Bipartisanship Is Dead – Long Live Bipartisanship!

Republicans have been gnashing their teeth and rending their garments, lamenting the landmark passage of health care reform late Sunday night. The Tea Party wing of the party has been vowing that this isn’t the end of the fight over healthcare — it’s just the beginning.

While House Minority Leader John Boehner’s response to the health care bill (not least its tax hike on tanning salons) has been a “hell no,” the more pragmatic thinkers on the other side of the aisle have been bemoaning the GOP’s Waterloo. David “Axis of Evil” Frum, who coined the “Waterloo” phrase, has laid out some constructive responses Republicans can take up on health care — and he’s making more sense than most in the party of Lincoln.

Frum outlines four ideas that Republicans should get behind:

1) One of the worst things about the Democrats’ plan is the method of financing: an increase in tax on high-income earners. At first that tax bites only a very small number, but the new taxes will surely be applied to larger and larger portions of the American population over time.

Republicans champion lower taxes and faster economic growth. We need to start thinking now about how to get rid of these new taxes on work, saving and investment — if necessary by finding other sources of revenue, including carbon taxes.

2) We should quit defending employment-based health care. The leading Republican spokesman in the House on these issues, Rep. Paul Ryan, repeatedly complained during floor debate that the Obama plan would “dump” people out of employer-provided care into the exchanges. He said that as if it were a bad thing.

Yet free-market economists from Milton Friedman onward have identified employer-provided care as the original sin of American health care. Employers choose different policies for employees than those employees would choose for themselves. The cost is concealed.

Wages are depressed without employees understanding why. The day when every employee in America gets his or her insurance through an exchange will be a good day for market economics. It’s true that the exchanges are subsidized. So is employer-provided care, to the tune of almost $200 billion a year.

3) We should call for reducing regulation of the policies sold inside the health care exchanges. The Democrats’ plans require every policy sold within the exchanges to meet certain strict conditions.

American workers will lose the option of buying more basic but cheaper plans. It will be as if the only cable packages available were those that include all the premium channels. No bargains in that case. Republicans should press for more scope for insurers to cut prices if they think they can offer an attractive product that way.

4) The Democratic plan requires businesses with payrolls more than $500,000 to buy health insurance for their workers or face fines of $2,000 per worker. Could there be a worse time to heap this new mandate on smaller employers? Health insurance comes out of employee wages, plain and simple. Employers who do not offer health insurance must compete for labor against those who do — and presumably pay equivalent wages for equivalent work.

The first point is red-meat, tax-cutting rhetoric for the Republican base – not much to see there.

The third point is very broad, but middle ground could be easily reached. Everyone is against “over-regulation” but everyone is for “consumer protection.” Finding the middle ground to give patients the best set of alternatives should be a key goal as the regulations of health-exchanges are spelled out.

The fourth and final point, while a good-faith effort to protect engines of job creation from additional burden, misrepresents the small business coverage of the health care reform bill. The small business provisions of the bill exempt companies with less than 50 employees. The only way Frum’s payroll figure would make sense is if each employee was being paid $10,000 a year. At that point they’re eligible for health care subsidies of almost $50,000 for a family of four.

But it’s Frum’s second point that progressives should consider. Employer-based health care has been a long-term roadblock to innovation and job creation. (The whole story can be heard here.) Moving from a system where insurers try to sell packages to employer HR departments to one where patients can make choices themselves on the exchanges envisioned in Sunday’s historic bill can save up to 40 percent of what we’re spending on health care. But many of us getting health care through our employers don’t have the option to look to the exchanges. (The Washington Post has a handy tool you can use to see what your health care options will be come 2014.)

We should take sensible Republicans like Frum at their word and look to give more people the opportunity to embrace the benefits of choice that will be brought around by health exchanges. Maybe by getting behind an idea like the Wyden proposal we can get Republicans like Frum to embrace the president’s vision of working in a bipartisan manner.

Photo credit: https://www.flickr.com/photos/urbanmixer/ / CC BY-NC 2.0

Explaining the Democratic “No” Votes

Amidst the understandable relief among Democrats at the passage of health care reform by the House, there’s been relatively little talk about the Democrats who still voted “no.” But 34 of them did, and fortunately, Nate Silver of 538.com took a close look at factors that might have explained the residual defections.

Nate concludes that Obama’s 2008 share of the vote in each members’ district, their general ideology, and their views on abortion, were the variables most highly correlated with a “no” vote. Variables that didn’t make as much difference include the competitiveness of the members’ own races, the number of uninsured in their districts and campaign contributions by insurance industry lobbyists.

It’s not that surprising that all 12 House Democrats representing districts where Obama won less than 40 percent of the vote in 2008 voted “no,” or that 61 of the 63 representing districts where Obama won over 60 percent voted “yea.” But 13 of the 30 from districts where Obama won more than 40 percent but less than a majority voted “no.”

