FOIA Number: 2006-0885-F (Segment 7) FOIA MARKER This is not a textual record. This is used as an administrative marker by the William J. Clinton Presidential Library Staff.

Collection/Record Group: Clinton Presidential Records

Subgroup/Office of Origin: Health Care Task Force

Series/Staff Member: Steven Edelstein

Subseries:

OA/ID Number: 3674 FolderlD:

Folder Title: Penny, Timothy J. (D-MN)

Stack: Row: Section: Shelf: Position: s 52 3 6 1 688 MINNESOTA

FIRST DISTRICT

Southeast from Minneapolis and St. Paul, the Mississippi River cuts a path through rolling hills and where it widens forms broad calm lakes lapping at the bottomlands: here is one of the finest river landscapes of North America. This far north, the westward tide of Yankee migrants thinned out. In the years after the Civil War, most settlers following the railroads on the floodplains west of the river were Germans and Scandinavians, bringing their families to this terrain so like the Rhine, and to the rolling uplands beyond which resemble the northern European plain. Southeastern Minnesota is a borderland between Yankee and German settlements—politically, between Civil War Republicans and Farmer-Laborites favoring inter- ventionist economic and isolationist foreign policies. Minnesota's southeastern corner is, today, the state's 1st Congressional District. Within its compact bounds is considerable diversity. Rochester has been home of the Mayo Clinic since it was founded in 1863 when English-born physician William Mayo set up a practice to examine inductees into the Union Army—early involvement of government in medicine; today, Roches­ ter, with its large professional population, is prosperous and growing. Austin, a county away, is headquarters of the Hormel meatpacking firm that beat a bitter strike in 1986; in 1991, Hormel celebrated its 100th birthday with a huge party that included a Spam sculpture contest Politically, Rochester is an IR stronghold, while Austin, poorer and losing population, is solidly DFL. The Ist District extends north to new subdivisions spreading out from the Twin Citiesi to Northfield, home of Carleton College and former professor Senator Paul Wellstone. The Ist also includes the river towns of Red Wing, Wabasha and Winona, with their 19th Century stone storefronts and mountain-like rock outcroppings that overlook the river. There are farms here, but not the big—and troubled—commercial farms you find farther west. Tim Penny, congressman from the 1st District, transcends some of southeastern Minnesota's divisiveness. A Democrat of Scandinavian descent, he is also an embodiment of Yankee parsimoniousness. Penny is one of those young Democrats with an instinctive feel for polities' vast energy—the reason why Democrats are a majority in most American legislatures. He was elected to the state Senate in 1976 at age 24, after visiting every home in a Republican district; in 1982, he again campaigned door-to-door, while raising $ 182,000, and won a congressional seat into which two Republican incumbents had been redistricted. In the last four elections, he has received at least 70% of the vote; in 1992, he was endorsed by the Red Wing newspaper, even though his Republican opponent had worked there a few years before. How does a Democrat win in a usually Republican district? "My fundamental goal," P( has said, "is to give the Democratic Party a better image on budget issues." In his first term, he chaired a Freshman Budget Group which sought to reduce deficits; ever since, he has compiled a more conservative record on economic issues than most northern, much less Minnesota, Democrats—arousing complaints from Minnesota labor unions and teachers' groups. He supports the line-item veto and the balanced budget amendment. In the late 1980s, he started seeking identical percentage cuts in over-budget appropriations bills. More recently, he has been introducing "Porkbuster" bills cutting specific projects from filbert blight research and Scranton, Pennsylvania's Steamtown theme park, to the space station and Supercollider. His 1992 "Porkbuster" bill would have cut 68 projects for a total of $5.7 billion in savings. Also, in 1992 he took the "Lead or Leave" pledge to retire in 1996 if the budget deficit has not been cut in half; after the 1992 election, he attacked Senator Paul Wellstone for leading the DFL to the left and overreacting to the Democratic victory. Vocal and motivated by convictions, he been something of a thorn in the side of the Democratic leadership. In 1993, Penny jc Charles Stenholm in calling for greater spending cuts in the Clinton budget, though he voted for it in March, and in May, he joined Stenholm again in calling for consideration of caps oo entitlement spending to insure deficit reduction. Penny has not served on Budget nor has he sought a seat on Appropriations; for the 103d MINNESOTA 689

Congress, he tried unsuccessfully to get a seat on Ways and Means. His committees are Agriculture and Veterans' Affairs where he has addressed concerns of southeastern Minnesota. On Agriculture, he sponsored a Beginning Farmer's Act to subsidize down payments and operating loans for farmers just starting out; Penny has been dismayed at the small number of young Minnesotans going into farming. He has also pushed for export assistance for beef, pork, vegetable oil, and milk products—a Spam subsidy! On Veterans', he has oversight of the more- succcssful-than-expected G.I. Bill of Rights and has sponsored a law authorizing the military to pay up to $12,000 of a veteran's starting wage, to ease transition to civilian life. The People: Pop. 1990: 546,909; 48% rural; 14% age 65+; 97% White; 1% Asian; 1% Hispanic origin. Voting age pop.: 398,958; 1% Hispanic origin. Households: 62% married couple families; 30% married couple fams. w. children; 44% college educ; median household income: $28,371; per capita income: $12,661; median gross rent: $342; median house value: $58,600.

1992 Presidential Vote 1988 Presidential Vote Clinton(D) 109,829 (38%) Bush (R) 128,191 (51%) Bush(R) 98,384 (34%) Dukakis (D) 120,933 (49%) Perot (I) 75,227 (26%)

Timothy J. Penny (DFL) Elected 1982; b. Nov. 19, 1951, Freeborn Cnty.; home. New Richland; Winona St. U., B.A. 1974; U. of MN, 1975; Lutheran; married (Barbara). Career: MN Senate, 1976-82. Offices: 436 CHOB 20515, 202-225-2472. Also 108 West Park Sq., Owatonna, 55060, 507-455-9151. Committees: Agriculture (8th of 28 D): Environment, Credit and Rural Development; Foreign Agriculture and Hunger (Chmn.). Veterans' Affairs (5th of 21 D): Education, Training and Employ­ ment.

Cnwp Ratings ADA ACLU COPE CDF CFA LCV ACU NTLC NSI COC CEI '"2 45 65 50 30 53 69 52 40 60 50 64 "91 50 - 42 30 44 62 30 — — 60 67

"^rtonal Journal Ratings 1991 LIB — 1991 CONS 1992 LIB - 1992 CONS f-conomic 39% — 60% 47% — 52% Social 50% — 48% 35% — 64% Foreign 62% — 36% 76% — 19%

Votes of the 102d Congress I Ban Striker Replace FOR 5. Handgun Wait/7-Day AGN 9. Use Force in Gulf AGN * * for Homeownership AGN 6. Overseas Mil. AbortionAGN 10. US Mil. Abroad $ Cut FOR \ Tax Rich/Cut Mid Cls FOR 7. Obscn. Art NEA $ Ban FOR 11. Limit SDI Funds FOR 4 FY93/SI5BDef.Cut FOR 8. Death Pen. from Jury AGN 12. Cuba Trade Embargo AGN Minnesota - 1st District 1 Timothy J. Penny (D) Of New Richland — Elected 1982; 6th Term

Born; Nov. 19, 1951, Albert Lea, Minn. Education: Winona State U., B.A. 1974: U. of Minnesota, 1975. Military Service: Naval Reserve, 1986-present. Occupation: Sales representative. Family: Wife, Barbara Christianson; four children. Religion: Lutheran. Political Career Minn. Senate, 1977-83. Capitol Office: 436 Cannon Bldg. 20515; 225-2472. In Washington: Throughout his career, from defense should be used to reduce the Penny has been preoccupied by the intractabil­ deficit, as required by the 1990 budget agree­ ity of federal fiscal problems and the unwilling­ ment. Republicans joined with Democratic defi­ ness of senior members of Congress to strike out cit hawks to reject the plan, giving Democratic in new directions. As a budget watchdog trying leaders an embarrassing defeat. to restrain the Democratic Party's inclinations Less than a year later, Penny and Sten­ toward generosity in spending, he often jousts holm led the clamor to alter President Clinton's with party leaders. He sealed his commitment $16.3 billion economic stimulus package. But to the cause in 1992 with his promise to leave the White House, fueled by what one Democrat Congress if the budget deficit is not cut in half called "good will and momentum," rebuffed by 1996. their efforts to trim the package, banking on When Penny and other like-minded bud­ the large Democratic majority in the House. get deficit "hawks" began their assaults on United Republican opposition in the Senate spending bills in the 1980s, it was easy for ultimately killed the bill. Democratic leaders to dismiss those efforts as Unlike Stenholm, Penny decided to vote quixotic adventures with no chance of affecting for the stimulus package. He said he informed policy. But as the economy and the size of the the White House that "some noses would be out deficit took greater prominence in the public of joint" if the Senate received the deal that debate in the 102nd and 103rd Congresses, a House conservatives craved. Good will and mo­ larger segment of the Democratic Caucus has mentum, Penny said, are finite commodities. joined the campaign for fiscal restraint. "You can only bank on that a couple of times." Penny, who considers himself a strong At a White House reception the morning after Democrat, tries to balance his readiness to the vote, according to The Washington Post, he challenge his party's leaders and their preroga­ told Clinton: "I hope you understand I voted tives against his own party loyalties. Although with you because I was trying to be helpful." he joined conservative Democrats seeking to Penny told the Post that Clinton noted that it change President Clinton's economic stimulus was a tough vote and added, "I'll never forget package early in the 103rd Congress, in the end it." he voted for the bill. Penny established an early beachhead Still, senior Democrats do not always take from which to wage his war on deficits. In 1983 to Penny's maverick conduct. He failed in his he became chairman of the Freshman Budget bid to join the Ways and Means Committee in Task Force, a group of Democratic first-termers the 103rd Congress. He was, however, named by touting an across-the-board budget freeze. This Speaker Thomas S. Foley of Washington, to his effort begat the Budget Study Group, an orga­ Working Group on Policy Development created nization that discusses deficit-reduction options at the start of the 103rd, which is designed to and that has grown in both size and acceptance. help set the legislative agenda. In 1987, Penny and Iowa Republican Tom Deficit hawks registered several high-pro­ Tauke formed the Truth-in-Budgeting Task file victories in the 102nd Congress, including Force, of which Penny is still a co-chairman. House adoption of a budget resolution that "The only way we can meet our deficit reduc­ devoted defense savings to deficit reduction. tion is to cut a little more as each opportunity Penny and Texas Democrat Charles W. Sten­ arises," Penny said. Since then, Penny and holm, who heads the Conservative Democratic other allies have offered numerous amendments Forum, led a conservative Democratic revolt to appropriations bills making across-the-board that blocked a proposed shift of funds from the cuts in funding levels. They meet with limited defense budget to a variety of social programs. success; most — but not all — of the amend­ They argued, successfully, that any money cut ments lose, many by sizable margins.

812 Timothy J. Penny, D-Minn.

Southeast — Rochester; Minnesota 1 part of Mankato When he talks to audiences unfamiliar little, it gained North Mankato. Now the with the 1st, Rep. Penny describes it this whole metropolitan area of Mankato, the way: "It's Redwing Shoes, the Mayo Clinic, district's second largest city, will be in the Hormel and the valley of the Jolly Green same congressional district. Giant." In 1992, the district gave Ross Perot The "valley" is still mostly rural, and about 27 percent of the vote — more than in agriculture — corn, grains, dairy and hog any state district except the 2nd. The state farming — is the major focus. The rolling overall was one of Perot's biggest successes. In hills that extend from the Mississippi River 1988, George Bush won the old 1st with only to the great bend in the Minnesota River 51 percent of the vote; Bill Clinton narrowly offer farmers some of the state's most pro­ carried the 1st in 1992. ductive land. Still a fixture in the 1st is Redwing Except for Rochester and some Missis­ Shoes. Located in Red Wing, the company sippi River towns, the population centers in employs more than 1,000 people. The dis­ the 1st are devoted to serving the surround­ trict is also known for the world-famous ing farms, or in the case of Austin, process­ Mayo Clinic, located in Rochester. The fa­ ing the main local product — hogs. cility now employs about 1,000 physicians Austin's economy is fed by the meat- in the 19-story facility. And IBM's largest and food-processing plants in the area, and domestic facility, which employs about the name Hormel says it all. George A. 7,600 people, is in Rochester. Hormel founded the company in 1891. At Rochester (Olmsted County) has a the Mower County Historical Center, visi­ more white-collar orientation than the rest tors can see the original Hormel building, of the district. Its voters are more reliably along with steam locomotives and horse- Republican than many of the Ist's farmers, drawn carriages. who often stray from GOP traditions. And while there are pockets of Demo­ Another of the Ist's claims to fame is cratic strength (Mower County is the most as the scene of one of the last chapters of consistently Democratic in the 1st), the Old West history. It was in Northfield (Rice district as a whole is overwhelmingly Re­ County) that Jesse James and his gang were publican with a keen independent streak. finally stopped in 1876 when they at­ The state's redistricting odyssey has tempted to rob the Northfield Bank and not changed that configuration. A 1993 Su­ were ambushed by townfolk. Each Labor preme Court decision upheld a state-drawn Day weekend, thousands attend the "De­ redistricting map and invalidated a plan feat of Jesse James Days" celebration. crafted by the federal courts. The federally drawn plan was used in the 1992 election. 1990 Population: 546.887. White 535.088 (98%). However, the new state-drafted districts Black 1,752 (<1%). Other 10.047 (2%). Hispanic will be in effect for the 1994 congressional origin 5.347 (1%). 18 and over 399.063 (73%). 62 and election. Although the 1st will change over 90,709 (17%). Median age: 33.

Penny also has been willing to take his At the start of the 103rd Congress, Penny budget philosophy personally. In 1991, he took the helm of Agriculture's Foreign Agricul­ founded the Porkbusters group. He continues ture and Hunger Subcommittee. With the de­ to co-chair Porkbusters as well as the Demo­ mise of the House Select Committee on Hun­ cratic Budget Group. In August 1992, he joined ger, Penny instantly became a leading the anti-deficit "Lead ... or Leave" drive, sign­ legislative player on programs addressing world ing a pledge committing himself to quitting in hunger. 1996 if the deficit is not reduced to half of the On the issue of using military force in the $333 billion figure used by the group. Persian Gulf in early 1991, Penny, a member of On the Agriculture Committee, the assign­ the Veterans' Affairs Committee, agonized ment most crucial to Penny politically, he is a about his vote. He met with peace marchers and defender of his home-state dairy farmers,"- military families, with the confused and the though he can work with others seeking a passionate. In the end, Penny voted to rely on middle ground on dairy provisions. Penny sanctions and delay the use of force. He later joined other Midwestern and Northeastern law­ professed to being comfortable with his choice makers in 1991 when they tried unsuccessfully but added, "I'll probably have fewer doubts the to revise dairy programs in response to plum­ next time around." meting milk prices. At Home: The first Democrat to hold this ,

813 Minnesota - 1st District district in nearly a century, Penny defied GOP showed him with his young family, a contrast predictions that he would be a one-term fluke. with the divorced Hagedorn. Penny prevailed Penny has been running for office virtually with 51 percent of the vote. his entire adult life. In 1976, barely a year out of In 1984, Penny defeated Republican Keith graduate school, he ran for the state Senate in Spicer, a Rochester sales manager with close ties south-central Minnesota. Treading in staunchly to southern Minnesota's fundamentalist Chris­ GOP territory, Penny visited each household in tian community. Although President Ronald the district three times and drew 52 percent to Reagan swept the 1st District, Spicer had little oust a Republican incumbent. appeal to the district's large contingent of moder­ Redistricting carved up his state Senate ate Republicans, whom Penny had cultivated. district and left him without a familiar place to GOP leaders hoped Erdahl would run in seek re-election. So he decided to run for Con­ 1986, but he bowed out in late 1985, choosing a gress in 1982. His chances of making it seemed position in the national office of the Peace minimal until a vicious quarrel developed be­ Corps. Republicans fielded a weak challenger tween two GOP incumbents, Tom Hagedorn then, and again in 1988. and Arlen Erdahl, who ended up running In early 1990, Republican state Rep. Dave against each other after redistricting. Bishop, a popular moderate from Rochester, When Hagedorn won the GOP district said he was considering challenging Penny be­ convention, Penny worked to exploit lingering cause the Democrat was too conservative. But bitterness, calling himself a moderate in the Bishop opted against running, and once again Erdahl tradition. As the race tightened, Hage­ the GOP settled for insignificant opposition. dorn unleashed a barrage of charges, including Penny racked up his biggest House election criticism that Penny had never worked in the mark: 78 percent. In 1992, Penny won with 74 private sector. Penny responded with ads that percent of the vote.

Committees Key Votes Agriculture (8th of 28 Democrats) 1993 Foreign Agriculture & Hunger (chairman); Environment, Credit Require parental notification of minors abortions Y 4 Rural Development Require unpaid family and medical leave N Approve national "motor voter" registration bill Y Veterans' Affairs (5th of 21 Democrats) Approve budget increasing taxes and reducing deficit Y Education. Training & Employment Approve economic stimulus plan Y Elections 1992 Approve balanced-budget constitutional amendment Y 1992 General Close down space station program Y Timothy J. Penny (D) 206.369 (74%) Approve U.S. aid for former Soviet Union Y Timothy R. Droogsma (R) 72.367 (26%) Allow shifting funds from defense to domestic programs N 1992 Primary 1991 Timothy J. Penny (D) 29.816 (92%) Extend unemployment benefits using deficit financing N E. Douglas Andersen (D) 1,618 (5%) Approve waiting period for handgun purchases N Joseph B. Campbell (D) 1,131 (3%) Authorize use of force in Persian Gulf N 1990 General Timothy J. Penny (D) 156,749 (78%) Voting Studies Doug Andersen (R) 43,856 (22%) Presidential Party Conservative Support Unity Coalition Previous Winning Percentages: 1988 (70%) 1986 (72%) Year S 0 S 0 S 0 1984 (57%) 1982 (51%) 1992 41 59 60 37 48 52 1991 50 50 66 32 57 41 34 66 66 33 56 44 District Vote for President 1990 1989 57 43 67 33 68 32 1992 1988 37 63 59 41 66 34 D 109,829(39%) 1987 35 65 59 41 49 51 R 98,384(35%) 1986 34 66 61 39 48 52 I 75,227 (27%) 1985 25 75 53 47 35 65 1984 35 65 69 31 36 64 Campaign Finance 1983 13 87 84 16 29 69 Receipts Expend­ Receipts from PACs itures Interest Group Ratings 1992 Year ADA AFL-CIO CCUS ACU Penny(D) $244,518 $92,743 (38%) $292,920 1992 45 50 50 52 Droogsma (R) $96,568 $10,981 (11%) $93,620 1991 50 42 60 30 1990 1990 67 50 43 25 Penny(D) $230,040 $113,050 (49%) $197,442 1989 55 50 80 46 1988 60 71 64 36 1987 64 50 53 30 1986 75 64 50 16 1985 60 47 50 24 1984 75 38 50 33 1983 75 76 40 17

814 / HOUSE COMMITTEE ON INTERIOR AND INSULAR AFFAIRS ojMESOTA

^ulLDING CHAIRMAN: <>C 20516-230* SUBCOMMITTEE ON NATIONAL PARKS Congress of the Bnitefl States AND PUBLIC LANDS /TRICT OFFICE: HOUSE COMMITTEE ON BANKING FINANCE AND GALTIER PLAZA URBAN AFFAIRS 175 FIFTH ST.. E. toonse of 'Representatta RM. 727, BOX 100 ST. PAUL MN 65101 HOUSE SELECT COMMITTEE (612) 224-4503 Washington, im-iw ON AGING February 26, 1993

Ms. Hillary Rodham Clinton Chairperson The President's Task Force on Health Care Reform The White House 1600 Pennsylvania Ave Washington, DC 20500 Dear Ms. Rodham Clinton: We are writing to extend an invitation to the President's Task Force on Health Care Reform to hold a public forum in Minnesota, in your pursuit of ideas and information to contribute to the formulation of the President's health care reform proposal. Minnesota is an appropriate location for such an event. As home to the world-famous Mayo Clinic, the prestigious University of Minnesota Medical Center, and over 600 independent corporations known as the "Minnesota Medical Alley", our state has valuable experience in the provision of quality health care. Minnesota recently surpassed Hawaii, in one national survey, as the healthiest in the nation. As you know, Minnesota passed health care reform legislation, the MinnesotaCare program, last year, which includes significant cost containment provisions. The aim of the program is to provide affordable health insurance to all Minnesotans. The process of public forums which preceded the passage of this legislation and the implementation of the program have also enabled Minnesota to gather input from all areas of the health care industry and all segments of the consumer population. In various town meetings on the subject of health care reform that we have held as Members of Congress, the key concerns expressed by those in attendance involved cost, accessibility and quality of care. It is clear from their statements that even in Minnesota, the location of some of the best health care programs in the nation, no one is immune to the problems of our current health care system. It is in the states that experiments with various health care reform measures and approaches are being conducted. Thus, much can be learned by improving the dialogue between the federal government and the states.

