On its face, the bill crafted by Senators Marco Rubio (R-FL) and Chris Coons (D-DE) looks modest enough.  The aptly-named AGREE (American Growth, Recovery, Empowerment, and Entrepreneurship) Act takes parts of job-growth proposals from both sides of the aisle with wide bipartisan support and rolls them into one proposal.  The two eliminated those components that create controversy, so that this Congress can act at least incrementally to improve the economic climate for job creators while larger reform efforts collide on Capitol Hill.

The incremental approach on policy actually is modest, if also effective and impactful.  But the effect of the AGREE Act on larger political strategies is anything but modest.  Rubio and Coons have basically challenged Harry Reid to get something accomplished — and that runs headlong into Barack Obama’s election strategy.  In my column for The Fiscal Times, I write that the entire notion of a do-nothing Congress is Obama’s best re-election argument.  Will Reid accept bipartisan progress, or defend Obama’s re-election strategy?

“If we can pass something that is bipartisan,” Rubio said, “people will look to Washington and see a glimmer of hope. Maybe there is reason for optimism.  …What’s holding back American creativity right now is the fear that tomorrow is going to be worse than today, and next year worse than this year.”

That, however, is the question at hand, and the AGREE Act is the test that might provide an answer. Will this Congress find a way to act on an incremental economic reform whose components attract wide bipartisan support – or will the politics of the Grand Reform Era keep it from getting a vote in the Senate?

It’s no secret that Barack Obama wants to position himself in the 2012 race as the man who can stand up to a “do-nothing Congress,” hoping to emulate Harry Truman’s surprise win in 1948. Majority Leader Harry Reid has stalled 15 House bills aimed at improving the environment for job creation as a way to protect Obama’s strategy and to force the House to accept the president’s second attempt at a stimulus package instead. The passage of the AGREE Act would undermine that strategy, as well as expose the partisan calculations of Obama’s jobs bill. …

“They’ve been hoping to run against a do-nothing Congress, so maybe they’re not excited about Congress actually acting on something like this,” [Rubio] said, adding, “There are things that are more important than someone’s re-election.”

This is a clever little trap that Rubio has laid for Reid.  If it proceeds, it’s likely to pass.  The challenge then passes to the House, which Coons probably hopes will offer some resistance in order to perpetuate the do-nothing meme.  However, the AGREE Act is palatable enough that the House GOP should have no problem with it — and Boehner would jump at the chance to wave the bill as evidence that the House will work with the Senate on incremental reforms when possible.

If it passes the Senate and the House, then it will land on Obama’s desk with a thud.  Would he find a reason to veto it?  He might want to try; its passage would  highlight the opportunity for engagement that Obama eschewed for his new class-warfare schtick and insistence on Congress swallowing Porkulus II: Economic Boogaloo in its entirety.  But it would be very difficult for Obama to explain a veto on a jobs bill that passed the Senate, and a veto would make him look even more extreme when it stops widely-supported reforms from becoming law.

The AGREE Act throws a wrench into Team Obama’s machinations.  I’d expect to see Harry Reid find ways to slow or stop it as quietly as possible — so it’s worth keeping our eyes on it.

Here is my entire interview with Senator Rubio from yesterday, as well as an interview with Darrell Issa at the 30-minute mark.  Enjoy.

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