Updating the legislative scenarios: Reply hazy, ask again later

Updating the legislative scenarios:  Reply hazy, ask again later

Now that Speaker Pelosi has released her health bill and Leader Reid will soon release his, we near the end of the most opaque part of the legislative process and approach floor consideration of both bills.

In response to yesterday’s post, a friend with two decades of legislative experience commented that this is the most interesting legislative process in years. I agree, and it is also quite difficult to predict. I just wish this fascinating process did not involve a policy that could so severely damage our economy.

Usually a legislative process gets easier to predict as it proceeds. This one is more difficult, and I am less certain about my projections than I was a month ago. At a minimum, I hope to help identify the forces pushing for and against legislative success.

Enactment of a comprehensive law is far from certain. The last two attempts to enact major health care reform both failed: the Clinton Health Plan in 1994, and the Patients’ Bill of Rights about ten years ago. PBoR seemed inevitable right up to when it died.

Here are my updated projections:

  1. Cut a bipartisan deal on a comprehensive bill with 3 Senate Republicans, leading to a law this year; (0.1% -> 0.01%)
  2. Pass a partisan comprehensive bill through the House and through the regular Senate process with 60, leading to a law this year; (unchanged at 50%)
  3. Pass a partisan comprehensive bill through the House and through the reconciliation process with 51 Senate Democrats, leading to a law this year; (20% -> 10%)
  4. Fall back to a much more limited bill that becomes law this year; (24.9% -> 10%)
  5. No bill becomes law this year. Process continues into next year. (5% -> 29.99%)

I am therefore now projecting a 60% chance a comprehensive bill becomes law this year a decline from 70% almost a month ago. This is largely due to the slow pace of legislative progress. I believe the job gets harder the longer it takes.

The end of the legislative year approaches. This process has moved slowly enough that I no longer think there is time to “pivot” from failure of a comprehensive bill to passage of an incremental bill this year. If Democrats are still struggling in December to pass a bill through the Senate, I think it’s far more likely the process just drags on into next year. This is why I shifted the 30% “failure this year” scenarios from “pivot this year” (option 4) to “drag into next year” (option 5). Scenario (5) might next year lead to any of scenarios (2), (3), or (4).

Let’s examine the forces in favor of a comprehensive bill this year:

  • Democrats have made significant legislative progress. Speaker Pelosi and Leader Reid each have a bill to which they are attaching their own names, and those bills roughly represent variants of the committee products within each body. That lends legitimacy to their bills (at least within the Democratic caucus) and creates an initial presumption among most Democrats in favor of these bills. If you’re a Democratic member, you will need to explain to your leaders, the White House, and your colleagues why you’re choosing to oppose the leader’s bill. This burden of proof creates a psychological advantage in favor of passage.
  • The Democratic party is unified in wanting a major legislative accomplishment. I know of no Democrat who is saying he or she wants the bill to fail, even if some of them will vote against it. This sounds trivial but is important. Congressional Democrats appear to believe that enactment of a comprehensive law is critical to their re-election. Most seem to believe that a White House signing ceremony is more important than the contents of the bill that becomes law. This helps the Leaders and the President rally votes and creates legislative bargaining flexibility.
  • The bill would appear to achieve a core policy goal of covering millions of uninsured. This is a policy holy grail for many Democrats.
  • It appears they can get CBO to say the bills, as drafted, are deficit-neutral. If so, this can assuage many concerns from nervous Democratic members. Jim Capretta and I have each written about why these bills will in fact still increase the deficit, but in the vote-counting context, CBO’s stamp of approval is a critical advantage.
  • The President and his team appear highly flexible on policy. Other than insisting that the bill not increase the budget deficit, the Administration appears willing to accommodate almost any policy changes needed to get the votes. The bills being developed would increase private health insurance premiums for most and bend the private cost curves up, but you don’t hear the White House protesting. It’s easier to get a bill when you don’t care too much what’s in it. They can rationalize this behavior by saying they are focused on the broad brush strokes of policy. Unfortunately, these bills get key broad strokes wrong, most importantly by increasing health care costs rather than reducing them.
  • The President and his team appear willing to use the President’s considerable resources to get votes. The President has a lot of resources he can bring to bear to persuade wavering members. He can support policy changes, make public statements, support or oppose other legislation, use administrative policy to make unrelated changes. He can commit his officials to visiting a particular Congressional district. He can help Democratic members get favorable press coverage back home. He can promise pork barrel spending in a district  I expect to soon see hospital-specific earmarks. He can invite Members to the Oval or on Air Force One for a personal pitch. He can raise money for candidates.