Despite Bart Stupak’s decision to support the bill at the last minute, it’s significant that 24 of the 34 “no” votes in the House were members who voted for the original Stupak Amendment. Putting it another way, supporters of the Stupak Amendment split 37-24 in favor of the bill, while opponents split 182-10.

Ideologically, Nate uses the Poole-Rosenthal system to break down Democrats, and shows that “roughly the 110 most liberal Democrats voted for the health care bill.” That’s pretty amazing when you consider the unhappiness over the bill expressed by so many self-conscious progressives once the public option dropped out. Those categorized as “mainline Democrats” in the Poole-Rosenthal typology went for the bill 48-2, and “mainline-moderates” voted for it 44-7. In the most rightward category — “moderate-conservative” — members split right down the middle, 25-25.

All the other variables don’t quite have the salience of Obama vote share, ideology or abortion position. That should be at least mildly comforting to those Democrats who feared that pure political self-protection or insurance industry money were the major motivating factors for those voting “no.” And it’s very clear that the Democratic Left’s decision to support the bill despite concerns over its composition was absolutely crucial.

This item is cross-posted at The Democratic Strategist.

The (Republican) Constitutional Challenge To Health Reform

Yesterday, we learned that a coalition of State Attorneys General — 12 so far — plan to launch a constitutional challenge to the just-passed-but-not-yet-signed Senate health reform bill on grounds that imposing an individual mandate to buy health insurance is not justified by the powers Congress enjoys under the Commerce Clause of the U.S. Constitution.

Interestingly enough, the media reports I’ve seen on this story do not mention that 11 of the 12 AGs in question are Republicans. The one Democrat, Drew Edmondson of Oklahoma, is running for governor in this very conservative state.

For what it’s worth, few constitutional experts find any merit for a Commerce Clause challenge to health reform. But the proposed suit is probably part of a longstanding conservative legal effort to slowly chip away at the expansive view of the Commerce Clause, which has been the basis for a variety of important congressional actions, including the Civil Rights Act.

While the challenge is unlikely to get anywhere, it is worth remembering that there wasn’t much if any precedent for the decision in Bush v. Gore, either.

This item is cross-posted at The Democratic Strategist.

And Now For Something Completely Different

We interrupt this somewhat unscheduled progressive glee to make a brief point about national security. The Washington Post has a pointed op-ed today on Guantanamo Bay and military tribunals.

Now, let’s be clear: There are differing views within the progressive movement about the viability, constitutionality and political realities of trying terrorism suspects. There has been significant grief from progressive quarters that the administration is laying the groundwork to reverse its decision to try Khalid Sheikh Mohammed in a civilian court. (For the record, my personal view is that I stand with what the president said at the National Archives last year.) But lost in this division, there’s one issue in the Post‘s piece that we progressives should seize:

Congress and the president should hammer out a set of rules to guide judges on how to handle the Guantanamo habeas cases still wending their way through the system. And they need to agree on a legal framework to govern indefinite detentions now and in the future. [Italics mine]

Let us not forget that the Bush administration force-fed Obama this shit-sandwich. Rather than construct a legal framework to deal with terrorism detainees, the Bush White House took a pass by locking them up in GTMO and hoping the problem would never resurface. It really didn’t, until the Bushies were back cutting brush at Crawford. So, if progressives want to avoid fights and internal fallouts over terrorism suspect issues in the future, they have to define the rules of the road.

And while we can argue about the threshold of evidence regarding civilian vs. military trials, one idea that merits serious consideration is something that PPI has pushed in the past — national security courts. Here’s an excerpt from our “Memo to the New President” by Harvey Rishikof:

The thrust of the idea is to have a dedicated set of federal trial judges working with an expert bar of federal and military prosecutors and defense counsel — all with high-level security clearances. Such a court could accommodate the particular challenges of prosecuting terrorism cases in a manner wholly consistent with the Constitution, the common law, international conventions, and the relevant statutes.

This would be no sealed-off Star Chamber; trials would be open to the public unless there were truly compelling reasons to limit access in a particular case. Such openness would help give our own people and our allies the necessary proof that the United States is reasserting its identity as a champion of human rights and due process.

It’s a good idea that deserves consideration as part of the solution, even if the national security court use is ultimately mixed in with civilian and/or military trials. But the Obama administration could make things a lot easier on itself if it solved the problem with an institutional fix, and not just muddling through like they are with KSM.

…and now you can return to smiling ear-to-ear about health care.

Get a Grip

Just over a month ago, Jon Chait of TNR predicted that conservatives would “freak out” if and when health reform legislation was indeed enacted. Aside from the fact that many of them have been drinking their own kool-aid about the allegedly totalitarian implications of a health care system that would maintain America’s uniquely capitalist orientation towards health services, conservatives spent far too much celebrating the death of reform to accept its resurrection.

I don’t believe in spending too much time on schadenfreude, but it has been interesting to see the absolute shock with which some conservatives and tea party activists have reacted to last night’s vote. My favorite reaction is this from Newt Gingrich, posted on the Human Events site:

This will not stand.No one should be confused about the outcome of Sunday’s vote

This is not the end of the fight it is the beginning of the fight.

