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June 29th, 2012
By Dan Miller
The majority decision distorts the Constitution to uphold ObamaCare. As bad as ObamaCare is, the decision transcends ObamaCare most perniciously because it expands the power of the Congress to interfere in countless other ways as yet unknown in how we live our lives.
John Turley today noted that having decided that the ObamaCare individual mandate is outside the authority of the Congress under the Commerce Clause, the Supreme Court found the requisite authority in the congressional authority to tax.
But no sooner had Roberts proclaimed his love for federalism than he effectively killed it. Roberts held that the individual mandate still fell squarely within the taxing authority of Congress. If so, all those “broccoli” questions asked by Roberts and other justices simply move over to the tax side. If Congress can “tax” people for not having health insurance, how about taxes on people who don’t have cellphones (as Roberts asked)? Just as there was no clear limiting principle in the commerce clause debate, there is a lack of such a principle in the tax debate. Instead, Roberts simply says the individual mandate is supported by a “functional approach” that has long allowed federal taxes to “seek to influence conduct” by citizens. …
It is hard to see who will be the ultimate winner from this decision. But the biggest loser is federalism. Roberts lifted it up only to make it an exquisite corpse. In that sense, the decision reads like the funeral speech of another character in Julius Caesar. To paraphrase Mark Anthony, Roberts came to bury federalism, not to praise it.
I agree; however it may be worse than that.
These excerpts from Chief Justice Roberts’ majority decision attempt to explain that congressional language to the contrary notwithstanding, the individual mandate is a tax.
Beginning in 2014, those who do not comply with the mandate must make a “[s]hared responsibility payment” to the Federal Government. §5000A(b)(1). That payment, which the Act describes as a “penalty,” is calculated as a percentage of household income, subject to a floor based on a specified dollar amount and a ceiling based on the average annual premium the individual would have to pay for qualifying private health insurance.
The Act provides that the penalty will be paid to the Internal Revenue Service with an individual’s taxes, and “shall be assessed and collected in the same manner” as tax penalties, such as the penalty for claiming too large an income tax refund.
The decision then tries to explain why the individual mandate, although labeled a “penalty,” may be deemed a “tax” because that seems to have been what the Congress desired. The attempted explanation is a tortured one and makes very little sense. However, the precedent has been established. In consequence, the Congress now has wide discretion to regulate almost anything it wishes under its taxing powers. That is illustrated by this portion of the decision:
In making its Commerce Clause argument, the Government defended the mandate as a regulation requiring individuals to purchase health insurance. The Government does not claim that the taxing power allows Congress to issue such a command. Instead, the Government asks us to read the mandate not as ordering individuals to buy insurance, but rather as imposing a tax on those who do not buy that product. …
Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes. See §5000A(b). That, according to the Government, means the mandate can be regarded as establishing a condition—not owning health insurance—that triggers a tax—the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance. Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earning income. And if the mandate is in effect just a tax hike on certain taxpayers who do not have health insurance, it may be within Congress’s constitutional power to tax. (Emphasis added.)
The thesis appears to be that just as the Congress can tax the purchase of gasoline, so can it tax the non-purchase of gasoline and therefore the non-purchase of insurance. That does not follow; the Congress has not taxed the non-purchase of gasoline. Nor does the thesis appear to be supported by the other examples cited in the decision — taxes on the purchase of imported goods to promote the sale of domestic goods, taxes on the purchase of marijuana and tobacco to discourage their use, etc. The Congress has not taxed (previously) the non-purchase of domestic goods or, for that matter, services.
The question is not whether that is the most natural interpretation of the mandate, but only whether it is a “fairly possible” one…. The Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution. Granting the Act the full measure of deference owed to federal statutes, it can be so read, for the reasons set forth below.
Were I writing a law review article it would be appropriate, as an intellectual exercise, to dissect and criticize the Court’s reasoning by citations to prior authority and scholarly commentary. It might also be useful to consider whether the Court’s decision will spur to greater activity the Law of Unintended Consequences or whether the effects were actually intended and thought good. However here, for more practical purposes, that is not relevant because the Supreme Court has spoken and what it said will likely remain “the law of the land” until some later Supreme Court changes it.
Continuing from the majority opinion,
If it is troubling to interpret the Commerce Clause as authorizing Congress to regulate those who abstain from commerce, perhaps it should be similarly troubling to permit Congress to impose a tax for not doing something.
The Court then attempts to explain why it does not see that as a problem.
Congress’s use of the Taxing Clause to encourage buying something is … not new. Tax incentives already promote,for example, purchasing homes and professional educations. See 26 U. S. C. §§163(h), 25A. Sustaining the mandate as a tax depends only on whether Congress has properly exercised its taxing power to encourage purchasing health insurance, not whether it can. Upholding the individual mandate under the Taxing Clause thus does not recognize any new federal power. It determines that Congress has used an existing one.
