By Matthew Bechard

As the first practicing physician elected to the U.S. Senate since 1928, Senate Majority Leader Bill Frist (R-TN) knows a thing or two about diagnosing difficult situations. Frist, who was one of the nation's pre-eminent transplant surgeons before being elected to the Senate in 1994, has been a leading voice on many critical issues: including health care, bioterrorism and national security, and education.

In his 10 years on Capitol Hill, Frist has risen rapidly through the Senate ranks. He served as deputy whip in 1999 and a year later was elected chairman of the National Republican Senatorial Committee. When Republicans gained back the majority in the Senate under Frist's watch in 2002, he was unanimously elected Senate Majority Leader—despite having served fewer total years in Congress than any other majority leader.

In addition, Frist currently serves on the Finance, Rules, and Health, Education, Labor and Pensions committees. Previously, Frist has served on the Foreign Relations, Budget, Banking, Commerce and Small Business committees. One of the most visible members on the Hill, Frist recently spoke with Portfolio about a number of issues including his political career, the upcoming elections, the impact of last year's tax cuts and the growth of REITs in his home state.

On Entering Politics

The son of a doctor, Frist says he knew early on that he wanted to pursue a career in medicine. He spent 20 years in medicine and performed more than 150 heart and lung transplants. After excelling in medicine, Frist began exploring a switch to public office in 1990.

Former U.S. Senate Majority Leader Howard Baker, also from Tennessee, encouraged Frist to run for public office.

"I believe my approach to public service was greatly shaped by my experiences as a doctor," Frist says. "I always had hopes of someday serving others at a broad policy level, where I could advance, in a way not really different from medicine, the health and quality of life of a community just as I'd advanced the health of individuals as a doctor."

To incorporate the broadest range of experiences, Frist says it is important that Congress is comprised of "citizen legislators" and not just career politicians.

"I'm hopeful that my participation in the Senate will encourage others to consider public service who may bring similar skills and knowledge gained through experiences outside government service," he says. "The foundation of America's democracy is based on a government of the people, by the people, and for the people."

It is a plus when those elected individuals act with civility and trust, two characteristics Frist says he values most in those he deals with. And, for the most part, he says those traits are prevalent in Washington— regardless of political affiliation.

"Civility and trust are the hallmarks of any effective leader. We are entrusted with great responsibilities, and it is our obligation to meet those expectations by working together, in an honest and bipartisan fashion so we can best serve America's interests," Frist says.

On the 2004 Election

Fortunately for Frist and his fellow Republicans in the House and Senate, they have enjoyed majority status since 2002. And Frist is confident the party's performance will allow it to hold on to the majority in this year's election.

"I'm confident that our ability to pass landmark legislations such as President Bush's tax cuts, historic education reforms, and the 2003 Medicare law while supporting the war on terrorism has demonstrated Republicans' proven ability to provide the country with strong leadership and a vision for a stronger America," Frist says.

On the presidential front, 2004 is already shaping up to be one of the most hotly contested elections in history. Not surprisingly, Frist says he is confident in President George W. Bush's track record and his ability to fend off his Democratic challenger.

"I feel this way because I believe the overall decisive issue driving this election will be whether or not Americans feel that they are better off than they were four years ago," Frist says, adding that he feels decisively that the answer to that question is "yes."

Just as important as whether or not Americans feel better off than they did four years ago may be if they feel safer. Regardless of what additional international or domestic instances arise in the next several months, national security, the war on terrorism and the war in Iraq will be critical issues.

"The war on terrorism has helped make our communities safer and more secure, while enabling us to spread the values of democracy and freedom to oppressed, war-torn countries throughout the world," Frist says.

As the author of "When Every Moment Counts," Frist has been vocal in his thoughts on protecting Americans from acts of bioterrorism. In the aftermath of September 11 and the anthrax attacks that followed, Frist says the actions of the government and the nation's first responders have made the country better prepared to respond in the event of a biological or chemical event on American soil.

On Tax Cuts

One of the more partisan pieces of legislation passed in 2003 was President Bush's Jobs and Growth Tax Plan. Congress was divided on the plan and remains split on its impact to date. Frist says signs point to the effects of the tax cut leading to a sustained economic recovery. He points to economic growth of 7.2 percent in July, August and September as nothing short of spectacular and unheard of since 1984 (although that growth has stalled lately).

"These numbers indicate a ramp up to recovery, but we have a lot more work to do," Frist says. "We must do more to help create jobs and bring economic recovery to all of our citizens. We can not rest until that happens."

Frist says Congress must continue to work toward reducing the cost of doing business in this country in such areas as health care, energy and litigation expenses. He adds that barriers to investment and economic growth also need to be removed so employers can create new jobs.

"We also need to focus on making sure workers have the skills that employers need. I think community colleges are a key component in achieving that goal," Frist says.

Will there be additional tax cuts in order to further stimulate the economic recovery? Not necessarily, according to Frist.

"Right now, I am most concerned about the tax cuts that were enacted that are set to expire in the future," Frist says. For example, at the end of 2004, the increase in the child tax credit, the expansion of the 10 percent tax bracket, the increase in the alternative minimum tax (AMT) exemption, the tax incentives for businesses, and the expansion of the 15 percent tax bracket and standard deduction for joint returns will all expire. "I do not want Americans to face a tax increase and will be fighting hard this year to make sure that does not happen."

On His Key Issue In 2004

In his first year as Senate Majority Leader, Frist oversaw several legislative victories. Perhaps the most significant was his lead role in passing the Medicare expansion for seniors needing prescription drug coverage—an effort that was seven years in the making, according to Frist. However, there remain several significant issues facing Congress in 2004, key among them is the growing number of Americans without health insurance.

"With more than 43 million Americans uninsured, we have a moral obligation to not only identify the reasons why so many Americans are uninsured, but to determine workable solutions that expand access to quality health care," Frist says.

Frist says Congress needs an aggressive approach to expand health coverage to those without health insurance in this country. A Senate task force on the uninsured is examining workable policy choices to reduce the number of uninsured and provide more affordable health care coverage options, he adds.

On E-Fairness

The issue of e-fairness has been on the radar screen of retail REIT executives since the rise of the dot.com era. There is pending legislation (S 1736 and HR 3184) that would level the playing field so that states that have simplified their sales tax systems could require all retailers, both online and brick-and-mortar, to collect sales and use taxes on purchases by in-state purchasers.

Being from a state without an income tax that's heavily dependent on sales tax revenues, Frist is in favor of this legislation for a few reasons.

"There is no question that permitting sales tax to be collected on Internet sales would help my state of Tennessee to raise revenue, but I also look at this as a fairness issue," he says. "These taxes are already collected on purchases made at brick-and-mortar stores."

Frist says this issue is picking up some steam in Congress, and he expects legislation addressing e-fairness to move forward in the near future.

On REITs In Tennessee

Born in Nashville, Frist is passionately supportive of his home state of Tennessee. There is more to the Volunteer State than just being the home of country music, it has increasingly become a prime location for companies in the health care, automotive and technology industries to relocate, Frist says.

The state is also home to six REITs: CBL & Associates Properties, Inc. (NYSE: CBL); Equity Inns, Inc. (NYSE: ENN); Mid-America Apartment Communities, Inc. (NYSE: MAA); National Health Realty, Inc. (NYSE: NHR); RFS Hotel Investors, Inc. (NYSE: RFS); and privately held Anderson-Tully Company. Frist says Tennessee's development over the years mixed with its small town charm and tourist attractions make it a competitive location for real estate companies to consider.