White House searching for new Capitol Hill strategy

President Bush is considering his options as he faces a Senate soon to be controlled by Democrats.

From Major Garrett
CNN White House correspondent

WASHINGTON (CNN) -- The Bush White House, hamstrung by the loss of the Senate, is groping for a new strategy that will convey Bush's ability to work with Republican and Democratic moderates without appearing to kowtow.

Interviews with several senior administration officials reveal the White House is hoping to seize the initiative next week, when Congress returns from the Memorial Day recess and Democrats take formal control of the Senate for the first time since 1995.

Senior officials are still trying to craft Bush's strategy.

Some officials, rooted in Bush's experience during the campaign, are pushing for specific outreach to GOP moderates and Democrats to change the perception left by the departure from the party of Sen. James Jeffords of Vermont, and Jeffords' stinging critique of the Bush White House and its agenda.

"We have to change the story," said one top adviser. "That's how we responded during the campaign when we hit a bump. We did something to change the story."

Still others are arguing for a business-as-usual approach that concentrates on moving legislation and letting victories on Capitol Hill illustrate the president's ability to forge bipartisan compromises. "We know what Jeffords said, but look at the tax and education bill," said another senior official. "Those are bipartisan."

Some of this debate is focusing intently on how to celebrate passage of Bush's $1.35 trillion tax cut. Some advisers are pushing for a large White House event next week while others have advocated a signing ceremony outside of Washington. While the ultimate decision makes no practical difference, the location will reveal Bush's own sense of how best to show the nation what he's accomplished.

A Washington ceremony, advisers said, would underscore what Bush has said to numerous top aides -- that passage of a tax cut will give him real political clout in Washington and that with such clout he can build support for even tougher political goals, such as reforming Medicare and Social Security.

An outside-the-Beltway ceremony -- some advisers have suggested a ceremony in Iowa, where Bush announced his tax cut plan during the campaign -- would show Bush wanted to push the imagery and his message closer to the people and to remind voters that he delivered on a key campaign promise.

Beyond celebrating the tax bill, senior advisers are also eyeing the new challenges of passing the president's education reform package. Those calculations have changed considerably with the ascendancy of Sen. Edward Kennedy of Massachusetts to head the Senate education committee.

Senior aides acknowledge Kennedy will push for more money for the education budget and the White House may have to meet those demands to get a bill -- even if means further aggravating conservative Republicans who believe the bill is already too costly and short-changes key reforms.

The White House wants a bill in June so Bush can point to tax cuts and education reform as concrete examples of bipartisan legislating they believe will help counter Jeffords' criticism.

Through it all, the White House is wondering if any more Republicans will switch parties. The White House will step up outreach efforts to moderate Republicans in the hopes of holding onto potential defectors such as Lincoln Chafee of Rhode Island and Olympia Snowe of Maine.

The White House is trying to schedule a meeting between the president and Chafee, for example.

The White House is also concerned about the possible defection of Arizona Sen. John McCain, but understand there might not be much they could do to stop it.

Senior officials believe another defection could damage Bush's national political standing.

"The Senate votes would not change, we'd still be in the minority, but it would cause huge perception problems," one top aide said.

On other issues, the White House is trying to decide how to deal with HMO reform, the issue incoming Senate Majority Leader Tom Daschle has said will be first on his agenda. White House advisers have been trying to build support for a bill sponsored by Republican Sen. Bill Frist of Tennessee, Democrat John Breaux of Louisiana and Jeffords. But many conservative Republicans oppose the bill as too liberal and most liberal Democrats favor a bill sponsored by Kennedy, McCain and North Carolina Democrat John Edwards.

Democrats want to use the HMO debate to portray Republicans and the Bush White House as hostile to the needs of patients given the run-around by HMO bureaucracies and insurance companies. The current White House strategy is to assail the Kennedy-McCain-Edwards bill as a sop to trial lawyers because it caps non-economic damages in lawsuits at $5 million, far above the $500,000 cap in the Frist-Breaux-Jeffords bill the White House supports.

Turning the HMO debate away from insurance companies and toward trial lawyers would be "a debate we like," said one adviser.