Why Should the Democrats Engage?

Another commenter on my post on Senator Hagel's plan asks:

I think I understand why you want them [the Democrats] to [put forward an alternative plan] - it would facilitate a bargaining process that would likely lead to an outcome you favor. But why is it so hard for you to see that it is far from obvious that their failure to offer an alternative plan will cost them politically?

The commenter draws an interesting parallel to the lack of a political price paid by the Republicans for refusing to engage on the Clinton health care plan and cites some polling results showing declining popular support for the President's plans for reform. The comment finishes with:

Seems at least possible that Democrats have a lot to gain just by opposing a plan that is becoming increasingly unpopular, no?

First, the commenter has my position essentially right--we are more likely to get a reform that restores solvency along the lines that I like if the Democrats engage. (See these two early posts for how I would do it.)

Second, I don't think the Clinton health care reform debacle is necessarily a good comparison at this point. My recollection is that even very few Democrats on the Hill wanted to touch that by the time the White House was done with it, and the Democrats were the majority party at the time. Much of the backlash also appeared to be directed at the First Lady's involvement in the process. And health care was never much of a Republican's issue--Social Security is very much a Democrat's issue.

Third, we can conjecture as to how the Republicans and Democrats would fare under the three relevant scenarios. I agree that it isn't "obvious" that the Democrats need to engage, but there are some potentially large risks if they don't. Here are my thoughts:

1) The strategy succeeds: Democrats refuse to engage, and the President's initiative fails without them.

What happens in the 2006 and 2008 campaigns? Republicans say that because of Democratic obstructionists, young people don't have personal accounts and the system still faces a long-term financial imbalance. No Democrat has any proposal of substance to say how he or she would have fixed the system. Democrats don't gain much traction on the issue of Social Security itself, but it's not like they campaign on it unless provoked.

On the other hand, the President would suffer one of his few electoral defeats. Who knows what kind of momentum that might generate? It could shift the political focus in the remainder of his term back onto issues where the President and the Republicans may be more vulnerable--chronic deficits on the domestic side, Iraq on the international side.

2) The strategy fails: Democrats refuse to engage, and the President succeeds in passing a reform without them.

Given the outline of the President's plan, we know that he will have two big talking points. First, on the day the plan is announced, the projected $10.4 trillion unfunded obligation in the Social Security system goes away. The President gets to say that he "saved Social Security" while the Democrats stood by and watched. Second, he will have added personal accounts to the system on a voluntary basis. The President gets to say that he transformed a "government program" into an "ownership society," again while the Democrats stood by and watched.

3) The strategy isn't adopted: Democrats engage and reform passes in a form that incorporates some of the Democrats' preferences.

The President still gets his talking points from #2, except that they cannot be made at the expense of the Democrats. The Democrats can also point to their contributions to the legislation and share some of the credit.

So the Democrats' strategic decision may be based on their assessment of the likelihood of each scenario and the electoral advantage or disadvantage in each case. It seems like #2 would be really bad for the Democrats, and if it appears like the President can hold his own party together (lowering the likelihood of #1), then we will get Democrats proposing plans of their own (leading to #3). Literally, Senator Clinton will have a plan with personal accounts.

Other people with more of a partisan interest in the Democratic party are weighing in on the same issue, generally at the expense of Senator Lieberman. Jonathan Chait is blogging for Josh Marshall over at Talking Points Memo and has this piece in The New Republic. (John's second round of comments on my earlier post prompted me to go read it.) Paul Krugman's column today has a similar theme.

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