Marketplace Scratch Pad

What Brown can do for you

Scott Jagow Jan 20, 2010

Everybody’s talking about Scott Brown’s election in Massachusetts, and what it might mean for the country. A Republican winning a Senate seat in one of the bluest states could be a warning to Democrats to stop what they’re doing on health care immediately. On the other hand, Brown’s win just might be a loss for Wall Street.

Let’s start with health care. Brown’s Senate seat will zap the Democratic supermajority in the Senate. He opposes the current health care bills, and his vote would prevent Democrats from getting the 60 votes needed for passage.

President Obama senior adviser David Axelrod, while acknowledging the significance of Brown’s win, said it would not derail the president’s agenda:

“What’s important is that middle class folks have spoken again on the need for change,” Axelrod said, a desire that fueled Obama’s own election in 2008. He said, “the agenda here is focused on them — not on banks, not on insurance companies, not on people with lobbyists.”

“The bottom line has to be the economic security of everyday people,” Axelrod added. “I don’t think we can be timid in pursuit of that agenda.”

And that includes “finishing the job” on health care, according to Axelrod. But at what cost? If the Democrats try to fast-track the health care vote before Brown is seated in the Senate, the political damage could significant.

In the New York Times, David Leonhardt says political damage be damned. The House and Senate health care bills are probably as close to centrist as they’re going to get:

In the wake of Mr. Brown’s victory, the decision facing Democrats is not whether to start with a blank slate and try to write a bill based on both liberal health care ideas and conservative ones. They’ve already tried that.

The decision is whether to expand insurance and try to control costs, despite the political risks, or whether that project will once again be put off until another day.

Here’s conservative George Will’s take:

In their joyless, tawdry slog toward passage of their increasingly ludicrous bill, Democrats cling grimly to Robert Frost’s axiom that “the best way out is always through.” Their sole remaining reason for completing the damn thing is that they started it…

If the Democrats’ congressional leaders are determined to continue their kamikaze flight to incineration, they will ignore Massachusetts’ redundant evidence of public disgust. They will leaven their strategy of briberies with procedural cynicism – delaying certification of Massachusetts’ Senate choice, or misusing “reconciliation” to evade Senate rules, or forcing the House to swallow its last shred of pride in order to rush the Senate bill to the president’s desk.

Let’s say the Democrats don’t try to shove through the bill. Let’s say after all these many months (and decades) health care reform fails yet again. And furthermore, that the energy bills that have even less momentum behind them fail also. Where do you think the scorned Democrats will turn?

Reuters columnist James Pethokoukis says Wall Street had better watch its back:

Unable to trumpet the economy, hitting Wall Street is one of the few political bullets Democrats have left.

So expect the Obama administration to go all out for the bank tax with increasingly harsh words for big financial institutions. Democrats may also be more willing to consider controversial proposals banks hate, like letting judges rework mortgages.

I have a feeling health care’s in trouble, but financial regulation could be where lawmakers can find compromise.

I’m interested in your take on Brown’s election and what it might signal/lead to. Thoughts?

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