In the eight Republican presidential debates held so far, more than 140,000 words have been spoken (142,130 to be exact). But the most telling word, the one that will have more impact than any other on life in Washington after the votes have been counted, surfaced for just a few fleeting seconds.
Obviously, that word isn’t “jobs” or “economy,” “taxes” or “regulations.”
The word is “reconciliation.”
Former Sen. Rick Santorum of Pennsylvania brought it up first in the seventh debate—the debate that attracted the smallest TV audience and was viewed mostly by political junkies on the Internet. Santorum raised reconciliation in the context of how he would, as president, repeal President Obama’s health care reform law. “By doing it through a reconciliation process, and since I have the experience and know-how to do that, we’ll take care of and get rid of it,” Santorum said at the debate sponsored by Bloomberg and The Washington Post on Oct. 11. Santorum said he would use the somewhat arcane Senate procedure to undo the sweeping health care law with a 51-vote majority, instead of the 60-vote threshold that is required to pass almost any other piece of legislation in the Senate.
Mitt Romney quickly followed up by saying he knew that reconciliation was the only way to slay what all Republicans seeking the nomination believe is the biggest legislative monster of the Obama presidency. Romney somewhat fancifully vowed to use reconciliation in the first week of his presidency to eradicate the health care law. “I will do that on Day Two with a reconciliation bill, because, as you know, it was passed by reconciliation, 51 votes. We can get rid of it with 51 votes.”
When it comes to trying to imagine the future of governing in Washington in January 2013, it’s almost impossible to do so without examining the probability and implications of a reconciliation process.
Because current polling data at the national and state levels and deep-seated anxiety about the economy and the nation’s overall direction indicate an era of volatility and, possibly, continued Republican success in Congress. Most scenarios envision a Republican House majority. They also foresee a GOP Senate majority. Nothing is guaranteed in politics, of course, and Democrats are in no mood to yield any ground. It is possible that Democrats could retain Senate control and win back the House. But it would require a reversal of fortunes without modern precedent.
In the Senate, Democrats have to defend 23 seats (two of which are held by independents who caucus with Democrats). Republicans must defend only 10 seats. Most outside analysts see Republicans gaining at least a narrow Senate majority. Some scenarios envision a GOP majority at least as large as the Democrats’ current 53-47 advantage. As for the House, robust summer fundraising and some recent gains in the generic question of which party voters want to run Congress have Democrats encouraged. But 14 House Democratic retirements (twice the current number of House GOP retirements), the comparative lack of high-probability takeaway targets, and the instability of the redistricting process have led most analysts to conclude that Democrats have only the slimmest chance of netting the 25 seats necessary to retake the House. “It’s like drawing an inside straight,” said Steve Elmendorf, a Democratic lobbyist and former chief of staff to then-House Minority Leader Richard Gephardt, D-Mo.
If Democrats win both chambers, their goal would be to solidify the gains that Obama made in his first two years in the White House by cementing the regulatory and bureaucratic framework of the health care law and Wall Street reform. It would also, in all likelihood, include dismantling the Bush-era tax cuts for the wealthy within the context of tax reform.
But what happens if voters return Obama to the White House and give Republicans the House and Senate? “It’s a tough election, and Obama wins narrowly and Democrats are in the minority,” Elmendorf said. “That’s the most probable outcome. Divided government.”
Within that framework, it’s very possible that Democrats could eat away at the House GOP’s majority, possibly even cutting it in half. But some Democrats wonder if that wouldn’t help Speaker John Boehner by forcing his remaining Republicans to follow his leadership more regularly to keep GOP priorities on track, especially if they have a Republican majority in the Senate waiting to move them forward. “There’s about 50 seats Boehner can’t control now at all,” said David Introcaso, an analyst with the Marwood Group and a former top aide to House Minority Whip Steny Hoyer, D-Md. “He could lose some of them—actually lose seats—but gain more authority. It could be paradoxical.”
If Obama wins a second term, Republicans hold the House, and Democrats keep the Senate, then the status quo will be set in stone. It would be hard to imagine any softening of GOP hostility to Obama or more receptivity in the Democratic-controlled Senate to Republican legislation. All sides would feel vindicated, and no one would have an incentive to recast or reshape current legislative behavior.
The best-case scenario for Republicans is wall-to-wall power at both ends of Pennsylvania Avenue—a Republican president and a GOP-controlled Congress. The current betting among Republicans is that the party has a 70 percent probability of holding the House and winning the Senate and a 50 percent probability of achieving a clean sweep. “The size of the Republican majority in the Senate will probably be large enough that they will be able to enact large pieces of legislation in the first eight months of 2013,” said Eric Ueland of the Duberstein Group, who served as chief of staff to then-Senate Majority Leader Bill Frist, R-Tenn. “The question is whether there will be someone in the White House willing to catch, or will there be a pretty aggressive hitter in the batter’s box?”
