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Charlie Baker is riding a wave of Republican pride in a notoriously blue state. But will it be big enough for this Swampscott resident to unseat a Democrat and become the next governor of Massachusetts?

On a blistering cold morning in late January, the warmth of hundreds of people radiated through Boston’s Faneuil Hall as crowds swarmed to listen to a man speak. Like many who spoke at that hall before him— from Samuel Adams to Ted Kennedy—he wanted to talk politics. Television news crews maneuvered feverishly around the crowds, while camera phones flashed against the ivory white columns from every direction amidst a sea of “Baker/Tisei 2010”  signs.

Charlie Baker Jr. walked out to the podium and spoke, his tall, commanding frame occasionally pacing with an assertive swagger, rallying the crowd with a mix of populist angst and humor. He greeted every unbridled outburst of applause and standing ovation with a panoramic nod and an appreciative yet brazen smile.

“Are you ready for November?” he yelled to the crowd as the band played a hard rock melody and the crowd chanted his name.

In that warm Boston landmark on that frigid winter day, it was clear that this Swampscott resident had become a political rock star.

Born in 1956 in Needham, Baker was raised in an atmosphere of mixed politics. His mother was a liberal Democrat. His father was a Republican who served during the Nixon and Reagan administrations. This made for interesting dinner conversations, Baker says, but with politics, the kids mostly just listened.

“My dad did have a whole bunch of questions he used to fire at us, and we all knew the answer to the first question, asked every time, which was, ‘Who made the miracle catch?’ Wasn’t Willie Mays,” Baker reminisces, sitting back in his chair at his Boston campaign office. He’s a tall man, six-feet, six-inches tall. But softly spoken with a subdued demeanor that offsets his titanic physical presence, he reflects more his no-flare reputation than his grand stage stump persona. Even his office has a minimalist quality—plain white bare walls and basic office furniture one might find in a bank or insurance office. “The answer is Al Gionfriddo. You can look that up.”

The oldest of three boys, Baker loved history and English but didn’t do as well in math and chemistry. He played sports and was an All-League basketball player at Needham High School. “Nothing out of the ordinary, although I was taller than the other kids.”

Baker graduated from Harvard University in 1979 with a bachelor’s degree in English and then worked as corporate communications director for the Massachusetts High Technology Council. Later, he pursued his master’s degree in management at Northwestern University’s Kellogg School of Management, where he met his wife, Lauren.

In the 1980s, Baker consulted for state governments and was named co-director of the new Pioneer Institute, a think tank based in Boston that focused on promoting free market principles to state governments. The institute’s founder, Lovett Peters, later recommended Baker to then-gubernatorial candidate William Weld.

“Charlie had volunteered to advise me for the campaign on insurance issues,” says Weld, who now practices law at an international firm in New York City. “Later, that extended to health issues as well. By the end of the campaign in 1990, I wanted to know Charlie’s view on every issue.”

After the campaign, Gov. Weld appointed Baker as undersecretary of the state’s Health and Human Services Department. Baker would later be promoted to secretary of that department and eventually secretary of administration and finance. Baker earned a reputation as an innovator and budget cutter, playing a role in health care restructuring, welfare reform, and other changes that incited both praise and controversy. The administration consolidated the state’s health facilities, closing Danvers Hospital and opening long-term operations at Tewksbury State Hospital, for example.

“He made sure more services were delivered in a smaller, community setting, often by non-profit providers, as opposed to being delivered in huge, prison-like red brick buildings, which were a vestige of the 18th and 19th century approach to public health, mental health, and developmental disabilities,” Weld says, pointing out that Baker’s approach received 92 percent approval from patients. “Both the patients and their families preferred the new approach as more humane and as preserving more dignity for the patients.”

But some of the deregulatory changes—like the merger between Partners Healthcare System and Blue Cross Blue Shield of Massachusetts that Baker signed off on—were later blamed for the rising cost of insurance in Massachusetts. Baker himself has acknowledged that the merger backfired and conceded that the process of restructuring services and reforming the budget was disruptive and controversial, but he says it enabled the state to fund community-based programs it wouldn’t have funded otherwise. “It was difficult,” Baker says. “Welfare reform was difficult. A lot of the stuff we did with Medicaid was difficult. And there’s a certain resistance to change, anyway, and we were certainly engaged in a lot of change.”

Weld praises Baker’s handling of the budget, pointing out that essential services were never curtailed and that Baker was a hero in the non-profit community. “As to how the budget was handled in general, I would point out that we received 50 percent of the vote in 1990 and 71 percent in 1994.”

After Weld resigned in 1997, Baker stayed on in the administration of acting Gov. Paul Cellucci. Cellucci and Baker discussed the possibility of Baker being Cellucci’s running mate in the next election, but Baker declined, saying it would put a strain on his family life. In 1998, at the end of Cellucci’s acting term, Baker left government and took over as CEO of Harvard Vanguard Medical Associates, a New England physicians’ organization. The next year, he was named CEO of Harvard Pilgrim Health Care, a non-profit health benefits company that was suffering financially and under state receivership. It had reportedly lost $58 million in 1998 and was expected to lose more than $90 million in 1999.

