The Magazine


Nov 23, 1998, Vol. 4, No. 11 • By MICHAEL BARONE
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"THE DIFFERENCES ARE MUCH DEEPER in the Republican party than in our party," says House minority leader Richard Gephardt. From the other side of the Democratic party, Al From's Democratic Leadership Council, comes the view that divided Republicans "have moved steadily out of the mainstream on a broad array of issues."

Story after story appears on the divisions in the Republican party; and divisions there are. But majority-seeking parties in a continental democracy are usually divided -- "faction," as James Madison warned us, being a natural feature of our politics. And while it is certainly worth looking at divisions in the Republican party, it is also useful to look at those in the Democratic party, which may make a greater difference on important issues in the coming two years.

The obvious division -- with players sometimes shifting over the lines, depending on the issue -- is between From's New Democrats and Gephardt's Old Democrats; between those who want to expand government only a little bit, and with a genuine regard for traditional values, and those who want to expand government as much as they can get away with, with an eye toward "liberation"-minded values.

The Clinton administration wobbles from one side to the other: Hillary-led health care one year, Republican-led welfare reform the next. Clinton backed NAFTA and got it confirmed in 1994; but House Democrats squelched fast track in 1997 and 1998. Indeed, even the DLC took the line that Republicans were bringing up fast track a second time only to highlight Democratic divisions. In 1993-94, the Clintonites ditched the minimum wage in favor of the DLC-backed Earned Income Tax Credit. But in 1995-96, Ted Kennedy resurrected the minimum-wage increase, and for 1999 Gephardt promises the Democrats will get enough Republican votes to increase it again.

The minimum wage, though, is small potatoes -- in many parts of the country, market wages have risen above it faster than the Democrats can boost it. Social Security is the big enchilada. There, the split among Democrats is deep. Serious Democrats have come forward with proposals to devote part of the payroll tax to individual retirement accounts -- senators Daniel Patrick Moynihan, Bob Kerrey, and John Breaux -- and the DLC supports the idea. The White House has emitted encouraging noises; the president, it is said, sees this as an opportunity to set his place in history.

But in 1998, as in the 1980s, Democratic rhetoric held that Democrats wanted to save the system from evil Republican attempts to destroy it. Gephardt certainly seems less than enthusiastic about private-investment proposals, which he caricatures as allowing "individuals to invest in anything they want." He appears more favorable to economist Henry Aaron's proposal that the government set aside funds and invest them, something that Moynihan, for one, rejects out of hand.

There is a window of opportunity for Social Security reform. It's the kind of thing that requires a bipartisan consensus, which is unlikely after 2000, when one party or the other seems likely to control both the White House and Congress. A Gore administration would probably not back reform, and a George W. Bush administration would be unlikely to achieve it over Democratic opposition. Clinton has an opportunity to make a strong commitment to reform at the White House Social Security conference in early December. But absent such a commitment, Republicans are unlikely to move reform proposals forward. The window may be open, but they fear that if they go through, Clinton and the Democrats will slam it shut on them. How Democrats resolve their intra-party divisions will probably make all the difference on Social Security reform.

And so with Medicare. The bipartisan Medicare advisory commission is scheduled to report in March. Its co-chairmen, Democrat John Breaux and Republican Bill Thomas, may agree on a plan that switches the system from a government entitlement to a system resembling the federal employees' health plan, which gives beneficiaries the choice of several forms of insurance. But many Democrats want to retain the current open-ended spending program, loath to give up what they believe is a great political issue. Again, how divisions in the Clinton administration and among congressional Democrats are resolved will probably determine whether Medicare is reformed or left as is: an ever-ballooning claim on the taxpayers.