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What's Going on in the House (or Is Health-Care Reform Becoming a Prisoner's Dilemma?)

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News reports filtering out of the House suggest that talks between Energy and Commerce Chairman Henry Waxman and the seven Blue Dogs on his committee have broken down. The situation is dire enough that Waxman is declaring his willingness to bypass his committee and bring the bill straight to the floor.

The central issue here is simple enough: The Blue Dogs want Waxman to make concessions he doesn't want to make. The sticking points, according to sources close to the process, are the public plan -- Blue Dogs still want a trigger option -- and the administration's proposal, which the Blue Dogs support, to create an independent commission able to set Medicare payment rates and make reforms. Waxman and others worry that a Republican administration and Congress could use this panel to undermine the Medicare program.

You can take Waxman's statements one of a couple ways. His willingness to bring the bill directly to the floor undermines the bargaining power of the Blue Dogs: It means they don't have veto power over the bill. This could, in other words, be a negotiating tactic on Waxman's part to soften the Blue Dogs' position. But if that doesn't work, it could also mean exactly what it says: That he's going to push the bill straight to the floor.

That would ensure some bad headlines, and an angry Blue Dog caucus. But versions of this bill have passed two other committees. Energy and Commerce isn't strictly necessary. Waxman's threat to bring the bill to the floor means that Pelosi and Waxman think they have the votes whether or not Energy and Commerce approves the legislation. And that may not be such a bad outcome, either for the Democrats or the Blue Dogs.

Some sources are speculating that the Blue Dogs are getting cold feet as they watch Max Baucus dither. Many of them felt burned by the hard and damaging vote on the cap-and-trade bill, as it looks like nothing will come of it in the Senate. Committing themselves to a health-care bill before the Senate shows its hand carries similar risks, and they're no longer in a risk-taking mood. The worst outcome for conservative Democrats in the House is that they're on record voting for a health-care reform bill that dies in the Senate and is judged a catastrophic example of liberal overreach.

The problem, of course, is that the more dissension there is among Democrats in the House, the less pressure there'll be on the Senate Democrats to make a hard vote on health-care reform. This makes health-care reform something of a prisoner's dilemma for conservative Democrats. If Blue Dogs in the House and centrists in the Senate both put it on the line to pass the bill, they're both better off. But if one puts it on the line and the other whiffs, then the other pays the price.


Photo credit: Bloomberg News Photo .

By Ezra Klein  |  July 24, 2009; 5:00 PM ET
Categories:  Health Reform  
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Comments

"That would ensure some bad headlines, and an angry Blue Dog caucus. "

Could there be enough angry Blue Dogs to SCUTTLE the bill on the House Floor? I really can't imagine enough of them could say no to their Speaker, their Majority Leader, Rahm, and POTUS, but I dunno, I didn't think they'd be this full of crap.

Posted by: colby1983 | July 24, 2009 5:06 PM | Report abuse

The CPC just sent a letter which probably tied Waxman's hands on the public option. A bill will not pass without a real public plan in the house

http://www.talkingpointsmemo.com/documents/2009/07/house-progressives-urge-swift-vote-no-more-concessions-on-health-care.php?page=1

Posted by: JonWa | July 24, 2009 5:28 PM | Report abuse

Trigger option - it may not be such a bad idea after all as long as those who would need public option are able to get the private option with government subsidy. Within a concrete time frame if it is established that people cannot have legitimate private insurance which addresses their needs or if private insurances flaunt other terms and conditions; the public plan for sure will trigger. By giving on this option if Blue Dogs can come on the board without folks needing public option not suffer, we have a win-win situation.

On independent MedPAC, by and large liberal faction is not supportive. GOP Administration misuse - seems like a Trojan Horse. Liberal Dems will have to take the risk of such a misuse. Their weapon in such a case is something called elections. With more and more people getting old, such a fear is misplaced. Look even Bush and GOP Congress passed a drug bill to increase drug coverage of old folks under Medicare even if it broke the bank. What is the point for holding on some hypothetical fear? The real issue seems to be that the gang of Pelosi, Waxman, Rangel do not sound minding costs. Seems like under any pretext they want to continue this tax and spend discredited liberal ideology.

The whole premise of Blue Dog is just because GOP was indifferent to balanced budget does not mean they would throw such concerns to wind.

Independent MedPAC with power to control Medicare expenses - for Blue Dogs that must be non-negotiable. Better to go on record opposing such a bill than support a bill which may bring euphoria for a while but in the long run for sure to expose the cost disregard.

Posted by: umesh409 | July 24, 2009 11:27 PM | Report abuse

What you've described isn't really a prisoner's dilemma. There's an equilibrium for both whiffing -- if one is whiffing, the other is better off also whiffing. But there's also an equilibrium at both putting it on the line -- as you say, if they both do that, they're both better off. A prisoner's dilemma is when you have an incentive to whiff when the other puts it on the line, even though if you both whif, you are worst off. But in this case, all you need is one side to suck it up and act, and the other should too -- if, indeed, they want to pass the bill. Ideally, though, I think they all want a bill to pass but to vote against it, to hedge their bets; by the time people love the new health system, they can run as the party that passed it and no Republican would call them out, since they all voted against it too.

