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The GOP's SCHIP Dilemma

By rejecting congressional legislation expanding the State Children's Health Insurance Program, or SCHIP, President Bush attempted to reassert his commitment to holding the line on federal spending. For many Republicans, moderate and conservative alike, the move is simply too little, too late.

Still, the potential for gain is present not just for Democrats, who could benefit from their politically popular position, but for the GOP as well, and some Republicans are optimistic that by vetoing the bill, the President has set his party back on the right track.

While the bill passed by wide margins in both houses - just 31 Senators and 45 Representatives voted against the legislation - Republican leaders are confident the party will have the votes to sustain the veto in the House. Sources say Democratic attempts to override the veto will come late next week.

According to several people close to the administration, the veto was simply the first step in what will be a new push from President Bush to control the size of government. Democrats, well aware of the veto threats, chose to offer up SCHIP first, hoping - successfully, it seems - that the battle would boil down to the simple message that Republicans were against helping poor children find health care.

If House and Senate leaders had sent up another bill to be vetoed first, Republicans would have been able to establish the spending argument more easily. By offering SCHIP first, though, Democrats forced the president into a politically unpopular position.

In the short term, Bush's veto, and any Republican who votes to sustain it, are rightly seen as benefiting Democrats. If the fledgling majority succeeds in tying Congressional Republicans, whether they vote to sustain or vote to override, to the president's veto, the GOP's reputation could suffer further. If so, says independent pollster Del Ali, President Bush has made a big mistake. The veto is "part of a stereotype of being out of touch. Whether it's the Iraq war, whether it's immigration, it just kind of leads into the campaign strategy of Democrats, overall, that this is an administration that just doesn't get it," he said.

"It gives the Democrats a weapon to say, 'Look, it's anything but a compassionate conservative position.'"

Polls show health care is the biggest domestic issue with which voters are concerned, and the issue favors Democrats dramatically. A recent Washington Post/ABC News poll showed 56% of voters trust Democrats to better handle health care issues, while just 26% pick Republicans.

Republicans on both sides of the debate agree that, when Democrats attack their party, the appropriate response will be to characterize the expansion as a massive tax hike. That could be a difficult sell, though, as SCHIP remains popular with voters. The Post-ABC poll showed 72% of respondents supported increased funding for the program, while just 25% oppose it. A poll by the well-regarded Republican firm Frabrizio McLaughlin, which described the bill as an expansion of a state-federal partnership, showed 62% of Republicans supported renewing the program and providing additional resources.

To many GOP strategists, though, the veto, and any arguments that ensue, should have been avoided earlier by simply swallowing the pill and signing the bill. "Most Republicans think it has been very poorly handled by the administration," said consultant Craig Shirley. "A lot of conservatives are scratching their heads."

The spending argument, Shirley and others suggest, won't hold water for voters, especially after the Bush Administration's track record. "For the last six years, all this administration has done is expand the government," Shirley said. "This is a drop in the bucket compared to what's gone before."

"I'm all for principled arguments," Shirley said, "but this is the first time we've seen a principled argument on the issue of federal spending."

"This is a political football that the Democrats are going to use," said Republican ad man Ben Burger. The legislation seems tailor-made for political spots - a Democratic challenger would be foolish not to focus ad dollars on an incumbent who voted to sustain the veto.

"Republicans who choose loyalty to George Bush over health insurance for millions of kids will be held accountable," Doug Thornell, spokesman for the Democratic Congressional Campaign Committee, said. The DCCC has already run a series of multi-platform advertisements targeting eight potentially vulnerable Republicans in marginal districts with radio ads, automated calls and emails. Further ads have not been ruled out.

Some vulnerable Republican members do not want to end up on the DCCC's list, and have already made clear they will vote to override. But if a significant number of Republicans vote to sustain the veto, everyone in the party could be tarred. "They call you rubber stamps all the time," said Pennsylvania Republican Charlie Dent, a perpetual Democratic target who represents a district John Kerry won, albeit narrowly. "You know [Democrats] going to hit you over the head no matter how you vote," Burger said.

Dent hopes voters in his district will not associate him with Republicans who vote the opposite way. "I get judged based on my votes, not based on other people's votes," he said.

But for other Republicans, who support the veto, the move is a positive step to getting back their fiscal conservative credentials. Vetoing anything over what the president requested, said Americans for Tax Reform head Grover Norquist, "is the Republican Party's necessary rebranding." Small sacrifices in public opinion now will lead to significant benefits down the road, he says.

The key for Bush, no matter how politically unpopular he becomes, is to keep at the strategy. That, at the moment, is the White House's plan. "This fall is going to be [Democrats] want to spend too much and Republicans are back on the wagon," Norquist said. "We're going to be talking about $600 hammers and bridges to Democratic nowhere."

Some Republicans see the expansion as a Democratic mistake, suggesting the bill could provide the GOP with arguments that the new majority has brought little change to Washington. Pointing out that the pharmaceutical industry is supportive of the bill, one Republican congressman looked back to Democratic attack ads from 2006. "Last year, those people were considered minions of evil on earth," he said. "I don't hear much of that now that they're helping Democrats." A message the congressman thinks will be effective in 2008: "Meet the new boss, same as the old boss."

When the House fails to override the veto next week, a situation that looks increasingly likely, members will head back to the drawing board. "This is not going to be the last vote on SCHIP," Dent said. The renewed negotiations will prove difficult for both parties: If Democrats let the issue die, Dent said, they risk backlash of their own. "Doing nothing, I think, has risks. There are some risks for everyone if we fail to reauthorize this thing."

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