Sunday, June 29, 2008

Duane Grimes -- Montana Headlines interview reprise-- full text


In May, Montana Headlines ran a 3-part series with Republican State Auditor candidate Duane Grimes as the first of a planned set of interviews with the Montana Republican Party's major candidates for state-wide office. One of our intentions at the time was to put the entire interview into a single post for ease of linking to it -- here it is in that one-post format.

Coming up this week is the Montana Headlines interview with Secretary of State Brad Johnson. We have made arrangements for further interviews -- stay tuned.

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MH: First of all, welcome to Montana Headlines, and thank you very much for agreeing to do this interview.

Let's start with a basic question: What is a State Auditor, and why does Montana need one?


Duane Grimes: The State Auditor regulates the insurance and securities industries in the state of Montana. Every state has a similar position, though in many states it is called the Insurance Commissioner and is actually an appointed rather than an elected position. The responsibilities of the Auditor have everything to do with the affordability and accessibility of the things you depend on to protect your family, business and future. In election years, the race for Auditor often gets overshadowed by races ‘higher-up’ on the ballot such as U.S. Congress or Governor, which is unfortunate given that decisions made by the Auditor’s office affect the daily lives of nearly every Montanan.

My 9-year-old daughter earlier this year had to go to school and tell her teacher and classmates what the State Auditor did, so I had to boil it down. I told her that the Auditor "makes sure insurance companies keep their promises." She wrinkled up her nose because she didn't know what an ‘insurance company’ was. So I boiled it down even further, saying, "the Auditor helps people with some of the problems they have when they get in accidents or go to the hospital."

And that's what it is. Insurance is the promise of financial protection and allows us all to assume the inherent risks in life, anticipated or not, with some sort of safety net. The Auditor is your first line of protection to ‘insure’ that safety net is as promised. Most people I talk to say about the same thing, "When I needed the Auditor, I really needed help!"

Montana – and every state – needs some form of Insurance Commissioner to ensure that honest businesses can provide a variety of quality insurance options to consumers at reasonable prices, and that unscrupulous businesses are stopped and prosecuted.

MH: How many years has it been since Montana has had a Republican State Auditor? Why have Republicans not been as successful in recent years as Democrats in getting elected to this statewide office?

Duane Grimes: Well, it has been 16 years since we had Andrea Bennett, a Republican. She succeeded Sonny Omholt who had the job since before the 1972 Constitution. (As a matter of fact, some folks involved back then have told me it was Omholt's reputation and friendliness that caused the position of Auditor to be retained in the massive state government reorganization of the early 1970's.) Since term limits, for the last 16 years we have had Mark O’Keefe and John Morrison.

The candidate that initially ran against O’Keefe was an insurance agent and long time legislator from Stevensville, Fred Thomas, who was accused by O’Keefe of being the "fox in the henhouse," because of his insurance affiliation, and that is probably the reason Thomas lost. For his first term, Morrison ran against a Republican who didn't campaign at all, and then I lost to him in his reelection bid 4 years later in 2004. I later found out that no incumbent in a ‘mid-tier’ race like this has ever lost a re-election! Now the seat is open again in this 2008 race and I think I have a very good chance to win the race.

MH: So our Republican Sec. State Brad Johnson should be feeling pretty good right now, if no incumbent in a mid-tier has lost, historically?

Duane Grimes
: Historically, sure, but I’m certainly not going to jinx Brad’s campaign by making any predictions! It also used to be true that you had to win Yellowstone County to win a statewide race: both Brad and Jon Tester broke that truism. The political landscape in Montana continues to change, and candidates can take nothing for granted.

MH: You are not an insurance agent, so you can't fairly be accused of partiality towards the insurance industry, but your reference to O'Keefe accusing Fred Thomas of being a "fox in the henhouse" just because of what he had done for a living is rather amusing.