The American people spoke decisively against a big government, high tax, Washington knows best, pro trial lawyer centralized bureaucratic health system

In every recent poll the vast majority of Americans opposed this monstrosity

Speaker Pelosi knew the country was against the bill. That is why she kept her members trapped in Washington and forced a vote on Sunday.

She knew if she let the members go home their constituents would convince them to vote no.

The Obama-Pelosi-Reid machine combined the radicalism of Alinsky, the corruption of Springfield and the machine power politics of Chicago.

Sunday was a pressured, bought, intimidated vote worthy of Hugo Chavez but unworthy of the United States of America.

It is hard to imagine how much pressure they brought to bear on congressman Stupak to get him to accept a cynical, phony clearly illegal and unconstitutional executive order on abortion. The ruthlessness and inhumanity of the Obama-Pelosi-Reid machine was most clearly on display in their public humiliation of Stupak.

Hugo Chavez! Saul Alinsky! A six-adjective sentence (“big government, high tax, Washington knows best, pro trial lawyer centralized bureaucratic health system”)! The end of civilization as we know it!

This is the same Newt Gingrich, mind you, who led a Republican-controlled Congress over the brink in 1995 and 1996 in the pursuit of extremely unpopular policies, arguing he had a mandate from the electorate to carry out a conservative revolution. And this is the same Newt Gingrich who increased the power of the Speaker’s Office to levels not seen since the days of “Czar” Reed, all but abolishing the seniority system and making loyalty to the Speaker and the Caucus’ agenda the only criterion for advancement. As for “intimidation”: wonder what Gingrich thought of those Republicans who placed photos of defeated 1994 Democrats on the seats of wavering Democratic members yesterday?

Gingrich’s crocodile tears for Bart Stupak are even more ludicrous. Stupak made himself a national celebrity by creating a symbolic fight over essentially inconsequential language differences in the House and Senate provisions on abortion. Yesterday he accepted a symbolic victory that was equally inconsequential, and folded his tent. I can’t imagine how Obama, Pelosi and Reid were guilty of “ruthlessness and inhumanity” by accepting his face-saving deal.

Newt was almost certainly playing for the galleries where his heart really lives these days: among potential 2012 caucus-goers in Iowa, a right-tilting crowd if ever there was one. And speaking of Iowa Republicans, Rep. Steve King outdid Gingrich in his remarks to a crowd of Tea Party protestors outside the Capitol last night:

You are the awesome American people,” said King. “If I could start a country with a bunch of people, they’d be the folks who were standing with us the last few days. Let’s hope we don’t have to do that! Let’s beat that other side to a pulp! Let’s chase them down. There’s going to be a reckoning!

It’s interesting how King alternates between a threat of violence and a threat to leave this godless socialist country behind and take the “real Americans” with him.

Let’s hope Republicans get a grip over the next few days.

This item is cross-posted at The Democratic Strategist.

It’s Not Over Yet

They took the scenic route, but they got there. After a year of negotiations, town halls, summits and shouting, Democrats have passed comprehensive health care reform legislation. The reform measure passed by the House Sunday now goes to President Obama’s desk for his signature. The House’s fixes inscribed in a separate bill will now be taken up by the Senate, and is expected to pass via the budget reconciliation process.

The outcome certainly affirms President Obama’s reputation as a clutch player – someone who’ll come through when you need him the most. Of course, the game probably wouldn’t have been that close if he hadn’t sat out for so long. This is where I hope the Obama administration has learned its lesson. Throughout the process, the president decided to take a hands-off approach, letting Congress do much of the work. It was a strategy borne of the failure of President Clinton’s plan, which was seen as a case of a White House completely oblivious to how Congress works. But Obama overcompensated, and the result was a process that seemed rudderless.

Worse, the hands-off approach extended to the bill’s selling. Confident that it was the right policy, the administration was complacent that the media and the public would see that it was the right thing to do as well. What we got instead was tea parties and town halls and “death panels.” In the absence of a permanent campaign to enlighten the public, misinformation ruled the day — and continues to infect public understanding of what just passed.

Which is why this is a good sign:

President Obama is set to begin an immediate public relations blitz aimed at turning around Americans’ opinion of the health-care bill.

Planning inside the West Wing for the post-vote period has proceeded quietly, even as the president and his allies on Capitol Hill were fighting for the measure’s passage.

Reshaping the legislation’s image will take place in three phases, White House aides said: the immediate aftermath; the seven months until the November midterm elections; and the several years that follow, during which many provisions in the measure will gradually take effect.

The plans for a PR blitz to sell the bill post-passage suggest an administration that has learned its lesson. Polls show that support for health care reform, particularly among Dems, began inching up the more Obama threw himself into its passage. It was a powerful reminder: when Obama commits himself to firing up the base, the base tends to get fired up. The promise of an all-out publicity campaign by the White House probably also assuaged a lot of wavering Democratic congressmen. As Nate Silver points out, one of the best predictors of whether a congressman would vote for the bill was whether they thought Obama would be an asset to them.