At the same time, there are factors making it harder to enact a law this year.

  • The public option fight slows down the bill. I think the public option fracas is overrated, mostly because there is a lot of policy room for potential compromise among Democrats. We have seen some of this already, and I just don’t believe that liberals will kill a bill that provides >95% health insurance coverage because the public option is “too weak.” But this intra-party battle consumes leader time and energy, making it harder to resolve other problems as they crop up.
  • With one exception, Republicans are unified in their opposition. Six months ago this was not a foregone conclusion. Republican leaders have been effective in unifying their party, facilitated by a legislative process that shut them out. I have written before that the President could have had a bipartisan bill, had he empowered Chairman Baucus to negotiate on his behalf with Finance Committee Republicans. The President implicitly chose to make this process partisan, and in so doing helped unify Republican opposition.
  • Tick, tock, tick, tock… Speaker Pelosi says she wants to move a bill quickly in the House (within the next two weeks, meaning the House is done before Thanksgiving). As usual the Senate is moving more slowly. This slow schedule means the elections and Thanksgiving recess can affect the Senate debate. If VA or NJ Governors’ races go Republican, will that scare a few Democratic Members into voting no? Expect lots of partisan spin from both sides next Wednesday about how the election results affect legislative prospects.
  • Oh yeah. The voters. More interesting is the Thanksgiving break. Will citizens besiege Members the way they did in August? Assuming the House has already passed a bill, will citizen input affect votes in the Senate? I hope so.
  • Moving forward without the votes. Both Leaders appear to be introducing bills and starting their legislative clocks before knowing they have the votes locked up. Sometimes you have to do this, but it’s risky. It also exposes the vote-gathering process to a moderate amount of sunlight, which is good for citizens but difficult for those whipping the votes. The leaders control the timing of when their respective floor debates begin. This means they can wait until they think they have the votes before proceeding. On the other hand, if they wait too long they could start losing votes, or they could run out of time on the back-end.
  • How to proceed on the Senate floor? Does Leader Reid allow a full amendment process, which could consume four weeks and might fragment his not-yet-existant coalition? Or does he quickly invoke cloture or “fill the amendment tree,” blocking unfriendly Republican amendments at the cost of exposing himself to process abuse attacks? Both paths involve significant risk.
  • Reconciliation is much harder now. By choosing a regular order path, Leader Reid is gambling he can hold 60 votes on key votes. In theory he still has reconciliation as a fallback process path, but the optics of doing reconciliation after you’ve been unable to hold your own party together are terrible. This is why I have lowered my projection for this path from almost 25% to 10%. If Reid can’t get to 60 votes, the entire effort is in big trouble.
  • Private health insurance premiums for 100+ M Americans would go UP. I know I’m harping on this, but it’s hard to think of a more important effect. I am encouraged that opponents of the bill are making this point – I have seen or heard it from Leader Boehner, Leader McConnell, and Senators Grassley and Enzi. If the debate turns to these quantitative aspects of the bill, and if Congressional Democrats start worrying that they are voting for bills that make health insurance more expensive for many, then the probability of enactment will decline precipitously.

In a couple of weeks I’ll shake the Magic 8-Ball and ask again.

* Technically, this post title blends two Magic 8-Ball answers: “Reply hazy, try again” and “Ask again later.”

(photo credit: Will I Ever Make Explore? (75/365) by somegeekintn)

10 responses

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  2. The bullet point labeled "Republicans are unified in their opposition" seems like a questionable argument to me. From my perspective, the attempts to negotiate with the republicans on the senate finance committee were clearly in good faith. Why do you feel that they were not?

    Also, you seem to be drawing the claim that 100m Americans would see their premiums increase from the discredited AHIP study. (from the post on 10/12) I thought the methodological criticisms of this study were decisive. If you disagree, could you explain? Or if the number comes from a different source, could you indicate that source? I'm a liberal, but if I thought the final hc bill would lead to higher costs over the long term, I would defect as a supporter.

    • I've written about this a few times before. Please search for "Grassley Obama" to find it. I believe Chairman Baucus negotiated in good faith with the SFC Republicans, but that he was not empowered by the President to negotiate. Sen. Baucus publicly commented to this effect a few times.

      I am not drawing on the AHIP study. I have written about the study, which I think was sloppy but ends up at the qualitatively correct place.
      As for the 100M+ Americans with employer-provided health insurance, no provisions in this bill would increase their premiums, while there are several provisions that would increase their premiums. Most importantly, increased demand for medical care would result from the greater insurance coverage, raising prices for medical care and insurance.

      Thanks for the questions.

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