The biggest debate in Congress right now, at least on home-front issues, is on whether to expand the State Children's Health Insurance Program, a government effort that helps cover many children in families with wallets too fat to qualify for Medicaid but too thin to afford private health insurance.

Both houses of Congress just passed bills that would radically expand SCHIP, by 140 percent ($35 billion) in the Senate version and 188 percent ($47 billion) in the House version. President Bush has pledged to veto the legislation, insisting that it would deliver welfare benefits to the middle class and weaken the private marketplace for health insurance.

In an Aug. 1 commentary, Julie K. Schnell, president of the labor union SEIU Healthcare Minnesota, and Dick Pettingill, CEO of Allina Hospitals and Clinics, point out that many children remain uninsured, and they argue in favor of SCHIP expansion. They express frustration over the veto threat, urge us to "put partisan fights aside," and imply that a National Governors Association letter signed by Gov. Tim Pawlenty, the organization's new chairman, expresses bipartisan support for substantial SCHIP expansion.

But the letter signed by Pawlenty explicitly reserves judgment on how much to increase funding. It also underscores the fact that bipartisan agreement, to the extent it exists among America's governors, is limited to fixing technical problems and urging the continuation of state flexibility, all points supported by the president.

Expanding a big government program and putting more children under the tender care of government bureaucrats is neither the only way nor the best way of reducing the number of uninsured children.

Schnell and Pettingill failed to mention that the president offered an alternative policy, focused on tax reform, that would cover even more kids. Under the president's proposal, every American family would get a $15,000 tax deduction for health-care costs. Presidential candidate Rudy Giuliani offered a similar proposal days ago. And a group of five Republican senators recently offered another tax-reform alternative -- dubbed the "Every American Insured Health Act" -- that would give every American a refundable tax credit to buy health coverage ($2,160 for individuals and $5,400 for families).

Why tax reform as the way to go?

America's tax code curiously provides exemptions for health-insurance costs, but only for people with employer-sponsored insurance. Not incidentally, those denied these tax breaks tend to have lower incomes.

According to the Lewin Group, a health-care consulting firm, the average family would save $732 a year under the president's proposal to shift from the current discriminatory tax exemption to a uniform deduction of $15,000 for families.

With tax savings in hand, the Lewin Group estimates that 9.2 million more Americans -- children and adults -- would acquire health insurance, reducing the number of uninsured by 19 percent. A refundable tax credit promises to reduce the uninsured rate by even more.

In contrast, the Congressional Budget Office estimates that the extra SCHIP funding would enroll 3.2 million more children by 2012.

Both tax reform and SCHIP expansion are intimately tied to covering kids. They should be looked at together.

A final question. According to the Minnesota Department of Health, 78 percent of Minnesota's 66,000 uninsured children are actually eligible for public programs. If that's so, how does it make sense to exorbitantly enlarge what's already in place? We need to think differently. We need to think about tax reform and much more.

-- Peter Nelson is a policy fellow with the Center of the American Experiment in Minneapolis.