This is not to make light of any unfair criticisms that Thomas had to endure. Rather, what is interesting is that Democratic candidates for Attorney General are often closely tied to the Montana Trial Lawyers Association -- and that Democratic candidates for State Superintendent routinely are very closely tied to the Montana Education Association. And yet, we don't tend to hear "fox in the henhouse" comments about those particular races. We are told that their opinion should have particular weight since lawyers understand the law and educators understand education. And yet if someone with experience in the insurance industry is interested in being what amounts to an insurance commissioner, it is automatically assumed that a nefarious scheme is afoot.

Don't worry -- you don't have to respond to that -- it's just some MH editorializing.

Getting back to your own situation, you clearly see the Auditor's role as being an advocate for Montana consumers of insurance and investment products -- and that is as it should be. But to play devil's advocate for a moment, aren't consumers best served by having a climate where insurance companies see Montana as a good place for them to do business? Most insurance companies seem to want clear ground rules that aren't going to turn into shifting sands, which includes a stable regulatory climate. If Montana is seen as a stable place for insurance companies to do business, won't there will be more of them competing to offer better products at lower prices?

Having a stable, open, and businesslike environment to encourage good insurance companies would seem to be important. You don't need to have a stance toward insurance and investment companies that is adversarial from the outset in order to do your job as Auditor to help Montana consumers, do you?


Duane Grimes: I believe that the best help an Auditor can bring consumers is by ensuring that there is a stable marketplace; the two go hand-in-hand. If honest businesses are able to operate in Montana and be successful, more businesses will open or move here and thus increase competition, ultimately making consumers the big winners.

Interestingly, my opponent has already begun to accuse me, in her words, of being “all too happy to carry the industry’s water,” in an attempt to portray me as ‘anti-consumer.’ I believe that an effective insurance commissioner should have open lines of communication with the small-business community rather than be reflexively combative from the start simply as political posturing. Arbitrarily treating small business – which is what most local insurance agents are – as the enemy is the wrong way to go about being a successful regulator and successful advocate for consumers.

MH: You've been running a positive campaign, not criticizing past State Auditors or the current Auditor's office, and that's one of the reasons that Montana Headlines has been particularly supportive of your candidacy. We like positive approaches to politics and government.

But for the benefit of readers, let's talk in general "compare and contrast" terms. For instance, the average educated Montana voter can make some fairly accurate general predictions (regarding basic things like taxes, spending, and government regulations) about how a "mainstream Montana Democrat" would approach, say, being governor, when compared to a "mainstream Montana Republican." That same educated Montana voter probably couldn't do the same, though, when talking about the State Auditor position.

Given what the Auditor's office does and given the current philosophical and policy positions of the Republican and Democratic Parties in Montana, could you -- as a reasonable mainstream Montana Republican – give some generalizations about how a Republican might approach the office of the State Auditor differently from a Democrat?


Duane Grimes: The simple answer to this question is in the general perceptions about the role of government that the political parties take: government solutions (Democrat) vs. private sector solutions (Republican). To a point, this may be valid. For instance, in the huge area of health care reform it is critical that we foster free market solutions rather than big government approaches. Those free market solutions really do work by the way, and help hold down costs. There are many ways the free market is not being allowed to function properly and I look forward to collaboratively addressing them.

But to back up a minute, in the bigger picture…this position is one of a regulator, so really the political affiliation is much less important than the personal philosophy and approach that a particular candidate has to the position. The State Auditor must be tough, fair, and impartial in their duties, working for the betterment of all Montanans, regardless of political affiliation.

The second thing, which also is apolitical and so vitally important, is how the next Auditor will administer the agency. The Office has a staff of great people, but I believe that they need to be recognized, understood, and engaged with the organizational leader to operate efficiently and strategically for the benefit of the consumer. The office currently averages over 700 complaint calls per week, and I intend to take some of those calls personally to ensure I stay engaged with the daily concerns of Montana consumers. A hands-on, knowledgeable approach to administration of the office will be crucial to the effective operation of this regulatory agency.

