Baucus retirement sets stage for sweeping legislative changes

The Washington Post

Montana Sen. Max Baucus, one of the most influential congressional figures of his era, announced his intention Tuesday to retire, a move that could produce sweeping changes in the political and legislative landscape over the next two years.

The announcement could mark the beginning of one of the most consequential periods in Baucus’ long public career, because he pledged to devote the rest of his time in Washington to pursuing a comprehensive rewrite of the federal tax code, an effort that many see as key to breaking the fiscal gridlock that has paralyzed Washington in recent years.

That paralysis of taxes and spending has been a central feature of Barack Obama’s presidency, and Baucus, 71, said that when the president called him Tuesday about his retirement, the talk quickly turned to tax reform. “They’re going to get tired of me,” Baucus said in an interview, adding that White House officials do not “know themselves where they are” on a strategy for ending the stalemate.

Baucus, chairman of the Senate Finance Committee, which has jurisdiction over tax issues, said his decision not to seek re-election frees him from the demands of a campaign and will also allow him to focus on new trade agreements and implementation of the Obama health care initiative, which he played a major role in drafting.

Baucus at some times has been a key ally of Obama and at others a thorn in his side. Shortly after Obama took office, Baucus crafted large portions of the massive 2009 economic stimulus package and played a key role in drafting the president’s health care plan. Last week, he opposed Obama’s gun-control proposal, the failure of which was a crushing defeat for the president.

Baucus infuriated Democratic colleagues in 2001, just ahead of a potentially tough re-election fight, when he worked with Republicans to write one of the largest tax cuts in American history just months after George W. Bush won the White House. In 2003, he helped Bush pass his Medicare prescription drug plan, but in 2005 he led the opposition to Bush’s effort to partially privatize Social Security.

Baucus has spent most of his adult life in Washington, having been elected to the House in 1974 and to the Senate in 1978. He explained his decision to retire in squarely personal terms, saying he had been wrestling with the idea since his mother died just over a year ago.

“It made me realize I’m not immortal. We’re all mortals,” Baucus said. “I don’t want to leave here when I’m 80 years old. There are things I want to do. . . . I want to see what life is like outside the United States Senate.”

With more than $5 million already in his campaign war chest, Baucus had been aggressively raising funds for re-election in a state that gave Republican presidential nominee Mitt Romney a 13 percentage point victory in 2012. “It’s a big loss for the Senate,” said Republican Sen. Charles Grassley, who drafted the 2001 tax cuts and the Medicare law with Baucus.

Baucus became the fifth Senate committee chairman, with more than 140 combined years of experience, to announce his intention to retire next year. The others include John Rockefeller IV, 75, chairman of the commerce committee, and Tom Harkin, 73, chairman of the health committee. In recent years, longtime committee chairmen Robert Byrd, Daniel Inouye and Edward Kennedy died in office. The retirements have given Republicans several openings in next year’s midterm elections, in which they currently need a six-seat gain to reclaim a majority they lost in the 2006 election.

Democrats immediately began courting former Montana Gov. Brian Schweitzer, who has honed an image as a Mountain West populist, to run for Baucus’ seat. Republicans had been trying to land a top recruit to challenge Baucus, who despite his unpolished public image has repeatedly won tough re-election battles. The state’s at-large congressman, Republican Rep. Steve Daines, is believed to be considering running for the open seat.

Another measure of Baucus’ influence is that many of his former staffers became some of the most influential political advisers and K Street lobbyists, establishing an alumni network that is the envy of many congressional offices and the object of derision by ethics watchdogs. Jim Messina, Obama’s 2012 campaign manager, rose through the ranks of Montana politics at Baucus’ side.

The Baucus announcement sent lobbyists scrambling to learn who will fill the chairmanship of the Finance Committee, with its oversight of tax, trade and entitlement policy. Sen. Ron Wyden, a liberal with an independent streak, is next in line.

The constraints on chairmen have grown evident over the past two years, especially as Obama and congressional party leaders have strayed repeatedly into territory traditionally governed by the Finance Committee. Since January, Baucus has been in an open feud with Senate Majority Leader Harry Reid and Sen. Charles Schumer over tax reform, arguing that a Democratic proposal to raise nearly $1 trillion in fresh revenue over the next decade is excessive and unworkable. Instead, Baucus has declared his intention to work with Republicans on a rewrite of the tax code. The revised code would eliminate loopholes and deductions and use the new revenue to lower tax rates, as Republicans desire, as well as to reduce the deficit, as Democrats demand.

In recent months, Baucus has worked with a new ally, House Ways and Means Chairman Dave Camp, a Republican who shares his enthusiasm for tax reform. With Camp facing a term limit on his chairmanship next year, aides said both chairmen have a rare sense of freedom in an era when power is concentrated in the offices of Reid and House Speaker John Boehner.

Inside the Democratic caucus, many junior Democrats have chafed at Baucus’ power, pushing the leadership to rein him in, and some have even promoted the prospect of imposing term limits on Senate chairmen. Those proposals have so far been brushed aside by Reid’s leadership team.

Baucus’ advisers said he was not afraid of running another tough race. But in one clear signal that he was ready to go, Baucus and his wife, Melodee, have recently begun building what they call their “dream home” outside Bozeman, Montana. Additionally, several of his closest advisers left their senior positions in recent months for private sector jobs.

Despite Obama’s double-digit defeat in Montana, Democrats intend to vigorously defend the seat. “Democrats have had a great deal of electoral success in Montana over the last decade, and I am confident that will continue,” said Colorado Sen. Michael Bennet, chairman of the Democratic Senatorial Campaign Committee.