But divided or unified, the Washington power matrix will, by all accounts, run on the same grid in early 2013—the one known as reconciliation. That’s because reconciliation will dictate the terms of debate regardless of whether Obama wins reelection. The key difference will be over signing or vetoing, not the contents of the bill a GOP-led Congress would write.
THE GOP’S AMBITIONS
For years, only a handful of adroit legislative tacticians have mastered reconciliation, once the procedural province of budget geeks and manipulators of tax policy. It is the device by which big budget bills that merge—or reconcile—spending and tax policy are passed without having to run a filibuster gantlet in the Senate. This is how President Bush won approval of his income-tax cuts in 2001 and his dividend and capital-gains tax cuts in 2003—with Vice President Dick Cheney casting the decisive vote.
Stripped to its essence, a bill that achieves numerical budget balance or reduces future deficits can pass on the reconciliation track, even if it includes sizable policy changes outside of spending and taxes or creates deficits outside a 10-year budget window. This procedure is how Obama and his Democratic majority passed the health care law in 2010. They used the reconciliation to shield the bill from a GOP filibuster that was sure to block it after Republican Scott Brown won the special election to fill the Senate seat of the late Democrat Edward Kennedy, an upset win that gave Republicans what they thought was the magic 41st vote.
But Democrats thwarted that tactic: They wedged health care reform into a reconciliation bill, using Congressional Budget Office projections to argue that the complex changes brought by universal access to insurance would reduce existing government spending on health care by $170 billion over 10 years. Whether those savings ever materialize is an open question (the administration’s recent decision to abandon the CLASS Act that sought to provide long-term and disability care through prepaid premiums has already cut health care’s projected deficit reduction in half). Regardless, budget projections at the time saying it would save money allowed the Democrats to squeeze the reform bill through the Senate on a 51-vote majority.
And don’t think that Republicans, if they run the House and Senate, won’t use reconciliation to undo health care. They will. But that’s not all. More than half a dozen Republicans on and off the Hill, all with deep experience in drafting legislation or familiarity with GOP plans if they win the majority, say that reconciliation would be used to not only repeal health care but to do much more. Reconciliation could also become a vehicle for tax reform and, quite possibly, a means by which to revisit the spending cuts or deficit reduction called for by the so-called super committee.
In the process of canceling Obama’s health care law, Republicans are also eyeing retooling Medicaid, possibly moving it toward a system of block grants to the states as envisioned by this year’s House budget resolution. (Whether Republicans would push to transform Medicare from its current fee-for-service system to a type of voucher program is unclear. That idea was in the House budget that Senate Republicans largely embraced, but there’s been much less talk of it lately.) GOP insiders are even discussing using the reconciliation process in 2013 to open up oil and gas drilling in Alaska’s Arctic National Wildlife Refuge, a long-denied GOP energy policy goal; repealing the Dodd-Frank Wall Street regulations; and rewriting private-sector pension laws.
The reconciliation bill could be, in other words, one of the biggest and most far-reaching pieces of legislation in modern history. And this scenario will play out whether a Republican is elected president or not.
Republicans agree that if they win control of the House and Senate, an immediate clash with Obama over health care repeal will commence. Unlike the showdown that ended with a whimper this year, a GOP-led Senate will take up the charge, use reconciliation to frustrate a Democratic filibuster, and force Obama to veto—as he surely would—a bill that seeks health care’s demise. (This assumes that the Supreme Court either upholds the law’s individual mandate for insurance purchases or punts the issue on technical procedural grounds until after the election.)
“Presuming the Court upholds the individual mandate, [the White House] will spend the next four years defending it to their dying breath,” Ueland said.
In those more than 140,000 words spoken at the eight GOP presidential debates so far, repeal of the health care law (“Obamacare” is a universal GOP epithet now) is priority No. 1. A GOP-led Congress will pursue this goal, even if it knows its ultimate futility. That means 2013 would be defined, at least initially, by a conflict that has raged more or less continuously since Obama signed the bill into law on March 23, 2010. Democrats believe such a course would be the height of political malpractice for Republicans. “If Obama wins, he’s a lame duck from the start and he has a lot more flexibility,” Elmendorf said. “The Republicans’ ability to jam him is less relevant. Do they really want to spend another two years on health care? I don’t think being negative is going to work for them. They would have to try to solve some problems and get some things done.” If Obama returns to the White House, he will have survived the toughest onslaught imaginable against the health care law and his other activist initiatives. Will Republicans really want to re-litigate issues just settled in a presidential election?
“You can’t move forward on any other issues until you’ve exhausted yourself on that battlefield,” Ueland said.
Exhaustion, therefore, is the likeliest early outcome of divided government. But if Republicans win it all, they will pursue the twin goals of turning back the clock on the Obama era and installing a new tax code and possibly new approaches to entitlements such as Medicaid, energy policy, Wall Street regulation, and private-sector pensions. The coming election may well turn on how willing the public is to reconcile itself to just such an agenda.
This article appears in the October 29, 2011 edition of National Journal Magazine.