Daschle's Health-Care Plan

Published August 27, 2008

National Review Online

Former South Dakota Democratic Senator Tom Daschle was an early and prominent supporter of Senator Barack Obama's bid for the presidency, which explains why a politician now nearly four years removed from a defeat at the polls, courtesy of John Thune, has been given a prominent speaking role at the Democratic convention today. (Full disclosure #1: I worked, for a brief time, on a consulting project with Senator Daschle.)

Daschle, it seems clear, is not ready to close the book on his political career. His involuntary departure from the Senate in January 2005 apparently left him with a yearning for an Act II, even if such a role would certainly entail less power than he wielded as leader of his party in the Senate. His mentor, former Democratic Senate Majority Leader George Mitchell, left the upper chamber on his own terms in 1995, and appears more than satisfied with his flourishing career as an elder statesman. Mitchell's public roles in recent years — peace negotiations in Northern Ireland and an investigation of the use of steroids in Major League Baseball — have been the kinds of assignments only retired-and-not-coming-back politicians are asked to take on.

Daschle, by contrast, seems to be very consciously positioning himself for a return to the Washington fray. He signed up as a Distinguished Senior Fellow at the liberal think tank, the Center for American Progress, and, for a time, he was mentioned as a potential Democratic candidate for president — before pulling his name from the list of contenders. Shortly thereafter, he endorsed newcomer Obama, becoming one of the first Washington insiders to sign up with the long-shot candidate, and he has been a top counselor to the candidate ever since. Which has made the curious wonder: What does Daschle want in return from Obama for signing on so early? VP? Although he submitted the paperwork, Daschle said he did not want the job nor did he seem to be under serious consideration for it. White House Chief of Staff, a la Leon Panetta? No, Daschle said, that doesn't interest him either.

It seems the only job that really gets Daschle's heart pounding is . . . Secretary of Health and Human Services? Granted, that's not a post most ambitious Republican politicians covet, given what's involved in a conservative administration. HHS is ground zero in the battle for limited government, and Republicans have lost far more of the skirmishes there than they have won. HHS spending now stands at $670 billion annually, and counting, and the agency employs nearly 64,000 workers.

But if your ambition is to remake American health care based on an activist vision, and you think you have the legislative game plan to pull it off, is there a better post than HHS Secretary?

Daschle seems to think that perhaps there isn't. He let it be known in June that he wouldn't mind playing a prominent role pushing for a reform plan in an Obama Administration, and that could mean taking the top job at HHS.

For the most part, Daschle's views on health-care policy are predictable for a Democratic politician with long service in the Congress. (Full disclosure #2: Daschle published a book on health care in 2008, with two co-authors, which I have not read; his views on reform discussed here are pulled from numerous news stories and other articles he has written outlining his views.) Like other Democrats, the goal that animates him is universal coverage, and he distrusts market forces and financial incentives in the health sector. Consequently, the toolbox he is looking through is the same one other Democrats are also reaching for: mandates on individuals and businesses to buy or offer coverage; new government-run insurance options for the under-65 population; a national governmental agency offering anyone who wants it to sign up for insurance outside of work; large new subsidy programs; and much more government involvement in determining what is and is not effective medical care.

But Daschle's vision isn't entirely conventional. For many years, he has argued that a crucial element of reform is something like a Federal Reserve Board for Health. Unlike most Democrats, Daschle seems to understand there is a downside to government-run health care — which is, well, the government calling the shots. That's a recipe for rigid and outdated regulations from an unresponsive bureaucracy and a meddling Congress micromanaging payment rules. Of course, this is exactly what Daschle observed in the Senate as politicians took turns manipulating Medicare's complex and counter-productive web of fee schedules to meet their parochial objectives.

The answer, of course, would be to build an effective marketplace and hand decisions over to consumers. But Daschle is no free-market reformer. He believes the solution is to entrust government-run health care to people more trustworthy than HHS bureaucrats or elected members of Congress — like an unaccountable, unelected Board of wise men. In Daschle's vision, such a board would be charged with making the big and controversial decisions — like what should or should not be covered by insurance plans — without having to answer to the public. Of course, this would be a nightmare scenario for those fearful of government intrusion into the practice of medicine. Once up and running, such a Board would inevitably accrue more power and authority, becoming the choke point for all crucial decisions. And the public would have little recourse to ever undo it.

What's even scarier is Daschle's idea of how to get such a Board approved by Congress. He has long held that the Clintons made two crucial mistakes in 1993: they put health care on the back burner until October, to allow time for passage of the tax plan, and they agreed to pursue reform in the Senate under the normal rules, which require 60 votes to overcome a filibuster. Opponents took advantage of both decisions to defeat the entire effort. Should Obama win the election, Daschle is sure to urge him to strike quickly and use whatever leverage is available, including fast-track procedures, to pass as much of his health agenda as possible early in 2009.

Of course, even if Daschle becomes the HHS Secretary, fast-tracking a government takeover of health care would still be a long shot. The problem in 1993 wasn't just timing and legislative tactics. Then, as now, most Americans had good insurance through their employers and ready access to some of the finest medical institutions in the world. The public turned against the Clinton plan when they realized all of that would be at risk in the name of a universal system. An Obama/Daschle reform scheme would suffer from the same flaw.

Still, Daschle should not be underestimated. He understands legislative dynamics better than most. And he also understands that just about any reform plan passed by a Democratic Congress would be a strategic victory, likely to set in motion market dynamics which would make a later government takeover inevitable. Knowing this, he would be
willing to make the compromises necessary to get something through to the president's desk.

Let's hope he never has the opportunity.

— James C. Capretta is a fellow at the Ethics and Public Policy Center and a health-policy and research consultant.

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