The budget resolution being drafted by Senate Democrats will include reconciliation instructions, according to Democrats briefed on the matter. […]
[T]he reconciliation language could also be used to pass the extension of expiring tax cuts, job-creation measures and energy legislation, according to Sen. Ben Cardin (D-Md.).
Reconciliation bills can't be filibustered, and so need only a simple majority to pass the Senate. The biggest limiting issue on what can be done with reconciliation is the Byrd rule, which says all provision must affect the budget. Even with this limitation, there is a huge set of potential progressive uses for reconciliation.
The one piece of bad news--and it is bad--is that Democrats are possibly thinking about using reconciliation to extend some Bush-era tax cuts that are set to expire:
Sen. Ron Wyden said the reconciliation instructions in Conrad's budget draft would include provisions for the extension of expiring tax policies and tax reform.
This would be a foolish waste of reconciliation--it is hard to imagine that Democrats wouldn't be able to get at least a few Senate Republican votes for tax extenders. If Republicans really want to filibuster a bill to keep taxes low for the majority of Americans because it does not also help the super-rich, Democrats should go ahead and dare them to. It would be a great issue for Democrats going into November.
Personally, I would not be 100% opposed including the the tax cut extension in an omnibus reconciliation bill if and only if it were paid for with progressive reforms like a public option, a greenhouse gas tax, and/or a tax to designed to make "too big to fail" financial institutions unprofitable.
Now that reconciliation instructions will be included in the budget, the important battle will be the scope and design of the reconciliation instructions. The broader the scope the better.
It will also be interesting to see if the instructions are for a deficit-reducing bill or for the less common deficit-increasing reconciliation bill. So far, the indications are that the instructions will be for a deficit-reducing bill, but they don't technically need to be. Republicans set a precedent in the George W. Bush years by using deficit-increasing reconciliation instructions to pass tax cuts. With unemployment so high, Democrats should think about possibly using a deficit-increasing reconciliation instruction to pass a jobs-creating bill like the “Local Jobs for Americans Act.” Of course, I would prefer to see that measure instead paid for with a robust public option, which is projected to save roughly $115 billion.
It is important to remember that including reconciliation instructions in the budget only leaves open the potential to later push for progressive reform. It is not guarantee that reconciliation will be used at all, or for something good, but it is a critical first step.