GIVE President George Bush an for picking Secretary of Transportation Samuel K. Skinner, a well-regarded politician and a proven manager, as his new chief of staff. Yet, the chief-of-staff position, as it did with John Sununu, can undermine the presidency and ill-serve the nation if President Bush chooses the wrong chief-of-staff model and misuses Mr. Skinner's many talents.To be sure, Mr. Sununu's arrogance, abrasiveness, and political tin ear contributed to his downfall. But the chief culprit was Bush. Based on his distaste for domestic policy, Bush made Chief of Staff Sununu his deputy president and top political adviser. Domestic policy was run in Bush's name by a regency of Sununu and Richard Darman, director of the Office of Management and Budget (OMB). The two practiced an imperious, secretive, top-down style that cut off ideas from below. What so marked the domestic policy regency was the extent to which Sununu and Mr. Darman operated off the top of their heads with little or no policy debate. A combination of extreme egomania and fear of leaks led Sununu and Darman to let the domestic policy process atrophy, resulting in a "policyless," reactive domestic presidency that left Bush always behind the game and looking weak. As Bush's chief political strategist, Sununu created ill-will in Congress, alienated Republican supporters, and gave the president faulty political advice that made him look inept. Beguiled by his high approval ratings flowing from the Gulf war victory, Bush sanctioned Sununu and Darman's imperious behavior. However poorly Sununu as chief of staff did his job, he was doing exactly what Bush assigned him to do in acting as deputy president and chief politico. What should Bush do to restore the job of chief of staff so it well serves both him and the country? First, he should make Skinner his "honest broker," managing a coherent policy process that can revive Bush's domestic presidency. The best model is the presidency of Gerald Ford. The basic responsibility of President Ford's first chief of staff, Donald Rumsfeld, and Mr. Rumsfeld's deputy and replacement, Dick Cheney (now the secretary of defense), was to ensure that the president received a broad range of policy ideas from key actors. The Ford policy process produced an orderly flow of well-reasoned decision papers up and down with significant inputs from the departments and agencies that strengthened domestic policymaking. Sound domestic policy cannot be made without such a proc ess. SECOND, Bush should let his new and able presidential campaign team run the 1992 campaign, outside the White House. He can thereby better use White House staff, such as his congressional relations people, to do the regular political chores. Skinner should help the president oversee how well these tasks are done, not run them himself. Such an assignment draws on Skinner's political and managerial skills but does not overburden him so that he cannot be an effective honest broker. Third, the president should fire Darman, who stands for the old top-down style that cuts off policy debate. Bush should bring in a person who will better use the talented OMB staff. An administration official caught the Darman style in noting that OMB now stands for "One Man Band." Seldom has the OMB professional staff been so badly misused. Darman should go. A manager like Paul H. O'Neill, former OMB deputy director under Ford and now chief executive officer of Aluminum Company of America, is the kind of person Bush needs. Finally, Bush needs to recognize that, as president, he is the most important actor in the White House's domestic-policy process. It will work well only if he leads the process that the chief of staff simply manages. If Bush's domestic presidency is to be revived, he must go beyond picking the right man to choosing the right chief-of-staff model. The advice to Bush is hard but clear: Clean house and change your own approach, or continue to fail as domestic-policy president.