He may be known as No Drama Obama, but the president supplied plenty of it these last few weeks, with a bipartisan summit, rousing public appearances and quiet one-on-ones with recalcitrant Dems, culminating in a tour-de-force address to House Democrats on Saturday. The result was a pitch-perfect campaign that rallied progressives, bucked up public opinion, and emboldened lawmakers.

This administration has the best salesman in the country at the helm. When he talks, people – at least the converted and the persuadable – tend to listen. It seems like they’re finally starting to figure it out.

PPI to Host Clean Energy Event in Boston Today

Already reeling economically, California may soon be overtaken by Massachusetts as the greenest state in the union.

California ranked first in a 2009 survey of the most energy-efficient states, with Massachusetts second. In January, however, the Bay State announced the nation’s most ambitious energy efficiency standards for utilities.

Despite growing energy demand, Massachusetts aims to cut electricity use by 2.4 percent over the next three years. It will provide utility customers with $1.6 billion in incentives to conserve energy at home, including free energy audits and rebates to purchase more efficient appliances. That’s more on a per person basis than California spends on energy efficiency.

And it’s not just Massachusetts. Connecticut, Maine and Rhode Island also have passed mandates for utilities to invest in any energy-saving measures that cost less than traditional energy-supply options. In fact, New England seems to be emerging as the nation’s epicenter of energy efficiency, clean tech innovation and carbon emissions control.

While Congress struggles with a nationwide “cap and trade” system for carbon dioxide, 10 Northeast states launched a regional cap-and-trade program covering all major power plants. The Regional Greenhouse Gas Initiative (RGGI) caps emissions at projected 2009 levels through 2015, when the cap declines annually to reduce emissions 10 percent by 2019.

To examine why, and how, New England has catapulted itself into clean energy leadership, PPI is hosting a conversation in Boston today with Ian A. Bowles, Massachusetts’ secretary for energy and environmental affairs. Boston is also the base for the Clean Energy Council, a regional network of clean tech businesses, analysts and investors.

The event is part of PPI’s E3 Initiative, a coalition of energy and environmental businesses working to develop and drive new policy frameworks to build a clean economy.

A Huge Accomplishment

Health care reform legislation, declared dead so many times by its enemies and sometimes its friends, became an accomplished fact last night via House enactment of the Senate-passed bill. The House also passed the closely associated reconciliation bill “fixing” the Senate bill, and final action on that measure in the Senate will take a while. But no matter: the most important health care legislation since the enactment of Medicare in 1965 is on its way to the president’s desk. It will ultimately provide coverage for 32 million people lacking health insurance; will finally outlaw the denial of insurance (or outrageous premiums for) those with pre-existing conditions, beginning with children; will undertake the most serious effort yet to move the health care system from payment for procedures to payment for good health results; and is estimated to reduce federal budget deficits by $120 billion in its first decade. For dessert, the bill closes the arbitrary “donut hole” for the Medicare prescription drug benefit.

The winding road leading to this accomplishment almost defies description, particularly after Republicans gained a 41st seat in the Senate in January and with it the ability to veto any legislation that didn’t proceed under budget reconciliation rules. After endless mockery for their handling of the issue last year, the administration and the Democratic congressional leadership all earn a great deal of credit for the ultimate victory: Harry Reid for getting all 60 Senate Democrats on board for a bill in December; Nancy Pelosi for the deft negotiations that produced 219 votes in the House; and the White House and the president for refusing to heed a thousand calls to totally revamp or abandon the legislation.

And despite the many conflicts among Democrats over the composition of the ultimate bill, it’s significant that joy over the vote last night extends all across the party, from single-payer fans to managed competition advocates to all sorts of people focused on narrow issues. It appears we owe a special thanks to the Catholic nuns whose strong support for the legislation seems to have shamed Rep. Bart Stupak and several other House colleagues into a face-saving deal on abortion language, mainly a symbolic gesture offered to secure real live votes.

Now Republicans, of course, are predicting a huge public backlash and then a quick repeal of the legislation if and when they retake control of Congress. There will be a lot of noise made in the days just ahead by Tea Party activists who have become invested in apocalyptic rhetoric about the dangers of health reform, and perhaps others who have bought some of the lies and distortions conservatives deployed to fight this legislation, from wild claims about “death panels” to pervasive predictions that premiums will skyrocket and Medicare benefits will be cut. When these disasters don’t occur, much of the negative excitement will die down, even as the merits of health reform become more apparent.