PRINTED ON RECYCLED PAPER ,6 would be honored if you would accept this invitation to come to Minnesota and make use of our experience as a resource in designing the President's health care reform plan. Sincerely, 1/ - :e Vento DQ^d Durei^Jsjrger \ r.S. Representative U.S. Senator ^

Paul Wellstone fames Oberstar U.S. Senator 17 Represenatative

Martin Sabo U.S. Representative

Jamets Rams tad U.S. Representative U.S. Representative

Rod Grams U.S. Representative Representatives and Staffs • 11-213 Timothy J. Penn arl C. Perkins DFL-Minnesola, Isi Disiiict D-Kentucky, 7th District Began Service: 1983 Began Service: 1984 436 Cannon House 1004 Longworth HeCuse Office Building Office Buildinc Washington, DC 20515-2301 Washington, D^20515-1707 (202) 225-2472 FAX: (202(225-005 (202) 2/5-4935 BIOGRAPHICAL Born: 11/19/51 •Home: New BIOGRAPHICAL^orn: 8/6/54 • Home: Leburn Richland • Educ: B.A., Winona State U. • Prof.: Sale', • Educ: B.A., Davidsdp Col.;/D., U. of Louisville • Prof.: Representative • Rel.: Lutheran Attorney • Rel.: Baptis KEY STAFF AIDES KEY STAFF AIDES' Namg/Position Legislative RcsponsiBHU.v Name/Position egislative Responsibility 'Steven Bosacker David M Whnlm Pifblic Works, Appropriations Admin. Asst. Admin. Asst. Teresa McFarland Samantha O'Neill Envfronment, Interior, Veterans, Press Secy. Press Secy./ Defense, Foreign Affairs Legis. Asst. Christopher Hoven Office Admin. Charlotte Reilev/ Welch Joe TheissenX Budget, Appropruilions. Lducn- Oil ice Myr Legis. DirJ tion, Civil Rights, Labor. Busi­ (Appls.) ness; Overall Constance F. Health, Ways and Means Glenda Kendrick Veterans' Committee; Taxes, Crosby Legis. Asst. , Health, Welfare, Child Care, Legis. Dir.I A-Housing Peter J. Schilnkraut Science Cfflmmittee; Agriculture, Mark Mullenbach Defense, D.C, Transportation. Legis AssJ. Energy/Commerce, Banking/ Legis. Asst, Communications, Environ mem Housing Jane Shey Agriculture and Select Hur.gci Legis. Asst. Committees; Foreign Policy, COMMITTriE ASSIGNMENTS Banking Education ar d Labor: Employment Opportunities, Chairman • Elementary, jSecondary, and Vocationa\ Education • Labor Heather Arndt Crime, Prisons, Law Enforce­ Standards Admin. Staff ment Asst./Scheduler Science, Sp: ce, and Technology: Science • Space

COMMITTEE ASSIGNMENTS OTHER PfbsiTIONS \ Agriculture: Wheat, Soybeans, and Feed Grams, Vice Cinur- Democruiic Congressional Campaign Committee • Democratic man •Conservation, Credit, and Rural Development • Live­ Study Group • Congressional Steel Caucus •Congressional Coal stock, Dairy, and Poultry Group Veterans' Affairs: Education, Training and Employment, DISTRICI OFFICES Chairman • Compensation, Pension and Insurance Federal Bid; Ashland. KV 41101 . ,\ (606) 325-8530 Hunger (Select) (Task Forces): Intcmaiional I-L'dcal Bid Pikcwlk K "i 4151)1 V606 ) 432-4191 OTHER POSITIONS PO Box 4!jb Majority Whip At Large • Democratic Budget Study Group. Morehei d, KY 40351 . 16) 784-1000 Co-Chairman •Congressional Soybean Caucus, Steering Com­ mittee • Rural Health Care Coalition, Steering Committee; Ru­ ral Veterans' Health Task Force, Chairman DISTRICT OFFICES Park Towers, 22 No. Broadway Rochester, MN 55906 (5U7) 2hl-(i05.: 410 So. 5th St., P.O. Box 3148 Mankato, MN 56001 (507) 025-6921

Summer 1992 /

Congress of the "Hmted States tose of Heprestntatities HDashington, Bd 20515 REPRESENTATIVE TIM PENNY A PROFILE

Tim Penny, a DemocraC, was elected in 1992 to his sixth term as the U.S. Representative to the First District in Minnesota. In his ten years in office Penny has made deficit reduction a top priority. He has also concentrated his efforts on projecting democracy, promoting growth and providing for children. Penny was recently named Chair of the Subcommittee on Foreign Agriculture and Hunger. He also serves on the Veterans' Affairs Committee and the Select Committee on Hunger.

Cutting Costs to Reduce the Federal Deficit

Congressman Penny is a strong advocate of the pay-as-you-go fiscal policy which ensures that all new spending must be financed by cuts in less important budget items or by offsetting revenues. He also recognizes that the U.S. federal budget deficit is crippling the economy and strapping the next generation with a debt they didn't create. . His first year in office Penny started the Democratic Budget Study Group which has become an influential forum for discussing significant economic and budget issues in Congress. In addition Penny founded the "Porkbusters" group and led the successful effort to enact $8.2 billion in federal budget cuts in 1992. In 1990 and 1992 Penny was presented with the Friend of the Taxpayers Award for consistently voting to cut spending and reduce the federal deficit. The Washington-based organization "Watchdogs of the Treasury, Inc." recognized Penny twice with a fiscal responsibility award. In addition, the citizens' group "More Common Sense," has presented Penny with four "Sound Dollar Awards" for his outstanding record on deficit reduction.

Promoting Economic Growth and Democratic Ideals

While Penny believes that the best economic stimulus would be a dramatic reduction in the federal deficit, he has sought to promote economic growth for the country through increased employment and international trading opportunities. As a member of the House Agriculture Committee, Penny achieved passage of legislation designed to promote innovative uses of agricultural products through the Agricultural Research Commercialization Corporation (ARCC). In 1992 Penny successfully passed legislation giving young farmers financial assistance necessary to start farming operations. The beginning farmer program redirects money already allocated to FmHA. Penny also understands that the economic recovery of the former Soviet Union will increase the opportunities for U.S. agricultural commodities. During the 1992 session Penny was appointed to the conference committee of the Freedom Support Act, a bill which provides assistance to the former Soviet Union. As the chair of a newly-created subcommittee on Foreign Agriculture and Hunger, Penny will expand his role in pursuing increased economic act: vi ty through exports. In particular Penny will explore additional credit and assistance programs for the former Soviet Union. /• -2-

As a member of the Select Committee on Hunger, Penny has demonstrated a concern for children in impoverished nations around the world. Penny was a leader in passage of the Child Survival Assistance program which aided the innocent young victims of Nicaragua's long civil strife. Penny also successfully and persistently lobbied for legislation that ensured delivery of U.N. assistance to the children of war-torn Iraq after the Iraqi government refused to accept terras for U.N. aid.

Background and Family

Penny was born in Freeborn County on November 19, 1951. In 1974 he graduated cum laude from Winona State University with a bachelor's degree in political science. While at Winona State University Penny was the first student representative to serve on the Minnesota State University Board. He was also the first lobbyist for the Minnesota State College Student Association. Penny was elected to the Minnesota State Senate in 1976 and held the position until 1982. He served as Vice Chairman of the Senate Finance Committee and was a member of the Agriculture and Transportation Committees. Penny is also a drilling member of the U.S. Naval Reserve in non-pay status and currently serves as a lieutenant with a naval intelligence unit at the Pentagon. Tim Penny and Barb Christianson were married October 18, 1975. They have four children, Jamison 13, Joseph 12, Molly 11 and Marcus 7. The family splits their time between New Richland, Minnesota and Vienna, Virginia. To: Task Force on National Health Care Reform

Fr: U.S. Rep. Tim Penny

Dt: February 26, 1993

Re: Health Contacts and Other Information

In response to your request:

1) D.C. Chief of Staff: Steven Bosacker 202-225-2472 (o) 202-986-1586 (h) 202-225-0051 (fax)

2) Legislative Director: Joe Theissen 202-225-2472 (o) 202-225-0051 (fax)

3) Health Care L.A: Glenda Kendrick 202-225-2472 (o) 202-225-0051 (fax)

4) Press Secretary: Teresa McFarland 202-225-2472 (o) 202-686-1189 (h) 202-225-0051 (fax)

First Congressional District of Minnesota. Home of world renowned Mayo Clinic in Rochester, Minnesota. 1993 marks the implementation of Minnesota's universal health care system passed in the 1991 legislature called "MinnesotaCare." Rep. Penny interested in pursuing health care reforms that lead to use of managed care systems.

U.S. Rep. Tim Penny 436 Cannon House Office Building Washington, D.C. 20515

PHOTOCOPY PRESERVATION 0( ^ z_ PM-The Next Hurdle, Bj1,680 WASHINGTON TODAY: La% akers Find Little Voter Appetite for a Big N Plan By ALAN FRAM- 'Associated Press Writer- WASHINGTON (AP) One win often builds aomentum for the next in politics, jut President Clinton's deficit-reduction victory may have limited his options for his upcoming push to revamp the health-care system. Some congressional Democrats visiting home for the first time since they >ushed his budget-cutting plan through Congress say their constituents don't rant to hear about another big plan right now. Instead, lawmakers said they found voters: In no mood for the broad tax increases a health-care overhaul may require, sven one levied solely on employers. Demanding that money to pay for the overhaul come from federal spending :uts even though the deficit-reduction bill just trimmed the growth of ledicare and other popular federal health programs. Wary of the medical-care effort because of skepticism about Washington's ibility to fix things especially something as complicated and personal as iealth care. ''The cynicism is just overwhelming right now,'' Rep. Tim Johnson, D-S.D., aid last week. ''It's tough to go home and tell people, 'I've got an idea hat will make your life better.' They just don't believe it." Clinton has promised to unveil his plan for reworking the nation's ealth-care system next month after Congress returns from its summer recess. So far, he and aides have provided few details. But the proposal's main oals will be to provide coverage for everyone, and to rein rapidly growing osts. It's likely to be an expensive effort because of the many billions of ollars a year it will cost to cover the 37 million Americans now uninsured. According to early descriptions, Clinton would put the prime burden on mployers, who would be required to pay up to 80 percent of their workers' nsurance premiums in the form of a payroll tax. Other funds would come from utting costs in the government's Medicare and Medicaid programs, and ossibly higher '"sin'' taxes on tobacco and alcohol. Senate Minority Leader Bob Dole, R-Kan., told the National Governors' ssociation last week that he wouldn't rule out supporting mandates on mployers and steeper cigarette taxes. Despite that, members of Congress say hat in the aftermath of the budget fight, the public may be hard to bring long in today's strong anti-tax climate. Lawmakers say there may not be loud resistance to raising taxes on alcohol nd tobacco consumption. But they caution that there would probably be roblems with a broad tax, even a payroll tax levied on employers. That 'would be perceived as a tax by the public,1' said Rep. Tim Penny,\ ^ -Minn. "It would be very tough for the administration to sell." The broad tax on most energy sources that Clinton sought as part of his adget-cutting bill met similar resistance and was eventually whittled down o a 4.3 cent-a-gallon gasoline tax increase. The anti-tax mood is fueled by a public perception that the needed funds in be squeezed out of federal health programs. . ''They'd prefer to see us developing cost containment programs before ve ] & lise taxes to fund" the overhaul, said Rep. Cal Dooley, D-Calif. The money is there. Federal health spending totals nearly $300 billion inually. The problem is finding the specific savings and the public and ilitical will to actually make the cuts. That proved difficult for the authors of the deficit reduction bill. It duced the growth of Medicare and Medicaid, the health insurance programs >r the elderly, disabled and poor by $63 billion over five years. Those cuts re among the last items agreed upon even though most of them will directly feet only hospitals and doctors. Penny says the deficit-reduction fight disappointed people because it atured the same partisan bickering they have observed for years. That's

jst sharpened public skepticism about the health-care overhaul, making it lat much harder to galvanize support for the effort. "Constituents feel you can't expect miracles any more," Penny said. ) ^ Then he added, "That's probably a healthy attitude." ' EDITORS NOTE Alan Fram covers budget issues in Congress for The jsociated Press. BUDGET

After the Boll Weevils

n the debate leading up to the mid- muscles in key budget debates in the A dozen years ago, March House vote on President House this year. On the budget resolu­ some conservative Clinton's $16.3 billion economic tion, they forced through an additional stimulus program, some Democrats $63 billion in deficit reduction, and on House Democrats broke tooIk direct aim at Charles W. Stenholm, the budget reconciliation bill, they suc­ their colleague from Texas. Everybody in ceeded in adding a provision for review of ranks to support the the chamber knew exactly whom they greater-than-expected entitlement spend­ Reagan tax package. were talking about as they recalled the ing. And though they failed to get the decision by some southern Democrats in compromise they wanted on Clinton's This year, many 1981 to join with the GOP in pushing $16.3 billion stimulus package, they President Reagan*s massive tax cut legis­ earned the right to say i told you so' Democratic lation through to approval. when the proposal died in the Senate. "Many of you who oppose the stimulus They are also likely to have an influen conservatives and package are the ones who helped bring us tial voice on the final shape of the recon moderates would to despair in the 1990s with your econom­ ciliation bill when conferees meet to ic policies of the 1980s, not just Republi­ hammer out a compromise. rather pull President cans alone, but by the Reagan boll weevil On several issues, especially those tha Democrats who voted with you," Rep. affect fiscal policy, they may hold the bal Clinton to the right Douglas Applegate, D-Ohio, said. "What ance of power. than bolt the party. were the results? Heavy deficit, bad trade "When that coalition comes together policy more people in poverty." it's a significant segment of the [Demo Stenholm will never forget his vote for cratic] Caucus, comprising perhaps as the Reagan package, nor will others let many as 80 Members." said Timothy J. BY VIVECA NOVAK him. Now there's a Democrat in the Penny. D-Minn.. a prominent member of White House, and the boll weevils, for the group. "On any given day. half of various political and demographic rea­ them are prepared to vote a cenain way, sons, are nearly extinct. and that's enough to get the attention of So has all the kick been emptied from the leadership and the White House." Stenholm's boots? Though the Senate has its own outspo­ Anything but. As Democrats struggle ken moderate-to-conservative Democrat­ to define themselves and cope with con­ ic Members, they are likelier to sound off trolling both the executive and legislative on their own. By contrast, the House's branches. Stenholm's been heard from larger size and tighter rules encourage more than ever. His way of compensating teamwork. for his 1981 vote appears to be to dedi­ cate his soul to cutting the deficit. He's not alone. In fact, a kind of al­ CHANGING TIMES liance on fiscal issues has emerged Times have changed for this wing of between old-line conservatives such as the party. For one thing, it's no longer Stenholm and other members of the Con­ mostly southern: Increasingly, southern servative Democratic Forum (CDF) and lawmakers are black—and therefore gen­ at least some of the centrist-to-conserva­ erally more liberal—or Republican. For tive members of the House's Mainstream another, southerners and northerners Forum, an organ of the Democratic tend more and more to look at issues in Leadership Council (DLC). Emboldened the same way as their constituencies be­ by the fact that the economic planks in come more alike—primarily, urban. Clinton's campaign platform last year Then too, the party leadership has more or less reflected their views, they've reached out to many of these lawmakers pushed hard to counter what they've per­ and given them choice committee assign­ ceived as the President's drift away from ments and party tasks, particularly as they centrist principles. have built seniority. In 1989, for example, Some of these Democratic moderates Speaker Thomas S. Foley, D-Wash., and and conservatives have been flexing their Majority Leader Richard A. Gephardt,

1630 NATIONAL JOURNAL 6/26/93 D-Mo., flew down to attend Stenholm's "To coalesce with the Republicans is to servatives can push the party only so far annual barbecue fund-raiser in his home­ defeat something and to do nothing," without getting the more liberal wing up town of Ericksdahl. In the same year, said Thomas E. Mann, director of gov­ in arms. That's already beginning to hap­ Stenholm was made a deputy whip and ernmental studies at the Brookings Insti­ pen. The congressional Black Caucus was co-captained the House Democrats' cam­ tution. "I think Charlie [and the others) angry over the leadership's receptiveness paign to kill President Bush's proposed would rather get something done. I think to the efforts of Stenholm and others for capital gains tax cut. that's the orientation of all the serious more spending cuts in the budget resolu­ The Republican Party, meanwhile, has players on the Democratic side." In addi­ tion and over the entitlement cap propos­ moved increasingly to the right, making it tion, he said, budget realities play in favor als. harder for it to forge alliances with con- of Stenholm. Penny and their colleagues But the more conservative Democrats servative Democrats. Coalitions aren't and against such advocates of expanded say that they have good reasons for push­ impossible: Last year, conservative Dem­ government assistance as Henry A. Wax- ing as hard as they have. "These people ocrats joined some Republicans to pre­ man, D-Calif. And with the budget a believe that [Clinton] is one of their own. vent shifts in funds from defense to higher-profile issue than ever, deficit They have exerted as much pressure as they could to try to get him to go along, which means more spending cuts and less taxes." David W. Rohde, a political sci­ ence professor at Michigan State Univer­ sity, said. "Clinton's [campaign] promises give them even more authority to stand up for what they've been standing up for all along." The coalition falls apart on such issues as family leave, gays in the military and trade policy. But "I think they found that their interests have converged, at least with respect to the economic plan," said Will Marshall, president of the Progres­ sive Policy Institute, the DLC's think tank. Other areas of possible agreement? Health care, for one, Marshall said. "As the details of the President's plan emerge, the Mainstream Forum and the CDF might defend the idea that health care markets should be reformed before we go to price controls and other things." he noted. But the bottom line, most of those in the House's moderate and conservative Rep. Charles W. Stenholm, D-Texas camps assert, is helping Clinton succeed. In 1981, he voted (or huge tax cuts; now, he wants to cut the deficit. "We've elected a President, and he's formulated a program, and we need to domestic programs, and some Democrats reduction is a high priority for many in help him move it through," said Rep. threatened in the same year to team with the class of '92. John M. Spratt Jr., D-S.C, an important the GOP to kill a bill financing govern­ Stenholm's CDF and the Mainstream broker in the moderate-to-conservative ment operations unless the House was Forum, which Rep. Dave McCurdy, D- wing of the party. "We've got to reconcile given an opponunity to vote on a modi­ Okla., heads, have a good deal of mem­ all of these differences within our own fied line-item veto. bership overlap. The groups are more Caucus. The force that has to work is this But so far this year there have been forums for discussing ideas than they are motivating force of wanting to see the few such pannerships. Republicans have tight voting blocs. Even though Sten­ President succeed. What this Congress been unusually unified in opposing any­ holm. McCurdy and Penny (who heads has to offer the Administration is some thing Clinton puts forward, and conserva­ the Democratic Budget Group, an even depth of perspeaive." tive and moderate Democrats have looser cluster with membership that over­ worked within the party to a striking laps the other two) eventually voted for degree. the reconciliation bill, for example, many WHICH IS THE REAL STENHOLM? "We're in transition as a Caucus right others in their groups did not. Of the 36 There are two views of Stenholm. One now," a Democratic leadership aide said. Democrats who voted against it, in fact, portrays him as a lawmaker who makes "But 1 think [the moderates and conser­ 16 are members of both the CDF and the tough, principled demands on controver­ vatives] are playing a very constructive Mainstream Forum. The CDF, once sial votes but then caves in too quickly to role. . .. Almost all of them have worked known informally as the Redneck Cau­ party leaders. In the other view, he is an within the Caucus." As further proof of cus, dates back to 1980: the Mainstream effective legislator who works within the the good relations, the aide said, five to Forum was formed in 1990 in response, a system to press his case, get what he can seven of them held back on the May 27 McCurdy aide said, to the "screamers" and then cut a deal. reconciliation vote until the outcome was on the Republican side such as the out­ Not surprisingly, Democrats have clear: party leaders, the aide said, "felt spoken House Minority Whip Newt Gin­ recently had mostly praise for Stenholm, they would have voted with us if we had grich of Georgia. while Republicans who have sometimes needed them." But Democratic moderates and con­ worked with him have fumed. A scathing

