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NY-26: Big impact on deficit fights

By David Gergen, CNN Senior Political Analyst
  • GOP's Christopher Lee resigned from Congress last year after shirtless picture e-mailed
  • The special election to replace him is reframing deficit debate, says David Gergen
  • Election complicates possible bargain on entitlements before 2012, he says

Editor's note: David Gergen is a senior political analyst for CNN and has been adviser to four presidents. He is professor of public service and director of the Center for Public Leadership at Harvard University's Kennedy School of Business.

Cambridge, Massachusetts (CNN) -- When a young GOP Congressman stripped off his shirt, took his picture and e-mailed it to a woman, he did more than end his career -- he set off a political ripple that probably ends prospects for resolving the nation's growing debt crisis before next year's elections.

The clumsy seduction attempt by Christopher Lee forced him to resign from Congress late last year, unexpectedly setting up a special election this week in NY-26, a district that runs between Buffalo and Rochester in New York state.

In stepped Democrat Kathy Hochul with a hard-hitting campaign against Paul Ryan's plan to overhaul Medicare and easily grabbed one of the country's reliably Republican seats. Ordinarily, a special election for a single House seat wouldn't mean much -- and this one has been over-interpreted -- but by all appearances, it is quickly reshaping the landscape for deficit reductions.

For both Republicans and Democrats, the message has been the same: Mess with Medicare at your peril.

Republicans have been gambling that, with a deficit picture so bleak, a majority of Americans will be willing to reduce the benefits of Medicare and Social Security in order to save the programs. If Republicans come up with a better message, they may yet prevail in that argument, but clearly they haven't yet. In NY-26, "Medi-scare" won hands down.

For Democrats, who paid at the polls last November for their own reductions in Medicare, the New York victory provides a sharp incentive to put the Ryan plan at the center of the 2012 campaign. They see blood in the water.

In the short term, all this may be good for the country: It may make it easier to reach a bipartisan compromise that cuts deficits and raises the national debt ceiling before August 2 of this year.

Republicans have been asking for large reductions in Medicare as a price for that debt extension. They are likely to lower their expectations now, and with that, Democrats could also lower their hopes -- unrealistic -- for a significant increase in taxes. The deficit reduction plan won't be anywhere near as big as we need, but if the parties work together, it could be respectable.

The challenge that arises because of NY-26 is that it makes it much harder to reach a "grand bargain" on entitlements and taxes before the 2012 elections.

Democrats clearly want to wave the Ryan plan at Republicans as a possible way to save the Senate and re-gain the House. Republicans will face a dilemma over the Ryan plan: Should they go into a fierce offense or should their presidential nominee come up with a different plan behind which the party can rally?

Either way, major Medicare reform isn't going to happen before the elections, and that, in turn, means that Washington won't make the hard choices on spending, taxes and the like until 2013-2014 -- if then.

But politics-as-usual has become a highly dangerous game these days. Not many in Washington like to point this out, but only just over a month ago, Standard & Poor's warned that if the country does not adopt a serious, credible plan on deficits BEFORE the year 2013, there is a one-in-three chance that S&P will reduce the nation's AAA credit rating.

We are playing with fire.

The opinions expressed in this commentary are solely those of David Gergen.