The GOP Must Use the Reconciliation Option Prudently

Published March 19, 2015

National Review Online

What’s been missing from the early weeks of the new Republican-controlled Congress is a sense of tactical direction.

The problem is not differing views on the overall mission. There’s widespread agreement that the primary job of this Congress is to stop and reverse the worst elements of the Obama administration’s initiatives and begin putting in place new policies that correct some of the damage that has been done.

But there’s much less agreement on what legislative steps will work best to move in the right direction. That was evident in the Homeland Security/immigration fight. A disagreement over tactics eventually led to an embarrassing GOP retreat.

To avoid repeating that mistake, it is important for GOP leaders in both the House and Senate to think clearly about their tactical options and to come to a rough agreement with one another about how they will proceed, well before they actually have to execute a plan.

The most important decision they must make regarding tactics in the coming months is what to do in the budget-reconciliation process. That is the legislative tool that allows budget-related legislation to be considered in the Senate with a time limit on debate — meaning it can’t be filibustered and thus can be passed, at least in theory, without any Democratic support. Reconciliation gives the GOP substantial additional leverage that does not exist on bills considered under regular order.

The budget plans introduced this week in the House and in the Senate include very flexible reconciliation instructions. In the House, the major committees with jurisdiction over non-appropriated spending programs and taxes are tasked with producing deficit-reducing legislation by July 15. The key committees for taxes and health care — Ways and Means, and Energy and Commerce — are required to produce legislation reducing the deficit by $1 billion over ten years. In the Senate, the Finance and Health, Education, Labor, and Pensions committees — also the key committees with jurisdiction over taxes and health care — received a similar instruction. It is possible to conceive of multiple combinations of tax and entitlement adjustments that would meet such a broadly defined reconciliation instruction.

The most important potential use of the reconciliation option this year would be to fast-track a legislative response to a Supreme Court decision in favor of the plaintiffs in the King v. Burwell case. If the Court invalidates the payment of premium credits in the federally run exchanges, there will be substantial disruption to the ongoing implementation of the Affordable Care Act (ACA) in the affected states. Under such a scenario, Republicans would have the opportunity, using mechanisms that begin to move away from the ACA’s basic structure, to propose and pass legislation that comes to the assistance of several million people at risk of losing their insurance.

Skeptics argue that the president will never sign such legislation, and that’s probably true. But that’s not a reason to abandon the idea. In the aftermath of a King decision in favor of the plaintiffs, Republicans in Congress would be in a far better position politically if they supported a realistic legislative plan than if they were viewed as doing nothing. Put another way, the president would not relish vetoing legislation that his opponents could credibly claim would come to the aid of several million people on the verge of losing their health insurance. Nor would Democrats in Congress be eager to sustain his veto of such legislation. So, yes, the president would probably oppose the Republican plan, but that might not be the final word. The public would almost certainly support such a plan if they saw it as providing a viable way forward, which would give the GOP substantial leverage to push for its approach despite administration opposition.

But what if the Court sides with the administration in the King case? How should Congress proceed with budget reconciliation under that scenario?

Some are advocating the use of reconciliation exclusively for the purpose of delivering a full repeal of the ACA to the president’s desk. They argue that any legislation that could get signed into law by the president would have Democratic support in the Senate anyway, and therefore would not need the protection of reconciliation procedures. Thus, reconciliation should be used to produce legislation that provides maximum contrast between the governing visions of the two parties, and, at this moment, that means repeal of Obamacare.

But using reconciliation to deliver a full repeal of the ACA to the president would be a waste of this powerful tool. For starters, it is highly unlikely to work, in the sense that it is unlikely that such a bill would make it through both the House and Senate, even with reconciliation protection. That’s because full repeal without anything to replace it is going to be more politically vulnerable than some currently assume. Obamacare is unpopular, and voters would like a plan with less expense and federal control. But they also want some answer to the question of preexisting conditions and other problems that predate Obamacare. Repeal without replace provides no answers to those questions, which will, in time, make some politically vulnerable Republicans (including some Senators up for reelection in 2016 in swing states) squeamish about voting for it.

Further, even if full repeal could be delivered to the president’s desk for a certain veto, what new leverage would the GOP gain in the process? The country is well aware that the GOP opposes the ACA, and also that the president supports it and will not sign legislation dismantling it. It is hard to see how playing this out with a veto of full repeal would shift the political dynamic in any meaningful way. It would not be politically difficult for the president to veto an ACA-repeal bill, nor would it be difficult for most Democrats in Congress to sustain that veto.

A far better use of reconciliation would be to advance any number of different GOP priorities — with respect to taxes, health care, education, housing, and other issues. Republicans shouldn’t pursue a maximalist agenda aimed at transforming everything. Rather, they should zero in on a medium-size reform program, specifically aimed at advancing GOP priorities that move in the right direction and are difficult for Democrats to oppose. For instance, in health care, that could mean suspending the employer and individual mandates for a time (perhaps two years), or exempting more lower- and middle-income families from the individual mandate tax; repealing the Independent Payment Advisory Board; allowing consumers to reenroll in insurance products outlawed by the ACA’s rules; changes in Medicare that improve consumer choice and promote options under Medicare Advantage; and new flexibility in Medicaid that would allow Republican governors to pursue reforms without having to get permission first from the federal government. Similar reforms in other areas of the budget should also be advanced.

There’s no guarantee that the president would agree to any of this, of course. But that’s not the point. These provisions would have strong public support, and so they would improve the standing of the GOP. Vetoing a reconciliation bill constructed in this way would not be comfortable for the president.

Moreover, it is very likely that Republican leaders in Congress will, at some point later this year, be forced into a negotiation of some sort with the administration over must-pass legislation. Among other things, Congress will need to raise the debt limit again and approve appropriations for fiscal year 2016. The GOP will be in a far better position to make demands in those negotiations if Congress has previously approved, or is in the process of approving, legislation with key GOP priorities in it. No one should have high expectations for what can be accomplished during the Obama administration, but the prospects will surely improve for the GOP if it spends most of 2015 building a realistic agenda with strong appeal among voters.

Last November, the electorate gave Republicans full control of Congress for the first time in eight years. It is true that a Republican Congress cannot deliver far-reaching reforms; those must wait for a new administration. But that does not mean nothing can be accomplished. The GOP should use the power the voters have given it to make as much progress as possible. And that means using its most powerful tool — reconciliation — to advance an agenda that’s right for the current moment.

— James C. Capretta is a senior fellow at the Ethics and Public Policy Center and a visiting fellow at the American Enterprise Institute.

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