August 3, 2009

[H/t Heather]

When I think of how much the Bush administration shoved down the country's throat on strictly partisan votes, it makes me crazy when Democrats start talking about being bipartisan. This kind of talk by Tim Geithner on This Week with George Stephanopoulous is more like it:

STEPHANOPOULOS: Let me ask you about health care. The negotiations seem to stall out in the Senate, they are going to try to come back by Sept 15th. The House committees have all passed the bill. One of the things that, Senator Grassley, we just saw, is asking about is that he says he wants some assurance, some guarantees really, that whatever deal, if they strike a deal, a bipartisan deal in the Senate finance committee it's going to hold all the way through the process. The Senate floor, the House floor, the conference committee, can the administration give him that assurance?

GEITHNER: I think that is what every legislator wants. They want that to be of confidence.

STEPHANOPOULOS: They are not going to get it through?

GEITHNER: You know, (chuckles), we want to have an outcome that meets these core principles the President laid out. Which is we want to make sure that we're doing something that is going to reduce the growth in cost over the long term, expand access, improve the quality of care. Do that in a fiscally responsible way that does not increase, increase unduly the burden on average Americans today. That's the basic test. And we're going to try to make sure that we achieve that with the broadest consensus as possible.

STEPHANOPOULOS: You want broad consensus but Senator Grassley, his colleague Senator Enzi are saying that they need those assurances, that can't get them?

GEITHNER: Well again, you know (laughs) we want to make sure we get this done. And we're gonna- as the President's said, we're going to look at anything reasonable, consistent with those principles that's going to get this done.

STEPHANOPOULOS: You want it to be through consensus, the President has said he wants a bipartisan bill if possible, but do you believe it is possible if necessary to get meaningful health care reform with democrats only?

GEITHNER: George, I think that again this is a big consequential reform of the country. And as many people observes, ideally you want to do this with as broad a base of consensus as possible. But people on the hill are going to have to make that choice, do they want to help shape this and be part of it. Or do they want this country, the United States of America, to go another several decades without doing whatever other serious country has done, which is to give their citizens access to basic quality of care.

STEPHANOPOULOS: But if Republicans can't come to an agreement with the democrats are the Democrats and the White House willing to go it to alone?

GEITHNER: George, again, we're going to try and get this done on the best possible terms consistent with those principles. Can't tell you what it's going to take. But you see what the President is trying to do.

As gratifying as it is to hear tough talk from the Dems, though, there are some very serious drawbacks to doing it through the reconciliation process. It would require Obama to walk quite a political tightrope after dangling major healthcare reform in front of the voters:

But reconciliation is not just a “50-vote senate,” as it's sometimes called. It's a process constructed in the 1970s for a specific, limited purpose: to bring existing programs in line (reconcile them) with a long-term budget. Since then, it's been used for huge policy changes: the Reagan and Clinton budget plans, the Bush tax cuts. But there are limits. Under the senate's Byrd Rule, intended to hold the process somewhat to its original purpose, reconciliation can't include provisions that have no budgetary effect or that have an effect outside the current budget window, which right now is five years. (Byrd Rule limits can be waived, but by 60 votes, so you're back in the 60-vote Senate.)

To greatly oversimplify, what this means is that it's almost impossible to use reconciliation to build something new. You can expand Medicare or shrink it, cut taxes or raise them. But to construct something that doesn't already exist will inevitably require provisions that don't in themselves have a significant budgetary impact: regulations, structures, guidelines, realigned bureaucracies. In particular, much of the structure of health insurance exchanges that are envisioned in the House and HELP Committee bills would not survive the Byrd Rule axe. Only the flimsiest outlines of a health reform bill would survive – the financing would be there, but not the structures to ensure that the money would be used properly. Further, reconciliation would give the Finance Committee – which controls the money – even more clout over the more liberal HELP committee.

Some have suggested using reconciliation to install the rough skeleton of reform, and then fixing it later, but the act of using reconciliation in the first place is such a nuclear option that it is likely to poison the waters not just with the four semi-reasonable Republicans but also with the Democrats who are left out of the deal, and will be needed on subsequent legislation.

But what if Congress did it in reverse? Use the 60-vote Senate to pass whatever they can pass now -- we liberals will grumble but live with it -- and then use reconciliation next year to fix it. With the exchange structure and subsidies established, it wouldn't be hard to add an employer mandate, which would save money. With the rudiments of even a weak public plan in place, it wouldn't be complicated to expand it and modify its eligibility rules, in ways that might save or cost money but in either event, involve budget changes to an existing program rather than creating something new. Aggregating small changes over the next few years (on the model of the steady expansion of Medicaid engineered by Henry Waxman and others over the 1980s and 1990s) could non-controversially build the kind of robust and equitable system we dream of.

It's not ideal, and any political scheme based on do something now and hoping to fix it later faces the reality of all the partial reforms that litter the landscape. A plan that is so bad that it brings a backlash is more likely to be repealed than fixed. But it might just be that the big reform of health care can't be achieved all at once. And this would at least get the pieces in place for the next phase to move forward, with or without the current obstructionists.

The big problem there is if the Democrats are turned out of control in the next election. Then we have a very big problem on our hands.

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