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Now Congress Gets To Play Budget-maker...

This week, budget committee chairmen in the House (John Spratt) and Senate (Kent Conrad) get to do what President Obama got to do last month: Unveil a vision for how the government should handle its finances. And we already have a pretty good idea of what those visions will look like, at least as far as health care goes.

Both will propose the creation of some sort of health reserve fund, from which comprehensive reform can draw its financing. Neither will specify how big the fund should be. And while the House proposal will likely include "reconcliation instructions" for health care, the Senate proposal probably won't.

What does this mean? A fine question, that.

On the surface, this looks like a proposal that should disappoint fans of health reform. What's the significance of a health reserve fund if there are no dollars attached? And since the whole point of using the reconciliation process is to get health reform through the Senate, without subjecting it to the threat of a Republican filibuster, doesn't the absence of reconcilaition instructions in the Senate proposal suggest certain doom for that idea?

But most of the people I've been consulting over the last few days--a collection of advocates, Hill staffers, and administration officials, all of them friendly to reform--suggest that interpretation is misguided.

It was important that Obama put a number on his reserve fund, these people say, because his interest in making health care a priority was in doubt. That's not the case in Congress, where the leadership has made clear its intention to move forward and the key committee chairmen have been hard at work on a comprehensive package that will, if fully implemented, eventually insure everybody while introducing changes that will ultimately make medical care less expensive. By leaving the reserve fund undefined, these sources say, congressional budgetmakers actually leave more congressional reform architects flexibility.

As for the reconciliation issue, that's a bit trickier. Key reformers in the White House and both chambers of Congress want to enact health care. They'd prefer to do it with large majorities--which means reaching out to Republcians and working with them. But they also realize such efforts might fail. And,if that happens, they realize they'll need to use the reconciliation process.

(No great secret here, by the way; it's what top administration officials and congressional leaders have been saying for many weeks.) 

Keeping reconciliation out of the Senate budget proposal but including it in the House budget proposal allows congressional leaders to pursue a good cop-bad cop strategy. Once each chamber passes its budget, the two must get together and work out the differences between their versions. As long as reconciliation is in the House version, it'll be on the table in those negotiations. And by that time, the thinking goes, leaders in both houses will have a better sense of whether it's necessary to use reconciliation.

One more reason reformers seem generally happy is--oddly enough--Senator Conrad. I say "oddly" because he's made clear his worry over both deficits and proposals for government spending. He's come out against paying for health care with higher income taxes on the wealthy, which will make it tougher to raise the necessary revenue. And he has expressed a strong desire to avoid reconciliation for health care, which--again--would seem to be an important option to keep in the Dems' legislative arsenal.

Still, Conrad has has not suggested that health care, itself, will have to wait--not even after the latest, dire defiict projections from the Congressional Budget Office. And in the opinion of most (though not all) people I consulted, that means he's not going to be the obstruction some feared he would be.

By the way, I have no idea if these sources are right. The congressional budget process remains positively baffling to me. Plus, of course, they could just be spinning.

But this is the story they told me. So now I'm telling you. Make of it what you will.

Update: The Wonk Room's Igor Volsky makes a smart contrarian case. 

--Jonathan Cohn