“Charlie was a very effective and charismatic leader,” says Lynn Bowman, vice president of customer service at Harvard Pilgrim, who worked with Baker there. “Even though the company was in disarray, he came in and was confident in himself and his team that we were going to be successful. He’s very direct and honest; a straight shooter. He says we have a problem, here’s what the problem is, here are the steps we’re going to take to fix the problem, and here’s how we’re going to measure success.”

Baker immediately restructured the company’s business method and cut the workforce by 90 people. The company then increased premiums, restructured relationships with physicians and pharmacies, outsourced the company’s information technology, and completed the merger between Harvard Vanguard and Harvard Pilgrim to create an organization people could more clearly understand in terms of roles and responsibilities.

“We also exited the Rhode Island marketplace, which was very, very difficult to do and falls into the categories of one of the toughest things I’ve ever done,” Baker says soberly. “We had about 200,000 members down there, but I couldn’t see any way we could ever break even if we stayed there.”

Baker’s restructuring worked, and the company’s financial situation turned around. By 2002 it saw profits increasing, and it was named “America’s Best Health Plan” by U.S. News & World Report five years in a row, from 2004 to 2009. It was also named by The Boston Globe and Boston Business Journal as one of the best places to work.

In 2004, Baker decided to jump back into government, this time in electoral politics, and ran for a spot on the Swampscott Board of Selectmen. He won in a landslide victory. “The town was having some of the same issues that a lot of local governments were having, budget issues mostly,” Baker says. “We had three kids in the schools, and my wife and I have been involved in a whole bunch of activities of one sort or another on behalf of the town. It just seemed like a logical extension of that.”

While on the Board, Baker was known for his quiet businessman-like approach to the town’s issues and heavy emphasis on the town’s budget, bypassing flare and town hall theatrics in favor of the number-crunching grindstone.

“I’m not much of a bomb thrower,” Baker laughs. “I ran basically talking about the budget and trying to do things in a smarter and better way. It’s a small community; it was about how to do the same with less, or how to get more out of this. It really was about tactics and operating strategies, stuff like that.”

Although Baker was all business, his arrival on the Board created excitement and some bewilderment.

“I didn’t know what to think when he first decided to run, an executive from Harvard Pilgrim coming on to the local board,” says Dan Santiello, who served on the Board with Baker. “But he really surprised a lot of people with his ability to step right in and serve as selectman. He took a look at things from different angles, forced us to think outside the box. “

Marc Paster served as chairman of the Board of Selectmen while Baker served and says Baker’s arrival on the Board of Selectman turned out to be a much-needed benefit. “One major thing that really impressed me was his knowledge of the budgetary process and how it works,” Paster says. “He could really sit down, analyze a budget, and see where there are areas we could improve. He acted almost like a second town manager, he was that good.”

Baker’s experience working with state government paid off for the town, Paster adds. Baker was instrumental in helping the town secure state funding to build its new high school, and even turned that into an opportunity to address the need for a new senior citizens center by having it built as part of the new high school—which solved two problems and got the town money from the state.

In 2007, Baker decided not to run for reelection. Harvard Pilgrim was about to expand into New Hampshire and Maine, and Baker says he worried about his ability to focus on that expansion while also serving effectively as a selectman. But last year, with the atmosphere friendlier for a Republican candidate, Baker announced in July that he would be resigning from Harvard Pilgrim and running for the governor seat.

“I think the stakes are pretty high,” Baker says of this year’s election. “The fiscal situation’s a mess. The economic situation’s a mess. Having been through two turnarounds before, one in the 1990s and one with Harvard Pilgrim, I know what they look like. And what’s going on right now is not a turnaround.”

Like Weld before him, Baker has positioned himself as fiscally conservative and socially liberal, perhaps a reflection of being raised by a Republican father and a liberal Democratic mother. He’s a budget hawk but supports abortion rights and gay rights. He supports the state’s universal health care coverage but wants to make structural changes for cost efficiency.  He wants to trim the state budget but not cut aid to municipalities. And he wants to cut the state’s income tax rate to five percent, which voters have twice called for in the past decade, and cut the sales tax back to five percent as well.

“It’s almost impossible for businesses to invest in Massachusetts if they never know what the rules of the game are going to be,” Baker says. There’s a calm certainty in his voice when he speaks about budget policy, like that of a minister discussing theology. “As long as state government keeps talking about raising this tax or that tax, the message they’re sending to businesses is ‘We don’t know what’s going to happen next in Massachusetts, but it’s probably going to be bad.’”

Baker says he wants to focus on regional job growth, evaluating each part of the state for its commercial strengths and weaknesses. “The North Shore is a perfect example,” Baker says. “There you have a whole bunch of different kinds of businesses you don’t necessarily have in other parts of the state. You’ve got fishing in Gloucester, a bunch of technology companies up on 128, all kinds of college and university activity from UMass Lowell and Salem State to Merrimack and North Shore. There is a flavor to the North Shore from an economic development point of view, and we ought to be thinking about what we do there to build on the strengths of the region. That’s why I’ve been so aggressive about getting the administration involved in this fight with the feds around fishing.”

