Obama scrambles to salvage agenda after humiliation in Massachusetts

Success of President's healthcare reform thrown into jeopardy as Democrats blow super-majority in shock election defeat
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Suddenly sapped of political confidence, the White House and Democrat leaders on Capitol Hill were last night pondering their options for keeping healthcare reform and other key policy priorities alive in the wake of the stunning, upset victory by Republican Scott Brown in the special senate election in Massachusetts.

Their most urgent assessment involved the damage done to the healthcare effort. Even though the Democrats will still have a 59-41 majority in the Senate, the loss of the Massachusetts seat deprives them of the so-called super-majority of 60 seats that makes filibustering by the Republicans impossible.

The White House said President Barack Obama still wanted healthcare reform enacted in 2010 in spite of the setback. In an interview with ABC News, Mr Obama appealed to Democrats to "move quickly to coalesce around those elements of thepackage that people agree on".

Yesterday was a day of open glee for Republicans, who now have a real opportunity to complete the mission they embarked upon months ago: to stop healthcare reform in its tracks. To call Democrats glum, meanwhile, would not adequately describe their shock. It was all the more sobering that the setback came in Massachusetts and involved a seat that had been held by a Kennedy almost without break since 1953.

Nor did it go unnoticed that the fall-out from Tuesday's election came one year to the day after the swearing-in of Mr Obama. The fervour of anticipation and hope that suffused his supporters then has been replaced by disappointment, frustration and even recrimination, some of it aimed at the losing Democrat, the Massachusetts Attorney General Martha Coakley.

There is not much time for Democrats to regroup and turn around their slide in popularity. One deadline is the State of the Union address that Mr Obama will give to both houses of Congress – and the nation – next Wednesday. Mr Obama, who carried Massachusetts by 26 percentage points 14 months ago, will need to calibrate the extent to which he changes course, or not, after this week's election defeat.

The other date on the minds of elected Democrats is this November, when every member of the House and one third of the US Senate will face voters in the midterm elections. Many will now be reassessing their relationship with Mr Obama and the risks that come with supporting his agenda.

"People are tired of business as usual," Mr Brown said of his win. While he did not say the race was a referendum on Mr Obama or healthcare reform, he highlighted "backroom deals" that secured the support of some senators to get the reform bill to where it stands now. "Things like that just drive people crazy. The main thing they want is good government back and to be part of the process."

Healthcare reform, which would extend coverage to 30 million uninsured Americans and attempt to tame the costs of medical care, is tantalisingly close to becoming law. All that remains is to reconcile the two separate versions already passed by both chambers of Congress. But the loss of the 60-seat majority means the approval of a reconciled version faces being stymied in the Senate.

In theory, a number of legislative sleights-of-hand could be employed by the Democratic leadership to try to force the bill through anyway, including a move to persuade the House simply to accept the Senate version, rendering any further votes by senators unnecessary. But anything that looks like chicanery or ignoring the will of the voters would bring enormous political risks.

Aides to Mr Obama and top Democrats insisted letting the entire effort wither and die was not an option. "We have a good healthcare plan," said David Plouffe, chief campaign manager of Mr Obama's 2008 campaign. "We need to pass that. We have to lead." David Axelrod, a top advisor to the President, insisted: "It's not an option simply to walk away from a problem that's only going to get worse."

Nancy Pelosi, the House Speaker who has become a national lightning rod for those furious about the healthcare push, spent part of yesterday behind closed doors debating options with other Democrat leaders. "We will get the job done. I'm very confident. I've always been confident," she said.

Another of the President's legislative priorities that could be in danger is action on climate change. Measures approved by the House to introduce emission ceilings with a cap-and-trade system were already facing much stiffer headwinds in the Senate. The likelihood of their passing now is considerably slimmer. "There is minimal enthusiasm, and that's putting it mildly, for cap and trade," said Mitch McConnell, the Republican leader in the Senate.

That prospect was already ringing alarm bells beyond America's borders as governments around the world consider whether they will be willing to go further on curbing emissions if the likelihood of the US playing its part is further diminished. "This is definitely bad news. It doesn't bring new confidence to international negotiations," said Ailun Yang, Greenpeace China's climate campaign manager.

Senior Republicans instantly warned against any manoeuvres to push through healthcare reform. "There are rumours out there that they will jam this proposal through the House... they should not do that," Senator John McCain said. "The American people have spoken, the people of Massachusetts have spoken for the rest of America. Stop this process." Even some Democrats on the Hill appealed for some acknowledgment of the souring public mood. "We have got to recognise we are in an entirely different scenario," said Anthony Weiner, a House Democrat. "We shouldn't show the arrogance of not getting the message here."

Shortly after the death of Ted Kennedy in August, the Massachusetts legislature, controlled by Democrats, manipulated the rules to install an interim senator, Paul Kirk, in the seat. It was done precisely to keep the 60-seat majority intact, pending the special election that could not be held until this month. Now, Mr Brown will serve out the remainder of Kennedy's elected term, until the end of 2012.

Healthcare: What are the options now?

* Persuade the House of Representatives simply to swallow and adopt the altogether less comprehensive bill that was passed by the US Senate on Christmas Eve. Liberals in the House and around the country would squeal blue murder, however.

* Get the Senate version through the House but then take some of those things liberals want that are left out and push them through in a so-called reconciliation bill where only a simple majority would be needed for passage. That would require some bending of procedural rules, though.

* Beg and bribe and hope just one Senate Republican will break ranks and join the Democrats to reassert the 60-seat anti-filibuster threshold. Senator Olympia Snowe from Maine may be a possible candidate. Oh, but the trouble she would get into.

* Give up on healthcare reform and move onto other topics – like employment.

David Usborne