As for threats that the bill will soon be repealed: the very tools of obstruction that Republicans so eagerly utilized to try to thwart health reform will be available to those trying to stop its repeal. Will 60 senators vote to withdraw health coverage from tens of millions of Americans any time soon? Will 60 senators go to the mats to re-establish the “right” of insurance companies to deny coverage to children with pre-existing health conditions? Will Republicans vote to re-open the Medicare prescription drug “donut hole”? Where will they find the funds to offset elimination of health reform’s deficit savings? Maybe they ignored the president’s recent arguments about how the most popular reform measures won’t work without a comprehensive approach. But if Republicans try to repeal reforms piece-meal, they’ll finally figure out what he was talking about.

All in all, it’s clear that President Obama and most congressional Democrats did one thing that cynical voters don’t much expect of politicians these days: they kept a promise to meet one of America’s most urgent national challenges, and they kept it despite a collective Republican decision against any cooperation, despite vast institutional barriers in the Senate, and despite predictable public nervousness about — and, for many, hostility towards — comprehensive action on such a complex issue.

That’s an accomplishment worth celebrating, extending and, if necessary, defending. Let’s prove America’s not ungovernable after all.

US News & World Report: Democrats See a Healthcare Victory as a Springboard

Will Marshall in U.S. News & World Report:

But despite the GOP opposition, the Democrats do have cause for some optimism. Voters are about evenly split over Obama’s plan in Congress, with 41 percent in favor and 43 percent opposed, and many Americans’ views remain in flux. “Public opinion is not immutable,” says Will Marshall, president of the centrist Progressive Policy Institute. “Opinions change along with conditions.” He agrees that final passage of healthcare will provide an important opportunity for Obama and the Democrats to trumpet their ability to govern on their own. Few if any GOP legislators are expected to vote for the Democratic plan.

Marshall adds that the GOP is pigeon­holing itself as the obstructionist party. “The Republicans have gone so far off the rails” that many conservatives are “treating the commander in chief as an alien,” Marshall argues. “The Republican mainstream doesn’t seem to be there anymore. Who are the elders who say the party needs to regain its balance? . . . They let their crackpots loose, and to me, that’s scary.” He was referring to some members of the tea-party movement and others who have harshly criticized Obama in personal and political terms.

Read the entire article.

Inverted Hubris

As we count down towards the health reform vote(s) in the House, it’s clearer than ever that there are two distinct but mutually reinforcing conservative takes on the bill. The most obvious, of course, is the bizarre construction of “ObamaCare” that the Right has been building for nearly a year now, based on distortions, fear-mongering, a few outright lies and sweeping smears, all in order to make legislation pretty close to what moderate Republicans have promoted for years seem like a socialist revolution if not a coup d’etat. This is the hard sell, and it will continue up to and well beyond this weekend’s votes.

But then there’s the soft sell, beloved of today’s model of “moderate” Republicans, such as they are, which involves lots of tut-tutting at the unedifying spectacle of the health reform debate, constant if unsupported claims that there are plentiful opportunities for a bipartisan “incremental” approach, and above all, phony concern for what Barack Obama is doing to his party and his country. This approach typically ignores or rationalizes the hard sell that most conservatives have undertaken, and the lockstep obstructionism of the congressional GOP, and blames Obama and Democrats for all the problems they are encountering in getting this legislation done.

A pitch-perfect example of the soft sell is Peggy Noonan’s latest Wall Street Journal column, presumably her final pre-vote expression of contempt for the president in the guise of respect for the presidency, which alas, isn’t what it used to be when her mentor, Ronald Reagan, stood astride Washington and the globe like a colossus.

The column begins with an extended expression of horror that Obama would postpone a trip to Indonesia and Australia in order to lobby for this little domestic bill that would deal with the trifle of health coverage for 40 million or so Americans:

And to do this to Australia of all countries, a nation that has always had America’s back and been America’s friend. How bush league, how undisciplined, how kid’s stuff.

It’s characteristic that Noonan does not mention that Obama is trying to give Americans the universal health coverage that Australians have and take for granted, or that final passage wouldn’t have been delayed until now if Scott Brown hadn’t come to Washington pledging to kill “ObamaCare.”

Noonan then engages, with the air of someone examining an especially loathsome insect, in a lengthy attack on the procedural issues involved in House passage of health reform, asserting that Obama’s trying to hide something in the legislation via the “deem and pass” (which she suggests sounds tellingly like “demon pass”) mechanism that House Democrats are apparently going to deploy this weekend. She endorses as self-evidently correct the complaint of Fox News’ Bret Baier, in his obnoxious interview of the president last week, that “deem and pass” means nobody will know what’s in the bill that’s “deemed” and “passed.” Like Baier, Noonan doesn’t seem to understand the simple fact that the underlying bill we are talking about here is exactly the same bill passed by the Senate in December — long enough even for Peggy Noonan to have gotten wind of it. The changes in the bill — namely, the reconciliation measure — were made available, along with a CBO scoring of their impact, before the votes were scheduled, and will be voted on explicitly by the House (and later the Senate). Yes, this is complicated, but you’d think someone with Noonan’s experience and pay grade would be able to figure it out, and again, Democrats would have never resorted to this approach if Republicans weren’t using their 41st Senate vote to thwart the normal process after a majority in the House and a supermajority in the Senate had already passed similar legislation.

