The Heritage Foundation has been cozying up to top Trump aides and congressional leaders for months, hoping to put its conservative imprint on the president’s policy agenda. But the first major bill that Republicans proposed this week — to repeal and replace Obamacare — runs completely afoul of Heritage’s priorities and threatens to upend a critical relationship between conservative activists and the Trump administration.
Now the 44-year-old think tank must decide whether to stay in the administration’s good graces by compromising some of its core values to get things done, or embrace its long-standing reputation as a political bomb-thrower.
What’s happening at the Heritage Foundation is a revealing example of the path the group has taken from conservative rabble-rouser to insider. And it’s a test of how conservatives in the Trump era cope with being part of the establishment.
Health care offers the first reality check of Heritage’s rosy relationship with Trump. The powerful and vocal group wanted Republicans to repeal Obamacare immediately after his inauguration and worry later about a replacement. Instead, congressional leaders moved forward haltingly and then proposed what many conservative groups are calling “Obamacare-lite” — a bill that leaves hated parts of the health care law like the Medicaid expansion and so-called Cadillac tax intact for a few years.
Heritage Action, the 501(c)3 associated with the foundation, quickly bashed the bill on Tuesday, calling it “bad politics and, more importantly, bad policy.” Former Sen. Jim DeMint, the Heritage Foundation president, is slated to go to the White House later Wednesday to discuss the bill with Trump, according to a Heritage source, part of Trump’s broader push to win over conservative groups.
Interviews with more than a dozen Heritage staffers, many of whom worked on Trump’s presidential transition team, give an inside look at how the group is trying find a middle ground between agitator and dealmaker.
Before the draft Obamacare repeal bill even came out, DeMint said Republicans never would have found themselves in this situation had they scrapped Obamacare right away.
“If they had pushed through, as a lot of us had hoped and a lot of members of Congress said they would, the first week of the Trump administration — if they had put the bill through the House and Senate that had passed in 2015, then all of the town hall disturbances would be about how they’re going to replace it,” he said in an interview with POLITICO last week.
And health care will not be the last fissure between Heritage and the administration. DeMint has been quietly working behind the scenes for months to kill policy proposals that depart from Heritage’s conservative values.
He brought together top congressional leaders and key White House officials last Wednesday for closed-door, two-hour dinner at the think tank to talk about tax reform, and to raise concerns about the border adjustment tax, a linchpin of House Speaker Paul Ryan’s tax reform plan, three sources told POLITICO.
Among those who attended: Ryan, Ways & Means Chairman Kevin Brady; Sens. Pat Toomey and Rob Portman, as well as White House Deputy Chief of Staff Rick Dearborn and White House Director of Legislative Affairs Marc Short. Ryan and Brady’s office did not respond to requests for comment.
Other tensions are also brewing: Heritage has long called for entitlement reform, something that Trump has so far largely shied away from. The think tank has also questioned spending billions of federal dollars on fixing the country’s roads and bridges. Trump has promised to pursue a $1 trillion infrastructure package, but he has not yet specified how much of that money would come from federal coffers.
DeMint is quick to downplay these potential clashes. “It’s unlikely that they’re going to do anything that’s a perfect fit for what we do,” he said, “because our job is not to compromise, but to put the flag in the ground in the right place and try to build public support for the right ideas, so that politics can move in the right direction.”
“That’s just our role: To call balls and strikes, as we say, on what really happened and not get tied up into personalities or parties,” he added
Though they may differ with Trump on key issues, Heritage officials maintain that they are largely in step with the president. “The percentage of stuff that we wouldn’t do, that’s probably in the five to 10 percent range,” one Heritage official said, adding, “My guess is 80 percent of the policy will be fine.”
The Heritage Foundation is closer to Trumpworld than any other administration since Reagan, a relationship they’ve cultivated as part of a strategy to give them deep influence. DeMint has strong ties to Vice President Mike Pence (they’ve been friends since they served in the House together and Pence spoke at a Heritage event late last year). He’s also close to Dearborn, and Short, according to Heritage staffers, many of whom worked on the transition.
Heritage staffers, like former president Ed Feulner and Becky Norton Dunlop, populated the sparse Trump transition offices during the early days of the operation, while other Heritage staffers spoke frequently with Ryan’s office about health care and tax reform during the transition, according to a former Republican House leadership aide.
Now, several Heritage experts work in the White House, like Paul Winfree, the director of budget policy and No. 2 at the Domestic Policy Council — to say nothing of the dozens of ex-Heritage people serving on the so-called beachhead teams inside federal agencies, or as White House liaisons.
“We’ve got the playbook in place. Now, it’s just a question of execution,” said a source close to Heritage, who played a senior role in the transition.
Still, some close to Republican congressional leadership question their influence. “Heritage is never determinative but they can certainly make things more difficult,” said a former Republican leadership aide.
The tight-knit relationship between the think tank and Trump dates back to 2015, when Trump met DeMint before the Republican primaries at a gathering of conservative groups in Iowa. The two stayed in touch, and DeMint went to Trump Tower later that year to meet with the billionaire before he announced his bid for the presidency.
The meet-ups paid off. Just after Trump appointed Gov. Chris Christie as the head of the transition, Christie’s two top transition aides went to Heritage for a morning full of meetings in the boardroom and lunch.
“I give Sen. DeMint great credit,” said former top transition official and lawyer, Bill Palatucci. “He and his entire team were there and had prepared specific presentations from personnel to policy to running a transition.”
Toward the end of the presentation, Ed Meese, former Attorney General under Ronald Reagan, offered his own recommendations on how Reagan, another entertainer-turned-politician, had set up his White House.
From then on, Heritage sought to make itself an indispensable resource for Trump, with think tank staffers regularly distributing their policy proposals and blueprints to his team. DeMint discussed possible Supreme Court picks with Trump during a March 2016 meeting at the law firm Jones Day, and Trump was shown on tape giving DeMint a hug after a January ceremony at the White House in which he announced the nomination of Neil Gorsuch to the high court.
DeMint never publicly criticized Trump, like many other conservatives did, and always offered Heritage as a resource to Trump’s thinly staffed campaign and transition.
Heritage officials said DeMint strongly encouraged staff to work for Trump’s transition, without taking a leave from the think tank. “Sen. DeMint believes very strongly that personnel is policy,” a Heritage official said. “He made it clear to the staff that he would support them working for the administration.”
A Heritage official said more than 30 staffers worked on the transition in some capacity, or now work in the administration.
And Heritage staff often act as a conduit between the White House and members of Congress, sometimes even helping to set up meetings, according to Heritage officials. It’s all part of DeMint’s broader strategy of placing Heritage allies across the government, even though DeMint insists that the group functions only as a resource for politicians, not as decision-makers.
Officials at the White House Office of Management and Budget are using Heritage’s budget blueprint, which calls for deep cuts at many federal agencies, as a guide as they finish Trump’s first budget proposal, sources said.
“We’ve been waiting at least eight years for the opportunity to have someone that wants to hear us in the White House,” a Heritage official said.
For DeMint, the goal is to pass as much conservative policy as possible to set Trump up for another four years — and that includes the current fight over health care.
“If the House doesn’t move something relatively quickly,” DeMint said, “it’s going to create a blockade for tax reform and other things that really need to be done in order for the public to see the benefits of those by next year.”
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