Showdown in Congress over child healthcare.

Sen. Orrin Hatch (R) of Utah, who helped negotiate the compromise, says that he's "very sympathetic" with Bush's views that S-CHIP not become "a big, one-size-fits-all government program," but that he hopes the president will work with the Congress to come up with a compromise.

But, unusually, the key vote in S-CHIP is likely to come in the House, which requires 290 votes to override a presidential veto. Responding to reports that the White House will be asking for $200 billion for the war in Iraq this week, House Democrats say the claims that insuring 10 million children under S-CHIP is "excessive spending" is a sign that Bush has the wrong priorities.

"For this president who helped rack up $3 trillion in new debt, it is not about the spending, it is about priorities and the president has made his clear," said House Democratic Caucus chairman Rahm Emanuel, in a statement.

Meanwhile, House Republicans are hoping to pull over tobacco-state Democrats, riled that the S-CHIP increases are paid for by tobacco taxes. "Tobacco taxes fall hardest on the working poor – the very people who S-CHIP was originally designed to help," wrote Rep. Jim McCrery (R) of Louisiana, the top Republican on the House Ways and Means Committee, in an oped on Monday.

A veto on the S-CHIP reauthorization would be only the third of the Bush presidency.

"It's the riskiest use of the veto we've seen yet," says Julian Zelizer, a congressional historian at Princeton University. "Democrats have been able to corner the president and Republicans into an area of healthcare where's its very difficult to say no. That's a big gamble, because it's such a symbolically charged issue."

But beyond politics, there are deep divisions over values at stake in this week's S-CHIP debate. Conservative and libertarian analysts are calling the S-CHIP renewal the first battle in stopping the growth of government-managed healthcare.

"This is a program that doesn't make any sense. Taxpayers have to send their money to Washington, so Washington can send it back to the states and tell the states how to spend it on health insurance for poor and middle-class kids," says Michael Cannon, director of health policy for the CATO Institute, a libertarian think tank. "There's no evidence it's a cost-effective way of paying for healthcare, and evidence that it makes private healthcare more expensive."

Other health policy analysts chide the White House for not working with the Congress to find a compromise. "The White House has stood at the sidelines and just been negative, rather than enter constructively into a discussion to wind up with what might be a compromise proposal," says Henry Aaron senior fellow of the Brookings Institution.

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