NATIONAL JOURNAL 6/26/93 1 631 Wall Street Journal editorial called him ing cuts in the budget resolution—also in including the wool and mohair program, Cave Man Charlie: a conservative month­ good part the result of Stenholm's which has taken cut after cut but survives, ly, The American Spectator, will publish a efforts. thanks to him. He has also stood up for critical story about him in August. But Stenholm, first elected in 1978, food stamp spending. A Black Caucus member recently kept the pressure on, and the Admini­ Stenholm pushed hard this year for described that group's priorities on the stration agreed to accept a lenient form House consideration of a modified line- budget reconciliation package as being of cap. The final shape of the measure, item veto, and after weeks of partisan '"in the best of the Stenholmian tradi­ an entitlement review rather than a cap, jockeying, it was approved in April. (It tion," apparently referring to the way the was settled in the early hours of the now languishes in the Senate.) Another Texan deftly sets conditions for his sup­ morning of the vote after days of intra­ Stenholm passion is a constitutional pon. party haggling. It specifies that if entitle­ amendment that would require a bal­ Stenholm "will get what he can and ment spending exceeds the levels project­ anced budget by 1999 or two years after then work with you if you've dealt with ed in the budget resolution, the President ratification by the states. The proposed him fairly." said an aide to former House and Congress must formally decide amendment fell nine votes shon of victo­ Budget Committee chairman Leon E. whether to reduce other benefits spend­ ry in the House last year. This year the Panetta, D-Calif, who now heads the ing, raise taxes or let the deficit grow. Senate will act first. Office of Management and Budget "From a practical standpoint it was a Stenholm's tone toward the Admini­ (OMB). He gets high marks, too. for relatively easy vote—to move the process stration is sometimes downright laudato­ being accessible and open about his forward," Stenholm said of his compro­ ry: "I don't think the President is getting intentions. Somehow Stenholm, a former mise. To Republicans, it was typical of nearly the credit he should for biting a cotton and livestock farmer with a safe Stenholm's behavior. very tough deficit reduction bullet." he seat, remains a respected player even "He's burned a lot of bridges with said. "You can criticize him for all kinds though he voted with Reagan and Bush Republicans and some of the conserva­ of reasons, but what most critics cannot most of the time, in some years more tive groups." said Michael G. Franc, do is come up with a constructive alterna­ than any other Democrat. director of congressional relations for the tive that can get 218 votes." Many Democrats weren't happy about Heritage Foundation. He called the enti­ At the same time, he warned that Clin­ Stenholm's recent insistence on entitle- tlement review provision "the dog that ton must be careful where he aims. "The didn't bark" and added that it is Far Right you can forget, the Far Left noteworthy that no Republicans you'd better forget, but it's that 218 votes tried to forge a bipartisan proposal in the middle where a successful presi­ with Stenholm. "That's a very loud dency will be and a successful Congress comment on how much distance will be. That's the challenge we have. there is," he said. We're going to try to remind him of who "So be it," Stenholm said in an he was; he was the DLC's candidate." interview. The Republicans have (Fora report on Clinton and the DLC. see "decided to march in lockstep to NJ. 6/12/93, p. 1407.) their leadership and not exercise Further coalitions between members independent judgment." of the CDF and the DLC's Mainstream Before voting against the stimu­ Forum are likely in several areas, includ­ lus package, he tried to add an ing health care. Stenholm said. "We've amendment that would have been very nervous and concerned about slashed the cost by more than half how big a package we're talking about by offsetting it with spending cuts. and how costly it's going to be," he said. But the leadership refused to allow "We don't believe that we can solve a vote on his amendment. (The bill everybody's problem with a new federal passed by a large majority; most of program, and afford it and keep the the Democrats who voted no were American people behind us." Rep. Jim CDF members.) Cooper, D-Tenn., who belongs to both In 1981, Stenholm said, he voted groups, helped craft a managed-competi­ his district over his conscience. tion-style health reform package that the "We succumbed to some very illu­ CDF got behind last year. sory goals," he said. This year, in Welfare reform is another such issue, voting for the budget reconcilia­ one where "we're going to be able to fol­ tion bill, he added, he did the low our President, because he has stated opposite. "The fact that my con­ very clearly that after a period of time if Rep. Timothy J. Penny, D-Minn. stituency was very strongly you're on welfare and you don't have a He's called "penny-pincher" by ether Members. opposed to it has made it very, job, you should be history," absent exten­ very tough," he said. When he uating circumstances. Stenholm said. ment caps in the budget reconciliation arrived in his district for the Memorial The Texas Democrat, it seems clear, is bill. It put Clinton in the position of argu­ Day recess, he said, he was greeted by trying to prod the President as well as to ing against a provision meant to control people bearing signs calling him a praise him. spending. The President asked the Dem­ "traitor" and worse. Many of the people were supporters of Ross Perot. ocratic Caucus to drop the idea, asserting that it would merely shift health costs to For all his talk, however, Stenholm is RELENTLESSNESS private payers and interfere with health hardly a deficit purist. He has supported He's called "penny-pincher" by other care reform. Everyone knew that it could projects that provide jobs or money for Members and "Scrooge" by his kids. also alienate party liberals, who were Texans, such as the superconducting Minnesota's Penny admits to being already displeased about the extra spend­ supercollider and most farm programs— almost singlemindedly focused on the

1632 NATIONAL JOURNAL 6/26/93 budget deficit. It's a subject, he acknowl­ reduction plan," he said. "Now, it will tee and a respected voice on foreign poli­ edges, on which he has a tendency to require higher taxes. I think that's a cy and defense, McCurdy has more make "intemperate remarks in the heat major problem, because ... they're going recently taken a beating. of the moment." And then he proceeds to run right up against the same kind of In January, he was stripped of his to make more, a habit that's made him resistance that they have had on the stim­ InteUigence post in response to his steady popular with the news media if not ulus and the budget reconciliation." criticism of Foley's handling of the House always with party leaders. Penny still hopes to cut funds for the bank and post office scandals. Penny doesn't hide his disappointment superconducting supercollider, the space And despite his hard campaigning for with Clinton's economic program. "This station and the Strategic Defense Initia­ Clinton last year, he was passed over for was the year to challenge ourselves and tive ("Star Wars") this year. He'll be Defense Secretary, a post it was widely to challenge the electorate to see some­ joined in some of those efforts by Reps. believed he desired. (Some, in fact, say he thing more dramatic," he said. "I don't Jim Slattery, D-Kan.. Louise M. Slaugh­ campaigned too hard for it.) Clinton think we've challenged the American ter, D-N.Y., and probably plenty of oth­ might have made him CIA director, but people enough as far as presenting ers. But he may be out on his own on McCurdy, if he wanted it, didn't handle spending cuts." Clinton's program, he some of the other items on his wish list, that one well, either. "The consensus is said "inflicts a certain amount of pain, such as elimination of the Consumer the guy's ego has totally run away with particularly in the area of taxes, and Product Safety Commission, the Eco­ him," a high-ranking Democratic aide doesn't get us more than halfway" toward nomic Development Administration, the said. eliminating the deficit. The President has Federal Emergency Management Agen­ On the reconciliation bill, McCurdy let down the "New Democrats." among cy and the Small Business Administration was his own subplot. In an interview, he whom Penny counts himself, in several as well as the community development said that he'd been raising concerns with ways, but clearly on the budget "there are block grant program, although Penny Clinton for months about what he saw as major fault lines." he said. concedes that he doesn't expect these the Administration's drift away from its proposals to go anywhere. Penny, who came to the House in campaign principles and those of the 1983. has frequently teamed with Sten­ The role of moderate and conservative DLC. During the week before the vote, holm on budget issues. On reconciliation, Democrats is "trickier" with a Democrat chief White House lobbyist Howard G. he supported Stenholm's demand for an in the White House. Penny said. "Now Paster met with the Mainstream Forum, entitlement cap. He also wanted to trim we're in a position where any measure where he heard complaints about the the stimulus package, though in the end approved by the Congress is likely to be energy tax, insufficient spending cuts and he voted for it. signed into law. It makes Ihe differences other matters. Paster was not responsive, For a northern Democrat. Penny has within our Caucus more apparent, but it McCurdy said. voted against his party surprisingly often; also makes it more important that we Within a day of that meeting. McCurdy his intensity about the budget deficit sometimes irritates his colleagues. A Democratic critic described him as hav­ ing "a myopic fixation on the deficit as the sole evil of Western civilization." More of a purist than Stenholm. Penny has been far more eager to reform agri­ culture programs, for instance. He has pledged to leave Congress in 1996 if the deficit isn't halved. He's also sympathetic to human rights causes and spending for the homeless, and he has a stronger record of voting with his party than Stenholm has. Even so. though others grant that he has a sharp mind and a lot of guts, he isn't as consequential in the House as the Texan. He was rebuffed by the leadership this year in his bid for a Ways and Means Committee seat. Along with Rep. David E. Price, D- N.C.. Penny coordinates the Democratic Budget Group that brings 20-30 lawmak­ ers together on a regular basis for a sort Rep. Dave McCurdy, D-Okla. of academic forum on budget issues. But Once a rising star in the House, he has more recently been taking a beating. he has also reached across the aisle on this subject, teaming with then-Rep. resolve the differences ... so we can all publicly proposed to ditch the energy tax Thomas J. Tauke. R-Iowa. in a Truth-in- be part of the same team." and find $50 billion more in spending Budgeting Task Force to propose small, cuts. He railed about Clinton's being a across-the-board cuts in appropriations stereotypical "tax-and-spend" Democrat legislation. Their effons were rarely suc­ FALLING STAR? in a Caucus meeting, angering many of cessful. If McCurdy seems a little shaken these his colleagues. He repeatedly urged the Penny, too. predicts a reemergence of days—and he does—he has good reason. White House to pull the reconciliation the DLC-CDF alliance on health care. Once a rising star in the House, a protege bill back because, in his view, it didn't "During the campaign, health care of then-Speaker Jim Wright, the chair­ have the votes. reform was central to [Clinton's] deficit man of the Select Intelligence Commit- "We were saying. 'You didn't win on

NATIONAL JOURNAL 6/26/93 1 633 the stimulus package, you ignored the be government solving all of our prob­ mittee this year after losing a race to center there and you lost. Don't repeat lems." chair it to Martin Olav Sabo. D-Minn. this."" McCurdy said recently. He predicted that "it's upward from But he heads the Government Opera­ On the day of the vote, he said, he here on out" for the Clinton Administra­ tions Subcommittee on Commerce. Con­ talked to Clinton three times before his tion. "Maybe they needed to have that sumer and Monetary Affairs, which han­ message got through. Promises were near-death experience" of the reconcilia­ dles many budget process questions. made, he said, to cut the energy tax and tion vote, he said. But he urged caution Discussion of entitlement caps began find deeper spending cuts. Other com­ on issues such as health care, which are in earnest several weeks before the rec­ mitments were made, McCurdy said, "very, very dangerous politically." He onciliation vote, when Spratt and Sten­ though he won't discuss them. prefers a health financing scheme that holm met with OMB director Panetta The final telephone call took place places responsibility on individuals to and floated the idea. Spratt said Panetta after the voting had begun—and after an start behaving like consumers. was noncommittal. afternoon meeting with some other Because of his relationship with Clin­ "We felt it would strengthen the Presi­ Mainstream Forum members who didn't ton and his leadership within the DLC, dent's claim for this bill if he could say we McCurdy could be an important have capped discretionary spending and force in pressing Clinton toward we are putting reasonable bounds around the center. entitlement spending," Spratt said. "I think his career in the Stenholm presented his plan at a meet­ House is still salvageable," a ing of the Democratic Policy Committee. House Democrat said. Described Then Spratt outlined his more moderate more than once as "rawly ambi­ version. Both met with resistance, but tious," McCurdy now vows that Spratt's sparked some interest. "Several he doesn't want to be either people, such as Barney Frank [D-Mass.] House Speaker or President. and George Miller [D-Calif.]. told me "Someone told me not to issue they thought I had a workable idea and Shermanesque statements, but would like to see me resolve the prob­ let me tell you, 1 have no ambi­ lems with it and keep pushing." Spratt tion to be President," he said. said. "It became clear from people McCurdy knows that some in approaching me and [Stenholm] that the House leadership have tried quite a few wanted to see something like to isolate him. but he thinks he's this in the bill." demonstrated it won't work. Per­ Still, major disagreements over how to haps in an effort to mend the rift, adjust for inflation and for growth in the he wrote a letter to his Demo­ beneficiary population, whether there cratic colleagues on the day that should be an automatic enforcement they were to consider the petition mechanism and other questions needed tying chairmanships to the recon­ to be ironed out. ciliation vote. Filled with lan­ In the end. the cap became a review. It guage about healing and uniting, has fewer teeth than either he or Sten­ it said that Democrats "are a holm originally proposed, Spratt said, but diverse group. Our successes are it provides "accountability: The President built on ... respect for the differ­ would have to address the issue, and we ences among our members. . . . would have to take a vote on his recom­ Rep. John M. Spratt Jr., D-S.C We must get on with the business mendation." of governing." He frequently tries to moderate between groups. Spratt said he hammers away on the deficit because "you've got to be single- support the package. McCurdy went to minded, focused, relentless and absolute­ the floor and voted for it—drawing, he THE BROKER ly determined to get it done. Otherwise said, "a lot of flak." McCurdy, who was "A class act," a House aide said of the excuses and delays and detours will first elected in 1980 and who chairs an Spratt, and that seems to be a widely held overtake you," he said. "That's the story Armed Services subcommittee, said his view. Outside Congress, his name recog­ of the deficit." vote had nothing to do with a petition cir­ nition is low; but within the institution Clinton, he said, "is extremely con­ culating before the balloting calling on and at home, the Oxford-educated for­ cerned with not being too zealous, too the Democratic Caucus to consider strip­ mer lawyer and banker commands hawkish, so that we tip the economy in ping the subcommittee and committee respect. Having served a quiet decade in the wrong direction and undo everything chairmanships of all who voted no. the House, Spratt has never been accused we're attempting to do. We're telling him "Had I not had the personal relation­ of grandstanding to further higher politi­ we've erred on the side of being reluctant ship with the President and just a level of cal ambitions—although some other and cautious in the past and we've only trust and hope, I don't think I would have Democrats say they wouldn't be sur­ avoided resolving the problem. Let's get changed my decision," McCurdy said. "It prised to see him rise in the leadership. bold now and hope the financial markets was a call for help, and I understood it Spratt became the broker in the nego­ respond with vigor." was sincere." tiating over entitlement caps in the rec­ Spratt, too, sees the possibility of mem­ McCurdy said he'll keep trying to onciliation bill, taking on his not-unac­ bers of the CDF, the Mainstream Forum move Clinton "back to the New Demo­ customed role of trying to moderate and the Democratic Budget Group join­ crat agenda. I believe in his head [Clin­ between groups. He's played similar parts ing forces on health care reform. "Every­ ton] understands that you have to change in quarrels over the defense budget, for thing we've done to date," he said, "will the way government operates, it cannot example, an area where he's considered be dwarfed by the magnitude of the be the old tax-and-spend way, it cannot an expert. Spratt left the Budget Com­ health care proposal." •

1634 NATIONAL JOURNAL 6/26/93 Congressman JtmOberstar

He has been supportive of the President's plan His wife died recently. While she had insurance, the cost of the uninsured expenses and deductible caused Congressman Oberstar to remortgage his home.

Congressman Jim Ramstad

He has been supportive of the First Lady and expresses support for a bipartisan approach. He has a particular interest tn small business issues and chemical dependency. He is a recovering alcoholic who obtained Inpatient treatment. Congressman Tim Penny

He has not been vocal on health care reform.

Congressman mi In Pefreon

I am not aware of his views on health care reform.

History of Minnesota Reform in 1985, a report entitled He^jthsp^n proposed legislative passage of universal access legislation. in 1989, the legislature appointed the Minnesota Health Care Access Commission to propose a plan for universal access and cost containment. That body, which i chaired, unanimously agreed a plan for universal coverage. The plan continued a version of a purchasing alliance.

Health care reform legislation was passed In 1991 but vetoed by Governor Carlson

Reform legislation expanding access, controlling costs, and Initiating a process to for further reform was passed and signed in 1992 This plan established insurance coverage for the uninsured called MinnesotaCare. This bill was passed with bipartisan leadership.

Further reform legislation with bipartisan leadership was passed in 1993 which established budget targets and encouraged integration of the delivery system. The fttosljutgton Suttee * FRIDAY, DECEMBER 10, 1993

Entitlement panelist pulls out over 'payola' ward the conference and a two-year follow-up By Major Garrett study. TMe WASHINGTON TIMES A statement released by Lawrence Smedley, At least one participant has withdrawn from executive director of the National Council of a conference featuring President Clinton amid Senior Citizens, said that "the whole solicita­ reports that corporate sponsors paid money to tion bid smacks of payola" that implied, "If you secure key roles at the event pay, you play." The Heritage Foundation backed out of the Edwin J. Feulner Jr., president of the Heri­ conference to discuss entitlement spending, tage Foundation, told Mrs. Margolies- saying it does not "participate in political fund­ Mezvinsky that his group could not attend be­ raisers" and was unaware of the sponsorship cause it "could lead to the appearance that arrangement. Heritage Foundation ... is participating in a What's more, conference organizers said political event." that sponsors who paid for access to the meet­ Another conservative group, Americans for ing, set for Monday at Bryn Mawr College, are Tkx Reform, asked Tbm Kean, former Repub­ being removed from panel discussions in re­ lican governor of New Jersey, to cancel his sponse to criticism. plans to attend. Mr. Clinton agreed to anend the conference Grover Norquist, president of the tax group, on entitlement spending in exchange for sup­ said in a letter to Mr. Kean that the conference port of his budget by Rep. Marjorie Margolies- "is nothing more than a scripted attempt to Mezvinsky, Pennsylvania Democrat and a con­ present Bill Clinton in a good light and to raise ference organizer. funds to reverse [Mrs. Margolies-Mezvin­ Mrs. Margolies-Mezvinsky reversed her sky's] sagging political fortunes." earlier "no" vote to spare the White House a Representatives for Merck, Mercy Health debilitating legislative defeat over Mr. Clin­ and the Hospital Association of Pennsylvania ton's $496 billion economic package. were scheduled to participate in panel discus­ At that time, she said winning the presi­ sions. Mr McCord said those companies will dent's promise to attend the conference meant be withdrawn from the panels; Merck and the that she had bartered for something of sub­ association said there were no plans to cancel stance, instead of trading her vote for a pork- their donations. barrel project Jake Tapper, spokesman forMrs . Margolies- On Wednesday, the Philadelphia Inquirer re­ Mezvinsky, said the Congressional Institute ported that 27 corporations, foundations and for the Future will condua no clandestine po­ activist groups invited to the one-day confer­ litical work for her re-election bid next year ence were asked to contribute $50,000 to a spe­ According to a conference itinerary, Mr cial political fund overseen by Mrs. Margolies- Clinton will be joined by several Cabinet of­ Mezvinsky's formercampaig n treasurer ficials, including Donna E. Shalala, secretary Of those, IS have a specific stake in the of health and human services; Labor Secre­ outcome of entitlement reforms, the Inquirer tary Robert Reich; and Alice Rivlin, deputy said. director of the Office of Management and Rob McCord, director of the Congressional Budget Institute for the Future, which is organizing In another development. Rep. Timothy J. the conference, promised potential donors a Penny, a Minnesota Democrat and leader of an "high profile" in the event eflbrt to cut $90 billion from the deficit that Funds solicited from participants in the the White House narrowly defeated, was conference will pay for opinion polls, newslet­ moved off a panel to be moderated by Miss ters, advertising and follow-up mailings in Shalala. Mrs. Margolies-Mezvinsky's suburban Phila­ Mr. Penny was to have been on a panel to delphia district discuss retirement programs but was moved Merck Corp., American Telephone & Tele­ to the last panel of the day, which will discuss graph Co. and Mercy Health Corp. of South­ the "next step" in deficit reduction. eastern Pennsylvania are among about a dozen • This article is based in part an wire service companies that have put nearly 5200,000 to­ reports. entitlements.• • Clinton, it appeared, took Rivlin's advice. At the administration's behest, the conference was carefully scheduled to avoid putting the president in the middle of the politically-sensitive debate. Just weeks ago, the Clinton White House battled to defeat a House bill that would have cut an additional $90 billion from the federal budget. Its vociferous opposition cost the president credibility as a serious budget cutter with some of the fiscal conservatives here. Indeed, in his presentation Clinton advocated no specific new cuts. Instead he donned a professorial pose and gave a speech using pie charts and graphs to illustrate the role and rise of entitlement spending in the federal budget. Afterward, he remained only for a panel on health care reform, missing the testimony of later witnesses who argued for much stricter restraints on federal entitlement spending. Rep. Tim Penny, D-Minn., co-author of the narrowly-defeated spending cut package, said Clinton could have done more to spark a national debate on a subject that has ""•paralyzed'' politicians. "To peg the entire (deficit reduction) problem to health care reform is unrealistic,'' Penny said. Other participants were harsher yet. ""The administration does not want the deficit on the table and this (link to health care reform) is a way to put it off,'' added former Sen. Paul Tsongas, a deficit hawk who was Clinton's chief rival in the 1992 Democratic presidential race. ""They either take on entitlements with conviction and courage, or they're not going to get the budget under control.'' In addition to the medical and retirement programs, entitlement benefits include unemployment compensation, food stamps, veteran pensions, and Aid to Families with Dependent Children. According to the White House, entitlement spending grew from $36 billion in 1965 to $847 billion last year. ZAPPE-CNS-SD-12-13-93 1441PST

