To be clear, Sen. Elizabeth Warren (D-Mass.) and allies are right to rail against the bill and urge that it be stripped of Citigroup’s preferred laws (an effort they can continue in the Senate). Democrats in the House were also right to vote in large numbers against it, sending a message to would-be Democratic frontrunners that being too friendly with Wall Street leaves them vulnerable. But here’s the question for those who don’t want this package to become law: If the deal doesn’t pass, what happens next?
We know that, if the deal had failed a House vote last night (or if it gets stopped in the Senate), Speaker John Boehner and company would then pass a “clean” resolution funding the government for three months. Senate Democrats and the White House would have no policy reason to stop that alternative. This would punt the budget fight into February, when Boehner will have at least 12 more Republicans in his caucus and Mitch McConnell will be the Senate majority leader. Almost all the things that Democrats did get in this deal would be gone three months from now. The 20-plus riders that “would have devastated the Environmental Protection Agency” that Democrats got Republicans to drop? All or most would be back in three months. The money to implement the Affordable Care Act in this deal? Slashed. The budget increases for Securities and Exchange Commission and Commodities Futures Trading Commission enforcement that Republicans agreed to in exchange for getting rid of Section 716? Gone. And that’s just the tip of the iceberg.
When that happens, what then? Does Obama veto the package, leading to a government shutdown? That would be a huge political and policy mistake. The GOP would once again split its futile attempt to defund President Obama’s immigration executive order from the funding for the rest of the government, so Democrats wouldn’t have any leverage there. Even though voters hate Wall Street and its disgusting control over many, if not most, of our feckless lawmakers, they will still blame the White House for vetoing a bill that passed the House and Senate, just as last time they blamed the House Republicans last year for blocking a deal that had the Senate and the White House’s backing. (Brian Beutler argues: “The crucial difference is that last year, [Ted] Cruz and his supporters … were demanding the inclusion of a contentious, extraneous policy rider in a spending bill as the price for keeping the government open. Warren, [Nancy] Pelosi, and other Democrats are trying to remove such a rider, not to insert it.” I doubt that distinction will fly with most voters.)
More important, as I have said before, a shutdown has real, immediate consequences for millions of Americans. The U.S. economy lost $24 billion and 0.6 percent of fourth-quarter GDP growth during the last shutdown. Had it run longer, veterans’ benefits, Social Security checks, food stamps, Food and Drug Administration inspections and countless other programs all would have come under threat. Are liberals arguing that the president should let some or all of these things be in peril? (And the argument that this will encourage Republicans to “blackmail” Obama in the future doesn’t work: The GOP already does that with spending bills, and Obama can veto every single other bill in the next Congress if he wants, since those bills won’t carry the threat of a shutdown.)
At this point, probably the best way forward for Warren and her allies is to get the Citigroup provision removed and hope the GOP throws a fit over that one provision. But even then, Boehner can still go the “clean CR” route and delay the fight until the GOP is stronger. There’s no way around the truth for Democrats: This deal is a bitter pill to swallow. But that’s what happens when you don’t control the House and you’ve just lost the Senate. Democrats should still hope the country gets a funding agreement now, because it’s the best deal they will get in the next two years.
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