Are We There Yet?

March 30th, 2011

By Brian Bagent

Health Care and the Individual MandateEvery parent has heard this more times than we care to remember, but this isn’t about parenting.  I’m talking about the days of the ultimate inversion.

The set-up has been a long time coming, but I think we’re about there. Year before last, when then-Speaker Nancy Pelosi was asked about constitutional authority regarding O-care, she responded that nobody questions Congress’ authority to regulate insurance.  That’s true as far as it goes, but what did she mean, what is that authority, and authority to do what?

Insurance is regulated as interstate commerce, but there is more to it than that.  As we’ve discovered, and as has been defended in court, this Administration’s position is that the Commerce Clause may be used to compel us to buy health care insurance.  That’s certainly a stretch, for how can the government force us to buy anything?

Well, unfortunately, there is precedent.  In the Agricultural Adjustment Act of 1938, the federal government granted itself some extraordinary power.  It established its power to regulate agricultural activity to the extent that even mere intrastate agricultural commerce ultimately affects interstate commerce.  Well, no s**t kidding, but that wasn’t the intent of that clause.

In Wickard v Filburn (1942), a farmer was penalized for growing more wheat than the Act permitted him:

The appellee filed his complaint against the Secretary of Agriculture of the United States, three members of the County Agricultural Conservation Committee for Montgomery County, Ohio, and a member of the State Agricultural Conservation Committee for Ohio. He sought to enjoin enforcement against himself of the marketing penalty imposed by the amendment of May 26, 1941, to the Agricultural Adjustment Act of 1938, upon that part of his 1941 wheat crop which was available for marketing in excess of the marketing quota established for his farm.

The appellee had a small farm where he grew winter wheat for personal consumption as flour, to feed his livestock and poultry, for seed stock, and to sell whatever might be left over.  His problem was that he grew more wheat than federal law permitted.  The reasoning is identical to what Pelosi and the rest of the O-care crowd are arguing:  by growing more than he was permitted, he affected interstate commerce by not buying wheat from somebody else.  The issue in Wickard v Filburn didn’t meet the definition of “commerce” as held mostly since the inception of the republic:  commerce was buying and selling and the transportation that made the buying and selling possible.  And even more than that, the commerce clause was largely intended to prevent trade wars between the several states.  To that end, the commerce clause was very successful.  The success of our economy was in large measure due to the fact that commerce between the states was the ultimate “North American Free Trade Agreement.”

Fast-forward to today.  Not only has the Commerce Clause morphed into a power not dreamed of by our founders by regulating manufacturing, labor, agriculture, and industry rather than the mere trading and transportation of the things those industries produce, it has apparently become a billyclub to force us to buy things which we may not wish to buy.  In fact, it has transformed so much that not doing anything at all is considered commerce.

Could we possibly get more Orwellian?  War is peace, freedom is slavery, ignorance is strength.  And now, we must add “non-commerce is commerce” (even as loosely as commerce has been defined for the last 60 or 70 years).  Is there a more glaring example of doublethink?

I recently planted a small fruit orchard:  figs, plums, pears, and peaches.  Next year, I’ll add grapes, muscadines, quince, paw-paw, and mayhaw.  The precedent is established — the government could come after me for producing in excess of what I can personally consume.  No, there are no quotas (at least none that I am aware of) on any of those fruits.  And even if there were, I am small-time.  Nevertheless, the power has been established, and the fact is that I do not know whether or not I might be pursued.  And if you think about it for a moment, that’s the real problem.  Anybody can grow accustomed to a very strict legal system where laws are enforced uniformly.  It is the wanton and irrational enforcement of laws that is the problem.  If you doubt it, only give some consideration to how the IRS operates.

Which brings us back to O-care.  Apparently, O-care is a great idea for everyone, except when it isn’t and except to the friends of Obama who don’t think it’s so great and are being excused from participating in it.  In short, those with political pull can opt out.  The rest of us just have to eat that Vaseline sandwich.  If you want out, you have to be a FOO (friend of Obama), or pay homage to him in some way.

To those who understand the constitution rather differently than I do, this may not be a big deal.  But for me, this expanded power infringes on a right so fundamental to a free people that it was not even mentioned in the constitution:  the freedom of association.  It appears that we are going to be forced to associate with people or businesses that we have no interest in.