MH: This is an important point -- the job of State Auditor is to regulate the insurance and investment industries in Montana. Sometimes detractors of the Republican Party think that just because we believe in the power of free markets and individual liberty, that Republicans somehow won't do the jobs they were elected to do if they involve government regulation. This is simply not the case -- most Republicans elected or appointed to positions like these tend to be "strict constructionists," so to speak, faithfully and fairly following the letter and intent of the laws passed by state legislatures.

Duane Grimes: Agreed. Belief in a free market economy is not a belief in no regulations and no laws. We have an established legal framework; businesses that do not abide by these laws should be shut down. Let me be clear: Businesses that attempt to cheat or defraud Montanans will be prosecuted to the fullest extent of the law. This is an area where I believe the current Auditor has done a commendable job.

MH: You have been rightly critical of the Bush administration for taking steps to federalize some aspects of insurance regulation. You stated: "To have all the states regulated by a central federal bureaucracy is bad for Montana because all our oversight would be west and east-coast driven. Montana consumers would be caught in the middle, ending up losing the most."

Montana Headlines is all for state and local control whenever possible, so this news was disturbing. For those who aren't familiar with this recent move by the federal government to usurp what has traditionally been the prerogative of individual states, could you give some examples of how this change in federal regulation (which it sounds like is being done solely by the Executive Branch, and not even by Congress) will affect Montanans?


Duane Grimes: Fortunately, this is currently simply a proposal from the U.S. Treasury Department and many of its components need approval of Congress before being implemented. This would include the establishment of an Office of Insurance Oversight within the Department of the Treasury. While the proposal has many strong backers, there are also many, like me, against such federal takeover of an industry that, I believe, works best when regulated at a state level.

MH: To follow up on that, is there anything that Montana can do -- and specifically the office of the State Auditor -- either to reverse this decision or to mitigate its effects on our state?

Duane Grimes: There are things Montana’s State Auditor can and should do to ‘mitigate its effects on our state.’
Our current State Auditor has spoken out against this proposal and I will uphold that stance should I be elected; additionally, the Auditor has a great deal to do with how federal policy changes are received by the State Legislature as well as has input into the national model legislation.

It is extremely important for the Auditor to understand the technical issues and driving forces behind proposals such as this, as well as be very engaged in the process in order to help direct the policy in the direction that best impacts all Montanans. Working collaboratively with, instead of against, good companies that want to do business here is the best way to ensure that consumers have good insurance options available to them, and Montanans should be able to meet face-to-fact with the person who is their ‘first line of defense’ rather than having to call a 1-800 number in Washington, D.C.


MH: You've been traveling the state for months, going to every county Lincoln-Reagan Day Dinner to talk to Republican party faithful, and meeting Montanans of all political persuasions. Are there any common themes that you are hearing from voters that have affected how you are thinking about the job of State Auditor and about what the next Auditor needs to do to respond to those concerns?

Duane Grimes: As I have talked with folks across the political spectrum including small business people, families, ranchers, and seniors, I have come to truly appreciate the depth to which the actions taken by the State Auditor’s office affect every single person at the core of their (financial) security: one’s ability to receive healthcare, making an honest living, becoming financially independent, ensuring their families’ and their children’s futures.

This race is easy to overlook when compared to such high-profile ones as President or Governor which are also on the ballot, but it has humbled me to realize how vitally important a tough, fair and impartial regulator is to the daily lives of every Montanan.

MH: You were the first Montana Republican candidate, at least that we noted, to make a point of reaching out to bloggers on your website. How have you seen the Internet affect your efforts to get your message out in 2008, compared to your previous run for State Auditor and your previous legislative races?

Duane Grimes
: My two sons think this whole blogging thing is great and are excited that Dad is finally getting into it. This race isn’t as high-profile as others; we don’t get the media coverage others do. But it’s extremely important for voters to know how the State Auditor’s office affects their daily lives and blogs are a great outlet.

In that way, it has been night and day the difference I’ve found that the internet, including websites, e-mail, and blogs have provided the ability for myself as a statewide candidate to reach so many more voters. Hopefully, in a small way, this has helped voters be more informed about the issues of the Auditor’s office and feel they can reach out directly to me as a candidate.

