What’s Plan B for Democrats?

It was meant to be a populist legislative victory that would usher Democrats straight through the 2010 midterm elections: a sweeping health care reform bill offering affordable coverage to tens of millions of uninsured Americans, while preventing insurance companies from denying coverage based on pre-existing conditions.

House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Harry Reid, D-Nev. (WDCpix)

Then came Massachusetts.

In the wake of Republican Scott Brown’s stunning Senate victory in the Bay State Tuesday, Republicans are already spinning the outcome as a damning referendum on the Democrats’ partisan health reform proposal. The validity of the claim is debatable, as many political experts say the voters’ anger is more likely a response to the nation’s still-struggling economy. Still, with polls indicating that health reform has become more liability than asset, Democrats are scrambling for ways to put health care in the rearview mirror and make room for more tangible election-year items: taking on Wall Street and tackling the unemployment crisis.

Democrats can’t abandon their health reform bill, many experts say, but nor can they rely on it alone for success in November.

“There’s no question that this has got to make the Democrats queasy about health care reform,” Henry E. Brady, dean of the Goldman School of Public Policy at the University of California, Berkeley, said of the Massachusetts contest. “But the reason they’re getting clobbered on the health care bill is the economy. That’s what they’re going to live and die on.”

“There’s a much larger discontent that’s demoralized the average Democratic voter in Massachusetts, and that’s the state of the economy,” agreed Michael L. Mezey, a political science professor at DePaul University. “They want to get health care behind them, and the administration is going to pivot to more populist themes.”

David Epstein, an expert on congressional politics at Columbia University, compared the health reform bill to another consequential, but controversial, Democratic initiative: the sweeping deficit-reduction legislation passed by the Clinton administration in 1993. That law eventually helped the country achieve billions of dollars in budget surpluses, but because it took a few years to realize the gains, the accomplishment offered Democrats few immediate political advantages. Indeed, the Republicans swept to power just a year later.

“It was a great piece of public policy, but it didn’t help them [Democrats] in the [1994] midterms,” Epstein said. In a similar vein, he added, “just health care is not doing it right now.”

Democrats seem to have gotten the message. House Majority Leader Steny Hoyer, D-Md., indicated Tuesday that, after health care, the Democrats will turn their attention quickly to the economy — and keep it there through the year. “Creation of jobs and the policies which will return us to fiscal balance will be our focus,” Hoyer said.

Later, Rep. Chris Van Hollen, D-Md., chairman of the Democratic Congressional Campaign Committee, issued a statement summarizing the Democrats’ election-year message. It boasted of the “economic progress” under Democratic leadership, but there was no mention of health care reform.

Still, Democrats can’t entirely abandon their top domestic priority at this late stage in the debate. As tough as it might be for some Democrats to explain to constituents their support for the bill, detailing its failure would be even tougher.

“They’re going to look like the gang that can’t shoot straight,” said Mezey. “Not passing it would be a big problem.”

Gary C. Jacobson, a political science professor at the University of California at San Diego, agreed. “Folding at this point,” he said, “might be more dangerous than just plowing on.”

Brown’s victory Tuesday was never supposed to be. Not only is Massachusetts among the most loyally Democratic states in the country, but the contest was staged to fill the seat vacated by the late Sen. Edward Kennedy, D-Mass., a lifelong champion of health care reform and an author of one of the early versions of the Democrats’ proposal.

Republicans were quick to claim Brown’s win as an indictment of the Democrats’ health reform bill. “The voters in Massachusetts, like Americans everywhere, have made it abundantly clear where they stand on health care,” Senate Minority Leader Mitch McConnell, R-Ky., said in a statement. “They don’t want this bill and want Washington to listen to them.”

The episode has left Democratic leaders struggling to locate populist issues that voters will embrace. Epstein suggested that financial regulatory reform would be such an issue. “It’s good for them both as politics and policy,” Epstein said. “If you’re looking ahead, that’s the issue that will make or break the Democrats in the midterm elections.”

Not that the Democrats don’t already have some legislative trophies to carry with them on the campaign trail. In the last 12 months, President Obama has signed bills to prevent workplace pay discrimination, expand children’s health care coverage and protect consumers from the most abusive traps of credit card companies. And the Democrats’ $787 billion stimulus bill — which has taken its share of lumps from both sides of the aisle — is also widely credited with preventing the economy from sinking much lower.

Still, Democrats could have done much more to excite the populist base that swept them to victories in 2006 and 2008. Party leaders, for example, ignored calls from a host of prominent economists who warned that the $800 billion stimulus was much too small to tackle the Great Recession. More recently, the White House abandoned its earlier support for mortgage bankruptcy reform, paving the way for the bill’s failure in the Senate. And while consumer advocates have applauded the credit card reforms enacted last spring, they were also critical that Democrats, bowing to pressure from the finance industry, delayed the effective date of those changes until this year.

In the wake of Tuesday’s election in Massachusetts, MoveOn.org sent its members an email message indicative of many liberals’ discontent with the Democrats. “Pass real health care reform,” the email said. “Rein in Wall street. Take on the banks and special interests that stand in the way of change.”

Before they can move to the economy, though, Democratic leaders will have to decide how to pass their health reforms with just 59 seats in Senate. Under one scenario, the House could simply take up the Senate-passed bill. Many House Democrats, however, have blasted that proposal from both the right and the left, leaving the success of that option in question. Furthermore, many moderate House Democrats who supported health reform the first time through might get cold feet after witnessing Brown’s victory in Massachusetts. That election, Brady said, “makes it so much easier for people in the House not to vote for it.”

Some experts argue that the Democrats have spent so much time, energy and political capital on health care reform that they won’t be able to ignore it on the campaign trail.

“They’ll have to campaign on it,” said Jacobson. “They’re pretty well committed at this point. If they’re not going to defend what they’ve done then they’re hopeless.”

Furthermore, with unemployment still hovering in double digits, it’ll be difficult for lawmakers to campaign on what is perhaps their most significant accomplishment of the last year: the string of government interventions that prevented the recession from becoming a depression.

“It’s tough to make the case that, ‘Had we not done this, things would be worse,’” Mezey said. “People are going to say, ‘Well, things are still pretty bad now, what are you going to do about it?’”

Hoyer, for his part, had a response. “We’ve been trying to do something about it,” he said in the Capitol Tuesday. “I think we’re making success. … But until the numbers turn around, until the economy is creating jobs, until there is more stability, people are going to be angry. And that, I think, is manifested throughout the country — not just in Massachusetts.”

Mike Lillis covers Congress for The Washington Independent, a Center for Independent Media site.