Tuesday, November 10, 2009

The odds of health care reform passing Congress this year 

The real money odds at Intrade...

"A federal government run health insurance plan (a public option) to be approved before midnight ET 31 Dec 2009"

The money wagerers seem not overly impressed by Saturday evening's House vote. Was that "victory" for Speaker Pelosi a sign of strength or weakness?

Pelosi has a 60% majority in the House ... House rules give her the power to rule pretty much with an iron hand ... she needed 218 votes, and got all of 219 Democrats (plus one Republican) while losing 39 from her own side.

Now it is very likely that the vote really wasn't exactly that close, that once she had her 218 votes she gave permission to some Democrats to vote against the bill, as political "cover" going into the next election.

But being that the Democrats surely would have liked to pass this bill with a big majority, why would she give permission to enough members to vote against it to make the final tally so close?

Well, because now a clear majority of the public polls as being being against the health care plan: 44% in favor versus 52% against at this writing (the graph below is a "live" one that changes with updates) with the trend line rising "against"...

And among the critical "independents" -- who control the political life and death of Democrats in swing jurisdictions that were held by a Republican majority not so very long ago -- opposition to health reform has risen by 15 percentage points to an outright majority of 53%.

The Democrats just saw their team lose big in swing state Virginia and the normally totally Democratic state of New Jersey. Senators now are openly talking about taking the legislative process over into 2010, which has an election in it. The Senate is going to have great fun passing this bill -- and if it does, it and the House will have more fun reconciling what clearly will be two very different bills into one as they keep more than one eye on the polls and approaching 2010 vote.

Keith Hennessey, former Director of the U.S. National Economic Council, calculates the odds on various possible outcomes and legislative strategies going forward from here.

UPDATE: Those poll numbers will determine all, says Mickey Kaus, who believes the supposed "problem issues" for the health care plan -- the public option, who pays how much in taxes, abortion, who gets what subsidies -- aren't real problems at all.

If the Democrats think they will win in 2010 by passing a health care bill, there is no problem issue that they can't compromise, defer, or otherwise fudge to get a bill voted through.

But if enough Democrats start thinking they will lose their seats due a bill, you can look for them to start taking "principled stands" on these issues that are "too important to compromise" -- to scuttle any bill presented to them, while remaining able to say that of course they were for health care reform all along.

So watch those poll numbers.