• With: Dan Henninger, Kim Strassel, Joe Rago, Collin Levy

    This is a rush transcript from "Journal Editorial Report," September 21, 2013. This copy may not be in its final form and may be updated.

    PAUL GIGOT, HOST: This week on the "Journal Editorial Report," House Republicans decide that defunding ObamaCare is the price of keeping the government open, setting the stage for a showdown in the Senate. Is it a smart strategy for the GOP?

    Plus, a newly uncovered list of targeted groups shows how and why the IRS singled them out for scrutiny.

    And two years after Scott Walker's reforms, a look at what's happened to Wisconsin's unions now that public workers have a choice.

    Welcome to the "Journal Editorial Report." I'm Paul Gigot.

    Yielding to pressure from conservatives, House Republicans decided this week to strip funding for ObamaCare from a stopgap spending bill that would keep the government running past September 30th, setting the stage for a showdown in the Senate next week as a shutdown looms.

    Some in his own party have called the move political suicide, but House Speaker John Boehner had this message for his critics and his Senate colleagues.

    (BEGIN VIDEO CLIP)

    SPEAKER OF THE HOUSE JOHN BOEHNER, R-OHIO: ObamaCare's driving up the cost of health care. It's destroying millions of American jobs. It is a train wreck. It'll have to go. But we've done everything humanly possible over the last two and a half years to make our point and we're going to continue to make our point. It's time for them to pick up the mantle and get the job done.

    (END VIDEO CLIP)

    GIGOT: Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; Washington columnist, Kim Strassel; and editorial board member, Joe Rago.

    So, Kim, does this mean that the Ted Cruz, Republican, the Senator from Texas, who has been pushing this strategy, does this mean the House is now on board the Cruz train?

    (LAUGHTER)

    KIM STRASSEL, WASHINGTON COLUMNIST: Well, Senator Cruz has won this battle, although what he wins we don't yet know. I mean, here's the reality, John Boehner had no option but to go ahead with this. Guys like Ted Cruz and the Club for Growth and Heritage Action (ph) had suggested this was a matter of principle that Republicans vote for this. So Boehner didn't have enough votes to do anything but have a vote on this. This now goes to the Senate. But, yet, already, we've had Senator Cruz and everyone acknowledge what everyone should've known from the start, they don't have the votes to pass this in the Senate.

    GIGOT: All right. So --

    STRASSEL: So Harry Reid is going to pass it out and send it back to the House and we're looking at potential shutdown.

    GIGOT: And we don't know what the House will do there.

    But is there, Dan, is there a strategy here that you can detect to achieve some kind of outcome? And what is that outcome?

    DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: Well, the outcome presumably is to repeal or somehow overturn --

    GIGOT: I know, but I've talked to these people privately, Dan. They don't think they're going to -- even Ted Cruz and Jim DeMint and these guys, they say, well, we're not going to be able to defund ObamaCare.

    HENNINGER: Well, Ted Cruz has said publicly that he thought he was going to some sort of generate grass-roots uprising the way people were molded against going to war in Syria and he was going to do something similar here. ObamaCare, whatever feelings are about it out there, it was not going to produce a grass-roots uprising. So to the extent he has a victory, it's going to be a pyrrhic victory.

    Now my understanding is that Harry Reid is going to do is hold a series of votes. A couple of these procedural votes are going to allow the Republicans to vote for the measure that deletes funding for ObamaCare. But after the second procedural vote, he's only going to need 54 votes to pass more amendments. And that is when they will vote to simply strip it out --

    (CROSSTALK)

    HENNINGER: -- send it back to the House. The House is, I think, going to vote for the clean continuing resolution and move on, having made this, quote, unquote, "point."

    GIGOT: I'm not so sure that that might -- I mean, that might be true, but are you sure they can get a clean resolution through? Or are we back to the place where they're going to send another bill with the de-fund ObamaCare thing over to the Senate and we do go to a possible shutdown?

    JOE RAGO, EDITORIAL BOARD MEMBER: Right, well, they're transferring the leverage to the Senate where the main Democratic goal is to delete the sequester, increase --

    GIGOT: These are the automatic spending cuts that have been taking place and are already law. And the Democrats don't like that. They want to get rid of that.

    RAGO: Right, and they will if the House can't get 218 votes for a bill.

    GIGOT: What do you think is going to happen?

    RAGO: We're headed towards a shutdown. Everything's getting folded into the increase in the debt ceiling where it's a hostage Republicans can't shoot, so they're losing their leverage. And the guys who are pushing this plan just do not have a rational end game here. They're going to lose everything on health care and they're going to lose on domestic spending.

    GIGOT: So you're not very optimistic about this.

    But, Kim, the best case scenario the Republicans say, look, if it goes to a shutdown, the voters will blame the president for doing it because he's so insistent on keeping ObamaCare. When the public turns on the president, then they'll force some kind of concessions on the Democrats, maybe a delay for a year on ObamaCare. Is that the best-case scenario you can see here?

    STRASSEL: It's the best-case scenario but it's also wishful thinking, Paul. There's not one shred of evidence out there in polls that if a shutdown comes, the president is going to take the blame for it. He'll have the media on his side. He'll have the bully pulpit. He will put this on Republicans' shoulders. And in the best-case scenario, Republicans will share the blame which ought to be the last thing they're looking for as they go into this next election hoping to take back the Senate and keep the House.

    GIGOT: What's the worst case scenario, Dan?

    HENNINGER: The worst case is the shutdown and then this tsunami of bad publicity washes over the Republicans. They have no strategy for dealing with that.

    Paul, I kind of doubt it's going to happen. Senator Mike Lee, of Utah, who is associated with Cruz on this, has said, shutdowns are bad, it's not worth shutting down the government over this bill. I think they're going to step back from the brink.

    GIGOT: From the brink. But if they don't and some Republicans insist on that kind of a showdown, could they put the House majority in jeopardy?

    HENNINGER: I think they could put the House majority at risk with this strategy.

    GIGOT: In 2014.