Has Daschle Gone Rogue?

Tom Daschle, Obama's original pick to overhaul the health care system, is now floating a rival plan, to the administration's chagrin. The Daily Beast's Richard Wolffe asks the president's failed health nominee which side he's on.

Manuel Balce Ceneta / AP Photo

Tom Daschle, Obama's original pick to overhaul the health care system, is now floating a rival plan, to the chagrin of some in the administration. The Daily Beast's Richard Wolffe asks the president's failed health nominee which side he's on.

He was supposed to be at the heart of the health-care debate, shuttling between his White House office, the halls of Congress, and his expansive Cabinet secretary’s suite. Instead Tom Daschle, the former Democratic leader in the Senate and prominent advocate for health reform, is shaping the contentious debate through the advisory job that derailed his nomination as Obama’s first pick for Health secretary. And it's a shape that the president doesn't currently accept.

“This is difficult stuff,” he tells me. “It’s not easy. There’s no painless way to reach compromise. There’s no painless way to reach the revenue targets we’re trying to reach. I don’t mind taking heat. I guess I feel I took plenty of heat when I was leading the Senate. It comes with the territory. You have to accept the fact that you’re not going to please everybody.”

“He’s making compromises we don’t want to,” says one senior Obama aide. “We just take a different view right now.”

The reason he’s not pleasing Obama right now: the reform blueprint he negotiated with two former GOP Senate leaders, Bob Dole and Howard Baker. It includes compromises that some Democrats, including several inside the White House, are still uncomfortable with.

(Daschle works at the D.C. office of Alston & Bird, a corporate law and lobbying firm headquartered in Atlanta. He is not a registered lobbyist, meaning he cannot approach government officials on behalf of his clients. He can, however, advise the firm's clients, which include several major health care companies and organizations.)

Daschle’s big compromise was to weaken the so-called public option, making the federal government a fallback in case state governments fail to establish so-called insurance exchanges. Those exchanges are intended to allow patients to compare plans in a clear way, encouraging more competition between insurers to drive down costs.

In return, Daschle felt that his Republican counterparts dropped their opposition to universal coverage, and especially mandates for companies and individuals—which would levy fees or taxes on those who don’t offer coverage or take up insurance.

The headlines and commentary about Daschle’s compromises were not exactly positive. “Daschle Folds on Federal Public Health-Care Plan,” wrote ABC’s The Note. “Daschle reluctantly agreed that there would be no federal-government plan,” wrote The Washington Post’s veteran columnist David Broder. Another point of criticism: the fact that he continues shaping policy, including talking on background to reporters and commentators and sharing his expert analysis to his clients, via the job that derailed his nomination as Obama’s first pick for Health and Human Services secretary: special public-policy adviser at the law firm Alston & Bird.

White House insiders weren’t necessarily expecting the South Dakota Democrat to carry their water. But after his nomination debacle, they weren’t expecting major differences, either. Now there’s a feeling that he’s gotten out ahead of them. “Everyone loves Daschle,” says one senior Obama aide. “But he’s making compromises we don’t want to. We just take a different view right now.”

Daschle has expended much time and effort to correct the impression that he torpedoed a public health-care option—up to a point. “I don’t think I said that,” he explained. “But we have to be willing to compromise on a public plan. At the end of the day, I’m not opposing everything else just because a public plan isn’t designed the way I would like it to be. There isn’t one thing that should kill the reform effort this time.

“What we did at the Bipartisan Policy Center was to have a state option, rather than a federal system, and that was tough. It was painful for me. But there was a bigger picture, and the extraordinary willingness of Bob Dole and Howard Baker to agree to so many things that I wanted, led me to believe this was a fair compromise.”

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Daschle says he has received positive reaction from his Democratic friends in Congress and the White House, although he has not spoken to President Obama about his compromise package.

In any case, Daschle wants to see a sense of perspective in the debate, especially the estimated costs of universal coverage. The cost of the proposals from Daschle’s group amounts to $1.2 trillion over 10 years, compared to overall health-care spending of $35.2 trillion in the same period. That trillion-dollar figure has prompted howls of outrage from Republicans who believe they can drive deficit-conscious independent voters against major reform efforts “What is it worth to us to get universal coverage for the first time in American history,” says Daschle, “and a framework that puts wellness before illness, and potentially dramatically improve quality? What is that worth? Is it worth $1 trillion when we’re going to spend $35 trillion? Keep in mind everything we do now is only going to get worse five or 10 years from now.” On one point, Daschle says Democrats should not compromise. “I don’t think we’ll succeed if we look at this as an incremental effort,” he says. “Because that’s exactly what we tried to do for the last 50 years and we failed.”

Richard Wolffe is Daily Beast columnist and an award-winning journalist, political analyst for MSNBC, and senior strategist at Public Strategies. He covered the entire length of Barack Obama's presidential campaign for Newsweek magazine. His book, Renegade: The Making of a President , was recently published by Crown.