But whatever — Republican obstruction is never much mentioned in Noonan’s stuff on health reform. And so it is entirely in character that Noonan concludes her column by blaming Obama for the rudeness exhibited by Baier in last week’s interview, and hence for diminishing the presidency! Ah, if only we had a real president like you-know-who:

[W]e seem to have come a long way since Ronald Reagan was regularly barked at by Sam Donaldson, almost literally, and the president shrugged it off. The president—every president—works for us. We don’t work for him. We sometimes lose track of this, or rather get the balance wrong. Respect is due and must be palpable, but now and then you have to press, to either force them to be forthcoming or force them to reveal that they won’t be. Either way it’s revealing.

I’d say it’s hardly as revealing as Peggy Noonan’s inveterate habit of not only ignoring conservative hubris, but attributing it to its victims.

This item is cross-posted on The Democratic Strategist.

The Big Misconception About “Deem and Pass”

Over at TNR, congressional expert Sarah Binder provides a very useful and detailed explanation of the procedures the House will go through this weekend in dealing with health reform. There will be (assuming things go as planned and Democrats have their votes) four separate votes: one on a Republican motion to recommit the rule for consideration of the reconciliation bill, one on the rule itself, one on a Republican motion to recommit the reconciliation bill, and one on the reconciliation bill. If the first or third motions pass, or the second or fourth votes fail to pass, health reform will have been defeated, at least for the moment if not forever.

But it’s the vote on the rule that will (assuming the Rules Committee goes in the direction Speaker Pelosi has indicated is likely) “deem” the Senate health care bill as having been enacted. This “self-executing rule” is what all the yelling and screaming on the Right is about. But since everybody understands what’s going on, it is fundamentaly erroneous to say that the House is trying to avoid a vote on the Senate bill. The vote on the rule is a vote on the Senate bill, and will have exactly the same effect as an explicit vote on the Senate bill, no more and no less.

That fact obviously does raise the question of why the House leadership is utilizing the “deem and pass strategy,” since anyone voting for the rule is actually voting for the Senate bill. I can’t answer that question, but presumably this basically meaningless distinction matters to at least one House Democrat. But in any event, the conservative charge that the House is going to enact the Senate bill without voting on it just isn’t true, and is simply part of the fog Republicans are trying to spread over the fact that by the end of this process (again, if all goes as planned), majorities in both Houses will have twice approved health reform.

This item is cross-posted at The Democratic Strategist.

Did North Korea Execute a Government Official?

Reports of just how warped the North Korean regime is occasionally filter out to the broader world from time to time. This dispatch in the New York Times has got to be one of the more grotesque stories we’ve heard in a while:

North Korea has arrested and possibly executed its top financial official as it struggles to contain chaos set off by its botched attempt to halt inflation through a radical currency revaluation, according to news reports Thursday in South Korea.

[…]

Mr. Pak “was executed at a firing range in Pyongyang on the trumped-up charges of being an antirevolutionary element as public sentiments worsened over the failure of the currency reform,” reported the South Korean news agency Yonhap, quoting unnamed sources in North Korea.

Here’s where Mr. Pak screwed up:

In late November, North Korea suddenly told its people that it would introduce new banknotes, ordering them to turn in their old bills for new ones at a rate of 100 to 1. It also put a cap on how much old money they could swap for the new currency.

The shock measure was meant to arrest runaway inflation and crack down on illegal markets in the socialist state. But it only aggravated the food crisis, creating shortages and soaring prices, and reportedly led to isolated but highly unusual outbursts of protest in the totalitarian state.

I should note that Mr. Pak’s execution hasn’t been confirmed. But if it is, this is really serious stuff that the U.S. can’t ignore. When it comes to the internal machinations of a completely isolated society like North Korea, the West often writes off these kinds of stories. “They’re nuts,” you can almost hear a few desk officers in Foggy Bottom exclaim as they throw their hands in the air, “What are we supposed to do with this?”

But sooner or later during the Obama administration, the West will sit down with North Korea. The temptation is often to focus only on the nuclear issue, because it is obviously the most pressing concern for American national security. However, it’s critical that Western negotiators engage Pyongyang on human rights as well — if nothing else (and here’ s the cynic in me), asking hard questions about Mr. Pak’s disappearance creates diplomatic openings on other fronts, and will create incentives for the North Koreans to give ground elsewhere. And if we’re lucky, raising the issue might just protect Mr. Pak’s successor, too.

Progressives and Poker

There’s been some interesting talk going on this week involving a post mortem assessment of “the Left’s” strategy on health reform, particularly in terms of the ultimate emptiness of threats from progressive House Democrats that they would vote against any bill that didn’t include a “robust” public option.

Glenn Greenwald argues that progressives have once again exposed–and possibly even increased — their “powerlessness” within the Democratic Party. Chris Bowers challenges the premise by arguing that progressives did secure significant changes in the Senate bill, most notably the agreement to “fix” it, which certainly wasn’t the path of least resistance.

