Wednesday, November 3, 2010

Why Did They Lose?

The races aren't quite all resolved yet, but it's never too early to start assessing blame: Why did the Democrats lose so monumentally?

And, let's be frank: This is a huge loss. Certainly, they've retained control of the Senate, but they had a fairly wide 59-seat starting point, which is very, very unusual. In any other year this would have been a full-blown rout. However, the previous seat allocation is completely legitimate, so give credit to the Democrats for retaining control.

Many pundits will argue that it's the economy, or President Obama's inability to communicate (whatever that means), or a general anti-incumbant mood, or any of a myriad of reasons. While all of them certainly contributed, I'll play the part of conspiracy theorist and say it all boils down to one thing: health care.

Now, whether or not you approve of the health care bill itself is fairly irrelevant to my point. (Despite my ingratiating libertarian outlook, I am not inherently opposed to universal health care--but there are right ways to do it and wrong ways to do it. Needless to say, the health care bill that passed was the opposite of the good way to do it. But, anyway...) The problem was that the health care bill did everything pretty much wrong.

It was done at the wrong time. To introduce a bill that is so wide-reaching in its scope in the middle of a recession seems almost suicidal. To have it drag on for an entire year is borderline insane. This, of course, had two effects. First, all of the political capital and energy that could have been used to create jobs* and control spending was instead spent on health care. This is not insignificant. Second, the health care bill will, if nothing else, guarantee that the health care portion of an employee's benefits are going to skyrocket--the majority of this cost, of course, being paid by the employer. When you are in the middle of a recession, why on earth would you pass something that makes small and medium business owners even more unlikely to hire a new person?**

It was done the wrong way. The Republicans had promised to stop the health care legislation, so the Democrats in the Senate had to make sure they had 60 seats to break any filibusters. When Arlen Specter switched parties, they got exactly that--and proceeded to pass a bill laden with a lot of awful ideas. The House, of course, passed a separate version of the bill that had a different set of equally awful ideas. This, in and of itself, isn't a terrible thing--both houses of congress do this sort of thing, by both parties, all the time. All of those awful ideas get pounded out, reshaped, and eliminated when the two houses have to get together to pass the compromise bill. Well, a strange thing happened--Ted Kennedy died, and Scott Brown got elected in his place. All of a sudden they lose their 60-seat filibuster-proof majority. Unfortunately, this means that in order to pass the bill, the House has to pass the exact bill that the Senate passed--the one with all of the awful ideas--or start from scratch with a Republican filibuster looming. The Democrats chose to push on ahead with the awful bill rather than waste another year on another bill that they would have to compromise on. For a lot of people, passing an awful bill just so you wouldn't have to water it down for the opposing party seems equal parts arrogant and dishonest--especially since Brown's win in deep-blue Massachusetts was a clear message that people didn't like the health care bill as it was.  [Now, to be fair, they did pass a reconciliation bill afterward, but it wasn't near enough to combat the bad bits in the bill. And the GOP was making no effort to offer a compromise; they wanted to kill it. Still, the warning rockets had been set off, and the Democrats more or less chose to ignore them.]

It was done with the wrong ideas. I would say about 20% of the health care bill is legitimate reform that needed to be done, but the remaining 80% is outright ridiculous. I'm still finding out bits and pieces of the bill that outrage me. And even that 20% that went in the right direction is so clumsily implemented that it might as well be ridiculous. The important thing to remember is that just because it is health care doesn't mean that the laws of supply and demand no longer apply. And I'm not talking just about profits, though that certainly is a part. I'm talking about allocating medicine, training doctors, and waiting room visits. Just because it makes it illegal to charge deductibles for preventive care doesn't make it free. It just means you are going to have to come up with the money somewhere else. You still have to pay it, and now that there are restrictions as to how you get charged, hospitals and insurance companies are going to try and find behavior-distorting ways to do it. Most likely, you'll pay for it with a combination of 1) higher taxes, 2) lower quality, and 3) higher premiums. There were solutions to all of these problems. They weren't easy solutions, mind you, but people shouldn't be elected to make easy solutions. And now it is an absolute mess.

Is this the only reason that the Democrats lost so badly yesterday? Hardly. But the Tea Party was founded mostly as a reaction to the health care bill. (The auto and Wall Street bailouts also contributed, but those were temporary programs, whereas health care is a structural, long-term program.) And our economic situation is only slightly better because of this. The fact that the Republicans didn't gain control of the Senate is probably a tactically good move for them, since the Senate will now have partial responsibility for all of the things going wrong that the Republican presidential candidate in 2012 will ultimately claim is happening.

I, personally, am a little shocked that Obama's political instincts were so terribly off on this. So far, he seems to have been a brilliant campaigner and a mediocre (at best) politician. Of course, there has been a recent President who was a great campaigner yet lost control of the House early in his term, and that guy sat in the White House for eight years. So maybe his instincts aren't so far off. Though the scores of Democratic congressmen he sacrificed may not be so charitable with their words.

*For those keeping score at home, no, I don't believe that the government ever "creates jobs." Anyone who thinks so needs to take some economic courses. However, I think there is room to "foster job creation," which is really what I mean but am too lazy to find an elegant way to incorporate it into that paragraph.
**Some have claimed that the health care bill was imperative to pass immediately because so many people were out of work and didn't have health care. This is BS. For one, the effects of the bill won't take effect until 2014. And secondly, stopgap measures in Medicaid and Chips programs could easily have buoyed everyone over until the recession was over. Sure, it would have been expensive, but hopefully only for a few years. Now health care will be expensive every year.

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