The Heart of Power: Momentum and Medicare

The Heart of Power: Health and Politics in the Oval Office. David Blumenthal and James Morone, University of Californian Press, 420pp.

In all things which deal with people, be liberal, be human. In all those which deal with people's money or their economy, or their form of government, be conservative.

-President Dwight Eisenhower, 1954

Dwight Eisenhower fretted. The 34th president, a man Theodore White once called "the greatest living vote getter," worried obsessively about keeping the federal budget balanced. He worried that the New Deal had encroached on liberty (although privately he ridiculed reactionary attempts to roll it back). As president, the former five-star general cut military spending and famously warned of the political dangers posed by a military-industrial complex. And concerns over the inevitability of a sweeping government health care program gnawed at him enough to encourage members of his administration to explore alternatives.

In general, the health care proposals that emerged from the Eisenhower Administration comprised an unwieldy combination of federal funding, state administration, and private insurance. While these satisfied Eisenhower's insistence on a health care policy that minimized the role of the federal government in the day-to-day administration of the nation's health care, they also created an administrative burden that ran up costs. Administration plans were subject to a convoluted vetting process imposed by Eisenhower's belief in staff work, and usually wound up watered down by compromise and by the negative reaction of budget experts who insisted that broad health care reform would never pay for itself. Moreover, the proposals were never received with any great enthusiasm by the barons who ran congressional committees.

The Revenue Act of 1954, passed by a Democratic Congress and signed by Eisenhower, formalized and expanded an obscure World War II regulation that rendered tax free health care premiums paid by employers and employees. Although little remarked on at the time, the bill enabled the expansion of the private health care market because employers began offering the tax free benefit to employees. (Fatefully, Walter Reuther of the United Auto Workers proposed a cross-industry health care benefit that the Big Three, fearing a concentration of union power, opposed. They proposed and negotiated a separate deal with the UAW, a proposal that haunts them to this day.)

A second major advance for private insurance came with 1959's Federal Employee Benefits Program, a congressional proposal to offer health insurance to federal employees. Since the insurance came from private ensurers, Eisenhower readily acquiesced to a program that became the model for Barack Obama's health care promise during his 2008 campaign. The plan proved that the federal government could run a large privately administered, market-based benefit.

Eisenhower was a deeply humane man, but when it came to health care, his personal magnanimity often found itself in conflict with his public parsimony and skepticism of government. His interest in health care was personal: The lingering death of his mother-in-law had visited financial ruin on that family. Thus, his health care presidency centered on reconciling Eisenhower's personal experience with his philosophy of limited government. Although this led to no legislative breakthroughs, it resulted in the initial Republican alternative to the Democratic preference for government programs, led to the increase in the number of Americans with private insurance, and revealed a key truth for future presidents who would pursue health care reform.

Under Eisenhower, the role of private health insurance expanded to such a degree that by 1960 more Americans had health insurance than did not. Fearing the inevitability of an expansive government plan, his administration articulated a Republican alternative based on federal, state, and private insurance cooperation. And it uncovered a key rule for future presidents: Minimize the role of the bean counters. Pursue health care reform because you think it is the right policy, and don't give ammunition to opponents who want to make it a matter of cost.

The first president of the television age, John Kennedy inaugurated the era of the charismatic presidency. As president, Kennedy brought the unfathomable trait of charisma to bear on the domestic issue that preoccupied him most: Health care. Despite his cool, detached public exterior, Kennedy had a finally honed sense of fairness that revealed itself when his father suffered a debilitating stroke. My family can afford to pay for the best care, Kennedy reasoned, but most cannot. And so the Kennedy Administration put its weight behind Medicare, the federal health insurance program for the elderly.

Dwight Eisenhower's so-called hidden hand presidency had rendered him invisible when it came to health care policy. The Kennedy team decided instead to put the president's considerable public appeal front and center while also working an inside game with Congress. Kennedy delivered a series of speeches supporting Medicare, culminating in a nationally televised address at Madison Square Garden. On the stump, he found an effective rejoinder to the American Medical Association's tired warnings of socialized medicine: Opposing Medicare was no different than opposing Social Security.

