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After decades in public office, Montana’s senior statesman, Max Baucus, is back home

By SCOTT McMILLION

When I was a junior in high school, my journalism teacher brought to class a young politician named Max Baucus, who was walking from Yellowstone Park to Canada to draw attention to his run for Congress. I don’t remember what he said. But I remember being impressed with the big hike he was undertaking.

That was in 1974. Max Baucus won that race and every political match that came his way later. Only one of them, in 1996, was even close. A Democrat in a red-leaning state, he beat every other opponent by at least 10 points. He served two terms in the US House of Representatives and five in the US Senate, where he ran the Senate’s most powerful committee, then topped it off with three years as the American ambassador to China. At 75, he says he loved it all, but won’t run for election again.

Now he’s back in Montana, living in a tiny guesthouse in the Gallatin Valley with his wife, Melodee Hanes, and a frisky pair of cats—a gift from a Chinese dissident. It’ll do until they build a new home, hopefully breaking ground this spring. They have hundreds of boxes to unpack and sort, three storage units full, and more on the way. Baucus’ Senate papers will go to the University of Montana, which is planning a Baucus Institute, focusing on domestic and international policy.

Early in February, he sat down for an interview. He was on the phone when we got there, in jeans and a casual shirt. No shoes. One of the cats kept us company while he finished the call and found some socks.

His attire seemed appropriate, because he seems to have changed: still intense, still wonkish about details. I’ve interviewed Baucus many times over the years, covered countless meetings, debates, listening sessions. He brought a raft of foreign ambassadors and even the head of the Federal Reserve Bank to Butte, Montana, hoping to boost the state’s prospects. He was never shy about using his political clout to bring help. But he hasn’t lived here since the 1970s.
This interview was different. No aides hovered, fixing his tie, trying to vet questions. It was just us and the cats, Melodee a little later.

“We’re home,” he said. “We’re in Montana for the same reasons most people love Montana. We like to ski and hike and raft.”

Baucus chose the Gallatin Valley for its scenery and for its proximity to the Bozeman airport. His plans include plenty of travel.

“I want to stay involved with policy, generally. I want to be involved around the country,” and internationally. With his contacts and experience, he’d be a shoo-in for a lucrative consultant or lobbying job. I asked if he’d been approached. That got a grin out of him.

“Well, we’ve had a couple,” he said. “I’ll try to keep significantly involved in Asia, especially representing Montana.”

Looking forward, he said America’s most important relationship will be with China, a country about the same size as the United States but with several times the population and one that will, in a decade or so, have a bigger gross domestic product.

Baucus said he admires the Chinese people in many ways.

“They’re so energetic and pragmatic and practical. Competitive and almost survivalist,” he said. “They’ve survived a lot and the Chinese have an ancient culture, one that thinks strategically and takes a long view. They’ve got a bounce in their step now. I would too, if I was in their shoes.”

The challenge, he said, lies in figuring out a way for two great powers to work together, to make the gears mesh instead of grind.

For now, China and the United States play on an uneven field and Baucus said it’s tilted in favor of China. The government there has selected 10 or 15 “champion” industries, such as semiconductors, which it props up through subsidies, with trade barriers that limit foreign presence, and with the purchase of foreign companies that own coveted technology. There’s also a lot of theft going on, from bootleg products to the stealing of intellectual property.

“We have to stand up and not be cowed or bullied,” Baucus said. “It’s mutual self respect. If that person crosses the line you’ve got to stand up and not let it happen. It’s a simple concept, more difficult in execution.”
The Chinese aren’t so different from us, he said. They want clean air and water, health care, education, and enough money for a comfortable life. But their government also runs “a communist/socialist country. One party controls it. It’s secret. No due process. No rule of law. No independent judiciary.”

He said a “Faustian bargain” exists between the government and the people.

“That bargain is as long as the people are happy, the people won’t question [government] legitimacy. They won’t stand up and try to change the party in power. How do you keep the people happy? Give them jobs. Clean up the air and water. Try to deal with health care. Focus on these champion industries. I think that’s basically the game plan.”

Which, when you think about it, doesn’t sound that different from American politics: keep the voters happy and you keep your job.

And Max Baucus did a lot to keep Montana voters happy. Using a combination of powerful seats—he chaired the Senate Finance Committee and served on the Environment and Public Works Committee—he delivered buckets of money for Montana projects. The Center for Responsive Politics tallied up at least $226 million dollars’ worth of Montana “earmarks” between 2008 and 2010, the years before Congress ended that controversial process. All of them had Baucus’ name on them.