Meanwhile, Armando of Talk Left has compared the lack of leverage of progressives over items like the public option to the success of the labor movement in forcing concessions on the “Cadillac tax.” And Nate Silver has responded by arguing that progressive threats didn’t work because they weren’t credible in the first place.

I think everyone in this debate would agree that it’s generally a bad idea in politics to make threats you are entirely unwilling to carry out, but the real division of opinion is on whether such threats should be tempered or in fact intensified. But Nate makes one point that bears repeating: the political value of aggressiveness and posturing can and often does get exaggerated.

It feels good to assert that progressives just need to be tougher — perhaps even to the point of feigning irrationality. These arguments are not necessarily wrong — a reputation for being tougher bargainers would help at the margins — but it misdiagnoses the problem on health care. The progressive bloc failed not because of any reputational deficiency on the part of the progressives but because their bluff was too transparent — they claimed to be willing to wager enormous stakes (health care reform) to win a relatively small pot (the public option). That would have been beyond the capacity of any poker player — or activist — to pull off.

I’ve never much liked the strain of progressive analysis that endlessly promotes “fighting” and “spine” and “cojones” as the answers to every Democratic political problem. Sometimes “brains” or “heart” are more important, and moreover, if politics is reduced to a willingness to project brute force, the bad guys are going to win every time; it’s like getting into a selfishness competition with the Right — we’ll never win. But in any event, however you feel about the Will to Power theory of politics, Nate’s right, people aren’t all stupid, and macho posturing by progressives when it doesn’t make sense isn’t going to convince anybody. Poker playing is a relatively small and overrated part of politics. Real conviction and strategies based on conveying those convictions to friends and potential friends are the best building blocks for successful strategy.

This item is cross-posted at The Democratic Strategist.

The Dodd Plan Is Good — But It Can Be Made Better

Sen. Chris Dodd (D-CT), looking for a capstone to his 30-year career in the Senate, unveiled his vision for financial regulatory reform this week. The chairman of the Senate Banking Committee has long been dogged by claims that he’s in the pocket of the financial industry and hedge funds, but his plan is a robust effort to address the systemic issues that led to the 2008 financial crisis. While it’s far from perfect, the Dodd proposal is a good one that could be made even better with a few tweaks.

A robust Consumer Financial Protection Agency (CFPA) is vital. Concerns over creating a whole new bureaucracy have to be balanced against developing a consumer watchdog agency that has teeth to rein in subprime mortgages, hidden banking fees and the like. I got to hear Sen. Mark Warner (D-VA) talk about this with Sen. Bob Corker (R-TN) at a panel sponsored by the National Journal, where they described striking that balance by housing the CFPA in the Fed. The new autonomous agency would get Fed funding for its activities but would not fall under its oversight. That responsibility would fall on a CFPA director appointed by the president and confirmed by the Senate. This should give it enough independence from the financial institutions that fund the Fed to make the agency a real force for protecting consumers.

However, as described in the bill, the CFPA would exempt some lenders from oversight. An improvement would be to follow President Obama’s lead and create a CFPA that covers retail activities from all financial entities, including small banks, auto loan and mortgage originators (like Countrywide or GMAC), and payday lenders. The Department of Defense got military personnel protected from such lenders four years ago, finding that such loans “undermine military readiness, harm the morale of troops and their families, and add to the cost of fielding an all-volunteer fighting force.”

The Dodd bill includes the so-called Volcker rule, limiting the scope of bank activity, which I’ve argued before won’t make a real difference in prop trading, as banks can mask it behind market-making and client trading. However, the excess leverage tax in the Volcker rule — if properly beefed up — will discourage firms from becoming Too Big Too Fail (TBTF). And where the bill as envisioned doesn’t seem to rein in behemoths like Citi or Bank of America, increasing the capital requirements on overly large firms is a relatively easy fix, if the political pressure from bank lobbyists can be overcome.

The bill looks to wind down TBTF through a special financial panel of bankruptcy court, which would allow systemic risk overseers — envisioned in the bill as comprised of representatives from Treasury, the Fed and the CFPA — to take vulnerable firms into receivership and liquidation in times of crisis. The FDIC would manage a $50 billion fund that banks would pay into to provide liquidity in these situations. As envisioned, the treasury secretary petitions the court, the financial firm in question responds, and the court has 24 hours to decide. But a decision can be appealed to a Court of Appeal and then the Supreme Court, a process that could take up to 30 days. In a financial era in which multibillion dollar institutions like Merrill Lynch and Lehman Brothers can evaporate over the course of a weekend, giving management 30 days in which to stonewall means that an orderly wind-down as the new rule envisions is unlikely.

We’re waiting to see what will come from Sens. Jack Reed (D-RI) and Judd Gregg (R-NH) on derivatives, but the existing language encourages increased transparency and centralized clearing for standardized derivatives (the maligned CDS’s and the like) and increases margin requirements for non-standard derivatives. All trades being reported will help regulators understand the evolution of the financial system better.