There are various ways to “encourage” people to do or to refrain from doing things. It has long been considered constitutional to provide tax credits and deductions for purchases deemed desirable. It would be consistent with the Constitution to provide annual tax deductions and credits to people who purchase approved health insurance policies, even in amounts substantially greater than the annual costs of such policies. Whether doing so would be bad policy is not for the Court to determine. However, the imposition of additional taxes on those who do not make such purchases is a novelty. Still, according to the Court, that does not much matter because only money is involved.
[A]lthough the breadth of Congress’s power to tax is greater than its power to regulate commerce, the taxing power does not give Congress the same degree of control over individual behavior. Once we recognize that Congress may regulate a particular decision under the Commerce Clause, the Federal Government can bring its full weight to bear. Congress may simply command individuals to do as it directs. An individual who disobeys may be subjected to criminal sanctions. Those sanctions can include not only fines and imprisonment, but all the attendant consequences of being branded a criminal: deprivation of otherwise protected civil rights, such as the right to bear arms or vote in elections; loss of employment opportunities; social stigma; and severe disabilities in other controversies, such as custody or immigration disputes.
By contrast, Congress’s authority under the taxing power is limited to requiring an individual to pay money into the Federal Treasury, no more. If a tax is properly paid, the Government has no power to compel or punish individuals subject to it. We do not make light of the severe burden that taxation—especially taxation motivated by a regulatory purpose—can impose. But imposition of a tax nonetheless leaves an individual with a lawful choice to do or not do a certain act, so long as he is willing to pay a tax levied on that choice.
The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness. (Emphasis added.)
The authority to tax — the power to destroy — gives the Congress tremendous power to do stupid as well as wise things. Let’s consider a not very farfetched example. Suppose the Congress were to increase the income tax rate by fifty percent for all eligible citizens who fail to vote in a specified Federal election; voting is good and should therefore be encouraged. Perhaps fifty percent is too much; how about ten percent? As to ObamaCare, the Court said, “we need not here decide the precise point at which an exaction becomes so punitive that the taxing power does not authorize it.” It would, therefore, be up to the Congress to decide how high is too high and (only maybe) for the Court later to second guess it. That provides slim comfort at best. The Congress could probably accomplish much the same thing by decreasing the tax rate, providing tax credits or tax deductions in whatever amount it might wish for those who do vote, so why should it be unable to increase as much as it might wish the taxes of those who don’t vote? Based on the Court’s decision, a distinction is far from obvious.
This post merely scratches the surface of what the Congress can now do via its taxing powers to
force encourage people to do whatever it, in its infinite wisdom, considers good — be it good for CongressCriters themselves, for previously deprived U.S. citizens or residents, for the country, for the global environment or for peace on Earth and good will to men.
The power to tax far transcends the power to regulate commerce under the Commerce Clause. The related problems transcend President Obama, the Congress and even ObamaCare itself. Although repealing ObamaCare, defeating President Obama and electing conservatives to the Congress will make many of us happy, that will neither expunge the precedent created by the Court majority nor ensure that no future Congress will do something similar in the health care or any other context. It will not matter (nor should it, based on years of jurisprudence) whether the enactment is bad policy or just plain stupid. As the Chief Justice noted near the beginning the decision,
We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders. We ask only whether Congress has the power under the Constitution to enact the challenged provisions. …
“Proper respect for a co-ordinate branch of the government” requires that we strike down an Act of Congress only if “the lack of constitutional authority to pass [the] act in question is clearly demonstrated.” United States v. Harris, 106 U. S. 629, 635 (1883). Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.
That is all true and correct. The Supreme Court does not guard us against absurd congressional policy decisions. As to actions, wise or stupid, that contravene the Constitution we can rely on the Constitution alone, as interpreted by the Court (or perhaps on the veto power of the President) to prevent them. True, we can try to elect to the Congress and to the presidency only people who can be trusted to make wise and fair decisions; how’s that been working out? True also, we can also watch how our CongressCritters and President vote and refuse to reelect those with whose decisions we disagree; how’s that been working out?
Perhaps a constitutional amendment forbidding the Federal taxation of failures to purchase goods and services would help. Under Article V, an amendment can be proposed by the Congress upon the vote of two thirds of its members or the Congress, “on the Application of the Legislatures of two thirds of the several States, [the Congress] shall call a Convention for proposing Amendments.” An amendment proposed by the Congress or by the convention becomes effective as part of the Constitution
when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress;
The Constitution was intentionally made very difficult to amend, and that is a good thing. Unfortunately, good and reasonable amendments are no less difficult to achieve than are bad and frivolous amendments.
The only hopeful aspect of the ObamaCare decision is that it may encourage greater wisdom in electing our CongressCritters and Presidents. I hate to end on a sour note, but how likely does that seem?
(This article was also posted at Dan Miller’s Blog.)
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