The lessons of Clintoncare

Posted: Jan 03, 2005 12:00 AM

 Social Security overhaul seems to be the Bush administration's first priority for 2005. To gauge the prospects of success, it may be helpful to compare Bush's formidable task with the No. 1 goal of the incoming Clinton administration in 1993, health-care finance overhaul. On the surface, Clinton's odds of a win looked better in early 1993 than Bush's do today.

 But Bush actually has a better chance of prevailing. Keeping in mind that in the early stages Clinton had offered few details of his plan, just as Bush has been unspecific so far, the policy environment for Bush today looks better than it was for Clinton 12 years ago.

 Most Washington observers in early 1993 thought that Bill and Hillary Rodham Clinton would pass a health care plan. The polls showed public demand. The Clintons had big Democratic majorities in Congress -- 57-43 in the Senate, 259-176 in the House. Not all Democrats were reliable liberals, but most were in favor of expanding government to help ordinary people.

 The relevant committees had able and friendly chairmen -- Daniel Patrick Moynihan and Edward Kennedy in the Senate, Dan Rostenkowski and John Dingell in the House. All were of a mood to help the new president and first lady. Important Republicans -- notably Bob Dole, ranking member on Senate finance -- were sympathetic, too. Political pros could be forgiven for expecting a Clinton health care plan to get through.

 Compare the situation of Bush on Social Security today. The polls do show majorities in favor of individual investment accounts as part of Social Security. But they also show voters favoring Democrats over Republicans on the issue. Bush's majorities are smaller than Clinton's -- 55-45 in the Senate, 232-203 in the House. And as in 1993, not all majority lawmakers can be relied on to support their president.

 House Republicans are particularly skittish. Anyone who has accompanied a congressman as he makes the rounds in his district will know why. Few people will go out of their way to see their congressman, and so he appears mostly before captive audiences -- schoolchildren and senior citizens. And at the senior citizens' center, the first question always is, "You aren't going to take away my Social Security, are you?"

 House Republicans would like the Senate to vote first on a overhaul bill. But it's not clear whether Senate Republicans can clear the 60-vote hurdle if Democrats filibuster.

 House Ways and Means Chairman Bill Thomas has shown he can pass tough bills on party lines. But Senate Finance Chairman Charles Grassley is more inclined to seek bipartisan agreement. And few if any Democrats seem inclined to line up with Bush on the issue.

 So, if the Clintons couldn't do it, how can Bush? Because in broad terms the Bush plan is better policy and a more saleable idea. The Clinton health care plan failed because it took on too much. We do not have one health-care finance system in this country, but many. Powerful interests representing millions -- HMOs, private insurers, labor unions, teaching hospitals, rural providers -- feared they would lose from change. Social Security, in contrast, is a single national system. It does not have regional variations that create regional interests.

 In addition, the Bush Social Security plan is more in line with the direction in which society is moving. The Clintons were seeking more government control of one-seventh of the economy at a time when people had more respect for decentralized markets and less for centralized bureaucracy. The mid-century assumption that progress meant more government perished in the stagflation and gas lines of the 1970s.

 Bush's individual accounts, in contrast, are intended to give more people access to markets to accumulate wealth at a time when most voters are investors. At mid-century, it seemed wise to rely on big institutions to provide a safety net. But as big corporations default on their pension promises and when the Social Security trust fund is projected to fall to zero when today's 30-year-olds reach retirement age, it seems wiser to rely on savings multiplied by compound interest.

 All of which is not to say that the Bush plan is a slam dunk. There is still plenty of disagreement among Republicans and hostility from the Democrats. The politics isn't easy. But the policy is more in line with the changing character of American society.