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GOP Reconciliation Objection Thrown Out

March 23, 2010 - by Eric Naing

The GOP yesterday was handed the first defeat in what is likely to be a series of battles over the reconciliation health care bill (H.R.4872) when the Senate parliamentarian threw out a Republican challenge to the bill.

After President Obama signs the Senate health care bill (H.R.3590) into law later this morning, the Senate can begin consideration of the reconciliation bill containing changes to the Senate bill. As Donny explained yesterday, this is likely to be a complicated process governed by highly technical rules.

Senate Republicans yesterday claimed that the excise tax on so-called high-cost “Cadillac” insurance plans amended by the reconciliation bill violated the Byrd Rule, thus making the bill ineligible for budget reconciliation. Under the Byrd Rule, measures that make “recommendations” about Social Security can’t be considered under reconciliation. Republicans argued the excise tax did.

Kevin Drum explains why this line of thought was likely doomed to fail:

[T]he chain goes like this: (1) rider affects excise tax, (2) excise tax pushes down insurance costs, (3) lower insurance costs lead to higher wages, (4) higher wages lead to higher payroll taxes, and (5) higher payroll taxes affect the Social Security trust fund.

This is mind-bogglingly convoluted. It means that anything that ever had even the smallest and most roundabout effect on wages would be ineligible for reconciliation. Using logic like this, I doubt that any budget bill ever passed has met reconciliation rules.

Senate parliamentarian Alan Frumin apparently agreed and threw out the challenge last night. Senate Republicans have yet to hear the parliamentarian’s ruling on another challenge dealing with the timeframe for implementation of the tax. Expect many more battles over parliamentary procedure like these over the coming days.


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