House GOP playing with fire by tying debt ceiling to Obamacare

How do you try to stop House Republicans from doing something counterproductive and, potentially, politically ruinous to stop the 2010 healthcare law?

If you’re House Majority Leader Eric Cantor (R-Va.), evidently, it’s by proposing something even riskier.

The National Review’s Jonathan Strong reported Tuesday that Cantor briefed fellow Republicans that morning on its plans for the two major fiscal issues that Congress will confront in the coming weeks. The first is a bill (or rather, the continuing resolution) to provide funding for federal agencies after Sept. 30, when their current appropriations run out. The second is a measure to raise the debt ceiling, which Congress needs to pass within the next six weeks or so to avoid the Treasury stiffing some creditors.

If the first doesn’t pass, all “nonessential” operations of the federal government will shut down until funding is restored. If the second doesn’t, stock markets could plummet and interest rates rise as investors lose faith in the government’s credit.

Dozens of Republicans aligned with the tea party are eager to use the continuing resolution as leverage to force Congress to cut off funding for the Patient Protection and Affordable Care Act, better known as Obamacare. On Tuesday, Cantor outlined a plan that would shift the GOP’s focus to delaying the law’s main provisions, while moving the fight from the continuing resolution to the debt-ceiling bill.

On one level, Cantor’s idea isn’t as crazy as trying to defund the healthcare law. But on another, it’s much crazier.

House Republicans have the votes to cut off funding for Obamacare, but including such a proposal in the continuing resolution would only cause an impasse with Senate Democrats and President Obama. The likely result would be a government shutdown, and the last time House Republicans engineered one of those (in 1995 and 1996), voters punished them at the polls.

According to The Hill, Cantor offered his colleagues this alternative. The House would pass a “clean” version of the continuing resolution -- that is, one without any provocative strings attached -- along with a separate proposal to cut off the money to implement Obamacare. But it would also pass a rule designed to prevent the Senate from considering the continuing resolution until after it had voted on the Obamacare bill.

Although that’s a clever attempt to force vulnerable Senate Democrats to take a politically unpopular position, it’s hard to believe that the House really has the power to make the Senate do anything. If Senate Majority Leader Harry Reid (D-Nev.) wants to avoid voting on the Obamacare defunding bill, he could ignore the House-passed continuing resolution and tee up an identical Senate version for a vote. If Republicans tried to stop it with a filibuster, they’d bear the brunt of the fallout for the ensuing government shutdown.

Granted, the hard-core anti-Obamacare faction doesn’t seem troubled by the idea of shutting down the federal government. Cantor is, however. Yet he apparently is less worried about the political consequences of failing to raise the debt limit. Maybe that’s because there’s a long tradition in both parties of pretending that opposing an increase in the debt ceiling is an act of fiscal responsibility. It’s just the opposite; it’s a vote not to pay the tab Congress has already run up. Bear in mind that House Republicans voted en masse earlier this year for a supposedly austere budget that would still require trillions of dollars in additional borrowing.

To Cantor’s credit, enacting a measure that delayed all of Obamacare’s provisions for a year would wreak less havoc in the insurance market than defunding the law. That’s because a defunding bill wouldn’t affect the requirement that insurers offer coverage to all applicants as of Jan. 1, and that they no longer charge higher premiums to cover those with preexisting conditions. As a result, insurers would attract a sicker, riskier pool of customers, driving up their costs -- and everyone’s premiums. Delaying the law’s provisions would avoid that problem, although like the defunding proposal, it would leave millions of lower-income Americans unable to afford coverage.

Having said that, Cantor’s proposal still amounts to playing a game of chicken with the Senate and Obama over the debt limit. We watched this movie before, when the new House GOP majority held the debt ceiling hostage in 2011. Obama played along that time, trying to reach a “grand bargain” with Republicans that would reduce deficits by cutting spending, paring entitlements and raising taxes. Those negotiations fell through, however, and the long stalemate spooked Standard & Poor’s enough for the agency to downgrade the federal government’s credit. Oh, and yes, the stock market plummeted by almost 16% and the economy sputtered. Democrats successfully blamed the whole affair on Republican brinkmanship, helping Obama retain the White House and his party hold onto the Senate.

This go-round, Obama insists that he won’t negotiate over the debt ceiling. He wants a clean bill that raises the limit, no matter how unpalatable that may be for Republicans. Meanwhile, House Speaker John A. Boehner (R-Ohio) continues to demand that any debt limit bill include measures to reduce the deficit, just as Congress did last time.

The two sides are so far apart -- again -- on the debt ceiling that even the informal talks the White House was holding with selected Senate Republicans have fallen through for lack of common ground. By seeking to throw Obamacare into the mix, Cantor may help Congress get past its first fiscal hurdle. But he only makes the second one harder to overcome.

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