Bolten’s Softer Touch Calms Hill Adversaries

Posted June 1, 2004 at 6:56pm

It was during a fishing trip last summer in the wilds of Alaska that Sen. Ted Stevens (R-Alaska) learned he could work with Joshua Bolten, the man who was then newly appointed as White House budget chief.

This quick bonding was no small development for Stevens, who chairs the Appropriations Committee. He had cultivated a “back-channel friendship” — mainly through secret e-mail correspondence — with Mitch Daniels, Bolten’s predecessor at the Office of Management and Budget. But beyond that, the relationship between Daniels and Congressional appropriators had deteriorated — to the point where Stevens’ counterpart in the House, Rep. Bill Young (R-Fla.), had stopped returning the OMB director’s phone calls.

At both ends of Pennsylvania Avenue, everyone understood that Bolten’s appointment offered a chance for a fresh start.

“We had a good time up in Alaska,” Stevens recalled in an interview last week. “Mitch and I understood one another. … But I didn’t have the personal relationship with him the way I have with Josh.”

Although budget negotiations this year continue to plod along as slowly as ever — and without resolution — Bolten’s amiability appears to have ended two years of antagonism and restored the relationship between OMB and appropriators to its more familiar position: polite wariness.

“I would say there’s been a 1,000-percent improvement,” Young said. Bolten “has provided us with the information we need to do our job that his predecessor never saw fit to provide.”

The change has more to do with style than with substance. People who know both OMB directors describe Daniels — who left to run for governor of Indiana — as a “can-do” type who’s impatient with the trade-offs and compromises that inevitably grease the spending process. By contrast, Bolten is considered a discreet and diligent operator who sees benefit in cooperation.

Bolten, said one House GOP leadership aide, is “a pretty good diplomat, while Mitch was abrasive.”

To be sure, nothing in the job description obliges an OMB director to get on well with Congress. A former White House budget chief once joked that any OMB director is inevitably seen on Capitol Hill as “The Abominable ‘No’ Man.”

“‘No’ is probably a word you utter much more than ‘yes’ — that’s just in the nature of the job,” a White House official said.

Even lawmakers concede that a major part of the director’s job is to clash with Congress over conflicting budget priorities. No administration expects Congress to accept its budget framework without making revisions, even churlish ones. Yet, given the specter of a presidential veto, it is also important for the OMB to establish credible floors and ceilings, and to show where the administration will refuse to give an inch — or might agree to a compromise.

Given this tango, good diplomacy can go a long way even in contentious times. But insiders say that Daniels tended to emphasize the adversarial portion of his job description.

Right out of the box, Daniels mounted a crusade against Congressional earmarks — an effort that, while popular among the party’s deficit hawks, aggravated his relationship with the appropriators he would soon need to deal with directly.

Earmarking was an obvious target for Daniels. As he arrived at OMB, the Bush administration faced rapidly slipping economic indicators that would soon translate into declining federal revenues. Coupled with the president’s determination to push through a major tax cut, the incoming administration needed to improve its budget picture quickly.

Given the urgency of such economic forces, participants say, parochial concerns about district earmarks seemed, to Daniels, petty and selfish.

“He just felt like, ‘Shouldn’t [Members] feel ashamed that they are doing this?’” one former Daniels aide recalled. “But no, they don’t feel ashamed about it. Mitch might think some project is embarrassing, but a Member would want to put it in a press release.”

Inside Congress, the appropriations game is considered a two-way street. Rank-and-file Members leverage their fundraising prowess and committee seniority into chits they can cash in for special earmarks for their districts. In exchange, Members who sit on Appropriations benefit within their party caucus from their ability to deliver on the requests of colleagues.

The system is based on the understanding that a finite number of projects are available, with a finite amount of money to pay for them. If everyone could get what they want, appropriators would not have any particular clout. The same would be true if no one could get what they want.

“Mitch fundamentally did not understand appropriators,” the former Daniels aide at OMB recalled. “He had no idea how [appropriators] would respond.”

Against this backdrop, the public nature of Daniels’ attacks — depicting Congress as hopelessly addicted to pork — substantially hurt his standing with the spending committees. So did the impression — widely held among appropriations aides — that Daniels considered dealing with Congressional staff to be, in the words of some, “beneath him.”

Daniels, through his campaign, did not respond to a request for an interview. Bolten’s office declined to speak on the record about the director’s relationship with Congress.

Advocates for smaller government admire the stances Daniels took against higher spending, saying it took guts to take on Congress on one of its most sensitive issues.

“Mitch Daniels was the one who really tried to get the point across,” said Tom Schatz, the president of Citizens Against Government Waste.

But on a functional level, Daniels’ approach severely hampered his relationship with appropriators. For many, the last straw came after the Sept. 11, 2001, terrorist attacks when the Bush administration sought $40 billion in emergency spending from Congress.

Mirroring the spirit of unity that prevailed nationally after 9/11, appropriators and the White House also adopted a more conciliatory tone. The Bush administration sought wide flexibility on how the new funds would be spent — a request that, by its nature, undercut the constitutional role of Congress. Nevertheless, appropriators provided some leeway, on the condition that they would be regularly updated on how the money was being used.

In the ensuing months, however, details were few and far between.

“I don’t know how many times I asked [Daniels] for information that he couldn’t or wouldn’t provide,” Young said.

Such information may now be more forthcoming from Bolten, but some observers detect more similarity than difference in the tenures of the two most recent OMB directors.

“I don’t think it was a Mitch-zigged-so-Josh-zagged sort of thing,” one Bush administration official said.

Indeed, in the one measure that counts — results — there is little indication that the relationship between the OMB and Congress has changed considerably.

One GOP leadership aide on Capitol Hill cited the ongoing stalemate between the administration and Congress over spending in the highway bill. The lack of progress has frustrated Members, who want to be able to cite new transportation projects to the voters back home in time for this fall’s election.

In the meantime, deficit hawks also feel that little has changed. They see Congress falling back into its old habits.

“The Hill seems happier, but we don’t necessarily like that,” said Schatz of CAGW. “You can see the result. Our ‘Pigbook’” — an annual CAGW report on “pork-barrel” spending — “is bigger than ever.”

But measured by the tenor of relations between Congress and the White House, the struggle over the highway bill has yet to raise temperatures significantly — thanks in large part to Bolten’s diplomatic skills.

Whether that’s a good thing, though, is subject to varying interpretations.

To Roy Meyers — a former Congressional budget official who has been a strong critic of the Bush administration’s budget — the problem now is that the process lacks the sort of internal tension between the branches that produces meaningful compromise. He suggests that GOP control at both ends of Pennsylvania Avenue mean that Congress and the White House are now marching in “lock-step.”

“The major change that I observe is that [Bolten is] not visible,” said Meyers, a professor at the University of Maryland at Baltimore. “I’ve really been astonished by that. … Earmarking is really out of control now. So to one extent Bolten has been a failure.”

Indeed that Bolten has avoided the messy fights Daniels waged over earmarks, focusing instead on setting parameters for spending. And that approach is winning Bolten some cautious optimism among skeptics.

Schatz suggested the test for him will be whether the newest OMB director can force Congress to keep to the spending parameters set by the Bush administration for 2005.

“If Josh Bolten can get Congress to stick to a zero percent increase in non-Defense discretionary spending, then he’s doing a good job,” Schatz said.