**** filed by:CN-F(~) on 12/13/93 at 17:42EST **** **** printed by:WHPR(MMIL) on 12/13/93 at 17:43EST **** Tim Fsnny And John Kasich Deficit i/

Hie Post aho argued tbat our pro posed Medicare savings should i Of Options how be reserved for the Omxao i la a recent editorial ("A Stoppy Wayreform plan, is it rational to teD i i- to Govern," Nov. 1), Tbe Post oiticMedcan s that ee ant asje bea*h the Peimy-Kistch deSdt redtdtan pack­savings for defiot iwta tni hwaiw ^e age as a tiank cut" that lack* qwdfiowan. t to spend thoaeovings nest year? • The editorial was disappointBtg and, re­ Host Amexkans atVaiUjuwl that fed-. grettably, not relevant to the task of eral spending most be restrained now., finding real restraau to nnaway goIvn this respect, oar plan represents a! eminent spending. radical break fnxn tbe Wasfaxogtoo tradi­ We are particularfy (happcinted be-'tio n in which Congress (or tbe adminb- cause for years The Post has rightlytratwn ) pranises spending restraint skewered members of Congress for pro­somewhere down the road. posing phcny budget lavngs and for! Last February, President Cbnton asked Americans far "shared sacrifice* Taking in order to reduce the federal budget deficit He was right But the plan tbe Exception president proposed and tbe alternative ultimately approved by Congress in Au­ emphasizing budget process over spend-'gus t fell far short of the mark. ing reductkns. Furthemxe. tbe edito­ In addiban, Orton's badget makes rial seemed to parrot a faulty antique only temporary headway toward deficit recently released by Ihe Centar on reduction. Under the president's plan, Budget and Policy Prionbea. We vo^ the deficit decfines from more than - der tf The Post even looked at cm plaa S2Si 0 biUon to less than S200 bdfaoa by Our deficit reduction phn canuim 1997 only to rise again to more than . approximately $100 biDka in apeodbtf $300 bilbon by the turn of the century. cuts, described in a 30-page document, Even Omton adnowledged that more' outlining nearly 100 qiedfic propotah. must be done to restnan apendng. While the Clinton adnanttfntion ttfcs' in exchange far votes on ha about a federal work-force reductioo td package, Qmtai agreed to initiate an­ 252,000, our plan locks it sto law. We other remd of budget cuts m the td. recommend terminating outdated federTh-e president's reaasanc package, an­ I al programs and agencies, nch u the nounced this month, while savng only Intenute Commerce Coonisskn. Wb $10 bilbon over five yean fulfills his propose means-testing of coatly entitle­ cunmiUucnt and serves as the vehicle ment programs for wrahhy Americans. , by which deeper cats can be otfered. But the most disappointing feature of Unfortunately, the aavmgs m tbe rescis­ The Post's editorial was its compiamt sion package are already bang pledged that some ol the savings in the Peony-to new pending programs. Kasich plan are needed just to reach the Bolder steps are needed That is why existrng discretionary spendag caps. To under the Penny-Kaach plan all savings accept this argument, you mst abo are dedicated to defcit reduction. What accept that domestic vending has been we propose is, aAruttedty, tough medi- cut to the bone and there wiD be no dne. But it is wtuc the Amencan people place to look far addiboaal savings it are demanding and what the economy next year's $1.5 trillion federal budget needs for Jong-term growth. The fact ia, domestic discretionary ipfiidiiig, tar from being cut under the Tim Penny is a Dtmocrattc Cbnton budget, actually moeases. The ! rtpnstntotivtfrom Mtnnesota. John admrntstntjon never intended to uae Kasich is a Republican reductions such as those included io threpresentativee from Ohio. Pttmy-Kaaidi plan. Its budget met the discretionary op by reiynf solely 1 iecuts. can get better care from a primarily white medical establishment.

REPORT ON DEL. HEALTH RELEASED: Breast cancer and heart disease are among the top health problems that Delaware can help reduce by taking specific actions, said the new Health Delaware 2000 report released Monday. The report included specific actions that officials could take. Health Editor: Christopher Goldthwaite. (1-910-855-3491) Making copies of USA TODAY Update (Copyright, 19 94) for further distribution violates federal law.

REPUBLICANS TAKE AIM AT CLINTON HEALTH CARE PLAN By ELIZABETH NEUS=Gannett News Service= WASHINGTON President Clinton's health care reform plan contains a $1 trillion gap between the benefits promised and the money available to pay for them in the first seven years, says a GOP analysis that termed it ''quack economics.'' The Republican staff of Congress' Joint Economic Committee said the only way to make up the huge shortfall would be to increase?the? federal deficit,Praise?taxes on income or payroll, or institute strict price controls and rationing of care. ''It all feels too slick,'' said Lawrence Hunter, Republican staff director and one of the co-authors. ''The plan is quack economics. It's not even close to being financially coherent.'' The report was released the day before Clinton's State of the Union address, expected to focus on health care reform. Congress, which returns to work Tuesday, already has begun hearings on his Health Security Act and soon will begin debating the bill in earnest. Republicans lately have been saying the plan could be too much a shock to?the?nation's economy, and so reform should occur slowly. Leading Democrats disagree. ''Oh, I think there's a crisis,'' House?Speaker?Tom Foley, D-Wash., said on ''CBS This Morning'' Monday. ''It's a crisis in financial terms. It's affecting business, families and the government, the federal government.'' The Clinton plan would be financed through a combination of premiums paid by workers and businesses, additional taxes on cigarettes and corporations that form their own buying pools, and savings. Financing has been controversial from the beginning, largely because the plan promises extra benefits without additional spending. So far, the only other major analysis of the plan's financing came from the independent health policy firm of Lewin-VHI. That report found the financing assumptions basically sound, but said the White House had underestimated much of the cost of its plan. Lewin, for example, estimated premiums would cost about 17 percent more than administration predictions. A premium for a two-parent family would cost about $4,360 per year, with the family paying $872. The GOP also said premiums would be higher, but did not specify by how much. White House officials did not return calls seeking comment, but The Associated Press quoted Kenneth Thorpe, a deputy assistant secretary of health: v'The assumptions underlying it are simply incorrect. There is no financing gap.' ' Other findings of the GOP report, which analyzed the administration's own numbers and economic assumptions: The gap between the estimated cost and the money available to pay for it would mount daily, and would average about a $1.2 billion shortfall per day. To pay for his promised guaranteed universal benefits package, Clinton must find between $300 billion and $555 billion extra per year in tax revenue the equivalent of raising income taxes $2,700 per household per year but the financing outlined comes up with about $390 billion to pay for new benefits. The plan contains many internal inconsistencies, among them the promise to add new benefits while simultaneously cutting spending and limiting the amount people and businesses will have to pay for premiums. ''Even the casual observer gets the feeling that there is a pie-in-the-sky quality about (Clinton's promises),'' Hunter said. Republican House members who listened to the presentation Monday seemed disappointed the plan hadn't been savaged even more. ''Isn't this an understatement, and a dramatic one, of the shortfall?'' asked Rep. Christopher Cox, R-Calif. ''These are our lower-bound estimates of the gap rather than our best estimate,'' said Morgan Reynolds, a Texas A&M economist and the other co-author. ''What today's study indicates ... is that there's simply not enough revenue being generated by the Health Security Act. It is over-promised.'' Rep. Richard Armey, R-Texas, sent a letter to first lady Hillary Rodham Clinton Monday along with the report. ''This paper raises disturbing questions about the true cost and the real consequences of the Health Security Act,'' he wrote. He also sent copies of the report to Clinton's economic team and senior health care adviser Ira Magaziner. Two other House members plan to introduce a resolution later this week asking the premiums collected from businesses and workers to pay for health care reform be counted as part of the federal budget. The Congressional Budget Office is trying to decide whether health care premiums should be considered a tax and therefore part of the budget, where costs easily can be monitored. x,If we are going to transfer health care to government control, then the government's budget should treat that decision honestly,'' said Reps. Wayne Allard, R-Colo., and Tim Penny, D-Minn.

ADMINISTRATION DEFENDS HEALTH SPECIALIST PLAN WASHINGTON, Jan 24 (Reuter) - Administration officials Monday defended President Clinton's health care reform proposal to reduce the number of medical specialists against criticisms it would hurt big city teaching hospitals. ''We have an oversupply of specialists and it does increase costs,'' Health and Human Services Assistant Secretary Dr Philip Lee told reporters. President Clinton's plan requires medical schools to train at least 50 percent of their physicians in general care and allocate the number of residency slots through a new national medical education council. But New York hospitals have expressed concern that the proposal would affect them disproportionately because they now train about 15 percent of the country's medical residents and specialist training is a major attraction. Those concerns were outlined in a front page story in Monday's New York Times, prompting an administration response. Lee said similar worries have been expressed by hospitals in Boston and other areas. But he argued that as long as they provide quality training programmes they need not worry about bearing the full brunt of the plan to reduce the number of specialist doctors. ''We are not going to do it on a regional or per capita basis,'' Lee said. A national council will allocate residency slots based on a facility's quality, he said. Lee also said Clinton's plan will increase the amount of medical research money. Those hospitals that rely on residents as a cheap pool of labour to provide care to poor people will benefit from the health reform plan HEALTH-CARE OVERHAUL OR GO-SLOW REFORM? Charlotte Observer (CO) - SUNDAY, January 30, 1994 By: R.A. ZALDIVAR, Knight-Ridder Newspapers Edition: ONE - FOUR Section: PERSPECTIVE Page: ID word Count: 914 TEXT: WASHINGTON - With President Clinton's ambitious health-reform plan getting a lukewarm reception, lawmakers are taking a second look at more modest approaches that stop short of overhauling America's health-care system. The changes are not exactly baby steps. Modest reforms, such as requiring insurance companies to accept people with pre-existing health problems, would help millions of people, with minimal government intervention or taxpayer expense. But there's a catch. The cautious approach doesn't guarantee that every American would have health insurance - a benefit that a majority of the public wants, according to polls. Proponents say universal coverage must wait. Nonetheless, the go-slow school is shaping up as a major influence in this years health-reform debate. If caution becomes the watchword, Clinton could be forced to compromise on a longer phase-in for universal insurance coverage, or the elimination of contentious features like federal cost controls from his plan.

x'Many moderates are increasingly eyeing with longing some of the more modest incremental approaches - not because of what they do, butbecause of what they don't do,'' said Drew Altman, president of the Henry J. Kaiser Family Foundation, a health-care philanthropy based in Menlo Park, Calif. ''They don't regulate, they don't raise taxes and they're less open to charges of big government,'' added Altman, who supports comprehensive reform to guarantee insurance for all. Republicans are beginning to come together on cautious change as the GOP alternative to Clinton's plan. ''We can't wait on a consensus for universal coverage,'' said William Kristol, chairman of the Project for the Republican Future, a Washington think-tank promoting the idea that there is no widespread health-care crisis. ''Let's fix what needs to be fixed and let's not endanger the qualty of American health care.'' Many Democratic lawmakers also harbor sympathies in that direction. Indeed, Treasury Secretary Lloyd Bentsen got a modest, bipartisan health reform bill through the Senate in 1992, when he was chairman of the tax-writing Finance Committee. (Opposition from House Democrats ultimately killed it.) ''I want universal access,'' said Rep. Tim Penny, D-Minn. ''Let's reform the system in a way that makes it more likely that the uninsured have access to insurance. I think universal coverage is the second step.'' Of the major health-reform bills on Capitol Hill, one offered by Rep. Bob Michel, R-Ill., probably comes closest to reflecting the cautious, or incremental, approach. Clinton's bill would accomplish most of the same goals, but does not stop there. Here are some of the major elements of go-slow reform: * Making health insurance more available, as opposed to requiring everyone be insured. Changes would include guaranteeing that workers could keep their insurance when they switch jobs, limiting or eliminating denial of insurance to people with pre-existing health problems, guaranteeing that health insurance would be renewable and requiring employers to offer - but not pay for - insurance for their workers.

* Helping people through the tax system. Self-employed workers would be able to deduct the full cost of their health-insurance premiums on their income tax. Low- to moderate-income people would be eligible for tax credits or tax deductions to help defray the cost of health insurance.

* A focus on small business. Insurance companies would be limited in how much they could charge small firms and how steeply they could raise rates. States would be encouraged to form voluntary insurance purchasing alliances for small business.

* Reforming Medicaid. The federal-state health program for the poor would be overhauled to cut costs through managed care programs such as health maintenance organizations (HMOs), and expand the number of people covered. The incremental approach avoids Clinton's requirement that all employers pay for their workers' coverage, dispenses with a national health board to oversee the medical system and imposes no spending caps. That appeals to people who want to keep the government from assuming a bigger role in health care.

Government should limit itself to fixing inequities in the current system and helping the chronically uninsued, said Pete Shintay, a self-employed investment adviser from Charlotte. ''Let government focus on that and let everybody else be,'' he said.

In town meetings in recent weeks, members of Congress have heard similar objections to big government bureaucracy, as well as worries from people with insurance of new limits on their benefits and higher costs under Clinton's plan.

However, Clinton appears to have convinced a majority of the public that health reform must produce guaranteed coverage for all. Given a choice between Clinton's plan and a less expensive congressional proposal that might leave 10 million uninsured, 69 percent opted for the president's proposal in an NBC News/Wall Street Journal poll last month.

And the bill the pollsters had in mind was the bipartisan proposal by Rep. Jim Cooper, D-Tenn., which is more far-reaching than Michel's. congress confident of health care magic act say there are three ways to accom­ By Karen Riley plish the goal of universal coverage < THE MWSHMOTON TWES —increase taxes, force employers to There is a bipartisan President Clinton's ambitious pay for their workers and require plan to reform the nation's health individuals to pay for themselves. coalition that care system has stumbled and sput­ The Clinton plan largely rejects tered since Congress relumed last taxes in favor of employer and in­ ultimately comes > month, but lawmakers from both dividual mandates, putting 80 per­ together. The Clinton parties believe that they can get a cent of the burden on employers, a comprehensive bill enacted. ratio that mirrors the way most com­ proposal gets defined And with the start of the congres­ panies now pay for health care. sional election year, they've begun It will be difficult to sell an em­ out of the ballgame, searching for the magic formula that ployer mandate. Most businesses but ift not clear can survive Congress and be signed are against it. The National Feder­ by the president. ation of Independent Business has where the coalition is "The bipartisan middle ground mobilized its 300,000 members to going to coalesce." mayojjly-be-about 1 inch wide," Rep. stop the mandate. Last week the U.S. Jin££oopei^3ennessee Democrat, Chamber of Commerce and the said ShTspeech to a seniors group Business Roundtable rejected the last week. Mr. Cooper is the chief administration's bill largely because Nearly all companies would buy sponsor of the only bipartisan health of the mandate. their health care from one of the refonn proposal, one of several al­ But arriving at universal cover­ plans selected by an alliance. tematives on the table. Hillary Rodham Clinton has led the Rep. Jim Cooper has the only plan Rep. Robert S. Walker says the age — or nearly universal coverage But until that system is running, Getting 218 votes in the House fight for the administration's plan. with strong bipartisan support. Clinton plan has no hope ol winning. — is less daunting than it seems. Al­ the White House proposes a back­ and 51 votes in the Senate is a trying though 37 million people are without stop — caps on insurance premium task on most issues, but it's over­ health insurance at any time, most increases and fixed budgets for the whelming if you propose a change and reinforced their view that the and how health plans will compete. "I think they're smothering it with are uncovered for only a month or alliances. that would eclipse Social Security in health care system is not broken and Numerous committees in the deals and attention They should two. Seven million Americans are Rep. DaffRostenkowslsv/ Illinois its magnitude. requires only incremental changes. House and Senate are immersed in go south for a while and sit in the sun chronically uninsured. Democrat tod^hairmafiof the Ways "We're going to have to do this to Liberals said the report backed their health care hearings. Committee and reflect on the work they've "A fair portion of the president's and Means Committee, has said he gether. It can be done; we are at a view that the only way to control chairmen plan to pass their bills by done." plan is going to be stripped out. but wont support a bill without cost con­ point when we can do it," said Senate health costs is with a government Memorial Day so the two houses can Mr. Clinton and first lady Hillary the basic universal coverage will be tainment. Finance Cunupittee-Chairman Dan­ takeover of the system. consider legislation in June. Rodham Clinton, who has led the ad­ there. Most of the insurance reform But Republicans, conservative iel PatricW^Moynihaip New York Rep. TinMlhyUPennyTMinnesota Besides the authors of the various ministration's health care reform ef­ will be there The president then Democrats and nearly all of the Democrat. Democrat, said She~eBO report proposals, the key figures in the fort, are stumping to drum up sup­ will declare victory, and it wont mat­ health care industry oppose pre­ Rep. Robert«^tolken^ennsylva- causes "multiple problems'' for the debate will be the committee and port for their plan. The Democratic ter if it bears no resemblance to^iis mium caps, which they view as price nia Republican,-a-mernber of the Clinton plan but does not kill it. subcommittee chairmen, congres­ National Committee has stepped upi btifasit wnt in/'saidSen. BdbPackP controls. House minority leadership and His advice is to "just get every­ sional observers said. its lobbying effort, running a new,^woodpOrego n Republican andTfie "Price controls and global bud­ critic of Mr. Clinton's proposal, said: body in the same room It seems "They're not marking up for their television ad this week that chastisesi rafilung minority member of the gets must lead to health care ration­ "There is a bipartisan coalition that to me that if you've got a large con­ health. They're marking up because Republican attitudes toward health Senate Finance Committee. ing," said-HouM Minority Whip ultimately comes together. I dont stituency within the Democratic they have sometjiinretseto say," said care. Mr. Packwood said the chief ques­ N$wt^ingrichM)Georgia. think we're there yet. The Clinton caucus and maybe a third of the Re­ Rep. I^tricia^Schroedeiijfcolorado proposal gets defined out of the ball- The goal of universal coverage — tion for him is how to achieve univer­ fty opponents of Mr. Clinton's publicans that really are willing to Democrat. "MarKing up^is the alter­ like mom and apple pie — has broad sal coverage. He predicted the final plan agree with the concept of fos­ game, but it's not clear where the come to the tabic, get them all to the coalition is going to coalesce." ing of legisUyiotUn committee. support in Congress and with a vast product will require all Americans tering competition among health table and let's quit trashing some­ Rep. P^eStark^alifomia Demo­ array of interest groups. to purchase insurance, but busi­ plans by having them join forces in The latest blow to the Clinton plan body else's plan." crat and tfieTHairman of the Ways "Individuals, employers and gov­ nesses will not have to provide it. cooperatives, but they believe such came when the Congressional Bud­ Most political observers say the and Means health subcommittee, ernment all share responsibility for A second issue is how to control arrangements should be voluntary. get Office this week said the pro­ key to compromise is finding a way said the work of the committee paying for reform," said Dr. James health care costs. Mr. Clinton pro­ The Clinton plan would make them posal would boost the deficit by S126 to guarantee health coverage for ev­ chairmen will be"radically different Tbdd, executive director of the poses doing that two ways. First, he mandatory. billion over 10 years, not lower it as eryone — President Clinton's bot­ from the president's plan." American Medical Association. would create regional health alli­ After the CBO report was re­ Clinton officials had estimated. tom-line demand for any bill to avoid A critic of the White House's lob­ But who should bear the cost of ances that would have the bargain­ leased TUesday, Mr. Clinton's sup­ Conservatives said the report ef­ a veto. Other pivotal issues are how bying on health care, Mr. Stark had that coverage is more controversial. ing clout to negotiate with health porters started circulating propos­ fectively killed the Clinton proposal health care costs will be contained some advice for the administration. Mrs. Clinton and policy-makers plans for the best rates. als for trimming the cost of his plan. BUDGET

