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Everything (?) you wanted to know about reconciliation (but were afraid to ask…)

- January 22, 2010

On the heels of the Massachusetts election, it appears that the easiest route to health care reform (House concurrence to Senate-passed bill) is off the table. Most of the other options under discussion involve (in one way or another) use of “reconciliation”– a budget procedure that provides a fast-track to passage by circumventing a filibuster. Given all the attention to reconciliation, I thought a little primer on budget procedure might be helpful.

Why trust what you read on the Monkey Cage about reconciliation? Because I am a six-time winner of National Journal “Budget Battle” trivia contests! As proof, here I am with my 2002 mug. If you are ever in D.C., come by and I’ll show you my pennants, mouse-pads, and t-shirt (size XXL…maybe I’ll grow into it someday).


Credentials established, here are some key things to know about reconciliation:

1. What is it?

Reconciliation is an optional stage of the budget process established under the Congressional Budget Act (enacted in 1974 and as amended). Reconciliation is the process that Congress uses when it needs to make changes to law (affecting spending or taxes) in order to conform with budget levels set in the budget resolution. So if Congress found that it needed to reduce the deficit by $200 billion, reconciliation would be the legislative vehicle for proposing the mix of revenue and spending changes needed to reduce the deficit. For example, reconciliation could make changes to Medicare law to reduce outlays, or could make changes to the tax code to increase revenues. (Remember the days when Congress used to reduce the deficit?)

2. Why can’t senators filibuster reconciliation?

Simple. The Congressional Budget Act limits Senate consideration of reconciliation to 20 hours of debate and to 10 hours of debate on a reconciliation conference report. With a time certain for a vote, that means a minority cannot filibuster the effort to get to a vote. Why did senators create a fast-track for reconciliation in 1974? Chalk this one up to unanticipated consequences. Reconciliation was originally intended as a cleaning up mechanism to make the two congressional budget resolutions consistent with one another. When the Budget Act was revised and the second resolution dropped, reconciliation came to be used more aggressively for securing controversial policy changes.

3. How can the House and Senate use reconciliation to pursue health care reform?

In writing the budget resolution each year, legislators have the option of writing “reconciliation instructions” to the committees charged with coming up with revenue and spending changes. These directives grant the committee(s) the opportunity to develop a reconciliation bill (protected from a filibuster). Those changes come to the floor, packaged if need be by the Budget Committees, and then proceed through the legislative process under the Budget Act guidelines.

4. The last budget resolution agreed to in Congress (creating reconciliation instructions) applied to FY 2010. We’re now in FY 2011. Are they still valid instructions?

Yep. Although the news reporting on this issue has been uneven, my parliamentary sources tell me that Senate parliamentarians have over the past 20 years tried to err on the side of “making the budget act work.” In other words, when this issue has arisen in the past, Senate parliamentarians have advised that instructions remain viable until the end of the Congress (rather than the end of the fiscal year). (Although the precedent is apparently not written down, that would be the advice of the parliamentarian today.)

This is important, because it means that Congressional Democrats could start the process today for writing a reconciliation bill that addresses health care reform (rather than waiting for Congress to pass a FY2011 budget resolution– something unlikely to occur until spring). Just an aside– if Congress already has a set of operative instructions, that might reduce Democrats’ incentives to go to the effort to adopt a budget resolution for FY2011.

5. Is it really that simple?

Nope! This is the Senate we’re talking about!

Upset that reconciliation had become a vehicle for avoiding a filibuster of major policy change at times unrelated to deficit reduction, Senator Robert Byrd convinced his colleagues in the mid 1980s to place the “Byrd Rule” into the Budget Act. Under the Rule, the Senate is restricted from adding “extraneous matter” to a reconciliation bill or conference report. The Budget Act lays out the definition of “extraneous,” but in short these would be provisions that do not change revenues or outlays or would increase the deficit. Critical to its enforcement, the Byrd Rule requires 60 votes to waive any points of order that challenge the content of the bill under the Byrd Rule. But again, it’s not this simple. In practice, the Senate parliamentarians have become the arbiter of what counts as legit under the Byrd Rule. (Yes, senators could challenge the advice of the parliamentarian. And yes, the majority could fire the parliamentarian if they didn’t like his advice.) All this is important because it limits which health care provisions can be included in a reconciliation bill.

So, no, nothing regarding reconciliation is as simple or as fast as it may be seem. “If you want something done quickly, don’t send it to the Senate.”

6. So, is health care reform likely to happen this year?

Good question. Next?

7. Having made it to the end of your post, do I have a good chance of winning a National Journal budget battle?

Sorry. The contest was discontinued a few years ago, sometime after I won my second pennant. Just as well. It was hard to get excited about the prospects of winning a third.