That money paid for water and sewer systems, highways and bypasses and interchanges, brucellosis research, wolf control, jails, police equipment, job training. It’s a long list. Take Baucus almost anywhere in Montana and he can point to something and say, “I got that for you.”

But those chairmanships also allowed him to do something with much longer reach: write the formulas that determine how the federal money pie gets sliced, particularly for health care and transportation.

 

“We’re a donee state, not a donor state,” Baucus said. “We have to be. We’re so big and have so few people. You’ve got to make sure that legislation is passed that protects Montana.”

He points to rural health care. He authored a bill that redefined how Medicare and Medicaid payments go to small hospitals, places that rely heavily on federal payments to keep the doors open.

“I’ll bet you dollars to donuts we wouldn’t get our fair share of dollars if we had not put in legislation protecting our rural hospitals,” he said. “I could do that because I was chairman of the Finance Committee.”

When the committee was putting that bill together in the 1990s, a main speaker was a doctor from rural Indiana, where the population density is 25 times Montana’s.

“Rural in Montana is not the same as rural in Indiana,” Baucus said. So he brought Hillary Clinton to Montana. (Remember Hillarycare?)

“She got off the plane in Billings and said, ‘Wow. This isn’t rural. This is mega rural.’ And she was still in Billings.”

When the rural health care bill was passed, things got better for small hospitals in Montana.

Baucus also pointed to the federal highway bill, which he shaped on the Environment and Public Works Committee, and which provided Montana with $396 million last year, producing thousands of jobs. California, by comparison, got $3.5 billion. That’s almost 10 times as much, but that state has almost 40 times as many people and a lot more pavement.

Those highway projects also boosted a lot of businesses. Baucus got the money for the interchange linking Interstate 90 to Bozeman’s North 19th Street, now a bustling commercial thoroughfare.

“I made a lot of people wealthy. I didn’t make any money, but I made a lot of people wealthy.”

(The Center for Responsive Politics listed his net worth at $520,000 in 2012, shortly before he left the Senate. He was 69 years old and ranked 81st in the Senate in terms of personal wealth.)

“I also spent a lot of time writing farm bills that make sense for Montana agriculture. Disaster assistance and lots of different provisions.”

Those formulas, along with many other factors, produce about $1.50 in federal spending in Montana for every tax dollar the state sends to D.C. It also means the state has a hospital in almost every county seat and a usable road to get to it.

But will those formulas stand, long term, I asked. Are they sustainable, when the governmental mood favors a leaner budget?

“It’s largely on our congressional delegation,” said Baucus. “You have to work at it.”
A new movement is afoot to take public lands from federal control and transfer them to states or private entities. Such movements “bubble up” periodically, Baucus said.

He recalled the Sagebrush Rebellion of the 1980s. “Everybody was hot and bothered over how important it is to get the feds out of our lives. But we kind of like the public lands. We like to hunt and fish and go outdoors and it’s kind of worked out pretty well for us.”

Does the current movement have stronger legs?

He said that will depend on the ability of people to talk to each other. He ticked off a long list of projects that have protected public lands in the Flathead, the Gallatin, the Rocky Mountain Front and other places—all actions made possible by on-the-ground cooperation among environmentalists, snowmobilers, loggers, county commissioners and others.

“That’s worked in the past and that’s needed now today. Nothing’s easy. It’s hard work, just listening to the other side.”

He said he’s proud of working with Montanans to protect the state’s landscapes.

“We have a moral obligation, all of us, when we leave this place—and we’re not here very long, just a speck of a second, to leave it as good as or better than we found it. We’re basically stewards. We’re trustees. If more of us think along those lines, the more it tends to dilute political partisanship. Because we’re all in it together.”

Baucus is a lifelong Democrat. Does the same feeling hold true across the aisle?

“I bet more [agree] than one thinks,” he said. “Unfortunately, our structure tends to prevent it. We spend so much time raising money. People give me money. They give Republicans money. Most people don’t want anything in return. They want what they call good government. But good government for Democratic donors is a little bit different from good government for Republican donors.”

And the increasingly connected nature of our political conversations makes it more difficult, rather than easier, for people to communicate openly and honestly.

“Social media, internet. Everybody today has infinite access to infinite information and can disseminate infinite information on any subject without respect to the truth.

“And we’re so busy in our lives, we don’t take time to learn the real facts.”

