Time has just about run out on Republicans. They started the year with a clear and ambitious agenda: repeal Obamacare, cut taxes, and do it all by finding ways to circumvent Democratic opposition.
But now it’s too late for all that. Come Sept. 30, they are going to have to choose: Either they keep working on health care, or they move on to tax reform.
Why can’t they keep working on both? It’s all about an ingenious trick the Republicans are hoping to use, a legislative strategy expressly designed to let them avoid filibusters and work around Democrats to advance a number of key issues. It’s powerful but also time-limited. And that limit has arrived.
Reconciliation is the name for this process. It’s specifically designed for budget-related bills, those that deal narrowly with issues around spending and taxes. In fact, it was originally introduced as a way to smooth the annual budget process, giving congressional leaders a fast track for their most basic decisions on how to raise and allocate tax dollars. To that end, reconciliation provides immunity from Senate filibusters and limits the amendment process.
Over time, though, reconciliation has become a powerful weapon, allowing both parties to bypass opposition and move legislation that can plausibly be interpreted as budget-related — even when it is really about health care reform. Democrats used it to finalize Obamacare in 2010, and now Republicans are using it to undo Obamacare.
There’s a bluntness that comes with reconciliation, though. You can’t make changes that increase the long-term deficit, you can’t include purely regulatory issues that don’t affect the budget, and you only get one bite at this apple every year, as part of the annual budget process.
Except this Congress figured out a way to use reconciliation twice — and in the process produce two filibuster-proof reconciliation bills in quick succession. The first would be for repealing and replacing Obamacare, the second for tax reform and a new focus on conservative spending priorities.
What made this possible is the last Congress decided not to pass a reconciliation bill, in hopes that the option might prove useful to their successors. That has freed today’s lawmakers to legislate like it’s 2016, attaching a reconciliation bill to last year’s budget in order to replace the bulk of Obamacare without fear of a Democratic filibuster. It still needs to follow all the reconciliation rules, and the rollover only extends until this budget year ends in September, but that could be enough time.
Once this first reconciliation bill passes, Republicans can pursue a second, filibuster-proof reconciliation bill focused on tax reform, this one tied to the budget for next year.
It seemed to be a brilliant plan — until the House proposal to replace Obamacare was met with near-universal ire from conservatives, liberals, advocates, and health policy wonks alike. At that point, the real limitations became clear.
To begin with, you can’t push two reconciliation bills at the same time, not without opening a loophole that could give Democrats back their filibuster. Which means Republicans don’t have the option of temporarily setting health care aside to take up tax reform. If they try, they will lose their shot at two reconciliation bills.
They can’t easily switch the order either because they’ve already passed a resolution officially stating that they plan to use reconciliation for health care reform. Plus, there’s a reason Republicans chose to do health care first — it gives them a technical advantage when it comes to calculating how their tax cuts will affect the deficit — basically increasing the latitude they’ll have to claim that their cuts are revenue neutral.
Step back and you can see the full promise — and peril — of the Republican approach. Reconciliation is seductive, and back-to-back reconciliation bills would allow far-reaching, filibuster-proof changes to both US health care and the federal tax code.
Except that by lining these bills up, one after another, Republicans have walked themselves into a narrow corridor where they have to repeal Obamacare before they can address tax reform or draft a new budget around core, conservative priorities. And the clock is ticking because the “rollover” reconciliation bill they got as a gift from last year's Congress turns into a pumpkin come October.
Of course, it’s still possible Republicans will find a way to repeal and replace Obamacare. Monday night, House Speaker Paul Ryan introduced changes designed to speed passage in the House and attract new support from the Senate. At the same time, President Trump has continued to twist arms and buttonhole wary legislators, which could help win additional votes.
But every day of delay is a day without tax cuts. That means Republicans will soon face a humbling legislative choice: Either they give up on health care reform, dropping their long-held promise to repeal Obamacare in order to move ahead with tax reform. Or, they dig in for a long and uncertain fight, at the risk of holding up their broader agenda.