Republican State Senator Scott Brown’s victory in Tuesday’s special election to fill the late Ted Kennedy’s seat in the U.S. Senate will no doubt have a substantial impact on the labor and employment law agenda of the Administration and many Congressional Democrats. In defeating Massachusetts Attorney General Martha Coakley, Brown is set to become the 41st Republican member of the Senate, eliminating the Democrat’s filibuster-proof 60-seat supermajority. The loss of the seat held for 46 years could derail a number of President Obama’s legislative priorities, including healthcare reform, the Employee Free Choice Act (EFCA), and immigration overhaul, without significant modification and compromise from both sides of the aisle.
The fate of healthcare reform now that 60 Senate votes are no longer guaranteed is unknown. Democratic members of Congress have been in the process of reconciling the Senate’s Patient Protection and Affordable Care Act (H.R. 3590) with the House of Representative’s Affordable Health Care for America Act (H.R. 3962), both of which narrowly cleared their respective chambers. A unified bill would need to clear both the House and the Senate once again to ensure passage. Brown has explicitly stated that he opposes the current proposals, and would vote against any healthcare bill if a consolidated bill is brought to the floor of the Senate for a vote. Congress is now faced with a number of options to proceed with healthcare reform, none of which would be easy. The House could vote on the Senate bill, since it has already been approved by that chamber. However, a number of Democrats have expressed opposition to this approach. Many House Democrats – and members of organized labor – oppose certain provisions of the Senate bill, including the 40% excise tax on high-cost “Cadillac” health plans. On Friday, the White House and union leaders came to a reported deal that would, among other things, temporarily exempt collectively bargained health benefit plans from this tax. Should the House take up consideration of the Senate bill, this agreement – among other compromises reached in recent weeks – could no longer be included in the final legislation.
In the alternative, healthcare reform could be pursued through a process known as reconciliation, which would require only 51 votes to pass. Reconciliation is not an optimal means of implementing reform, however, as it is politically-charged, procedurally complicated, and limited in scope. Also under consideration is a “two-step” process by which certain modifications are made through a separate reconciliation bill. Other options such as making concessions in an attempt to solicit one or more Republican votes, and delaying Brown’s swearing-in in an attempt to squeeze in a Senate vote beforehand appear increasingly unlikely. Starting from scratch, scaling back the proposal or scrapping healthcare reform entirely may become necessary as, it is believed, many lawmakers would like to move beyond healthcare reform, which has dominated the legislative agenda for much of 2009.
The special election may affect not only the fate of the healthcare bill, but other Democratic legislative priorities that were introduced in 2009. Without 60 Democratic Senate votes, prospects for passage of the politically charged Employee Free Choice Act (EFCA) has been diminished in its current form. Comprehensive immigration reform is also increasingly unlikely prior to the 2010 elections.
Given the new Senate composition, the Administration will probably move forward with legislation that enjoys some level of bipartisan support. Financial reform, for example, may well be the next big legislative push to ensure that some initiative is accomplished this term. Democrats and organized labor will probably become more amenable to compromise on a number of measures in order to salvage a portion of their legislative agenda with the political landscape pointing to a further erosion of Democratic-controlled seats after the 2010 elections. However, moderate Democrats who were already leery of supporting certain labor-supported initiatives may not be willing to risk perceived political fallout of supporting additional labor-backed labor and employment changes. Accordingly, with the loss of the Kennedy seat and its impact on the ability to pass legislation in the Senate, expect an increase in regulatory activity, which is a way for the Administration to achieve some of its goals without going through Congress. In essence, more incremental changes through regulations, more incremental changes or bipartisan bills – as opposed to sweeping legislative overhauls – are expected in the coming months.