By the Numbers

t was quickly apparent that Robert cutting the deficit by $58 billion over six Since the Congressional D. Reischauer's mike was dead as, years, the CBO said, it would swell it by Budget Office was facing the glare of hot lights and tele­ $74 billion—the office gave ammunition vision cameras and the somewhat aplenty to Republicans and proponents created 20 years ago, friendlieI r gazes of a half-dozen Senators, of other plans. And its treatment of the he began his synopsis of the Congressio­ Clinton plan's mandated employer pre­ it's been grinding out nal Budget Office's (CBO) eagerly await­ mium payments as part of the budget, analyses and ed annual economic and budget outlook. rather than off-budget as the White Several failed fix-it attempts prompted House wanted, allows the GOP to roll projections—and Budget Committee chairman Jim Sasser, out the T-word—a move that could pack D-Tenn., to invite Reischauer to take a big political punch. dodging partisan well-miked empty seat on the panel's dais Rep. Richard K. Armey, D-Texas. a to deliver his message. Maybe by chance, frequent CBO critic, had said earlier that sniper fire. Now the maybe not, Sasser indicated a chair on the office's integrity was "on the line" CBO is being tested as the Democratic side. The CBO director with this analysis. After he heard the smiled and hesitated a half-beat. "Well. I news, he said that "Reischauer, agonized never before by the could sit over there for half of my testi­ as he was, made a good-government deci­ mony, and over here for the other half," sion that will maintain the veneer of a rapidly accelerating he said, pointing to the GOP side. nonpartisan CBO." debate over health Reischauer's quip neatly summed up Democrats hailed the CBO for saying the delicate position he's often in: Trying that Clinton's plan would begin cutting care reforms. to maintain the credibility of the analyses the nation's health bill by 2000 and criti­ and projections the office is required to cized it for wanting to include the premi­ grind out while keeping most of his con­ ums in the budget. Clinton's first reaction gressional masters happy and somehow to that decision's impact on the deficit BY VIVECA NOVAK dodging partisan sniper fire. was, "We'll fix that." "We are an analytical institution that's An uncomfortable Reischauer, mean­ asked to be objective and shoot straight while, urged Congress to balance the and let the chips fall where they may," deficit projections with the advantages of Reischauer said in an interview, "that is universal health coverage. imbedded in an institution that is all poli­ Since last fall, the pressure on the CBO tics. The danger always is that the host had built. For a while, the question of institution, when the stakes are very high, taxes or premiums, on-budget or off, can't or doesn't want to accept politically were staples of small talk in Washington, damaging information and might choose where hipness is sometimes measured by to in a sense kill the messenger or banish one's glibness with acronyms of lesser- the messenger." (Fora report on President known government programs. Clinton's fiscal 1995 budget, see this issue, In late October, Republicans tried to p. 368.) tack on to temporary spending legislation For the most part, the CBO has walked a provision directing the CBO to count the fine line steadily. But now, 20 years the health insurance premiums as taxes. after the 1974 Congressional Budget Act That message was echoed in a Nov. 19 brought it into being, the stakes have letter to Reischauer signed by three never been higher for the office. Nothing Republican House leaders and the rank­ it has produced in the past has drawn as ing GOP members of all committees with much pregame day pressure as its Feb. 8 health jurisdiction. analysis of Clinton's plan for overhauling In early December, The Washington the nation's health care system. And Post's, David S. Broder wrote that the when all is said and done, it's likely that CBO had already made its mind up to never will its decision-making process keep the bulk of the package off-budget. have been so intensively probed. Reischauer denied it. but the report trig­ With its decision that the Clinton gered a visit from five House Republi­ plan's numbers don't add up—instead of cans, led by Minority Leader Robert H.

348 NATIONAL JOURNAL 2/12/94 Michel of Illinois. He acted like a man who felt like he was on the rack." Thomas J. Bliley Jr. of Virginia, one of the five, said ot Reischauer. "Let's tace it. lie was between Seylla and Charyhdis. On the one hand was his eredihilii\. on the other hand his job." ,-*T^vj'. Days before the analysis was set for release. Reps. Wayne Allard. R-Colo.. and Timothy J. Penny. D-Minn.. intro­ duced a resolution to require that all health care legislation be on-budget. "Do you believe the largest entitlement pro­ gram in U.S. history should be off-bud­ get'.'" Allard asked in a "Dear Colleague" note. A similar resolution was introduced bv Sen. Judd Gregg, R-N.H. During a Jan. 27 hearing on the CBO's economic outlook, lour Republicans asked Reischauer about the health care analysis and told him where he should come out. "1 wanted to publicly acknowl­ edge that I'm fully aware ol the pressure that you're going to lace, and we in the minority will surely not want to lessen that pressure.'' said Sen. Pete V. Domcnici of New .Mexico, a onetime Budget Committee chairman. House and Senate Democratic leaders. House Budget Committee chairman Martin Olav Sabo. D-Minn.. and numer­ ous other Members and ke\ staff spoke w ith Reischauer and sonic ol his team of 35 or so aides who were spending at least pan of their time untangling and quanti­ fying ihe bill. The White House tunneled us pressures through congressional offices-, of course, il couldn't have been clearer what il wanted. Alice M. Rivlin. the CBO's first director and now deputy director of the Office of Management and Budget (OMB). was in touch with Reischauer. her former aide from the CBO's early days.

AT LAST, A LITTLE RESPECT Oddly, il was less than two decades ago that the CBO's founders, of whom Reis­ i chauer was one. had to work to persuade Congressional Budget Office director Robert D. Reischauer Washington to pay attention to them. On any day, many "are concerned, upset, distressed by something we've done." The CBO was hardlv the locus of the ll.»74 budget law. and there was little defi­ KS?. the CBO helped Congress assess its mgton. "Legallv. OM13 eslimales prevail, nition lo the office's portfolio when it compliance with that vear's Balanced bui as a practical mailer, as Congress opened us doors. But it quickK became a Budget Act's deficit targets, further considers legislation, thev rely on CBO. presence The CBO was credited, or enhancing its status. Then, with the 1W(I "The budget process now endows CBO blamed, tor sinking President Carter's Budget Enforcement Act and Us accom­ numbers with a power that means lile or wellare relorm plan. panying caps on discrelionaiv spending death for particular programs and is LventualK. the CBO's main acidities and its pay-as-you-go rules m the enmlc indeed alfccung the design ot programs." became clear. Scoring bills lor their bud- ment and tax areas, the CBO ami its Penner said. Clinton's health care pro­ gel impact I w hich did in Carter's welfare numbers crunchers took on even bioadci gram is a case in point. The Adminisira- proposal), makitii! economic and budget aulboi itv. tion would not have put price conirols m pro|cctions. analvziiii! program and poli­ - The caps and pa>-as-vou-go rules |ils health reforni plan) but lor the hope cy issues attectmg the budget and—since have all gi\en CBO estimates new [low­ that thev would be scored" bv the CBO m7lJ—printing a widelv distributed book er." said Rudolph G. Penner. who was as sav ing inoncv. of options lor reducing the delieit the office's second director and is now- Reischauer is consianllv called on to The office's inipoi lance grew in IMS I. senior manager of ki'MG I'eat Mar- luck his rangv frame behind one witness as OMB became more politicized. .Alter wieks policy economics group in Wash table oi another. In IW.v he appeared

NATIONAL. IOLRN.AI. 2 i:,l)4 J49 before congressional panels 23 times, and when he promised to use "the indepen­ some years have been much more inten­ Anyone who thinks dent numbers of the Congressional Bud­ sive, as '94 is likely to be. In a two-week get Office" in putting together his eco­ period at the end of January and the the CBO has been nomic plan—as opposed to figures from beginning of February, Reischauer was OMB, which have always been thought on six witness lists. more politically skewed. (This year's The CBO's credibility has been en­ a lapdog for budget reverted to using OMB's num­ hanced by the fact that its economic and bers.) deficit projections, while generally too the Democrats The critics include Rep. Jim Kolbe, R- rosy, have been closer to the mark than Ariz., a Budget Commitee member, who OMB's over the years. In its forecasts of need only look at has called the CBO a "budgetary brothel, economic growth, for example, it beat . . . little more than a campaign research OMB in 6 of the 10 years ending in 1992 tool for the majority." The American and tied it in one. its review of Spectator has tried to discredit it by point­ Both OMB and the CBO grossly ing out that in 1992, a CBO aide was underestimated the impact and duration Clinton's budget named to head the Democratic National of the recession of the past few years, Committee's opposition research team. leading to overly optimistic revenue esti­ The CBO's most vocal detractor by far, mates and no sense of the massive de­ in 1993. though, has been Armey, an economist mand on food stamps, medicaid and and chairman of the House Republican other government programs as a result. Conference. "These are generally very Reischauer, a 53-year-old Harvard professional, well-trained people who University graduate with a Columbia scuffling after Penner's departure to would like to do their best work and doctorate in economics, helped Rivlin set choose a new director. Then-Speaker maintain their standing in the profes­ the place up. (The office staff remains at Thomas P. O'Neill Jr., D-Mass.. had sion," he said. "But they are under enor­ about 220, small enough for everyone to pushed Reischauer for the slot after mous pressures, and at times, they clearly be on a first-namebasis. ) Rivlin guided it Rivlin left, but he was considered too lib­ have produced work product that has a through two four-year terms, then Pen­ eral by the Republicans who then con­ partisan bias and has been used by the ner, a Republican, took charge from trolled the Senate. He finally got the nod majority for political purposes." 1983-87. Reischauer, meanwhile, had left in 1989. Armey cites several examples of what in 1981 to be a senior vice president of The CBO's leaders have all been wide­ he views as the CBO's kowtowing. Espe­ the Urban Institute, then a senior fellow ly respected. Still, there have always been cially serious, to Armey, was a flap over at the Brookings Institution, where he accusations of bias—from both sides. Its calculations of income distribution in once again was a colleague of Rivlin. The three directors have faced threats of 1992—data that were then used by Mas­ sachusetts Institute of Technology economist Paul R. Krugman to show il what many analysts had believed for some time—that the rich, unlike almost everybody else, got quite a bit richer dur­ ing the 1980s. Democrats used the data to fuel the "fairness" theme in the 1992 campaign, and Clinton used it heavily against President Bush. But Armey and other conservative Republicans found fault with the CBO's definition of family income, its treatment of capital gains income and how it took account of income mobility. Reischauer responded that even with adjustments, the general trend was the same: The rich did get disproportionately richer. Moreover, he said, private econ- \ omists had found the same drifts. And i the model the CBO used for its measure- ; ments was developed under former direc- I tor Penner. = Contrary to Armey & Co.'s assertions, Rudolph G. Penner, a former CBO director Penner said the flap has nothing to do "As a practical matter, as Congress considers legislation, [Members] rely on CBO." with the degree of behavioral response built into the CBO's models versus oth­ son of famed Japan scholar Edwin O. removal and warnings that the office ers. "Congress should take these [distri­ Reischauer, he has written extensively on itself would be dissolved. The numbers it butional tables] as one bit of information, social welfare issues, education, budget issues are regularly picked apart. but not as defining. But when a table policy and state and local fiscal problems A few Members, though, have ques­ appears on the front page of The New and was a domestic affairs adviser to tioned the CBO's claim to nonpartisan- York Times or The Washington Post, Democratic presidential nominee Mich­ ship for years now. When Clinton gave Congress is almost forced to take it as a ael S. Dukakis in 1988. his first State of the Union speech in truth from the gods." he said, lamenting It took two years of House-Senate 1993, snickers came from the GOP side press misinterpretation.

350 NATIONAL JOURNAL 2/12/94 Armey also made much of errors in the min istrations reinventing-government Reischauer said one of the main rea­ CBO's estimates of capital gains income, initiative would save $5.9 billion over five sons the CBO has been able to continue which were off by more than 100 per cent years. Try $305 million, the CBO said. drawing such good reviews is that it in 1990 alone and helped kill efforts to And its estimate of the five-year impact doesn't issue policy recommendations— reduce the capital gains tax rate. Reis­ on the deficit of the huge budget package unlike the General Accounting Office, chauer admits to the CBO's "'badly over­ passed by Congress also fell short of what another research arm of Congress that estimating" capital gains for a three-year the Democrats were saying: S433 billion has garnered far worse notices for. in the period but adds that in the previous four ($477 billion if it used the same baseline words of a Republican House aide, "pan­ years it had underestimated them. "We as the White House), as opposed to $496 dering to requesters" of its reports. are continually adjusting our models." he billion. It's not that Reischauer never opines. said, "and probably overcompensated Over all. far more Republicans than Last fall, he testified against two-year bud­ just as capital gains went in the tank" not respect the office, it seems. Many, geting, for example, saying it would force with the collapse of the savings and loan like Domenici, are big boosters. Members to rely too much on faulty long- industry and the real estate market and Even at the libertarian Cato Institute, range economic and budget forecasts. other changes in the economy. which is economically conservative, there Members, he added, should be forced to Armey, frustrated with the CBO, the is a split. "It's more and more clear that if confront the deficit every year and decide congressional Joint Committee on Taxa­ the Democrats have a program they want whether to act. Reischauer has said he tion and the Joint Economic Committee, to justify, the CBO will give them the feels like the Energizer bunny with his has turned elsewhere for numbers, set­ numbers to justify it," Cato president never-ending deficit remonstrations. ting up the Institute for Policy Innovation Edward H. Crane III said. On welfare reform, Reischauer has in Lewisville, Texas,, which is underwrit­ But Cato chairman William A. Niska- said: "If you look at our current welfare ten in part by such-conservative founda­ nen Jr.. who was a member of President system, we basically do what is the cheap- tions as John M. Olin; its primary Reagan's Council of economists are known as supply-siders. Economic Advisers, But not even many other congressional calls the CBO "a quite Republicans have high regard for the responsible group. group's work. "Its forecasts have Armey introduced a bill in the previous typically been more Congress to give the ranking minority accurate than those of members of the Budget Committees a the Administration," say in recommendations for new CBO he said. "It seems like directors. Currently, those panels send a government model names to the House Speaker and Senate of Brookings. They President Pro Tem, who make the deci­ are basically respon­ sion; some Republicans have complained sive to the Democrat­ that the CBO can't help but be influ­ ic majority, but that enced by knowing who controls the direc­ doesn't mean they are torship. The bill would also have created entirely captive." a bipartisan, 13-member oversight board "There's no doubt to ride herd on the CBO's work. It died about [the CBO's] and was not reintroduced. integrity." said Mark Some Democrats also complain about A. Bloomfield, presi­ the CBO's alleged political fouls. In 1991, dent of the American then-Finance Committee chairman Lloyd Council for Capital Bentsen, D-Texas, helped defeat a pro­ Formation — even posal by Sen. Daniel Patrick Moynihan, though he disagrees D-N.Y., to cut social security taxes with with the office about the assistance of a CBO report showing the impact of tax poli­ that such cuts would lower savings, drive cy on the economy. inflation up and lead to slower growth of "I'm a big fan of gross national product. Moynihan aide CBO; they do the best Eduard A. Lopez was furious when he analytic work in this found out the study had been finished for town, and they are almost a month but that Bentsen had willing to stick their been able to save it for a strategic necks out." said Ron moment. Boster. a longtime minority budget ex­ pert and now admini­ Rep. Richard K. Armey, R-Texas MIND THE TEETH strative assistant to The CBO's calculations can be tainted by partisan bias. Anyone who thinks the CBO's a lap- Rep. Rick A. Lazio, dog for the Democrats, however, need R-N.Y. "I'm absolutely convinced there's est way of solving our guilt or our obliga­ only review the past year. The office a healthy, dynamic, honest debate going tion. Wc put a little money out on the scored Clinton's budget $61.4 billion on there." stump and don't provide many support short of its goal over five years, giving Penner summed it up this way: "You services and say, "Low-income people, » conservative Democrats a chance to force get screamed at a lot by both sides. Some you can take it." " more cuts in the bundle. In mid-Novem­ of it's public, but much more of it's pri­ Reischauer, in his January testimony ber, the CBO exploded White House vate. If you're kicked from both sides, on the economic outlook, included com­ projections that the first leg of the Ad­ you stand up straight." ments about the proposed balanced bud-

NATIONAL JOURNAL 2/12/94 351 get constitutional amendment, something taken on an importance they probably "taxes" or not—but it's enormously he surely didn't have to do; he called it a don't deserve," Penner said. "This enor­ important politically. "radical response," inappropriate for a mous, complex budget process is so com­ Reischauer in September voiced time when "existing procedures and plicated that we spend as many resources doubts about the budget process itself, political pressures" were working. He administering it and trying to satisfy it as saying it "clearly restrains our ability to also warned that the economy, while on we do trying to figure out what's good do some long-run, sensible changes." the upswing, was still not going gang- and bad policy." While the process has "We're in this because we think we as a busters—seeming to give Democrats had a good disciplinary effect on Con­ society spend too much on health care implicit permission not to vote for anoth­ gress, he said, "The point is that we are and think we could have basically the er big round of budget cuts this year lest getting too involved in the arbitrary mat­ same outcomes or better devoting a they slow the recovery. He backed off shy ter of satisfying the budget process." smaller over-all portion of our resources of an actual recommendation, though: CBO deputy director James L. Blum to health care," Reischauer said. "Exactly when you take the next bite out cited a case in point: the current effort to Reischauer doesn't necessarily relish of the apple is really up to you." develop buyout legislation to let federal the limelight, especially these days. He'd On health care, many suspect Reis­ agencies downsize by offering bonuses be just as happy to have the CBO's im­ chauer of personally favoring a single- for early retirements and resignations. portance wane, since that would probably payer system, with the government in While over all, the projected savings far mean that the deficit was under control. charge, but if he does, he's been careful outweigh the costs of the program, the In January, Reischauer was unusually to watch his words. Still, it's clear that he scheme doesn't satisfy current scoring welcome on Capitol Hill. The projections he presented for the next five years were far more optimistic about the deficit and the economy than those he'd given Members a year ago. Still, more often than not, he's been a bear­ er of bad news who's had to scramble not to get caught in the policy cross fire. "This is an im­ mensely politically charged environment we live in," he said. "We produce infor­ mation, that informa­ tion enlightens some, for others it is simply a spear or sword in a battle. There's very little we can do about that. On any single day, there are a large number of Members and interest groups William A. Niskanen Jr., a former member of President Reagan's Council of Economic Advisers around the country The CBO is "basically responsive to the Democratic majority," but that doesn't make it "entirely captive." and people in the Administration who are concerned, upset, distressed by some­ thinks it's an issue that needs to be rules. "This is a situation where a good thing we've done." addressed. For years now, he's been case could be made for waiving the bud­ telling Congress that the core of the get rules," Blum said. Reischauer was obviously uneasy about deficit problem is health care costs. And Health care, of course, is a far more the health care reform report. "I have he's said that reform is essential "not only important example. "It really is madness considerable foreboding," he told the from the standpoint of the impact ... on to have this decision depend on what House Ways and Means Committee, that the economy, but also from the stand­ CBO can or cannot score." Penner said. "the CBO report might be used in point of equity." Reischauer has been issuing similar destructive rather than constructive ways warnings since the fall, saying that over­ ... to undercut a serious discussion of emphasizing the short-term savings of health reform altematives." OK, GANG, LIGHTEN UP! something like health reform or an over­ He won't say so. but it seems likely that It's perhaps ironic that two decades haul of the welfare system is shortsight­ his decision about whether he'd like after the CBO and the budget process ed—especially because the CBO's, or for another term as the CBO's director—his were created, there's growing suspicion that matter anyone's, scoring of a com­ is up early next year—will depend in part among many analysts that everybody is plete revamping of a seventh of the U.S. on the intensity of the fallout from the making too much of it all. economy is riddled with uncertainties. It office's health care reform analysis. "I'd "I think everybody who has anything to matters little in the broad scheme of be ready for a tour of Bosnia after this do with these numbers feels thev have things whether something is labeled job," he said with only a touch of irony. •

352 NATIONAL JOURNAL 2/12/94 Thoma5<^ a steering committee member of the House Rural Uealt^Qare Coalition, outlined suggestions contained in a rural health care reform bill that he sponsored. • "lisZJiJl'l Provisions include improving recruitment programs and preventing insurance cancellation for pre-existing conditions. ''Congress cannot afford to implement a national health care program that discriminates against rural people,'' he said in a copy of his testimony. 41 Rural folks deserve access to quality health care just as much as those living in inner cities. And any comprehensive reform plan must take that into account.''

