Health Care Heavyweights

There's an old saying in Washington: "Personnel is destiny."

In 1993, President Bill Clinton sealed the destiny of his health-reform plan when he chose his wife, Hillary Clinton, to head the effort, and his old friend, management consultant Ira Magaziner, to serve as her deputy. Neither of the two had lived long in Washington nor had either worked in Congress. Neither possessed standing relationships with powerful legislators or a deep understanding of the federal bureaucracy. But they had something else: undeniable brilliance. Tremendous analytical horsepower. They would -- President Clinton thought -- approach the policy problem with an outsider's perspective and synthesize dazzling new ideas and tested old concepts.

They did, but unmitigated disaster resulted. Clinton and Magaziner built a policy of exquisite delicacy and undeniable innovation, pairing managed care with managed competition to construct an elegant hybrid structure where the public sector and the private sector would toil in productive cooperation. The legislation stretched past 1,000 pages, was nearly impossible to explain, and lacked the support of either the relevant legislators or the American public.

Yesterday, in Chicago, Illinois, Barack Obama named the personnel for his own health-reform effort. Tom Daschle, the former majority leader of the United States Senate, will serve as both secretary of Health and Human Services and as director of the newly constituted White House Office of Health Reform. Jeanne Lambrew, the former top health-care staffer for the National Economic Council and the Office of Management and Budget, will serve as his deputy. Their presence ensures that Obama's effort to reform health care will follow a very different path than that of his Democratic predecessor.

The mistakes of the 1994 health-care reform were predictable the moment Magaziner was unveiled as its architect. Peter Gosselin, writing in The Boston Globe, noted Magaziner's tendency to produce "mammoth policy studies conducted under the auspices of big bi-partisan commissions that don't just make recommendations, but come up with entirely new language for talking about problems." This has since become the standard explanation for what doomed the Clinton plan. The lumbering, bureaucratic approach produced a proposal few understood and none desired. But Gosselin wasn't writing a postmortem. He wasn't even writing about the health-care battle. He was profiling Magaziner in November of 1992, before Magaziner had any involvement in health-care at all.

Hillary Clinton, meanwhile, created a different set of problems. Whip smart and a tireless campaigner, her presence atop the effort was meant to signal its importance to the president. But she also had a chilling effect on the administration's deliberative process. You can tell the president's health-care adviser that he's full of shit. You can't say that to the president's wife. And so few did. As discussion inevitably turned to disagreement, the process sprung a thousand leaks. Better to let the president know your objections through an anonymous quotation on the front page of the The New York Times than risk angering his life partner.

Clinton and Magaziner's blind spots converged in the process that led to the Clinton administration's plan. The initial phases of that process are now famous: 30 working groups involving more than 500 people, most of them policy wonks. What followed might have made for a good Brookings conference, but it did not result in sound legislation. Eventually, the sprawling structure was dissolved, and a smaller executive committee built the actual bill. Procedurally, that made sense to Clinton and Magaziner. The point was sound and comprehensive legislation, and that required experts gathered in a room. Politically, it made no sense at all.

The executive committee, after all, didn't have any votes in Congress. Members of Congress had votes in Congress. And the bill wasn't constructed with their involvement, and so few of them understood its eventual shape, much less felt personally invested in its success. "I was the biggest mistake of the Clinton health-care bill," says Sara Rosenbaum, who sat in a hotel room with other policy experts and drafted the legislation. "It was a terrible error to have the president doing what Congress was supposed to do. It was a misuse of the relationship between the legislative branch and the executive branch. By sending a 1,300-page bill, you're writing a detailed blueprint for the policy rather than using the congressional process to create a consensus." Clinton and Magaziner did not know Congress, and so they did not build legislation that worked in Congress. They saw the policy problem more clearly than the political problem. Arguably, they solved the former. But in failing to solve the political problem, their policy was stillborn.

You can't pass health-care reform without understanding Congress anymore than you can win a race without knowing the route. Congress is where health-care reform happens. If you don't have the votes, you don't have reform. And so Barack Obama and Joe Biden -- the first dual-senator ticket to win since John F. Kennedy and Lyndon Johnson -- asked former Senate Majority Leader Tom Daschle to serve as secretary of Health and Human Services.

But, as Mike Allen reported, Daschle "did not want to be HHS secretary -- or at least was lukewarm on it -- unless he was given a health-czar role." Health and Human Services is an administrative position with a heavy load of bureaucratic responsibility. The agency's leader must oversee the National Institute of Health, the Center for Disease Control and Prevention, the Food and Drug Administration, the Indian Health Service, and dozens more. Worse, it's far from the Oval Office. There's no guarantee of regular contact with the president. Donna Shalala, secretary of Health and Human Services during the 1994 health-reform fight was a peripheral player at best.

Negotiations produced a new White House agency named the Office of Health Reform, which Daschle will also direct. Daschle chose for his deputy Jeanne Lambrew, a longtime government health expert, survivor of the 1990s battles, and Daschle confidante (they even co-authored a book together: Critical: What We Can Do About the Health-Care Crisis). "This is a way for Daschle to institutionalize his pre-eminence," says Len Nichols, director of the New America Foundation's health-policy program, "so when he's on the Hill, he's speaking for health reform. It's a reaction to the Clinton structure and shows the world he's in the White House on a daily basis."

If the Office of Health Reform is Daschle's reaction to the marginalization of Shalala, Daschle is Obama's effort to inoculate his administration against the personnel mistakes of Bill Clinton. Magaziner and Clinton may have known policy. But Tom Daschle knows legislative politics.

Daschle first came to the Senate in 1973, as a staffer for the eccentric Sen. James Abourezk of South Dakota. He won his first race for Congress in 1978. He was elected to the Senate in 1986 and became Senate minority leader in 1994 -- at the age of 47. "It turned out that beneath the 'Leave It to Beaver' exterior was a little bit of Machiavelli," marveled George Stephanopoulos.

It was a difficult time. 1994 was, for Democrats, their party’s nadir. The midterm elections had been a historic massacre. The party lost 54 seats in the House and eight in the Senate. The proximate cause, at least in part, was the catastrophic failure of Bill Clinton's health-reform effort.

In those dark days, when Democrats were supposed to get rolled by a newly assertive Republican majority, Daschle showed a surprising talent for caucus management and parliamentary maneuvering. “In his three years as Minority Leader, Daschle has never failed to get forty-one votes to block the Republicans when he’s decided to make the effort to do so,” wrote Joe Klein in a 1997 New Yorker profile that examined Daschle’s unexpected success at navigating the traditionally fractious Democratic coalition. "The counting of noses and the winning of votes is one of the more elusive political arts," Klein continued. "It happens one on one, in private. It requires skills too subtle for most politicians -- notably, the divining of individual temperaments." He went on to quote Chris Dodd, who had challenged Daschle for the position. "I'd like to think I would have done a good job as leader," said Dodd. "But, boy, Tom certainly does have a talent for this."

It's that talent -- the talent for counting noses and winning votes and understanding temperaments -- that Obama will now be relying on. Daschle can recite the pet issues of individual senators and the unseen constituent crosscurrents that shape their decisions. Personnel is destiny, and if policy wonks give you a process tightly focused on the concerns of experts, former legislators are likely to give you a process that's intensely sensitive to the needs of congressmen. And congressmen, after all, are the ones who will decide whether policy becomes law.