress.

"During previous attempts to pass comprehensive health care legislation," Baucus says, "many organizations and industries that were invested in the future of the health care system were left out of the negotiating room. They had no chance to offer solutions or be part of the discussion, so they spent all their energy and money sinking the plan—and it worked.

"This time around, we've brought everyone to the table. And by keeping everyone at the table, we can work through issues constructively, instead of destructively," he continues. "Plus, I think everyone knows that our health care system must be fixed, and everyone wants to find a way to bring about comprehensive reform."

The groups sitting around Baucus' table, even the more progressive ones, say the senator stands out—at least so far—as health care reform's unsung hero, not its Achilles heel.

"This is the range that Baucus has at the table," says Bob Struckman, the Montana communications director for the Service Employees International Union (SEIU). "On one end there's the groups like us, the Service Employees International Union, which is fairly liberal. On the other end, he's got the pharmaceutical and the insurance industries, who have a lot vested in things the way they are... We're literally at the same table, talking with Baucus, trying to hammer out what we all want. There are other groups, too. The fact that all these people are giving input means that none of them are feeling disempowered or scared of the process and trying to stop it and end it."

In 1993, David Kendall of Missoula served on the President's Task Force on National Health Care Reform, and he's worked on Capitol Hill ever since that infamous crash-and-burn to "try to get it right." Now a senior fellow with the Third Way, a progressive think tank, Kendall believes Baucus holds more power on the health care issue than the president. He says if Baucus doesn't lead the finance committee forward—with the health insurance industry in tow—there's zero chance of reform passing.

"I think it's very hard for people in Montana to see how central Sen. Baucus is to the health care debate," he says.

More than that, though, Kendall says that Baucus has approached the issue with unequaled zeal, which, he observes, started with CHIP and continued into the current debate.

"About a year ago," Kendall says, "he started walking the Senate Finance Committee through the issue and all the problems they were facing.

He did that in a way that was utterly engaging. These were meetings that members of Congress usually don't ever participate in, and he had pretty much the whole finance committee sitting around for days at a time discussing this issue. That's unheard of.

click to enlarge Single-payer advocates rally in front of Baucus’ Missoula office in June. Baucus excluded single-payer health insurance from negotiations early on, calling it politically impossible. Critics say that decision proves he’s kowtowing to the companies that fill his campaign coffers. - PHOTO BY CHAD HARDER
  • Photo by Chad Harder
  • Single-payer advocates rally in front of Baucus’ Missoula office in June. Baucus excluded single-payer health insurance from negotiations early on, calling it politically impossible. Critics say that decision proves he’s kowtowing to the companies that fill his campaign coffers.

"From the very start," Kendall continues, "he's taken an unprecedented approach to leading the senators through this issue, and that's paid off now that we're actually in the weeds here trying to sort this out. It's an ugly process making legislation, no different from making sausage. But without that background, without the trust that developed in terms of being able to have a civil discussion about the reform, if they hadn't had that, I can't imagine how much harder this would be. What we're dealing with today would be so much harder if Sen. Baucus hadn't laid the foundation for this over the last year."

Furthermore, Kendall says that not only has Baucus filled the leadership void left by Sen. Ted Kennedy, but that Baucus can also bring people into the debate Kennedy couldn't have.

"Sen. Baucus can talk more directly to those Western Democrats, the moderate Republicans, because of his relationship over the years," he says.

The question, then, is what Baucus will have to sacrifice to bring moderates into the fray.

Definition of leadership

Last week, in an effort to change a few moderate minds amid partisan wrangling, and to assure the country that health care reform remained on track, President Obama delivered a speech in the East Room of the White House. He made clear the stakes of the health care debate.

"This debate is not a game for these Americans [without, or with inadequate, health insurance], and they cannot afford to wait for reform any longer," he said. "They are counting on us to get this done. They are looking to us for leadership. And we must not let them down. We will pass reform that lowers cost, promotes choice, and provides coverage that every American can count on. And we will do it this year."

The president implicitly dropped the millstone squarely on Baucus, pressuring his committee to come through—soon—with a bill that moderate Democrats and maybe a Republican or two will support. No one doubts that Baucus is putting in the necessary work to accomplish it. In fact, observers say that he thrives in the difficulties posed by these complicated negotiations, that he's a "glutton for punishment," that bloodying his face during a marathon and then continuing to run reveals the nature of his work ethic. But there's a distinction to be made, some say, between what Baucus brings to the table and what the situation calls for—namely, leadership.

"I think we've reached a juncture, probably in history, where there's a difference between hard work and leadership," says Dave McAlpin, a member of the Montana House of Representatives who worked on Baucus' re-election campaign in 1990 and in his Bozeman office from 1992 to 1995. "Mike Mansfield passed historic legislation because of his leadership ability. And Max needs to exhibit that he can bring this issue to the fore and get a good bill passed to solve an enormous problem—probably the biggest policy problem and issue of our time—through leadership, not just hard work. I think it's too soon to tell whether Max will be successful."

For McAlpin, and most Democrats, the measure of success would be the inclusion of a public insurance option to compete with private insurers. For most Republicans, the demarcation line appears to be its exclusion. Baucus, characteristically, straddles that line.

"Every option is on the table," he tells the Independent when asked if he's committed to the public option, "and I'm looking at every way possible to get a bill that achieves my goals for reform. The bottom line is that I'm committed to passing a bill that provides access to quality, affordable health care to every American. I'm committed to reforming the system to allow folks with preexisting conditions to get the coverage they need, while allowing folks who like their coverage to keep what they have."

The two views of Baucus—the sellout or the savvy centrist—point to at least two predictions of how this historic debate will end. If his critics are right, any bill that passes will be so watered down and industry-friendly in the name of bipartisanship that it might as well have failed. If his defenders are right, any bill he hammers out—even if it lacks a public option—will be the most progressive health care reform in decades, and, in David Kendall's words, "we'll look back on this and see just how critical his leadership was."

The rub is that both sides will probably stick their label on Baucus anyway. We won't know, in trading away the perfect for the good, how much better the bill could have been. His deal-making rap, for better or worse, will remain. And the legacy of health care reform will almost certainly belong to someone else. "That's frankly unfortunate for Max," says former Congressman Williams, "but that's where it is."

There is one other option: Baucus can claim his own legacy, not by again stepping toward the middle, but by stepping forward.

"It's a historic moment for Max, not in Montana, but nationally," McAlpin says. "If he wants to be remembered like Mansfield and [former Montana Congressman Lee] Metcalf, he needs to provide the leadership to solve this problem. He was elected to choose how to solve this problem...The clock is ticking."

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