But Kennedy's effort preceded the 24-hour news cycle and had little effect on the representatives and senators who controlled the legislative fate of Medicare. Moreover, the Administration had no effective, unified plan for dealing with Congress. When the senate narrowly defeated Medicare, Kennedy found himself denouncing this "most serious defeat for every American family."

Historians will long debate the unfinished promise of John Kennedy's presidency. Medicare had became personal to him, and a sweeping electoral victory in 1964 might well have prompted him to revisit it. We do know that his successor, the man Blumenthal and Morone call "the greatest inside player of the twentieth century" achieved the historic breakthrough that eluded Kennedy. But even in defeat, Kennedy taught future presidents a valuable lesson: Passing major health care legislation requires a full court press, a total commitment from the president, something that Kennedy's successor understood in his bones.

"A man's vision reflects his memories," wrote Lyndon Johnson, and Johnson's memories included a hard-scrabble youth, teaching school in one of the poorest parts of the country, and working as a young New Deal administrator during the heart of the Great Depression, when -- as he later observed -- he discovered that for too many people Christmas was just another day of poverty and misery. To Lyndon Johnson, government was a tool for helping the American people, to facilitate what he termed a Great Society that would, among many other things, end once and for all the problem of inadequate health care for the elderly.

The master of Congress, a former Senate Majority Leader, knew how to work the legislative branch: Relentlessly and without letup. The standard history of Medicare suggests that in 1965 Rep. Wilbur Mills (D-AR), the conservative House Ways and Means Committee chairman who had made a habit of making his committee the place where health care reform went to die, underwent a sudden conversion and reported a comprehensive Medicare bill out of his committee. But research by Blumenthal and Morone into heretofore unavailable resources reveals that Johnson negotiated with Mills for over a year and played an instrumental part in bringing a divided Congress around to support Medicare legislation.

The bill itself knit together three proposals: An Administration bill to pay hospital costs for the elderly via Social Security, a Republican proposal to pay physician costs, and an AMA plan to cover costs for the poor and the near-poor (Medicaid). Johnson never concerned himself with the details and expressed anger whenever the costs of the legislation came up: He knew what a deal breaker this could be to a service that he thought as fundamental to the American home as coffee and flour. Pass the bill, he said; I'll find the money.

Lyndon Johnson had the wind at his back. He was taking up the cause of a martyred and popular president and had just won a landslide reelection. He knew Congress and its members like the back of his hand, and he knew how to pass legislation. Johnson pulled every stop that he knew, and Lyndon Johnson knew a lot of stops. And even so, Medicare was near thing: The Senate passed it by a 49-44 vote; even after passage, implementation was uncertain.

Would southern hospitals integrate? Administration pressure and a reluctance to decline Medicare largesse ensured that they did. Would doctors boycott Medicare patients? Johnson's personal intervention and negotiation brought them around. Would hospitals be able to handle an influx of patients? In the event, they did.

The most successful health care president of the 20th Century left his successors with a blueprint for health care policy success. His personal commitment was total and he worked with alacrity. Johnson steered clear of policy details and focused on creating political momentum. He understood how to deal with Congress, readily grasped that spectacular reelection had given him the upper hand, and passed out credit like Halloween candy. And, as counterintuitive as it seems, Johnson kept his economists in check.

Lyndon Johnson's great legislative year of 1965 remains one of the high water marks of American liberalism. But his immense popularity foundered on the Vietnam War and the riots of the mid-60s. These events tarnished Johnson's presidency and opened the door to a president whose troubled, byzantine mind contributed to forcing him from office. But unlike today's conservatives, Richard Nixon thought of himself as a government man, and the experience of a painful childhood opened opened his complex mind to the possibility of extending health insurance to all Americans.

(End Part 2. Next, Part 3: The Republicans Take Command.)

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