Reid tossing cap-and-trade under the bus?

Harry Reid has sent some interesting signals today with his schedule for legislation in the Senate.  He added his troubled health-care reform bill to next week’s agenda despite the threats from Joe Lieberman and Ben Nelson to filibuster it if it contains a public option or if it doesn’t contain Stupak-like language to ban abortion funding.  However, the sudden focus on producing a jobs bill threatens to push another Obama priority into next year — and therefore oblivion for the 111th Congress:

Senate Democrats will take up a new job-creation bill in the wake of the 10.2 percent unemployment rate, Majority Leader Harry Reid told his colleagues Tuesday.

Sen. Ben Cardin (D-Md.) told The Hill that Reid (D-Nev.) made the announcement about a new jobs bill at the Senate Democrats’ weekly lunch. …

A new jobs bill would add yet another piece of major legislation onto the Congress’s plate. Democrats are currently trying to finish work on healthcare reform. Afterward, they plan to turn to legislation curbing climate change and overhauling financial regulations.

But some Democrats are wary of moving to the global warming bill, and Reid’s signal that he wants to proceed to a jobs bill could suggest the climate measure will have to wait in line.

Reid has little choice.  Voters have become outraged that Congress has continued to push big-spending plans while more Americans lose their jobs.  The unemployment rate accelerated from September to October, meaning that the situation is getting worse instead of better.  If Congress doesn’t make itself seem to be addressing that problem, voters will make Reid and Nancy Pelosi irrelevant next November.

However, a new jobs bill is fraught with political risks.  Just considering such a bill will be seen as a tacit admission that Porkulus has utterly failed.  The natural question will be why Reid doesn’t pull the plug on further Porkulus spending and use some of what’s left in real economic stimulation — signaling tax credits rather than the massive tax expansions of ObamaCare, for instance, and the end of funding pork projects.  If we need a jobs bill now, we should first stop spending massive amounts of cash on the one that failed.

But perhaps Reid is signaling on jobs with this reschedule that deprioritizes the Kerry-Boxer effort on cap-and-trade.  That bill, based on the already-passed Waxman-Markey, hasn’t got a prayer of passing the Senate with unemployment skyrocketing.  It kills jobs and economic growth by artificially escalating energy prices to create slush funds for Congress.  It’s already unpopular in red states with Senate Democrats, like Nelson, Blanche Lincoln, Jay Rockefeller, Evan Bayh, and so on.  If it gets pushed into an election year, it will have even less chance of getting a vote, let alone passing, while unemployment continues to rise.

In fact, James Pethokoukis says it could go as high as 12% by next summer:

Gluskin Sheff economist David Rosenberg, formerly of Merrill Lynch, thinks the unemployment rate is going to at least 12 percent, maybe even 13 percent. Optimists, Rosenberg explains, underestimate the incredible damage done to the labor market during this downturn. And even before this downturn, the economy was not generating jobs in huge numbers. If he is right, all political bets are off. I think the Democrats could lose the House and effective control of the Senate.

At this point, the best jobs program Reid can deliver is an end to cap-and-trade.  If he pushes it into 2010, that will effectively kill it.  If that happens, the 112th Congress will have to reconsider Waxman-Markey, and the way it looks now, Nancy Pelosi won’t be the one in charge of the House to push it.