Sadly, in these days of seemingly perpetual violence and threat of war over the trade of scarce resources (most notably oil), we’ve lost sight of what freedom from compulsion, what free trade can get us.  Some years ago, Milton Friedman gave a lecture called “The Lesson of the Pencil.”  We can move closer to perpetual peace through free trade than all of the bombs, guns, and ships, religion, peace protests, and congressional missives could in a million years.  Freedom is the engine that makes wealth possible, not compulsion.  This is only about a 10 minute video.  We should all watch it until we have it memorized.

So…back to my original point.  Are we there yet?  One of my favorite philosophers, Ayn Rand, penned, about 50 years ago, this:

…the race goes, not to the ablest at production, but to those most ruthless at brutality. When force is the standard, the murderer wins over the pickpocket. And then that society vanishes, in a spread of ruins and slaughter.

Do you wish to know whether that day is coming? Watch money. Money is the barometer of a society’s virtue.  When you see that trading is done, not by consent, but by compulsion — when you see that in order to produce, you need to obtain permission from men who produce nothing — when you see that money is flowing to those who deal, not in goods, but in favors — when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you — when you see corruption being rewarded and honesty becoming a self-sacrifice — you may know that your society is doomed. Money is so noble a medium that it does not compete with guns and it does not make terms with brutality. It will not permit a country to survive as half-property, half-loot. [emphasis added]

If O-care survives the Supreme Court, you can rest assured that we are there.  Even in Wickard v Filburn, the scope of application was rather narrow — it applied only to farmers and farming.  O-care applies to us all.


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4 Responses to “Are We There Yet?”



  1. Tom Carter |

    Brian, I agree with you, although we’re probably coming at this from slightly different directions. One of the many unfortunate things about ObamaCare is that it depends so heavily on forcing citizens to make a decision to buy something that they otherwise wouldn’t have to buy. It’s one thing to say that deciding not to do something is a decision (DC district court), but how about people who ignore the whole thing and don’t make a decision at all? The implication is that the government somehow knows what’s going on in our heads.

    I understand that a huge number of uninsured people have made the decision to be uninsured even though they have the money to buy insurance, and I know this adds to overall health costs that the rest of us must fund through taxes. But there has to be a better way.


  2. Brian Bagent |

    Tom, O-care wasn’t the point of the essay, it was but an example, a symptom, as was Wickard v Filburn, of a much larger problem, namely that far too many liberals don’t give a whit about freedom, or at least do not understand it and why freedom is better than force for everybody. If this crowd can be so absurd as to suggest that not choosing to engage in commerce is actual commerce, that we MUST BE FORCED to do “the right thing,” then we are doomed.

    If we can be compelled by the federal government to buy health insurance, what other magic beanstalk beans are these people going to find in the constitution that permits them to force us to buy anything?

    In the context of O-care, the link to the Friedman video doesn’t make much sense. But in the context of the idea that freedom solves far more problems than force ever will, it fits perfectly.

    We cannot abandon the principles that enabled us to be the economic engine for the world if we wish to retain that position. Do you imagine for an instant that if China or India becomes the biggest economy in the world that there will be people risking death to get to those places as people have been doing to get here for the better part of 125 years?


  3. Tom Carter |

    The Friedman video is very good, and I agree that everyone should watch it. It’s an excellent explanation in simple terms (rare for an economist) of how markets and trade work.

    Another good example of a simple fact of economics that some people don’t understand is business taxes. Leftists often mindlessly support higher taxes on businesses without having a clue that those taxes are actually paid by consumers.

    But to your larger point — I certainly agree that controls, regulations, and laws often come at the cost of basic freedoms. More than that, they may violate the principles that made the U.S. an economic and political power. Some of that may be necessary, and everything is a compromise. But more and more it seems to me things are going too far.


  4. Brian Bagent |

    I’d also add that anyone in support of business taxes does so mindlessly. A business ledger basically shows two things: expenses (cost of doing business), and income. Taxes obviously are not income; therefore, they are a cost of doing business. All costs of doing business are ultimately passed on to the consumer in the form of higher prices. In essence, federal corporate/business income tax is a hidden sales tax.

    I think that what I most want anyone to take away from this is that in spite of the uncertainties of a free market, it has demonstrated time and again that it fills the larder better than force.


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