Sources: Matheson (UT) released by Pelosi to vote no

Everything I'm hearing and seeing suggests that Democratic Utah Rep. Jim Matheson's announcement that he will vote "no" on the health care reform package was done after Speaker of the House Pelosi released him to do so.

Matheson apparently was ready to vote "yes" on the legislation if his vote was necessary to put the Democrats over the top.  Because such a vote would hurt Matheson in the upcoming November elections, however, he and the House Democratic leadership agreed to delay finalizing his vote until it was clear whether or not they needed a "yes" from him.  Hence the late timing of his decision.  (This is exactly what I suggested might happen in this article earlier today.)

We'll get a sense if this scenario is true or not based on at least two things.

First, if the vote goes for the Democrats with more than just one or two votes in their favor, that will be a pretty strong tipoff that Matheson was released.

Second, it will be useful to keep an eye on what Matheson does over the course of the next 24 hours.  I doubt we'll see it, but if there's clear evidence that he's been out and about persuading other fence-sitting Dems to vote "no," we'll know that my sources were feeding me dogfood.

As health care reform's chances improve, Democratic party election prospects for 2010 and 2012 drop

As I predicted a few days ago, President Obama is now telling Democratic members of the House that, instead of being hurt by a vote in favor of the party's health care reform package, they actually will benefit from passage of the proposed legislation.

He is quoted as having said "all Democrats would benefit from a health care win."  He also argued that his Presidency would receive a significant boost if the health care reform package is passed.

This is a narrative that party liberals, sensing a unique opportunity to balloon the government's role in health care, desperately want their more moderate and conservative House members to believe.

But trading at the prediction market Intrade, where investors make or lose real money if their bets are wrong, are telling a story completely opposed to the one being told by President Obama and senior House Democrats.

It's generally well known that the Intrade contract tied to the passage of the health care reform package has gone up noticeably over the course of the last month.  This is clearly evident in the price history graph below.  It suggests that the chance of the health care bill becoming law by June 30th has increased from 30 percent to about 70 percent.

If President Obama's story is correct, and passage of the bill will be good for all House Democrats -- and for the Obama Presidency -- then the bill's improving prospects over the past month should have been reflected in at least two key ways.

First, there should have been an increasing likelihood that the Democrats will be able to hold on to their majority in the House after this fall's elections.

Oops!  The Intrade contract on that subject shows exactly the opposite (see below).  

While the chances of health care reform becoming law increased, the chance of the Democrats holding on to the House dropped from 58 percent to 52 percent. 

Second, for the President's argument to hold water, the chance of the Democrats retaining the Presidency through the next election also should have increased over the course of the last month.

Oops again!  The Intrade contract for this topic once again shows trends going in exactly the opposite direction (see below).    

A month ago, the chances of a Democrat -- presumably President Obama -- winning the next Presidential election were about 58.5 percent.  At the end of the day yesterday, the chances were down to about 55.5 percent.

There are, of course, all kinds of caveats one should make about these numbers.  I've argued in my previous article, for example, that the health care reform Intrade contract probably overstates the chances of the Democratic billl becoming law.

But, even with all those caveats, the story is pretty transparent.  If health care reform passes, it will be bad for House Democrats overall, and it will be bad for the Democrat's chances of holding on to the Presidency come 2012.

These numbers may not fit with the left-wing, Big Government objectives of President Obama -- who (moderate and conservative House members note!) made it very clear he'd rather be a "good" one-term President instead of a "mediocre" two-term President.

But the numbers do reflect actual bets made by people wagering their own hard earned dollars.

And, besides, remember what what House Speaker Nancy Pelosi  said earlier today: "I love numbers. They're so precise."

Update (3/18, 8 pm) - Don't buy what I've just written?  Consider this.  Over the past few days, the health care reform ("Obamacare") contract at Intrade has been at its highest level ever.  And today, for the first time ever, President Obama's average net approval rating turned negative at the polls tracked by RealClearPolitics.com.