Budget Office Said Likely to Consider Health Plan Part of Budget By CHRISTOPHER CONNELL= Associated Press Writer=

WASHINGTON (AP) Feb 8 -- The White House says President Clinton won't be deterred from pursuing private health insurance for all Americans even if the Congressional Budget Office insists on counting the premiums as federal spending.

But a Republican lawmaker says such a ruling would inflict ''a real body blow'' to the White House plan. If health insurance premiums are considered federal spending and part of the budget it doesn't change the administration proposal but it becomes vastly more costly on paper. It would also open the administration to criticism that it is sharply increasing the budget or raising taxes.

CBO Director Robert D. Reischauer was delivering his agency's verdict today on whether Clinton's numbers add up and whether the president really can cover all Americans and reduce the deficit without a major tax hike.

White House officials said Monday the administration expects Reischauer to recommend that Clinton's mandatory premiums for employers and individuals be counted as part of the budget. The officials spoke on condition of anonymity.

Democratic congressional sources said the CBO report would have both good news and bad for the White House.

These sources, who also spoke on condition of anonymity, said the CBO had concluded the premiums were not a tax, but were like a tax and had a budgetary impact and should be considered on-budget, not off. But they said Reischauer, a Democratic economist, also had concluded Clinton's numbers add up and that the program could pay for itself.

The mandatory premiums on all employers and individuals would likely exceed $1 trillion from 1998 to 2000 and make the task of passing Clinton's Health Security Act even more daunting.

Clinton's fiscal 1995 budget estimates the total federal cost of the health plan at $396.8 billion between 1995 and 2000, including $58.5 billion for deficit reduction.

But that does not count the costs of the premiums.

The CBO's analysis is not binding on Congress, but it is highly influential, and the White House labored to frame its proposal in a way that the CBO could 4'score'' or calculate its costs and savings.

Rep. Dan Rostenkowski, D-Ill, the Ways and Means chairman, said last Thursday that lawmakers look to the nonpartisan CBO to get the numbers straight.

1'Those of us that legislate have to look to somebody for numbers,'' said Rostenkowski. 1'We have to depend on somebody.'' Republicans and some Democrats have argued they belonged in the budget so the public would know the full cost of what Clinton was asking for.

Rep. Jqhn Kasich^R-Ohio, ranking Republican on House Budget CommltteerTsaid the CBO's insisting on counting the premiums as spending would be ''a real body blow to this plan. It will show the American people precisely what i will cost.'' RjUt Rep. Tii£^^rw^b-Minn. , co-author with Kasjxrfi of a balanced budgSt^amendment, said such a ruling'would be ^ ''about a 7.0 (earthquake) on the Richter scale. I don't think you can fix the problem this creates for Clinton with patchwork. It requires a basic reconstruction.''

But Jeff Eller, a White House spokesman, said Monday in Houston on a trip with the president, ''We have not seen the report. But we think that putting everything particularly the premiums on budget ... is not a very logical thing to do.''

''In the president's plan this is private money,'' Eller said. ''It's a payment from one private party to another. It's not part of the federal government. We are not going to either collect nor spend that money. ... The minimum wage is not considered part of the budget.'' Eller added, ''Regardless of what CBO does, it does not affect the president's plan to provide private health insurance for every American.''

Three-quarters of the financing for Clinton's health plan would come from premiums Americans would pay into new health alliances. A new National Health Board would set premium targets for the alliances and they would be subject to federal oversight but 4'otherwise operate independently,'' the White House said.

4'Since the alliances are not federal entities, premiums paid to the alliances are not government receipts, and expenditures by the alliances are not federal expenditures,'' it said.

HEALTH-CARE COVERAGE AVAILABLE FOR 4,000 UNINSURED CHILDREN Families Can Apply By Calling The Blues

DETROIT, Feb. 7 /PRNewswire/ -- A $250,000 grant from the Detroit- based Skillman Foundation will continue health-care coverage for another year for 700 Michigan children at no charge to their families, and will trigger available state and federal funds and other private grants to provide coverage for up to 4,000 other children whose families are uninsured.

Children would receive health-care services through the Caring Program for Children, a non-profit program administered free of charge by Blue Cross and Blue Shield of Michigan in cooperation with the State of Michigan.

The Caring Program raises private donations, which are then combined with state and federal grants to provide health care to lower-income, uninsured children who do not qualify for Medicaid or private health- care coverage.

The program, which has already served 5,000 youngsters, is a joint project of the Blues, the State of Michigan and the Michigan Health Care Education and Research Foundation (MHCERF). Enrolled children receive emergency services, prescription drugs, outpatient surgery, office visits, diagnostic services such as x-rays and other preventive services.

The Skillman grant will be combined with up to $1 Copley News Service WASHINGTON Feb 7 ,f- President Clinton's budget for fiscal 1995 is as revealing for what's in it as for what isn't: money for health care and welfare reform.

The budget is the financial portrait of Clinton's priorities. But nowhere in the six-pound pile of data and documents is the price tag for president's two key domestic initiatives.

It's not quite an omission, said White House staffers, who cite legislative reasons for the president neglecting to put his money where his mouth is.

In Washington, after all, the budget is a political tool, and this one is a clue to Clinton's strategy. On both health care and welfare, which promise to pose the biggest political fights of his administration, Clinton hopes to spotlight the benefits and the savings before he focuses on the costs.

White House aides have long argued that health care reform will save more money than it spends. The Health and Human Services portion of the budget, for example, slices Medicare and Medicaid by $179 billion, as proposed in the president's health plan.

4'These are not new cuts,'' said HHS Secretary Donna Shalala, ''They are projected savings under health care reform.''

But the same budget does not include the new health costs which, in the short term at least, could total hundreds of billions. ''He's promised to give health care to everyone who doesn't have it and expandHbenefits for almost everyone^ .else,'' said Rep. Tit^Penny*)D-Minn. ''That costs money we ought to be seeing in 'bfei«^budget. '' Clinton's budget won points for trimming federal spending. Republicans, however, said Clinton's cuts are all but wiped out when he ignores the gpst,of a health___ _ plan they contend could addL3_J^^4rlriT5Tr doTTars to the " deficit. retends to be frugal while ignoring the biggest Mll^of the century, ' ' said Texas Republican Rep. Richard Grrriey} ' 'Cut out all your expenses and your bottom line • look pretty good, too.'' Critics also questioned Clinton's commitment to welfare reform, unfunded in the 1995 budget even though he is scheduled to introduce his reform plan this spring. *'We have to make sure everyone agrees on the costs and how to pay for it,'' said Bruce Reed, a senior White House official in charge of welfare reform.

Officials said Clinton's budget *4 anticipates' ' welfare reform by raising spending on related programs like Head Start, child care and job training.

But some critics say the budget demonstrates that, on welfare reform, Clinton is quick to add ''carrots'' but slow to apply the ''stick.''

''He's not yet spent one thin penny on workfare to get people off the welfare rolls,'' said Robert Rector, a welfare analyst at the Heritage Foundation, who notes the ''hypocrisy'' of a budget that calls for billions in new welfare benefits while spending nothing on programs that move people off welfare rolls.'' ''He thinks he can embrace the tough rhetoric of welfare reform while doing nothing substantial to achieve it,'' Rector said.

The White House denies any attempt to understate program costs, but aides admit privately to employing some political strategy. After all, Clinton has promised his welfare plan will be ''deficit neutral.'' To pay for expanded benefits, he will have to come up with billions in new cuts.

''This is a tough budget, and we've got our work cut out just to get Congress to pass it,'' said Mary Jo Bane, an HHS official working on the welfare plan. ''We'll cross the next bridge when we get to it. ' '

COST OF HEALTH CARE REFORM MISSING FROM CLINTON BUDGET By ELIZABETH NEUS= Gannett News Service=

WASHINGTON Feb 7 -- The program that could be the costliest among President Clinton's health-related budget requests was not tallied in his proposed budget Monday.

Costs of health care reform remain largely off-budget, although it is widely expected the Congressional Budget Office will say Tuesday the Health Security Act should be part of the federal budget, so spending can be monitored closely. CO GRESS AND HEA1TH

Into the Swamp

n meeting rooms all over Capitol tee, has been publicly attacking key ele­ Take the most Hill, congressional Democrats have ments of the Clinton plan and has ambitious and waded into what most see as their skipped strategy meetings called by most important task this year: pass­ Democratic leaders and White House complicated domestic inIg a health care reform bill. representatives. There's been little news It's been nearly two months since Pres­ from the Labor and Human Resources policy initiative in ident Clinton promised in his State of the Committee, the other Senate panel with decades. Toss it into a Union address to veto any bill that did jurisdiction over the legislation. And not "guarantee private health insurance Majority Leader George J. Mitchell, D- morass of big egos, that can never be taken away." But so far, Maine, recently stunned colleagues by despite a marathon of closed-door nego­ announcing that he will retire at the end weak leadership and tiations and soothing public predictions of this year—raising questions about from party leaders, his congressional whether his lame-duck status will hurt the deep-seated internal allies have little to show for their efforts. Democrats' efforts. conflicts. Welcome to House Majority Leader Richard A. The unfolding story resembles a moral­ Gephardt of Missouri holds regular ses­ ity play in which lawmakers pay the price the congressional sions of his "Green Berets," a team of for past vices. The big egos, weak leader­ Democratic loyalists who are to help him ship tools and deep-seated internal con­ debate on health care round up votes for health care reform. flicts of modem congressional politics are reform. But like suitcd-up players fidgeting on the deadly sins that threaten Clinton's the bench, they wait as the House com­ proposal. mittees working on the bill march slowly These institutional weaknesses can bog to the plate. down even simple pieces of legislation. BY RICHARD E. COHEN Already the House Energy and Com­ But when combined with the inherent merce Subcommittee on Health and the complexities of health care reform, they Environment has thrown in the towel on threaten to produce a legislative sinkhole. marking up a reform bill after its chair­ As the clock continues to run and man. Henry A. Waxman, D-Calif., con­ timetables fall by the wayside, supporters cluded that he couldn't muster a majority of Clinton's proposal have begun to voice for anything resembling Clinton's propos­ fears that Congress may be ill-equipped al. Instead, the legislation will be handled to handle the most ambitious and compli­ in the full committee. cated domestic policy initiative to reach In the House Ways and Means Com­ Capitol Hill in decades. mittee. Fonney H. (Pete) Stark, D-Calif, "We're not in good shape right now," the liberal chairman of the Health Sub­ Sen. John D. (Jay) Rockefeller IV, D- committee, has started marking up a bill W.Va., acknowledged in a recent inter­ that veers to the left of the President's view. approach. But Stark's medicare-based "It's one of the most difficult and proposal has already bogged down under obdurate issues I've ever worked on," attacks from Democrats and Republi­ House Energy and Commerce Commit­ cans: some observers predict that Ways tee chairman John D. Dingell, D-Mich., and Means chairman Dan Rostenkowski, said in a recent interview. "The reason D-Ill., will ignore whatever the subcom­ that this is so is because the issue is not mittee may produce. well understood.... The President's pro­ To complicate matters in the full com­ posal must be complex to cover one-sev­ mittee, the cloud of a possible indictment enth of the nation's economy. But the in the House post office scandal hangs average American is not willing to listen over Rostenkowski. who would have to to the details." give up his chairmanship immediately if Dingell, Rockefeller and other advo­ he's indicted. cates predict that Congress will rise to the Things arc just as murky in the Senate, task. But even they seem to have little where Daniel Patrick Moynihan, D-N.Y., idea of the outcome. chairman of the pivotal Finance Commit­ The lack of a compelling alternative to

642 NATIONAL JOURNAL 3/19/94 the Clinton plan may be the strongest floor," Gephardt said in an interview. answer criticisms about any controversial factor in its favor. Despite the publicity The leaders "can't short-circuit the pro­ parts of the legislation. it's attracted, a conservative proposal by cess or take it over." Bonior, who collected more than 100 Rep. Jim Cooper, D-Tenn.. has not Gephardt and other Democratic lead­ signatures from Members last summer on picked up much momentum; it has 59 ers are trying to serve as liaisons between a letter to Clinton calling for immediate House co-sponsors, compared with 100 the committee chairmen and rank-and- action on health care, recently warned for the President's bill. file Members, while appearing publicly that "it could be disastrous politics" if Supporters of the Clinton measure upbeat about prospects for the legisla­ Clinton and the Democrats do not have hope thai with some tinkering, it will be tion. In truth, there's not much more that two full months to explain the results of the only credible option left standing they can do: Today's congressional lead­ their actions to the nation before Elec­ later this year, when Members will be ers have few weapons to force the hands tion Day. loath to leave town without acting on the of committee chairmen who pride them­ Gephardt has set a target for House issue. selves on their independence. And—to floor action around Memorial Day. And " There is a great deal of anxiety about the dismay of some Members who yearn Mitchell—who says that he'll be able to change." said Thomas A. Daschle of for a more aggressive leadership—nei­ devote full attention to the issue now that South Dakota, the Senate Democratic ther Mitchell nor House Speaker he's not running for reelection—has ten­ Policy Committee co-chairman who has Thomas S. Foley, D-Wash., seems tatively slated debate for the end of June. been designated by Mitchell to run inter­ inclined to dictate terms to the chairmen. The committee chairmen seem to see ference for the President's bill. But. he With the November midterm elections things a bit differently. From long experi­ said, "the encouraging thing for us is that looming, the leaders say that they want to ence, they assume that Congress—like a public opinion support doesn't seem to complete action on the legislation by the college student pulling an all-nighter on a waver" for Clinton's chief goals of univer­ August recess. That would leave enough term paper—rarely finishes anything sal health insurance and some version of time, they figure, for Democratic law­ before the last possible deadline. "These mandatory employer and individual con­ makers to take credit for the accomplish­ complex, large bills tends to be written in tributions. (For more on Daschle and ment during their fall campaigns—and to conference committees," Dingell said. oilier Members who are playing impoilunt behind-the-scenes roles in the debate, see this issue, p. 640.) But some lawmakers worry that the President is not doing enough lo defend his plan in the face of opposition from interest groups. Republicans and even members of his own party. They're wor­ ried that other problems—especially the choppy tides of Whitewater—could cam' him away from his reform mission. 'It's hard to sell this unless you totally focus your energies." said Majority Whip David E. Bonior. D-Mich.. who will play a key role in trying to secure House pas­ sage. "That is hard to do when there is a focus on other issues like foreign policy, crime, welfare and trade. ... I have told this to people in the Administration. But there are other constituencies for them to listen to." Sen. Paul Wellstone. D-Minn.. a lead­ ing advocate of a government-financed. Canadian-style health care system, said he has told the President and top White House aides that "this is a war. ... There must be a truly engaged and galvanized public."' Wellstone has also called on the President to declare a ""Health Care Day" this spring, modeled after the Earth Day celebration started in 1970. to "invite the public to be part of the deci­ sion making."

WHO'S IN CHARGE? With the concurrence of the White House, Democratic leaders have given House and Senate committee chairmen a wide berth to cut deals as they hammer out the details of a health care bill. "The committees will produce a bill with the House Energy and Commerce chairman John D. Dingell leads a committee caucus. best possible chance of passing on the He's trying to craft a health care bill after a subcommittee couldn't agree on one.

NATIONAL JOURNAL 3/19/94 643 Members of committees handling the bill lamented the scarcity of Democrats—at with Waxman over revisions to the Clean in the House say that lloor debate may be the White House and in Congress—who Air Act. During the 1980s, to counter delayed until July. understand both the politics and the poli­ Waxman's pro-environmentalist tilt, Din­ Asked whether the leaders or the cy of health care reform. "Clinton made a gell stacked the committee with conser­ chairmen will have the greater inlluence. big mistake in making universal coverage vative Democrats such as Ralph M. Hall some Democrats say they expect that the the line in the dust." the aide said. "It has of Texas, J. Roy Rowland of Georgia and chairmen's timetables^wlF75fe^iTr-^Che no voter appeal. This can only work as a W.J. (Billy) Tauzin of Louisiana. problem here is^tfiat the egos of thi> pocketbook issue. The American people These conservatives gave Dingell lever­ chairmen make life miserable for the care only about themselves." age to negotiate a compromise clean air leaders." said Rep. Timothy J. Penny. Still, many Democrats contend that bill with Waxman in 1990. But on health Minn.. wWose untiitppipess withiJ

644 NATIONAL JOURNAL VWUi happens if Rostenkowski is indicted. In ing with liberals inside and outside the times on health issues than I have, I 13 years as chairman, the Illinois Demo­ Senate who are committed to several expect," he said on the March 6 broad­ crat has so dominated the panel that he tenets, including an early start to univer­ cast of CBS News's Face the Nation. "I has no obvious understudy for the role of sal coverage, affordable rates and com­ sometimes wish I hadn't been." championing the President's proposal. prehensive benefits. "It would be a big Some congressional Democrats are While the arrangement has strengthened mistake to try to go to the center," Well­ growing frustrated with Moynihan, who, his hand, it leaves the inlluence and oper­ stone said. "We would have to back away an aide to the chairman says, views his ations of a powerful committee in jeop­ from commitments that [Democrats] committee as "the last bastion of reason ardy. made in the 1992 campaign." when all the shouting is done." For the past few weeks. Ros­ No one disputes that the former tenkowski was mostly disengaged Harvard University professor knows from the health care issue while strug­ an amazing number of things about gling successfully to save his seat in an amazing number of subjects. But the March 15 Illinois primary. (Sec over the years he has displayed little litis issue, pp. 671 and 6S0.) interest in health care, and his top Slill. leading Democrats count on adviser on the issue. Finance Commit­ Rostenkowski to help pull their chest­ tee staff director and chief counsel nuts out of the tire. "He is very impor­ Lawrence F. O'Donnell Jr., has no tant to this process." Gephardt said. background in health care. (For details "He has an enormous ability to bring on the roles of O'Donnell and other legislation through this House." Stark, aides, see this issue, pp. 650-51.) by contrast, is regarded as something As a result. Finance Committee of a loose cannon—an impression members have resorted to a series of reinforced by his handling of his alter­ ploys to circumvent the chairman. native health care proposal. Democrats and Republicans on the The House Education and Labor committee have made a number of Committee has other kinds of prob­ back-channel contacts with each other lems. On one hand, the strongly liber­ in hope of finding common ground. al leaningsol its Democratic members Some have organized informal ses- could make it an important White I sions to discuss health care outside House ally if the Clinton proposal | the Finance meeting room. And they gets into trouble al the other commit­ have planned a committee retreat on tees. But the panel, whose jurisdiction | the issue for this month, despite the derives from its control over work­ s chairman's initial coolness toward the place issues, has little experience in | < project. dealing with health care. f But those who seek to maneuver Another potential limitation for the I around Moynihan must be careful not committee is that its chairman. Sen. John H. Chafee, R-R.I. to cross him. Last year, when William D. Ford. D-Mich.. has Could he help the Finance Committee cut a deal? Daschle's Democratic Policy Commit­ announced his retirement and may tee issued a report on the Head Start have less leverage with players elsew here. program with wording that Moynihan He has mostly deferred to Williams on FINESSING FINANCE found objectionable, the Finance chair­ the legislative details of health care. The best-laid plans can fall victim to man barely spoke to Daschle for several Williams, in turn, is waiting for the two quirks of personality—especially in the months, according to sources familiar other committees to act. "I won't know Senate. Consider Finance Committee with the episode. what to do until I see what they do." he chairman Moynihan. Daschle, however, praises Moynihan said. "My hope is that the three commit­ He has issued a number of skeptical for organizing an extensive series of hear­ tees develop a tripartite approach to statements about Clinton's proposal, ings on health care. The sessions have enable legislation with universal care to describing the Administration's projec­ been "incredibly helpful to our cause." reach the lloor. But I don't know how to tion of the plan's budgetary impact as Daschle said in an interview, even though achieve that now." "fantasy" and declaring on national tele­ they have received far less attention than The Senate Labor and Human Re­ vision that welfare reform should take "the incredibly negative press we get on sources Committee has no lack of experi­ precedence over health care reform. the bill." ence or enthusiasm on health care. But Senate insiders say that since Moyni­ Many Democrats grind their teeth over its chairman. Kennedy, tends to domi­ han took over the Finance chairmanship Moynihan's refrain—repeated during fre­ nate the panel and to seek only the deals in January 1993. Majority Leader quent Sunday morning television show needed to advance his agenda. "For the Mitchell has devoted a vastly dispropor­ appearances—that it is essential to gain longest time. Kennedy and his stall want­ tionate share of his time to the care and the support of Minority Leader Robert ed to ram through the Clinton bill." an fecdiim of the proud and mercurial New Dole of Kansas, for health care reform. aide to a committee member said. "It Yorker. Moynihan argues that the Democrats didn't dawn on them that Democrats Mitchell dismisses talk of problems must round up at least 60 votes for their could oppose the bill." (Fora report on with Moynihan. But it remains to be seen bill to make it filibuster-proof. Many Kennedy's legisla live efforts, see i\'J. whether the lame-duck leader will exert Democrats contend, though, that only 51 712419.1 p. 1867.) much power over him. votes are needed because Republicans But Kennedy must be careful not to Even Moynihan acknowledges that his wouldn't dare filibuster a health care bill. take for granted his committee's liberal criticisms of Clinton's bill have created Nor do the Democrats want Dole to be wing if he tries to move to the center. headaches for the President and his perceived as dictating the contents of the Commiltee Democrat Wellstone is work­ allies. "No one has been more difficult at bill.

