A Federal Shutdown Won't Derail Obamacare

Closing down the government is a feel-good stunt for the far right that will end up wasting taxpayer dollars.

It’s no surprise that tea party Republicans are determined to shut down the federal government, but the group’s contention that the stunt will lead to defunding the Affordable Care Act lacks credibility. It won’t do any such thing. This is about politics, not policy. Parts of the government will likely be shuttered for a few days — a week at most. Obamacare will remain the law of the land.

In fact, there’s little or nothing to gain for the American taxpayer from the quixotic quest, and the GOP leadership knows it. "If we could do this [shut down the Affordable Care Act], we should do it. But we can't," Sen. Tom Coburn (R-OK) said over the weekend.

It’s the self-serving theatrics of presidential wannabes — notably, but not solely, freshman Sen. Ted Cruz (R-TX) — that will force the federal government to temporarily close its doors. To Cruz, a government shutdown tied to the repeal of Obamacare is his passport into the GOP presidential primary field, and he’s taking it as far as he can. “I think Senate Republicans are going to stand side by side with Speaker Boehner and House Republicans, listening to the people and stopping this train wreck that is Obamacare," Cruz says. And the tea party faithful, with their “no surrender” mantra, love him for it.

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Indeed, as the Oct. 1 deadline to pass a continuing resolution to fund the government nears, the tea party’s resolve is hardening, despite pleas from the GOP leadership and the urging of stalwart Republican allies, including the Chamber of Commerce, the Business Roundtable and the Wall Street Journal’s editorial board, to halt the budget shenanigans. But House Speaker John Boehner (OH) and his allies simply don’t have enough GOP votes to derail the tea party train, and Boehner is unwilling — at least for now, and for the sake of his own political future — to team up with Democrats to outvote his party’s renegade wing.

At the insistence of the tea party bloc, a provision barring the federal government from spending any money to implement the health care law was included in House legislation to approve continued government spending after Sept. 30, when current funding authorization expires. The measure passed, but the House GOP leadership knows full well that there is no way to get it through the Democratically controlled Senate. That leaves the House and Senate to make the two versions mesh, presumably by stripping the offending House provision from the final version. But as long as the three dozen or so tea partyers stand their ground and the Republican leadership balks at an alliance with Democrats, no agreement on a continuing resolution will be possible.

The odds now slightly favor a short shutdown of nonessential services, and they grow every day. Social Security benefits would still be issued, planes would fly, and troops would be paid. But many other services, such as veterans benefits, would be halted for the duration. Payments for some contracts would be delayed, and contractors paid a day rate would lose those wages. Thousands of nonessential government workers would be furloughed, with work piling up on their desks. Then they’d be paid retroactively for the lost days.

Caught between a rock and a hard place, Boehner knows from firsthand experience that his party will bear the brunt of the blame if legislation funding the government isn’t passed. He was around in 1995, the last time a congressional rebellion closed Uncle Sam’s shop.

Then, led by the freshman class of 1994, Republicans demanded steep cuts in Medicare, Medicaid and other nondefense spending for the fiscal year 1996 budget. President Clinton refused, and Speaker Newt Gingrich (R-GA) let legislation funding the government lapse. On Dec. 29, 1995, in the midst of the crisis, The Kiplinger Letter observed: “Oddly enough, the GOP takeover of Congress has helped Clinton. He looks more like a leader, confronting Republicans and vetoing bills…. With the GOP in charge, he paints himself as a bulwark against extremism.” In fact, Gingrich’s career never recovered from the fallout from those failed shutdowns. Clinton still crows over how the GOP overplayed its hand back then, hastening the end of the so-called Gingrich revolution.

Change “Clinton” to “Obama” and we could rerun the same story today. Some Republicans are likely to pay a price at the polls in 2014. To limit the damage, Boehner will eventually contrive to get a continuing resolution passed by the House that doesn’t include the defunding provision.

Fortunately, the stress, anxiety and recriminations from a government shutdown are likely to help prevent another stalemate over raising the federal debt ceiling in a little more than a month from now. Even if the tea party political bosses or their bankrollers threaten to run primary candidates against any fellow Republicans who support lifting the borrowing limit, enough mainstream GOPers will join with Democrats to prevent another crisis. The compromise will come at the last minute, after long, heated debate. But it will come. Neither side will risk being saddled with the blame for a government default so close to 2014’s congressional elections.

Kenneth R. Bazinet
Associate Editor, The Kiplinger Letter