MH: To end on a lighter note, there has been a great war of ideas "raging" in the Montana blogosphere in recent days about "Operation Chaos." At the risk of putting you on the outs with Rush Limbaugh and at least one Montana blogger who feels differently, can Montana Headlines ask whether you want Republicans to turn out on June 3rd to vote for Duane Grimes in your (unopposed) primary -- or whether you think your candidacy would be better served by having Republicans vote for Hillary Clinton to foment chaos in the Democratic ranks?

There's no right answer to this question -- but the future peace and tranquility of the Montana blogosphere does depend on it.


Duane Grimes: Frankly, I don’t think having Republicans vote for Hillary Clinton and potentially fomenting ‘chaos’ in the Democratic ranks would have a huge impact on the race for Montana State Auditor! (Nor would being on the outs with Rush Limbaugh bother me too much… but it would be good campaign press…!)

This may sound like the politically-correct answer, but Montanans have the freedom to choose which ballot they want to vote in the primary. While I am all-for promoting ‘peace and tranquility’ in the Montana blogosphere, I need every vote I can get!

This is a great opportunity for folks to get in the habit of voting Grimes!

MH: It's funny that you say that -- a contemplated MH post at one point was going to be the announcement of "Operation Practice Voting Republican." It doesn't sound as exciting as "Chaos," though, so that post never got off the ground.

So, any final comments for MH readers?


Duane Grimes: Yes, and thank you. I would like to take the opportunity to directly address an aspect of the healthcare debate: how do we stem rising costs?

There are many ideas out there about how to see that all citizens have access to health insurance, and addressing this challenge is a key issue in the race for State Auditor.

But let’s backup a minute. Isn’t the primary cause of the lack of access to affordable health insurance the ever-rising cost of healthcare for all of us? This is the root of the problem and until those in a position to do so – such as the State Auditor and others – take a stand to fix the system, basic healthcare for Montana families and citizens both young and old will only become more out of reach.

One of the biggest factors in rising costs is the lack of free-market competitiveness in our health care system. But how can these costs be stemmed? I believe that one way is by adding transparency to the process.

We know the costs of virtually everything else we pay for – a loaf of bread, an oil change – but have a hard time getting prices and out of pocket costs when we need vital healthcare. If we actually know those costs we would be able to compare prices and be more informed consumers. Transparency of costs would allow for a more competitive health marketplace.

There are a number of efforts currently involved in transparency, led by the U.S. Department of Health and Human Services Secretary Leavitt and the National Institutes of Health at the federal level, as well as the health care forum and legislative committees here in Montana, all of which I will work with to make our health care system and its costs more transparent to every citizen.

Frankly, the State Auditor has the ability to be a key player in the health care costs equation and, in fact, has a responsibility to Montana citizens to ensure a balanced marketplace of health insurance options. By improving the insurance climate through tough but fair and impartial regulation, consumers will win by having a better choice of affordable insurance options and honest businesses will want to do business here. These are the best means to work toward long-term solutions to holding down the costs of health care for everyone.

MH: That's a very interesting angle to approaching health care costs through the Auditor's office. It will be good to watch as these and other issues develop during the course of the campaign. And that's a good place to wrap things up for now.

Thank-you again for taking the time for this interview -- it would be nice to do an update a few months down the road if you have time. Good luck in the campaign.

1 comment:

SCOOP MONTANA said...

Headlines: This is an amazing interview - very informative and well presented. I look forward to the interview with Brad Johnson, who has done a very respectable job and deserves re-election.

(BTW - Can you ask him what efforts can be made to ensure people who vote are actually Montana residents? I think not requiring an ID has opened the door to potential fraud, but I'm not sure what he can do given a democrat controlled legislature helped make this loop hole possible.)

More to the point, Grimes will make an excellent auditor. I recommend the entire interview, but find his closing comments on health care a must read for all voters.

It helped cinch the Scoop's vote.