Posted by: Ulium | July 25, 2009 12:31 PM | Report abuse

What you've described isn't really a prisoner's dilemma. There's an equilibrium for both whiffing -- if one is whiffing, the other is better off also whiffing. But there's also an equilibrium at both putting it on the line -- as you say, if they both do that, they're both better off. A prisoner's dilemma is when you have an incentive to whiff when the other puts it on the line, even though if you both whif, you are worst off. But in this case, all you need is one side to suck it up and act, and the other should too -- if, indeed, they want to pass the bill. Ideally, though, I think they all want a bill to pass but to vote against it, to hedge their bets; by the time people love the new health system, they can run as the party that passed it and no Republican would call them out, since they all voted against it too.

Posted by: Ulium | July 25, 2009 12:42 PM | Report abuse

Wrong!! The core solution for the Blue Dogs in both houses is no bill. Pelosi and Reid get blamed and the Blue Dogs become the dominant player in the Capitol.

Posted by: Hamilton2 | July 25, 2009 4:31 PM | Report abuse

Poor Ezra,

You just can't reconcile yourself to the fact that Madame Pelosi doesn't have the votes to ram the Rangel bill through the House, and that, even if she did, it would be dead on arrival in the Senate. Stop upsetting yourself by trying to guess whether a Pelosi power play would work or boomerang. Just take a nice glass of warm milk, and do some knitting to unjangle your nerves.

Posted by: hartlex | July 25, 2009 6:01 PM | Report abuse

This maneuvering will all be forgotten when they make the deals and break enough legs to Rahm it through. At the end of the day it will pass, even if self-imposed deadlines are not met. If they don't pass it this year, they will pass it next year. If they can't pass it next year, they will increase Dem numbers dramatically in the 2010 elections, particularly in the Senate, and then pass it in 2011. And I say this because the Dems were very clever about the Stimulus (Porkulus). They passed a stimulus that will be spent almost entirely in the first 6 months of 2010, so that there is a big economic boost before the midterm elections. Any current economic stimulation is entirely due to Bernanke and Bush's TARP. They recognized this, and that is why they passed a stimulus that will primarily serve reelection. The Dems are not stupid. They know exactly what they are doing, and they will socialize health care before Obama is up for reelection.

Posted by: andrewp111 | July 25, 2009 7:59 PM | Report abuse

The fundamental problem here is not Prisoners Dilemma. Maybe when Klein learns something about economics they can work in a little game theory as well.

The "Prisoners" here are not only able to communicate, they are communicating. The problem is the bill itself. The stakes are incredibly high. An enraged public in which 100 million (per Lewin, a liberal consulting group) end up losing their established health care after being told they would not is a potential political catastrophe. Combine that with a new system which is mired in bureaucracy, rising taxes, skyrocketing deficits -- all 100% attributable to the Democrats who voted for it.

Maybe that is a risk worth taking if the public is clamoring for passage, but put aside the happy talk and they simply are not. Maybe it's an acceptable risk if those running the show are considered exceptionally competent. But the CBO has basically blown their fundamentals out of the water twice now.

Perhaps ObamaCare will be passed through raw political muscle, buyoffs, and the President's rapidly waning political powers of persuasion. I don't see how inventing faulty applications of game theory to avoid facing the fundamental problems in any way contributes to a favorable resolution. Despised though they may be by the left, the Blue Dogs are behaving in a perfectly rational way to the perceived deficiencies in the legislation. Waxman has nothing to lose no matter what -- his very liberal district will never consider voting him out of office. Others are less fortunate, and have to actually consider the impact of what they foist upon the public.

Posted by: DaMav | July 26, 2009 4:22 AM | Report abuse

Waxman is correct to worry what a Republican administration could do with an independent commission...because there will be a Republican administration beginning in January, 2013.

Posted by: johnhiggins1990 | July 26, 2009 8:51 AM | Report abuse

Screw the Blue Dogs, many of them that were elected in the last 4 years were elected because they were Democrats, not Republicans. If they want to play hardball, let them, and let them try to switch parties, loss funding for their reelection bids, and enjoy being a one or two term Congressman. This is nothing more than a small group that wants to have more sway than it actually has, the Progressive Caucus is the largest caucus in the Democratic Party, that is the group that should flex its muscles.

Posted by: Benadork | July 26, 2009 9:09 AM | Report abuse

"Waxman and others worry that a Republican administration and Congress could use this panel to undermine the Medicare program."

If by 'undermine' they mean, allow the future obligations to have a chance in hell of being affordable.

The USA isn't going to wake up until we have a California with our Treasuries because the gutless politicians of both parties won't cap benefits to seniors. I hope Social Security and Medicare are limited to the working poor by the time I retire.

Posted by: staticvars | July 26, 2009 10:09 PM | Report abuse

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