NATIONAL JOURNAL 3/19/94 645 But Moynihan's defenders counter that islative deals. But no two legislative With the help of about three dozen failing to press for bipartisanship could showdowns arc identical. And the politics "Green Berets," Gephardt and Bonior doom a reform bill in the Finance Com­ of the House and Senate are quite differ­ have already begun laying plans for their mittee and on the Senate lloor. ent. While House leaders can use the effort on the House floor. "Getting a big Moynihan is only one ol the question Rules Committee as a tool to control the piece of legislation, which is very compli­ marks on the Finance Commiltee. With floor debate. Senate leaders must con­ cated but very important, won't happen Democrats on the panel holding an 11-9 tend with that chamber's tradition of without a lot of hands-on work," Gep­ majority—including several centrist unlimited debate and amendments. As a hardt said. Democrats—Republicans believe that result, the House deliberations are likely Bonior is already talking with repre­ Finance is the committee where they will to proceed along more-sharply partisan sentatives of friendly interest groups, have the most leverage on health care. lines. including some labor unions and con­ But il is unclear how GOP Senators Some Senate Democrats predict that sumer groups that have begun lobbying might exercise that leverage. Mitchell will be their savior, engineering campaigns in support of the President's Democrats hope that Republican John the kind of backroom horse trades that bill. With the groups' help, he said, "we H. Chafee of Rhode Island—who has were his hallmark during deliberations on will move to retail, door-to-door selling." met several times with Hillary Rodham the 1990 clean air amendments and on Bonior acknowledged the difficulty of Clinton lo discuss health care and has last year's budget bill. lining up 218 votes from independent- brought her to his state—will be their As evidenced by the bipartisan tributes minded Members. But, he said, "the conduit to a Finance Commiltee compro­ that followed his retirement announce­ aggregate is so important for the country mise. But Chafee is under pressure from ment. Mitchell retains leverage because and the party that the sheep will come GOP conservatives to back away from of what a Democratic colleague termed home." serious deal making. Another possible " the extraordinary level of affection in The House Rules Committee, on contact point on the panel is Orrin G. which he is held." But Mitchell has which Bonior serves, will play an impor­ Hatch of Utah, who also serves on the acknowledged the limits of any leader's tant role by setting the ground rules for Labor Committee, where he has struck inlluence with other Senators on such a debate. Bonior said that his preference is deals in the past with Kennedy. Resting high-profile issue. "I don't have a large to allow Members to vote on a small atop the mound of Republican ambiguity bag of goodies to hand out to Senators, number of "broad choices"—such as the is Boh Packwood of Oregon, the commit­ nor do 1 have anv mechanism for disci- Clinton plan, a Canadian-style plan and a tee's ranking minority member. Republican alternative—rather than Although he has called for a biparti­ permitting amendments on specific san deal, his ethical woes have under­ provisions. mined his effectiveness. The Rules Committee may also Dave Durenberger. R-Minn.. one have to reconcile major differences in of five Finance members who'll be the bills reported by the three chief retiring at the end of this year, said House committees. Recalling Mem­ that ihe key to crafting a bill lies with bers' unhappiness last year at being lawmakers such as himself—moder­ asked to vote on an energy tax when it ates who care deeply about health was already clear that there was care reform. "1 hope that as soon as strong Senate opposition to the tax. possible the folks that are in the mid­ Rep. Martin Frost of Texas, another dle can get their act together, so that Rules Committee Democrat, predict­ the folks on either side who may be ed that the panel would drop any pro­ waiting for them to fail can join them vision that was likely to face an uphill and join the President" in reaching an fight in the Senate. agreement, he told the Senate last r For many Members, especially month. freshman Democrats, electoral poli­ But the Senate GOP moderates, as tics will be a central element of their thev shuttle between While House vote. "I'm wary of something that dinners and Republican retreats, have goes beyond the public's ability to yet lo show that they can move understand it," said Rep. Karen Shep­ beyond the talk and can help to bro­ herd, D-Utah, one of a small group of ker a deal. first-termers who have maintained "1 - "There arc an enormous number of j< informal contact with key committee subplots which arc enormously diffi­ members on health care. "People I "2 cult." said Rockefeller, another think that the Clinton bill is too com­ Finance Commiltee player and a key 1 plicated." Lawmakers are aware, too, Mitchell ally. ""When you take on the House Majority Leader Richard A. Gephardt that Congress will be judged not only most complicated subject ever, expect He's already laying plans for a floor vote. on the content of the legislation but smooth sailing—not. " also on whether its deliberations arc plining Senators." he said in a recent perceived to be fair and open. interview. (For details, see NJ, 3112194, p. But many Members say that they fear D00R-T0-D00R SELLING 59S.) even more a return of the hated gridlock If the spotlight now is on the House Foley, who tends to devote little atten­ of the past few years. "I tell Members and Senate committees, il will quickly tion to the details of legislation until it that they should be nervous if they don't shift to the Democratic leadership when reaches the lloor. has mostly deferred to pass a credible bill," said Rep. Barbara B. legislation heads for the floor. Gephardt on health care. The Majority Kennelly of Connecticut, one of four Folev. Gephardt and Mitchell all have Leader has had a deep interest in the Democratic chief deputy whips. "We will played active roles in brokering past leg- issue for more than a decade. do what has to be done." •

646 NA I ION \[. .I()t RN \l • I'l "J Page 3 • July 19, 1994 National Journal's CongressDaily/A.M. Rockefeller Details Campaign To Push Universal Coverage Key Senate Democrats will escalate gressional district would be affected by on various separate issues," but said the a campaign in the next seven to 10 days a lack of universal coverage. coalition now is shifting its emphasis to to recruit support for their "must have Rockefeller suggested support for universal coverage. universal coverage" approach universal coverage is quickly increas­ "Once we've established that, and to healthcare reform by at­ ing. He said he expects the list of 23 people are comfortable with it... then, tempting to identify the body of con­ to grow rapidly as Senate Democratic within the context we'll talk about stituents they claim would suffer with­ leaders write a healthcare reform bill in shared responsibility," he said. out such coverage. the next couple of weeks, adding, "I Meanwhile, Reps. Tim Penny, D- "We want to put all the pressure think we can bring the swing members Minn., Harris FaweU, R-Dl., Gary Con- we can on wavering members," Sen. to our side in time to help [Senate Ma­ dit, D-Calif., and Robert Livingston, Jay Rockefeller, D-W.Va., said Mon­ jority Leader] George Mitchell." R-La., and others are expected to par­ day. Rockefeller said he believes the ticipate in a news conference Wednes­ Rockefeller is playing an active role coalition will even get the support of day to voice opposition to the "commu­ in a newly formed universal coverage some members of the "rump group" that nity rating" provision included in some coalition run by Sen. Tom Daschle, D- is composed of conservative Democrats healthcare reform proposals, according S.D., that Rockefeller counts as already and moderate RepubUcans and is push­ to a statement from Third Millennium. having about 23 Senate Democrats as ing the Senate Finance Committee The group is an advocacy and edu­ backers. healthcare reform bill, which does not cational organization that says it was According to Rockefeller, the group get universal coverage by a date certain. founded by "concerned young Ameri­ will hold press conferences every day Rump group members privately cans" with the goal of redirecting "the for the next week to 10 days to demon­ have told Rockefeller that in the end, country's priorities from the next elec­ strate that a failure to get universal cov­ they will compromise by backing a hard tion cycle to the next generational cycle." erage would be a "fatal blow" to con­ trigger that would ensure universal cov­ "Young healthy people would likely stituents — especially the middle class. erage by a date certain. Rockefeller said. see a nearly three-fold increase in their He told reporters the coalition soon Rockefeller contended Democrats insurance premiums if the community will release a list estimating how many have "made the mistake in [the health­ rating in the president's plan is voted constituents in each individual con­ care reform] debate of trying to focus into law," the statement said. Dole Issues Telco Statement As Markup Likely Next Week Senate Minority Leader Dole text on the Senate floor. The statement question of universal service," Dole said. Monday sought to make his views emphasized the need to make certain "Without it as the foundation for any known on pending telecommunications rural America not be left behind as new communications proposal, rates will go TEIECOMMUNICATIONS legislation, as it information systems emerge. up for suburban and rural customers — appeared likely Dole has reportedly been holding and that's not for new services, just the that a markup of Senate Commerce talks with other Senate Republicans ones they already have." Chairman Hollings' bill on the issue about the telecommunications legisla­ Dole also made an apparent pitch will take place a week from today. tion. AT&T officials said Dole is cir­ for a reduced government role, saying: Senators involved in negotiations over culating a draft that he says would be his "Now I read all the hype about [Vice Hollings' bill were likely to see a revised way of dealing with the issue, although President] Al Gore's information high­ draft of the legislation Monday night or they had not seen Dole's document. way, and how some compare its creation this morning, with a markup to be sched­ Dole in his floor statement stressed to that of the Guttenberg press. I think uled for Thursday or next Tuesday, the need to insure that legislation pro­ cheerleaders have their place, but let's AT&T executives said Monday during a vides for universal service, saying pol­ not forget that coaches call the plays that conference call with reporters. icymakers should take a page from the win games. And in this case, private in­ But a committee source Monday in­ success of the Rural Electrification Ad­ dustry, not big government, is the coach." dicated it "would be difficult" to get a ministration and rural telephone bank Meanwhile, AT&T suggested Holl­ measure marked up this week. The panel programs that brought telephone ser­ ings is very determined to move the bill had confirmed earlier that if a markup vice to rural and hard-to-reach places and feels there is still an opportunity to cannot be scheduled by Thursday, it will by providing federal financing and re­ get it done. According to AT&T, aides probably take place next Tbesday. quiring companies to deliver telephone still are negotiating and revising the pro­ Dole Monday widely circulated a service to all who wanted it. visions in the Hollings bill speUing out floor statement of his own telecommu­ "It is premature, if not dangerous, requirements that the Bell companies nications policy — although it was un­ for Congress to move forward on any would have to meet before they could clear whether he actually presented the piece of legislation without solving the enter the long-distance markets. 4>

Senate G. O.P. Heats Up Attack on the Health Bill

House Leaders Hint at Delaying the Debate

By ROBIN TONER committed to a more incremental Specul to The New York Times approach to health care restructur­ ing, argued that the Mitchell plan WASHINGTON, Aug. 3 - Battle undermined the leadership's efforts lines hardened on the health care DIARY to pass a provision for the employer J5L front today and deadlines showed mandate in the House. "It raises the iiniiiiiii signs of slipping. specter that once again the House will Health Care Developments In the Senate, conservative Repub­ pass a bill with controversial ele­ licans escalated a bitterly ideological ments only to see them dropped in the assault on the new plan from the Senate." said Representative Tim YESTERDAY Democratic leadership, asserting it Penny, Democrat of Minnesota. would lead to socialized medicine, a At the same time, the time pres­ With health care legislation ready for introduction in both houses of "medical Gestapo knocking on your sure is growing ever more intense as Congress, cheering and jeering intensified parents' door" and other generalized the weeks tick away before Election threats to what Senator Phil Gramm Day. House and Senate leaders met of Texas described as the future of with Robert Reischauer, director of America. They vowed once again to the Congressional Budget Office, this CONGRESS try to slow the legislative process, afternoon about getting the necessary even as Senator George J. Mitchell, Technical difficulties in analyzing proposed health care legislation will financial analyses for the health care the majority leader, continued to alternatives that will be debated over delay consideration of the House bill, SpeaKer Thomas S. Foley said move the bill toward floor considera­ the next few weeks. This has been a Mr Foley said he could not guarantee that the House would act on tion next week. persistent problem for the leaders all the bill offered on Friday t>y Representative Richard A Gephardt of In the House, leaders and aides Missouri before the recess that is scheduled to start on Aug 12. In suggested that the House debate ex­ the Senate, some centrist Democrats praised the health care plan pected to begin next week would be likely to slip into the following week, proposed by Senator George J Mitchell, the maiority leader. Senator the one beginning on Aug. 15. That Health legislation is John B. Breaux of Louisiana called Mr. Mitchell s.effort a "major step would mean that House members m the right direction " Republicans continued their opposition. "Let s would lose a week of their much- face it. it's got about 16. 17 new taxes in it." the minority leader, prized August recess. complicated by Senator Bob Dole of Kansas, said on the NBC news program Democratic aides and leaders "Today " Mr Mitchell s plan Duoyed some moderate House members blamed technical difficulties in get­ House and Senate who worried that the bill they would be considering was too liberal. ting legislation drafted and analyzed "It's a clear improvement.' said Representative Jim Cooper, by the Congressional Budget Office differences. before it can be sent to the House Democrat of Tennessee floor. Republicans asserted that the Democrats were postponing action because they did not have the votes year, ana Mr. Reischauer emerged WHITE HOUSE for the House leadership bill an­ saying, "There is no simple answer." nounced last week by Representative President Clinton and his wife, Hillary, greeted hundreds of people Richard A. Gephardt, the majority Doubts on the Timetable who arrived as part of a bus caravan that had crossed the country to leader. At a news conference earlier in the promote health care change. Mrs. Clinton told the crowd on the How They Count Heads day, Speaker Thomas S. Foley South Lawn that no Americans should have to suffer from illnesses seemed to hint at the possibility that "1 think they do not see a path to the health care bill could be put off accidents and financial stress because their health insurance the sunlight,'' said Tony Blankley, until after the recess because of these disappears or doesn t really mean what it should when you read the spokesman for Representative Newt technical problems. But it has been fine print." One DUS naers. John Cox of Athens. Tex., moved Mr Gingrich, the Republican whip. "The widely assumed thai the bill must be Clinton to tears as he described his wife s death from cancer "We word floating around was that the voted on before the August recess if it buried her Monaay. and I m here today to tell Congress that right is Democratic count for Clinton-Gep­ is to make its way through a confer­ right ' Mr Cox said "Unless we can ensure universal health hardt was 153 — soft." It takes 218 ence committee in time for final pas­ votes to pass a bill in the House; sage before Congress adjourns in Oc­ coverage to all Americans, then life, liberty and the pursuit of Democratic leaders asserted they happiness lor some is just a dream " tober. were much closer to that count than Moreover, there are critical stra­ Mr. Blankley suggested. tegic considerations at work. Interest Still, it was a nervous day on Capi­ groups have proven to be remarkably tol Hill. No one was quite sure of the effective this year in their assaults on impact of Mr. Mitchell's plan on health plans. Giving them three to House members. The bill he is offer­ four weeks to attack the leadership's ing for action in the Senate would plan may make passage all the more impose only a delayed, much wa­ difficult. A. tered-down requirement that employ­ Not surprisingly, after theTn'eeung ,0 ers contribute to the cost of their with Mr. Reischauer. a spokesman 0° workers' insurance and then would for the Speaker emerged to quash require them to contribute only 50 any notion of breaking for recess percent of it. House Democrats are without a vote on a healthcare bill. being asked to support a far stronger "If need be, we'll go over into the employer mandate, which would gen­ third week of August," said the erally require employers to kick in 80 spokesman. Jeff Biggs. "But we're percent of the cost. The employer going to deal with this before we mandate has drawn intense opposi­ adjourn." tion, especially from small business­ es. Mr Mitchell has already indicated that he intends to nold the Senate ir, Some moderate and conservative session until n completes action or. Democrats m the House, who are the health bill The Michigan racaa Both the Detroit News and tt Detroit Free Press endorsed fo mer Michigan GOP Chairman ^Yo mg, healthy fear burdei Spencer Abraham over talk show personality Ronna Romney for the Republican Senate nomina­ tion in the Aug. 2 primary. of 'community rating' plan In the Democratic primary, the • . / Proponents say community rat- News endorsed businessman Joel By Karen Riley mg would thwart some insurers Ferguson and the Free Press T>* «»SM»«)TO TIMES who go "cherry-picking" — agree­ picked former Rep. Bill Brod- ing to cover groups that are gener­ In the debate on health care reform, ally healthy, or discouraging oth­ nead. The Free Press said rival one issue particularly has the potential Rep. Bob Carr has an "arrogance to pit generation against generation ers with high prices. It would that sometimes makes him un­ group against group. spread the risk among insurance willing to listen." companies and bring down premi­ On behalf of the young and the ums for older people, for example. healthy, for example, one organization n teS ovemm However, some groups would ' 2: J ^ 8 ent assurance of The •Ingle payers affordable health care coverage for pick up a heavier burden. Congressional supporters of Wder and sicker people inevitably will A study by the American Acad­ single-payer health care reform mean higher premiums for everyone emy of Actuaries found that under — a minority of about 90 in the CISC, pure community rating of indi­ House — are faced with some i At a Capitol Hill news conference viduals and small groups, 38 per­ delicate decisions during this yesterday, a nonpanisan youth advo­ cent would see premium increases phase of the battle, the New York cacy group calling itself Third Mil­ of more than 5 percent; 12 percent Times reports. lenium weighed in against this dollars- would see increases of more than n d cent The Times' Robin Tbner says ? . : s reality that's largely been 40 percent. hidden behind an arcane insurance In contrast, 23 percent would the group seeking a government- C0 , Ce >t known as run health insurance program is I T i community rating. see premiums lowered by more serving notice to Democrhtic Under a pure, or flat, community than 5 percent, and 5 percent leaders that it cannot be taken for ratmg principle, insurers must charge would pay premiums costing 40 • granted as it watches the focus of all under-65 members of a health plan percent less than their present the legislation move away from in a local area the same premium re­ rates. universal coverage and employer gardless of age, sex, health-related be­ After New York imposed a flat mandates. havior or pre-existing medical condi­ community rating system in 1993, tions. rates for young people jumped as The single-payer backers urge President Clinton's plan and most much as 170 percent, forcing indi­ President Clinton and the party health reform measures before Con­ viduals and small firms to drop leadership to stand firm, and the gress would require community rating their policies, according to figures generalized fear that they will to help make insurance available and compiled by the state insurance not go along with a moderate or department and widely reprinted. more conservative package may more affordable for people and small be keeping players from moving companies. Mutual of Omaha, for example, in that direction. But critics say flat community rat­ found that the average age of its ing is nothing more than a hidden tax. New York policyholders has in­ Already guaranteed a floor "It would alter radically the way creased by 3.5 years since the law health insurance is priced," said Deroy went into effect, as younger people vote for their bill, the single- Murdock, co-founder of Third Mil­ apparently decided not to shoul­ payer forces push for the most lenium. der a higher expense. comprehensive measure they can "Whether you are a 25-year-old aer­ In Maryland, small businesses get while holding on to provisions obics instructor oV a 55-year-old over­ are howling about new rates since allowing states to go to a single- weight, chain-smoking truck driver, a modified form of community rat­ payer plan if they choose to. everyone pays the same," he said. ing went into effect July 1. The year-old Third Millenium, based Insurance companies now may in New York with chapters in more take age and geographic region Whither Bennett? than 20 cities, says it is devoted to is­ into account when pricing their Columnist Gerald E Seib ob­ sues of importance to the "rising gen­ serves in the Wall Street Journal eration." policies but must be blind to gen­ der or medical claims history. that William Bennett has at least Joining them was the United States decided on a timetable fbr decid­ lb absorb the added risk, insur­ ing whether he will run for pres­ Pan Asian American Chamcerot Com- | ers in Maryland have raised rates ident: He thinks he has until the merce and a bipartisan group of law­ for companies with healthier, end of the year. makers. younger workers an average of 10 Noting he has the resume of an Rep. Cliff Steams, Florida Repub­ percent to 25 percent, according to academic and not a pol, Mr. Seib lican, said community rating would Roy Wilkinson, president of Wil­ says Mr Bennett also has "an im­ "help subsidize unhealthy lifestyles kinson Benefit Consultants Inc. of age as America's new crusader because it shifts most of the finan­ Baltimore. for restoration of moral fiber, a cial burden of some people's risky Last week Blue Cross and Blue reputation enhanced by his book and unhealthy behavior to every-' Shield of Maryland was forced to entitled 'The Book of Virtues." " one else." roll back rate increases on small- After talking to Mr. Bennett, "Community rating has some business health insurance after Mr. Seib reports that if he does virtue, but it creates an enormous companies complained. cost shift that's an inequity we run, he "wouldn't pursue a moral can't stand by and allow to hap­ The HIAA, Blue Cross and Blue crusade, but a classically conser­ pen," said Rep. Timothy J. Penny, Shield Association, the Group vative, though somewhat radical, Health Association of America political agenda." Minnesota Democrat. The insurance industry has and the Alliance for Managed The campaign theme would be been lobbying against community Competition support modified that Americans have given too rating, too, saying the method community rating, to allow differ­ much power and responsibility to raises premiums and winds up ences in premiums for individual their federal government, at the covering fewer people. and small-company health plans, expense of individuals, families, based on family size, geographic churches and schools. The Health Insurance Associ­ area and age of the subscriber; "In the name of compassion ation of America has run a televi­ sion ad featuring the fictional prices or discounts based on a and responsibility, I would want characters Harry and Louise com- • group's claims history would not to go through the federal govern­ plaining about community rating, be allowed. ment and start tearing it up, as part of its attack on President throwing stuff back to the states, CUnton's health care plan. taking stuff apart," Mr. Bennett "I think that this is just like a told his interviewer. Older Americana would pay tew ticking time bomb," said Charles and younger lamllies would bear a N. Kahn III, the association's ex­ heavier health insurance burden under the proposed "communny ecutive vice president. rating tyatem," which would »et a The price of health insurance Smpremlum for everyone in a policies for individuals and com­ geographic area regardless ot pany groups traditionally are based in part on actuarial tables Annual e«ect on tamily insurance that measure risks to the insurer, . such as sex, age. known medical I conditions and history of claims I Aae Effect payouts, lb rate an occupational | Under 25 $870 more group or a company, calculated 720 more risks are based on averages. Aae 25-34 Aae 35-44 720 more _» Aae 45-54 1.124 less _ Aae 55-64 1.908 less