Bad information doesn’t infect only the hoi polloi. Baucus said he was astounded to learn—from Republican Senator Steve Daines, who now holds his seat—how many members of Congress believe the recently axed Trans Pacific Partnership would have included China.

“I bet 15 to 20 percent of Congress members believe China is part of TPP,” Baucus said.

That trade deal would have included 12 countries around the rim of the Pacific Ocean, until President Trump withdrew, something Baucus sees as a colossal error. China was never a member of TPP and will benefit from the withdrawal, he said.

“Of all the things that crossed my desk over there [in China], TPP was the most important, at least geopolitically,” he said.

He said the deal would have boosted labor and environmental standards overseas and done more to protect intellectual property, including internet technology. The agreement would have made it easier to place American military bases and obtain overflight permissions. And it would have eased member countries into the American sphere of influence, instead of into China’s.

“TPP enables them to withstand Chinese pressure, political and economic pressure,” he said. “Now we’re pulling the plug. China is smiling broadly. It’s a gift. It’s a gift to China.”
If the Trump administration asked his advice, Baucus said he’d recommend revising the agreement and rebranding it. “Call it the Trump Pacific Partnership. It’ll be beyootiful. It’ll be yuuge.”

BAUCUS ON: The new administration

Baucus said that, like a lot of people, the Chinese “are a little befuddled with Trump.”

“I don’t think they take him that seriously,” he said. “But I did say this, it’s going to be a rockier road for you Chinese. Because you’re not being fair. It’s not a level playing field. Trump got elected because of people’s frustrations with jobs and trade, including China.”

He said he urged Chinese officials to “come up with something positive” to bring to the Trump administration. “Show that you know the playing field is unlevel. Take a positive action first, show that you care and you want to work with us.”

One Chinese official asked for suggestions.

“I said take our beef,” Baucus said. “He laughed and laughed. I said it’s going to get rougher. And it should get rougher. Now Trump’s won. It looks like he’s going to do what he said he’s going to do. He’s going to get tough with China.”

Is that the right approach?

“You just have to stand up to China. China will continue to go as far as it can, as long as it can, until they’re stopped, either externally or internally. It’s up to us to be smart about all this. Cool, calm, collected and smart. Don’t be histrionic but be firm. Talk softly and carry a big stick.”

BAUCUS ON: ObamaCare

Baucus worked for years on health care reform. He took a lot of heat for saying a single-payer option, a sort of Medicare-for-all plan, wasn’t on the table. And he worked closely with Republicans to try to craft something acceptable. He said they made a lot of progress, but as the 2008 elections approached, “I could feel the Republicans falling off. The other side saw this as a potent political wedge. And it worked. A lot of Democrats lost their Senate seats in that election. And Republicans in the House got more seats.”

Once Obama was elected, the Affordable Care Act passed without a single Republican vote.

Baucus didn’t sound surprised that Obamacare is being targeted by both Congress and the new president.

“When you jam something down somebody’s throat, it’s probably not going to be good policy, and its survival is limited because there’s not an agreement,” he said.
But he didn’t sound optimistic about Congress finding a better solution.

“I don’t think that’s going to happen,” he said. “Health care premiums are going to start to go way up.

“They’re in a big mess now. It sounds good to a lot of people. Repeal. Replace. But once you get into it and start to figure out what works and doesn’t work, once you realize how interconnected everything is, and how hard it is to put a coalition together, I think it’s going to be a mess on the hands of the majority party.”

BAUCUS ON: The future

So how does the national future look?

Baucus cited a book Yale historian Paul Kennedy wrote about the fate of nations.

“Countries, civilizations rise and fall. Big strong ones. There’s no guarantee that we’re going to be here forever. In fact, the evidence is kind of alarming that we might not.

“My glib answer is that our future is more secure if two conditions occur. One is a very educated public. It takes work to find out what the facts are. You can’t just agree on what another person says is true.

“The second is doing something about it. Don’t just sit on your tail. The assumption is that people [on the other side] have done their work, have gotten the facts. Then you’re going to have a discussion on facts, not on rumor and innuendo.”

But isn’t the country increasingly divided, I asked, increasingly insulated into echo chambers where nobody has to listen to opponents?

“Yes,” Baucus said. “I’m just giving my take. But I’ve learned that people are pretty smart. They may fumble it for a while. Somebody may do something to get them off kilter for a while. Listening. It works both ways.”

 

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