When Senate Finance Chairman Max Baucus (D-Mont.) ticks off his agenda for the year — Medicare Part D reform, child health care programs, energy tax provisions, trade deals and education — he hits all the topics that might make tax wonks drool and budget hawks cringe. But chief among his priorities as chairman of one of the most powerful committees in Congress is a return to what he sees as a more congenial and deliberative approach to legislating.

“The kind of tone [he sets] is important to me,” Baucus said in an interview with Roll Call, arguing that bitter partisanship and a propensity to short-change the committee process have limited the Senate’s ability to move significant legislation.

“It’s so important. I think virtually nothing of consequence passes or is enacted without working together, both sides of the aisle and both houses and with the administration,” Baucus said, explaining that this reality is what has driven, in part, his effort to forge a close relationship with Finance ranking member Chuck Grassley (Iowa), who served as chairman while the Senate was under GOP control.

And, according to Baucus, he is now pursuing a similar relationship with House Ways and Means Chairman Charlie Rangel (D-N.Y.). As was his practice with Grassley, Baucus is planning to meet privately with Rangel at least once a week to discuss matters before their committees and to find ways to smooth the legislative process. “I think the world of Chairman Rangel. … I like the man,” Baucus said, adding that while tensions may arise in their work, there is a basic understanding between them that “we both want to do what is right.”

Baucus also said he and Rangel have discussed ways to avoid fights over the use of “blue slips” by Rangel to block the Senate from attaching finance measures to bills. Under Congressional rules, the House can blue-slip a Senate bill with tax provisions since all tax measures are constitutionally required to originate in the House. The practice was often a source of tension between Grassley and former Ways and Means Chairman Bill Thomas (R-Calif.).

“I like to see the committee work as a committee, even more than it has in the past. That means more hearings … so Senators have a better idea of what they’re voting on before it gets to the floor,” Baucus added. Not allowing bills to percolate up through the committees means much of the policy work becomes “a matter of first impression … [which] discourages good policy. And my thought of this is let’s do much more of this in committee.”

Prior to Majority Leader Harry Reid’s (Nev.) ascension to the top spot in the Senate Democratic Caucus, such talk likely would have prompted dire warnings from Democratic partisans that Baucus would break with his party at the first sign of pressure from the White House, in order to avoid being painted as too liberal during his upcoming re-election fight.

But thanks in part to a close relationship with Reid — and growing national unhappiness with President Bush’s policies — Baucus said those concerns have fallen largely, though not entirely, into the background for Democrats.

Sen. Debbie Stabenow (D-Mich.) said Baucus has done a good job the past few years of being a team player with the rest of the Caucus.

“What we have seen is that Sen. Baucus is willing to balance his own personal beliefs with others in the Caucus and with Republicans,” said Stabenow, who noted he’s done a “terrific job balancing” those interests.

And she noted that Baucus’ relationship with Reid was an important influence.

“He and Sen. Reid have a great relationship, which makes all the difference in the world,” she said.

“Harry Reid embraced Max, as opposed to trying to legislate around him, and [former Senate Majority Leader Tom] Daschle (D-S.D.) used to legislate around him,” noted one former Finance staffer. That, in turn, has freed up Baucus to be more supportive of leadership now that he sees himself as part of the process, leadership aides have said.

A veteran aide to a Red State Democrat pointed out that Baucus’ recent comments criticizing Bush’s prosecution of the Iraq War were seen as a sign by many that he will not back down from the administration, even in the face of a certain attack by Republicans in 2008.

Nevertheless, this aide predicted that what type of legislation comes out of the Finance Committee — and Baucus’ ability to work with leadership in politically difficult positions — will be the true test of the veteran lawmaker.

“He has to prove that he is working with the Caucus,” the source said.

Whatever Baucus does, he’ll no doubt get some push-back from the more liberal side of his party — particularly when it comes to his negotiations with the House.

Already Baucus’ plan to add small-business tax breaks to a minimum-wage hike bill has run afoul of House Democratic leaders, and Rangel in particular. Rangel refuses to contemplate devising a bill similar to Baucus’ and has the power to blue-slip the Senate bill.

In an interview Friday, Rangel strongly denied any tension or animus between himself and Baucus, and he said Baucus has not tried to convince him to take up a small-business tax package, which Senate Democratic and Republican leaders insist is essential for passage of the bill in that chamber.

“No one has called me from the Senate and asked me to entertain a tax bill,” said Rangel. He added, “I’m not prepared to accept the Senate amendment of the tax bill.”

For his part, Baucus has deflected talk of the conflict with Rangel over small business tax breaks on the minimum-wage bill, arguing that any significant differences are based more on procedural realities than anything else. “The goal line in the House is a little different than the goal line in the Senate,” Baucus said.

Democrats on both sides of the Capitol said the friction between Baucus and Rangel over the minimum-wage measure is likely only temporary.

“We assume it’s going to be better than the Grassley-Thomas relationship,” said one well-placed House Democratic source. “It’s a little bit of tension just as we get rolling. … It’s a little dust-up.”

The source added that the tensions are more the result of the traditional impatience House Members have with the slow pace of the Senate and the Senate’s requirement for a supermajority, or 60 votes, on every issue.

And Baucus is adjusting to having to consult his House Democratic counterparts.

“The minority party in the House is irrelevant,” said one former Finance aide of the reason Baucus and Rangel have not worked together in the past. “This is a whole new ballgame for them.”

The aide added, “I think it’s just growing pains.”

Besides the natural tension between the House and Senate coming into play, Baucus and Rangel are stylistically different as well.

For example, Baucus — a moderate on most issues — is considered the consummate dealmaker.

“He actually wants to get things done,” said the former Finance staffer. The staffer added that liberals like Rangel and Sen. Edward Kennedy (D-Mass.), with whom Baucus could clash on health care issues, are more concerned with appealing to the Democratic base. “Those other two guys like to do message bills.”

But Baucus has been criticized by some in his party for being more concerned about making a bipartisan deal than he is about whether the deal achieves Democratic objectives.

“In the House, there’s a sense that Baucus … bought into the Bush tax cuts pretty quick,” said the House Democratic source. “There’s still some lingering suspicion because of that.”

Rangel, on the other hand, wants to work for bipartisan agreements, but “the deal has to be good. … I don’t think his opening position is, ‘Let’s make a deal,’” said the source.