Republicans look to stop bleeding; Dems look to attack sequester

The Senate reportedly is close to a deal that would reopen the government until January 15, 2014 and raise the debt ceiling until February 14. Under this deal, there would be bicameral budget negotiations through December 15 of this year to try to reach a broad bargain.

On the Obamacare front, HHS Secretary Sebelius would have to certify that individuals receiving Obamacare subsidies meet the income levels required by law. The Department’s inspector general would later have to conduct an audit on the matter.

Pushing the government to enforce the law isn’t much of a fig leaf for Republicans, but apparently it’s all they would get under the Senate deal. Meanwhile, Democrats would win a one year delay on the Obamacare reinsurance tax to be levied against most insurance plans as a means of spreading the risk for insurers who take on the sickest patients next year — something labor unions want. As I understand it, the fee is $63 per person covered by an insurance plan per year.

Would the House agree to this deal? I doubt that a majority of Republicans would, so it comes down to whether Speaker Boehner would apply the Hastert rule. My guess is that he probably would not apply it, especially if he can extract another fig leaf or two out of the Senate. If Boehner allows a vote, the Senate deal likely passes the House, I think.

The overriding idea behind the Senate deal is, of course, to kick the cans (CR and debt ceiling) down the road. I’m not sure that kicking either one into early 2014 is a good idea from a conservative perspective.

If the Republicans are going to use the debt ceiling to force budget concessions, it may be better to do it now, rather than in an election year. But the problem is that there’s not enough time left for Republicans to leverage a debt ceiling increase into meaningful concessions (assuming it can be done at all) without risking the economic and psychological consequences of going through the ceiling.

As for the CR, the January 15, 2014 extension date coincides with when the new sequestration is scheduled to occur. A longer extension, such as the six months Sen. Collins proposed, would lock in the new $967 billion sequestration levels (down from $986 billion) for 2014.

The Democrats will want to use the bicameral budget negotiations to get out from under sequestration levels. Republicans will want to get entitlement reform in exchange. So it will be same old play.

But kicking the matter into early 2014 gives both sides a chance to reevaluate their positions based on better information about the political fallout of the recent struggle. We know that Republicans have taken more blame than Democrats and that their brand has been hurt more.

But what does this mean in real terms? Do Democrats now have a realistic chance to win the House in 2014? Have Red States Democratic Senators up for reelection been helped or hurt by the shutdown showdown? (In Arkansas, where Tom Cotton is challenging Sen. Pryor, the voters — bless them — apparently blame Dems more than Republicans for the shutdown).

As the end of the year approaches, both sides will have a better read on these questions. And their read will help shape the negotiations and, if talks fail, the ensuing fight.

For example, if control of both the Senate and the House is in jeopardy, and to about the same extent, I expect that legislators from parties will try to win back favor with voters by earnestly seeking a responsible-sounding compromise. Neither party will want to risk losing control of the chamber it runs, and individual members up for reelection certainly won’t to rock the boat in an election year.

On the other hand, if Democratic prospects for holding the Senate look good, but the GOP appears to be in trouble in the House due to the shutdown, the Dems will drive a very hard bargain. And so forth.

Right now, I think the Republican leadership in both Houses just wants to stop the bleeding. As for the Democratic leadership, it must think that enough blood has been drawn for now, and that it’s time to set the stage for attacking the sequester.