The state’s fishing industry, already suffering in the bad economy, is set for new regulations that include changes to the length of time allowed at sea for groundfish and scallop businesses. Industry analysts estimate that the changes could cost the state’s fishing industry more than $1 billion.

“That’s an industry that really matters in places like Gloucester, and the state ought to be fighting tooth and nail to preserve the opportunity for those guys to play,” Baker says.

As for Baker’s family situation, he says that it’s now more able to accommodate a gubernatorial run than it was four years ago. His oldest son Charlie is a freshman in college. His other two children, AJ and Caroline, are now in their teens and have their own lives, as Baker puts it. His wife Lauren is active with the Red Cross and serves as the chair of the Board of Marian Court College.

When selecting his running mate, Baker says State Sen. Richard Tisei of Wakefield was the first and obvious choice. Tisei has decades of legislative experience and heightened status as Senate minority leader, balanced by his outside experience as owner of a successful real estate business in Lynnfield. “Richard has always been a reformer,” Baker says. “He’s always seen the building from the outside in. And he knows how the building works. I think Richard will be a terrific partner as far as getting my agenda accomplished.”

Polished, impeccably dressed, yet plain-spoken, Tisei carries himself with both an alertness and ease, a sense of busy comfort likely acquired with years of legislative muscling. He was the youngest Republican ever elected to the Massachusetts legislature, first elected to the House at age 22 right after graduating from college in 1984. He was elected to the Senate in 1991 and became Senate minority leader in 2007. Tisei played an instrumental role in writing the state’s welfare reform law in the early 1990s, which would be used as the basis for national welfare reform enacted later in the decade. He was also the chief sponsor for the whistleblower protection bill for health care workers who reported substandard care and authored a bill to turn the zoos over to a private non-profit company. And throughout years of debating  everything from regulation to fiscal policy, he has kept the respect of his colleagues. In a deep blue state where “minority party” has enhanced meaning—Democrats control about 90 percent of the seats in both the House and Senate—Tisei has had to master a balance between political convictions and legislative finesse.

“It’s a challenge, but it’s a fun challenge in a way,” Tisei says, glancing at the pictures of him in the 1980s with then-Vice President George Bush. “As minority leader in the Senate, it’s an added responsibility to make sure you’re always holding the majority’s feet to the fire. Being the underdog, I guess for some people, it would get them frustrated. For me, it’s been energizing.”

Tisei is also gay, something he discussed publicly for the first time in an interview with The Boston Globe a week before Baker announced him as his running mate in November. At that time, he dismissed the issue of his sexuality as an open secret and he still feels it won’t impact this year’s election. “Charlie didn’t pick me because of that, but he didn’t disqualify me either,” Tisei says. “And I think that says a lot about him more than anything else.”

Nationally, the Republican Party has not been friendly to gay rights, yet Tisei has been an active supporter of same-sex marriage, an ideological conflict he says he works through with personal convictions.

“At times, it’s been a little uncomfortable when that’s the focus,” Tisei says. “But the Republican Party in New England has always been pretty much a party that’s fiscally conservative and libertarian on social issues. I consider myself more of a Goldwater conservative. Keep the government off my back, out of my wallet, and away from my bedroom.”

The large room down the hall from Baker’s and Tisei‘s offices that was usually full of eager volunteers working diligently for the campaign was empty on January 19. The volunteers were helping the Scott Brown campaign through the final hours of the special Senate election.

Baker has shattered records in his aggressive fundraising push, amassing more than $2 million since last summer. In January, Baker and Tisei raised more than $388,000—out-raising Gov. Deval Patrick’s campaign by three-to-one and out-raising Independent candidate Tim Cahill’s campaign by even more than that. And this is not expected to be a good year for Democrats. In addition to Gov. Patrick’s frequently low approval numbers, scandals involving Democratic lawmakers seem to blanket the evening news on an almost weekly basis, and last year the state saw its House speaker indicted on fraud charges.

Tax increases and high unemployment has fueled voter dissatisfaction as well. Frank Torres lives in Haverhill and is a manager at King’s Subs & Pizza in Andover. He’s worried about what the economy may do to his job.

“Working for a small business, I can see the effects it’s had,” Torres says. “We used to have—at 9 o’clock at night—30 steak and cheese subs going, the ovens full, people running around not stopping. Now everything’s tightened up and we’re cutting back on staff.”

Torres moved to Massachusetts from Texas last year and says he’s excited to be here for what he sees as a time of change in the Bay State. “Really, it’s just refreshing to have a change about how government is done up here,” Torres says. “It seems like the floodgates are open, someone who’s running for governor is going to revamp that whole politics-as-usual in the governor’s office.”

Torres’ sentiments represent a populist groundswell that carried Scott Brown to victory and gave the late Ted Kennedy’s Senate seat to the Republican Party. Baker and Tisei hope that same populist rejection of government will carry them to the governor’s office.

“It’s the same atmosphere as we had in 1990, because people are ready for a change,” Tisei says. “The difference is Charlie is coming into this with more executive experience than Bill Weld had. I don’t remember a candidate for governor in recent memory as qualified as Charlie is.”