— u Th. wasninator Timw Top Ho se Democrats Urge Universal Coverage by 1999 „ 7

.Al been discussing ways :.. r\p;ind the PcWy "conscience clause'' already in the If 95 percent of the populatioxnz in a bill in a way that would allow those state was not insured in the early who oppose abortion to obtain poli­ years after the new century, the fed­ cies omitting it. "There is a real de­ eral government would require em­ sire on both sides to work this out," Pes Wivrd ployers to pay half of their workers' Fazio said, "but we're not there yet." insurance bill, with employees pay­ ing the rest. Other controversial questions "That's where (Mitchell's] coming were settled tn the final hours before down," Sen. Dennis DeConcini (D- yesterday's caucus. Large multi- Am.) said. state employers lost thevr bid to be Mitchell said he would introduce exempted from state laws creating a his plan Tuesday and begin debate single-payer, tax-financed health as early as Aug. 8. Differences be­ system, an option that Gephardt's tween bills ultimately passed by the bill provides to every state. Big busi­ Hou.-e and Senate would have to be ness, including auto and steel com­ reconciled in conference, returned panies, would have the health insur­ to both chambers for final passage ance cost of their current early and then go to the president for his er UWflT MOBBtS—THC WASHINGTON KJST retuees—55 to 64 years old—taken signature. Majority Leader Richard A. Gephardt, over by the government, but would offering leaders' legislation, says not have the same benefit in future Mitchell, struggling to meld a "this Is not the Clinton WU." measure much like that announced years. Hospitals gained some relief, by the House leadership with a more Those taxes were an immediate apparently at a cost to doctors, from modest proposal passed by the Sen­ target for Republican leaders, who the Medicare cutbacks they had ate Finance Committee, received dismissed the Democrats' claim to been protesting. bad news yesterday when the Con­ have scrapped the Clinton plan as a Gephardt produced charts show­ gressional Budget Office said the Fi­ 'cellophane-wrapped deception." in ing that the mandate would cost nance Committee bill would be the words of House GOP Conference small firms with low-wage workers largely unworkable. Chairman Richard K. Armey (R- only 16 cents an hour (after their tax Tex.). The CBO analysis showed that the credit) and that big firms with high House Minonty Whip Newt Gin­ bill could bring coverage to 20 mil­ wages would pay only $1.26 an hour. lion of the estimated 37 million unin­ grich (R-Ga.) said there would be no Republican votes for the Gephardt He argued that this is in the range of sured by the year 2000 and reduce the 90-cents-an-hour minimum wage the deficit by $5 billion. It found that bill, which leaves its fate largely in the hands of the moderate-to-con- increase approved in 1990 and the bill would cost the government promised that if it were accepted, no $124 billion to help low-income peo­ servative Democrats, 52 of whom signed a petition two weeks ago ask­ minimum-wage boost would be ple buy insurance, a pnce tag that sought in the next few years. might go up further to cover work­ ing for assurances of a floor .vote on ers dumped into new small firms ^b^aruwa aReaiaUve. now neanng Gephardt announced that his bill created expressly to qualify for the Vompietion, that Wonld omit employ­ and all substitutes for it must be filed subsidies. Its financing and adminis­ er manda^s., i by Wednesday night, a tough dead­ trative features would be "difficult to Gephardt must convert at least line for the bipartisan group seeking implement," the CBO adding some of those centpsts to his side to a middle-road alternative. House de­ that "it seems doubtfli!*Jfirt *SUtes bate is scheduled to begin o&ABg. 8 would be prepare^ ^iWtijWK^F win, and comments from that quar­ . Of 9 and final votes are setMtrjgjg. responsibilities un>(6 problems, rhetonc surrounding the House J Rep. Timothy J. Penny (D-Minn.) jteati 1 Jl^gj^fui- that Democrats' introduction of their biQ said, 'Tm not encouraged by what 1 1 • -IT w T-— - plicat- was their insistence that the meas-^' see. ... I don't think voters will •^mrome subsidy scheme and ure "is not the Clinton bill," as Ma­ trust something partisan on some-, thing this important." Rep. Peter Medicaid program, regulate and, jority Whip David E. Bonior (D- 1 Mich.) put it. Hoagland (D-Neb.), expressing monitor the health insurMce HKAIS-' try region by'region, premde\cao- The briefing materia) given law­ strong concern about the expansion t makers and the press included a of Medicare, said the bill "has moved ^ sumer infonnation and set up a schg chart of "key differences from the slightly in the way of the changes I ' ^ticated ©lyctronic data coDeetionr Clinton plan," noting that there are want, but it has quite a way to go." system', isA^b for by theFlhancef Comniitte«fc£J r^7> ! "no mandatory alliances" but only Sep. Michael A. Andrews (DJex.) f voluntary purchasing cooperatives Thiftbfll satisfies the the and, "no new, large government bu­ \ Dej&ocratjc ca

»•" S U CT l el 1 ° ' • The wasmngto" "" >15 ; •' Republican criticism of health-care reform bill might be warranted, CBO says that u would exceed percent. By Jill Zuckman Boston Globe This is going to be tough to sell to Republicans,' Grandy said, They're going to say it's too much WASHINGTON As the Senate continued Wednesday to government." debate legislation to overhaul the nation's health care system, the Congressional Budget Office said that Republican criticism of the measure might be warranted. The non-partisan agency concluded in a report issued Wednesday that complexity is the Achilles heel of health By Peter G. Gosselin care reform and questioned whether the Senate bill could Boston Globe work as designed. WASHINGTON A fight is brewing over provisions in the There is a significant chance that the substantial health bills now before Congress that would help Boston's changes required by this proposal ... could not be prestigious teaching hospitals and medical schools operate achieved as assumed," the report said. in a revamped Amencan health care system. Also Wednesday, the nation's largest organization of The institutions, which have been protected until now senior citizens threw its weight behind thi- Senate and by two Capitol Hill committee chairmen. Sens Edward M. House measures. Kennedy of Massachusetts arfd Daniel Patrick Moynihan of "Neither bill is perfect," said AARP President Eugene New York, are increasingly the target of antitax Lehrmann, a retired educator from Madison, Wis., but conservatives, rural state advocates and HMO industry without them health care reform will be dead for years lobbyists who charge the hospitals and medical schools are to come Now is the time to strike." Both bills would add unduly favored in legislative proposals. prescription drug coverage to Medicare and start One critic, Sen. Max S. Baucus, a Montana Democrat, a long-term-care program for the disabled. said yesterday he will seek to divert as much as one third The endorsement from the board of directors of the of the money now targeted for the institutions to rural 33-million-member AARP came as major business groups, health centers such as the ones that serve his small and large, sought to form a united front to fight constituents. In comments in recent days, Baucus and others Mitchell's bill. characterized the funds and rules that would help teaching hospitals and medical schools as little more than special President Clinton, speaking to reporters, accused his pleadings and pork. critics of generating "almost hysterical fear" from the ' Sutes and cities always try to get as much money they outset about health care reform. can, and-there's no evidence in this case it's needed," There was just this kill it, kill it, kill it, kill Baucus said. "We are going to be looking for some it, kill it drumbeat coming out of the ones who were changes," he said. negative, but there were more Amencan citizens, more At issue are a series of little-known provisions in the American business who know we ought to have universal health bills now making their way through the House and coverage and who support it," Clinton said. Senate that could largely determine what role institutions In its report, the CBO warned that health insurance like Harvard Medical School and Massachusetts General subsidies could have the unintended effect of discouraging Hospital play in a revamped health care system. low-income people from working. And it asserted that The provisions would more than double the amount of states would be overwhelmed in trying to regulate the new money Washington spends annually through Medicare and health care system. Medicaid to train medical residents, which now number Nevertheless, aides said Mitchell, D-Maine, is closer about 4,400 in Massachusetts, or almost 5 percent of the to gaining the votes needed to pass his health care reform nation's total. They would assure that expensive teaching bill. Mitchell's bill aims to provide coverage for 95 hospitals such as Boston's have a lucrative place in the percent of Americans by 2000 through a voluntary system new medical marketplace by requiring HMOs and other backed by government subsidies. A requirement that primary health plan to do business with them. And they employers pay for workers' coverage could be imposed if would take some of the sting out of requirements that both the voluntary approach fails. medical schools and teaching hospitals train fewer Meanwhile in the House, a bipartisan group of lawmakers specialists Boston's forte and more primary care attempted to woo support from conservative Democrats who doctors. have been hesitant, for The provisions "would take into account the legitimate a plan they submitted to the House Rules Committee costs of teaching and training doctors," said Mitchell Wednesday. Rabkin, president and CEO of Beth Israel Hospital. '' If The plan was crafted by a group of lawmakers that health care reform ignores these costs, the teaching included Jim Cooper, D-Tenn., Fred Grandy, R-Iowa; J. Roy hospitals are going to be in terrible trouble," he said. Rowland, D-Ga., and Michael Bilirakis, R-Fla. The problem politically is that virtually all the I don't know-how you get 218 votes for anything ? benefits of these arrangements would flow to just a handful of states, chief among them Massachusetts and New h^wa|&ne*pf;aj»!^^ York, which has three times as many teaching hospitals as suppdnj&t&partisah'he^ Massachusetts. None would flow to places such as Baucus' about 45 other conservatiye-^mocrats seem interested in Montana, which does not have a medical school or teaching theipian|b"uUhayeghotjehd^ it. hospital in the entire state. Rep. raMnslC^olev,,D^alif., .who At the moment, the threat to the arrangements seems to presentatiQnsJby the,,bipartisan group, said'rhe plan does be coming from two directions, a challenge by opponents to the funding for the institutions and some of the a little short in terms^oXj advantageous rules, and a move by some supporters to seek greater number of even greater advantage for the institutions, which seems likely to spur the opposition to greater effort. The conservative Democrats were told Tuesday night that Conservative GOP Sen. Malcolm Wallop, Republican of the bipartisan plan would increase insurance coverage from Wyoming, said this week he will seek to strike a 1 75 about 85 percent of all Americans now, to about 88 percent percent tax on insurance premiums in the Senate bill that SPECIAL REPORT

Contentions Health Care Debate...

f a congressional leader's rallies the troops and max­ Ijob is to listen, no one imizes the leadership's ad­ does it better than Richard vantage. A. Gephardt. He wins uni­ "He's a mediator, not ai>^ versal praise for the time creator," says Timothy J. he logs listening to diverse Penny, D-Minn. "He's opinions. comfortable in that role, On health care alone, and he's very good at it" the House majority leader That is the role Gep- has heard out untold num­ hardt is playing on health bers of Democrats on is­ care, having crafted the sues large and small and, leadership package by at Speaker Thomas S. Fo­ plucking provisions from ley's direction, melded thebills and plans of others. those views into a leader­ But none of those options ship alternative. But now, has a wide swath of support as his bill (HR 3600) At its worst Gephardt's moves to the floor, the Eagle Scout style is viewed time for listening is over. as feel-good leadership de­ fined by fellowship. Liber­ As Gephardt shifts R. MICHAEL JENKINS roles from compassionate Gephardt discusses leadership plan Aug. 3. als often yearn for a more sounding board to passion- forceful approach. They ate proselytizer, the debate has put his leadership to the want to see the leadership hold back plum assignments, test. At this point, it is far from clear that his preference campaign fundraising assistance and the right to offer up for gentle persuasion will get him the 218 votes needed to popular amendments — old-fashioned arm-twisting.

win passage of the still unpopular bill. H "The leadership hasn't used the levers of power it If it can and Gephardt delivers a health care bill that does have," says Rep. Henry A. WjggiaJ, D-Calif. assures affordable insurance for all Americans, he will Even so, most concede that the ouOWtup likely would^ score an impressive victory for his president and his not work in the modem House. The chamber and the party. He also will cement his eventual ascent to the caucus are increasingly populated by independent oper­ pinnacle of the House Democratic leadership. ators resistant to the loyalist label and repelled by the Failure, however, not dbly will threaten Democrats' heavy hand. vision of health care, it wiU open the party to criticism In this light Gephardt's patience and velvet glove about its ability to govern. Within the House, defeat will may at once leave many Democrats wanting and be a raise questions not only about Gephardt's passive hand- leader's only choice. ^-"1 holding of members that lasted through July, it also may "I don't think threats or retribution would play well raise questions about whether any kind of leader can inside or outside the House today," says Rep. Karen take charge of the increasingly unruly chamber. ahenLP-Utah. "But maybe that's why we're stuck in "I don't think there can be any other kind of leader­ Se swamp all the time." ship today," says veteran lawmaker John P. Murtha, D- Pa. Gephardt's protracted meetings were "the only way to Vestiges of 1988 draft the bill. But I don't know that anything can pass." It was not always clear that Gephardt's ambitions would drive him toward the House leadership. He gave up a place The Gephardt Style on the leadership ladder to make a 1988 presidential bid. Long before the health care debate, the 18-year When that faltered, he sought re-election to the House and House veteran was legendary for sitting intently through came to power as majority leader after the 1989 shake-up marathon meetings. Until now, the hours he dedicated as that resulted from the resignations of Speaker Jim Wright the Democratic point man at the 1990 White House of Texas, and whip Tony Coelho of California. The same budget summit stood out as unprecedented for any con­ personal loyalty that sent 42 colleagues out on the hustings gressional leader. for his presidential campaign allowed him to win the No. 2 Often revealing little about his own views in his ses­ job in the Democratic leadership easily. sions with members, Gephardt quickly grasps the legisla­ Today, with a Democratic baby boomer in the White tive and political nuances of concern to them. Lawmak­ House and another as vice president Gephardt, 53, seems ers generally leave the Missourian's Capitol office unlikely to bid for national office in the next decade. But warmed by his sincerity; rare is the report of bare­ even as his sights may be set on the Speaker's job, the issues knuckle confrontation. that caused his 1988 bid to fail remain with him. At its best, this conciliatory, behind-the-scenes style In that race, Gephardt won the Iowa caucuses and enables Gephardt to mold slivers of consensus into a finished second in New Hampshire, before he was driven legislative whole and to fashion political rhetoric that out of the race by an image as an overly ambitious

2206 — AUGUST 6, 1994 CO HEALTH CARE

Major Domestic Bills Had Bipartisan Support

rn a July 24 appearance on NBC's "Meet the Press," Clinton's comprehensive health system overhaul pro­ / Vice President Al Gore said, "You remember back in posal never achieved. the '30s when Social Security passed, not a single Re "History demonstrates the truly important issues publican voted for Social Security. ... At least that's my know no party lines," Rep. Timothy J. Penny, D-Minn., reading of the history." said in a letter he sent to colleagues Aug. 9, arguing for Gore seemed to imply that major pieces of social greater GOP participation in shaping health reform pro­ policy legislation — such as Social Security in 1935 or posals. . health care reform in 1994 — could be enacted with Whether any new, more modest health overhaul pro solid Democratic support and no help from the other posal now being contemplated by Senate negotiators side of the aisle. can attract bipartisan support remains unclear. (Story, p. But Gore misread the history book. The record U) shows that back in 1935, 77 Republican representatives But a less ambitious plan may be a promising start: (81 percent of those voting) and 15 GOP senators (75 The two major pieces of social policy legislation since percent) voted for the Social Security Act. For the past 1930 — Social Security in 1935 and Medicare in 1965 — 60 years, landmark domestic bills — covering Social were incremental programs that since have grown ex Security and civil rights, interstate highways and envi­ ponentially. ronmental protection — have been enacted with wide Still, the political equation in those times was quite bipartisan support. And that is something President different from the one that confronted Clinton's plan.

The following chart shows the bipartisan vote on eight major not adoption of the conference report, unless otherwise noted. domestic legislative initiatives since 1935. All votes are on passage, Totals may not add because of independents.

1 Democrat | Republican Social Security, 1935 Federal Highways, 1956' Established an income replacement system for retirees. Benefits originally Authorized funds for construction of a National Interstate Highway system. were limited to $15 per month, covering a small pefcentage of seniors.

Civil Rights, 1957 Civil Rights, 1964 Allowed attorney general to seek injunctions to halt denial of voting rights Guaranteed access to public accommodations, authorized federal govern­ and created Civil Rights Division in the Department of Justice. ment to sue to desegregate schools and required most companies to grant equal employment opportunity. I House Passed, 286-126 T T T [House Passed, 290-130 | I

Senate Passed, 72-18

prices. Whether such an uptick would cause a coverage by subsidizing policies for the unin public outcry remains unclear. sured poor. If insurance reform causes premi urns to rise, as expected, then the cost of Subsidies and Medicare Cuts government subsidies also will rise. Congress could decide that all it wants to do "The issue becomes how do you pay for this year is insurance reform. At this point, those subsidies?" said Martin Corry, legisla­ however, all the incremental bills, including tive director for the American Association of Chafee's and those by Senate Minority Leader Retired Persons. He sees only two answers: a Bob Dole, R Kan., and House Minority Leader tobacco tax and cuts in Medicare, the govern Robert H. Michel, R III., attempt to expand ment's health insurance program for the el-

14 September 10, 1994 CQ