A rare chance to break the gridlock

I don’t weigh in much on politics. I usually stick to what I know: investing.

But the dysfunction in our government is infecting and damaging every sphere of American life. It’s harming our health, our wealth, our institutions, and citizens’ very belief in the value of democracy.

{mosads}Fortunately, something happened in Washington last week that offers hope our leaders can focus more on solving problems than destroying one another.

The hope comes courtesy of nine Democrats in the House Problem Solvers Caucus who struck a deal with likely House Speaker Nancy Pelosi (D-Calif.) to significantly change the rules of Congress in ways that will create an opening for bipartisan solutions in the next two years.

To understand why this is so consequential, it’s important to look at what did and didn’t happen in the current Congress.

I saw much of it up close as a supporter of No Labels, a group of Democrats, Republicans and independents that has worked tirelessly to support leaders who are committed to working across the aisle.

The Problem Solvers Caucus was formed in early 2017, and in the next year it aligned several times behind bipartisan solutions on health care, immigration and border security and infrastructure. They were the kind of solutions that likely would have passed the House if they ever got to the floor. But House leadership refused to give these ideas so much as a hearing, let alone a vote.

So the Problem Solvers started looking at the web of arcane House rules that give absolute power to the leaders of the majority party, who in turn depend on support from the most ideological members of their party to stay there. Although there are 435 House members, House Speaker Paul Ryan (R-Wis.) couldn’t do much that the 30 or so members of the Freedom Caucus didn’t want him to do, because of strange House rules like the “motion to vacate,” which gives a single House member the power to try to topple a Speaker.

This current session of the House set a record for the number of bills considered under “closed rules,” a procedural step that prevents rank-and-file members from offering amendments to legislation. The House also increasingly spent its time passing “message bills”: legislation the base likes that allows members to pretend they’re doing something, even though they know full well the bill will die in the Senate, where bipartisan support is required to assemble the 60 votes needed to pass most legislation. In this Congress, the House passed more than 140 bills with only Republican votes that are now sitting in the Senate graveyard.

Absent the kinds of rule changes agreed to by Pelosi and the Problem Solvers Caucus, we were likely in for two more years of similar behavior: a Democratic House passing bills on a party-line basis that the Republican Senate would never pass.

The rule changes include a provision allowing bills co-sponsored by 290 members to get expedited consideration on the House floor, and another privileging any legislative amendment co-sponsored by at least 20 members of each party. They are no panacea; members of Congress will still need to do the hard work of getting to consensus on tough policy. But at least there’s an opening, and it comes not a moment too soon.

Two years ago, Harvard Business School released a study concluding that “the federal government has made no meaningful progress on the critical policy steps to restore U.S. competitiveness in the last decade or more.” It said, “our political system is now the major obstacle to progress on the economy, especially at the federal level.”

In short, the report concluded that America has less work, less investment and less innovation as a direct result of Washington’s failure to deal with our crumbling infrastructure, broken immigration system, fraying social safety net, and countless other problems.

There are many forces inflaming divisions in our country, but a key driver is undoubtedly Congress’s chronic inability to find common ground between the parties. The Problem Solvers’ Break the Gridlock package certainly won’t guarantee that members can find bipartisan solutions to our toughest challenges.

But at least they will finally have a chance.

Howard Marks is the Co-Chairman of Oaktree Capital Management