Newly minted Health, Education, Labor and Pensions Chairman Tom Harkin (D-Iowa) is poised to assert himself in the health care debate and work aggressively to protect liberal reform goals, setting up a possible Senate showdown with Finance Chairman Max Baucus (D-Mont.) and leading moderate Democrats.

Harkin and Baucus have a history of collaborating on legislation, particularly on the Agriculture, Nutrition and Forestry Committee, where they both sit. But the duo has also clashed since Baucus often pushes a centrist agenda while Harkin advocates liberal priorities.

Take for instance this week’s battle over whether to include a public insurance option in a health care reform bill. Just as Baucus worked to defeat the proposal in the Finance health care markup, arguing it would never pass the Senate, Harkin vowed it would be a part of any final Senate bill.

“As I’ve said before, four of five committees have a public option; one doesn’t,— Harkin said Wednesday, in reference to Baucus’ Finance Committee bill. “So, I think the vast majority of people want a public option. And, we’ll have a public option.—

Pressed further on how hard he is willing to fight Baucus and other opponents of the public insurance option, Harkin was emphatic, saying a reform bill would land on President Barack Obama’s desk before Christmas Day “and that bill will have a public option.—

Baucus on Wednesday declined to directly address Harkin’s assertion. But he reiterated that he does not believe a bill with a public insurance option can pass the Senate. Baucus’ Finance bill includes a proposal to create a nonprofit medical cooperative, the brainchild of moderate Democratic Sen. Kent Conrad (N.D.), while the HELP measure contains a public insurance option.

“I think it’s important that the bill that’s on the floor gets 60 votes,— Baucus said.

One Democratic source argued that the Finance bill more closely aligns with Obama’s vision for a health care package. Unlike Baucus’ plan, the bill passed by HELP along party lines in July is not deficit-neutral, an Obama priority.

[IMGCAP(1)]“This is about protecting the president’s vision,— this source said. “Everyone, including the White House, knows the Finance bill is the only bill that’s paid for and can pass. … The White House wants a win, and using the bulk of the Baucus bill is the playbook to get the ‘W.’—

Obama has said he prefers a public insurance option to compete with private insurers, as the HELP bill provides and Harkin insists upon. But the president has said other options would be acceptable if they achieve the same results of affordability and coverage.

As Senate Democrats prepare to transition from committees to floor debate, their Conference leadership is faced with a challenging balancing act including the egos of several influential players: Baucus, Harkin and Sen. Chris Dodd (D-Conn.), who shepherded the HELP bill through committee while then-Chairman Edward Kennedy (D-Mass.) was battling brain cancer. Harkin assumed the gavel last month following Kennedy’s Aug. 25 death.

The task rests most heavily with Majority Leader Harry Reid (D-Nev.), who knows the difficulties of managing an ideologically and regionally diverse caucus — not to mention a few veteran Senators eager to put their stamp on health care reform.

Majority Whip Dick Durbin (D-Ill.) acknowledged that the task of reconciling his Conference’s competing priorities is a tough one, noting that for 35 of the majority’s 60 Senators, the floor debate will mark the first opportunity to truly participate in the health care reform effort.

Durbin predicted Democrats would ultimately find common ground, but he conceded the necessity of bridging the gap between centrist and liberal Democrats.

“Each of us has important values and concerns for our state,— Durbin said. “And so we’re going to want to sit down, before we see a bill go out of the Senate, and address those. This world is all about, as they say, mutual concessions. And we’re going to have to find a good, common path for both of those Senators and for people who agree with them.—

Dodd is expected to be in the room with Baucus, Reid and White House officials when the merger of the HELP and Finance bills begins later this month. Still, Harkin is expected to have a say in the proceedings, and is likely to play an even larger role on the Senate floor, with one Democratic source predicting he would be “the fighter he’s always been to get a good, strong bill out.—

Democratic Senate aides predicted that there wouldn’t be any tension between Dodd and Harkin, given they worked closely together in drafting the HELP bill and agree on its major components. And despite the policy differences between those two and Baucus over health care, all three Senators insisted Wednesday that they would work together to reach a compromise.

“It won’t be easy. But we’ll get there,— Dodd said. “It’s going to get done.—