The inclusion of a non-binding shareholder vote on executive pay will give shareholders a greater role in compensation. While it won’t solve the “heads I win, tails you lose” problem of Wall Street’s bonus structure, it will give outsiders more say on pay and hopefully check the worst excesses.

Like the CFPA and the chairman of the Fed, the proposed legislation would also make the New York Fed presidency a White House appointment. That role, which was vital at the height of the 2008 crisis when now-Treasury Secretary Tim Geithner held it, and was central in previous crises, like the LTCM meltdown of 1998, has long been seen as beholden to Wall Street. A presidential appointment would increase its independence form investment banks.

As presented, the Dodd bill has its flaws — in addition to the ones mentioned above, others have argued that political realities have compromised the force of the bill, and because it hasn’t addressed leverage, the seeds of an asset-bubble-driven crisis like the most recent one are still there. It’s true, as Sen. Dodd said when he announced the bill: “This legislation will not stop the next crisis from coming. No legislation can…” But this bill — with improvements — can give regulators the tools they need to address future crises in a more proactive manner.

Stupak: The Man and the Movement

Given the importance of Rep. Bart Stupak (D-MI) and his allies in the struggle for health care reform in the House, it’s worth thinking a bit about what actually makes him tick. A very revealing moment came yesterday, when Stupak blew off a communication from Catholic religious orders representing 59,000 Catholic nuns urging approval of the health reform bill. According to Fox News’ report of Stupak’s reaction:

The conservative Democrat dismissed the action by the White House saying, “When I’m drafting right to life language, I don’t call up the nuns.” He says he instead confers with other groups including “leading bishops, Focus on the Family, and The National Right to Life Committee.”

Stupak’s meaning couldn’t be clearer: in figuring out his position on health reform, he’s not identifying with fellow Catholics who are struggling to balance various ethical considerations; he’s acting as an agent for the Right-To-Life Movement and its often-machiavellian political game plans. It’s particularly interesting that he mentioned Focus on the Family, the right-wing evangelical Protestant “ministry,” as a greater influence on him than 59,000 nuns.

Why does this matter? Well, aside from the fact that any serious ethical review of the bill has to include the positive impact of reform on maternal and childhood health, it’s also pretty clear that the net effect of the bill will be to reduce federal subsidies for abortion. As Matt Yglesias reminds us today, current law massively subsidizes abortions via the tax exclusion for employer-sponsored private health insurance, which frequently includes abortion coverage. By encouraging (especially over time) people to move from employer-sponsored coverage to the new health exchanges for individual coverage, which under the Senate language will make insurance for abortion exceptionally inconvenient, it’s a sure bet that the overall use of federal money to pay for policies that include abortion services will decline. Indeed, a group of twenty-five prominent pro-life Catholic and Protestant leaders recently penned a letter describing claims that the pending bill would expand abortion subsidies as “misinformation.”

So official right-to-lifer opposition to the health reform bill isn’t really “about” abortion. It’s “about” the desire of the Right-To-Life political movement to score a big symbolic triumph, and it’s “about” the non-abortion political agenda of some of the movement’s constituent members. For a group like Focus on the Family, to which Stupak listens so closely, that agenda includes the Republican takeover of Congress and a wide variety of right-wing policy measures that have zero to do with abortion.

This item is cross-posted at The Democratic Strategist.

The Wait Is Over

It took longer than expected, but the wait was worth it. The CBO score for the Senate health care reform bill and amendments that the House will vote on this weekend is now out (well, in leaked form anyway) and the numbers, at first glance, look good for reform’s prospects.

According to House Majority Leader Steny Hoyer, the legislation got slapped with a price tag of $940 billion over the next decade, more expensive than the Senate version, which makes sense since expanding coverage is one of the fixes the House wants to enact. But the CBO reportedly said the legislation would cut the deficit by $130 billion over the next decade and $1.2 trillion the decade after that — steeper deficit cuts than the Senate bill had. As Ezra Klein summed it up, “that’s more deficit reduction than either the House or Senate bill, and more coverage than the Senate bill.” Hoyer noted that it’s the biggest deficit reduction act since the 1993 Clinton budget.

It’ll be interesting to see how the bill achieves that goal. There had been word in the last 24 hours that the excise tax on Cadillac plans — something labor unions had opposed — had to be tweaked to make sure the legislation met its deficit-reduction aims. Will a more robust excise tax on high-end plans weaken labor’s support for the bill? One thing is certain: with the release of the CBO’s numbers, moderate Democrats concerned about the fiscal impact of the bill can now rest easier and support it.

One wait is over, but another one begins. With the official release of the CBO score later today, the clock officially begins on the 72-hour window that Democrats had promised to give members before voting on the legislation. This pegs the vote for Sunday — though Republicans have promised to pull out all the stops to delay the process.