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Supreme Court Upholds Affordable care Act

Chief Justice John Roberts saved his legacy for the history books but he had to tie himself in knots to do it. The first question the Supreme Court had to answer is whether the penalty for not buying insurance is a tax or a fine. You might think: "Who cares?" but the answer is: "The law." If the penalty is a tax, a law called the Anti-Injunction Act says that no one can sue over a tax until the tax has been assessed and paid. Since no one will pay the penalty until 2014, the Supreme Court could have kicked the can down the road and said the penalty was a tax and thus no one has standing to sue until 2014. Both the Attorneys General bringing the suit and the federal government argued that the penalty was not a tax and the case could go forward. The Court agreed and said the Anti-Injunction Act was therefore not applicable.

With me so far? The penalty is not a tax. Then the key point of the case came up: can Congress force everyone to buy insurance or face a fine on the grounds of the interstate commerce clause. Remember that the Court had ruled earlier in Gonzales v. Raich that growing your own marijuana for medical use in states where that is legal constitutes interstate commerce. With such an expansive definition of interstate commerce, one might have thought that something that deeply affects 18% of GDP would qualify as interstate commerce. However the Court ruled that the mandate did not fall under Congress' power to regulate interstate commerce. Probably the conservatives on the Court did not want to expand the definition of interstate commerce any more than they had done in Gonzales v. Raich.

So the Court ruled the ACA unconstitutional? Not so fast. It said the penalty was a tax and Congress has the power to levy taxes, so the ACA was fine. But didn't the Court first determine the penalty was not a tax to avoid the Anti-Injunction Act? Yes. So the penalty is not a tax for purposes of the Anti-Injunction Act but is a tax for purposes of Congress having the power to levy it? Generally, the purpose of a tax is to raise revenue (which the mandate is not), although there are a few counterexamples like cigarette taxes, which are also intended to influence behavior. Still, the tax/not tax business is splitting hairs, like legally determining that the number of angels that can dance on the head of a pin is 6.022 x 10^23.

Most likely Roberts felt that universal health care was going to happen one day and he didn't want to go down in the history books as another Roger Taney, the Chief Justice who wrote the majority opinion in the Dred Scott case. Taney ruled that slaves were private property and if one ran away, he had to be returned to his lawful owner. History does not look kindly on Chief Justice Taney. Roberts did not want to damage the Court's prestige by being on the wrong side of history again. So he invented this rather contorted "it's not a tax but it is a tax" story to get to where he wanted to go. So, in truth, the bottom line is that four justices wanted to kill the ACA on ideological grounds, four wanted to save it on ideological grounds, and Roberts was mostly concerned with his place in history and the Court's reputation, and it just happened that siding with the liberals in this case would achieve his goals. But to say this decision (or any decision in this case, for that matter), can be derived from a close reading of the Constitution is absurd.

If one tries to imagine how Gouverner Morris, Thomas Jefferson, John Adams, and the others who wrote the Constitution would have felt--in an era when most Americans were yeoman farmers or craftsmen living in small towns--they would surely have found it preposterous that the federal government require people to buy insurance. But they would also have found it unbelievable that the federal government required hospitals to treat anyone who showed up for emergency care for free if they couldn't pay. In their view, that would have been a state issue, not a federal issue, since hospitals did not operate across state boundaries then. They also probably could not have imagined the federal government licensing the electromagnetic spectrum or sending rockets to the moon. A lot has changed since 1788 and not every modern dispute can be resolved by looking at the text of the Constitution.

Politically, this has to be scored as a big win for President Obama. The main achievement of his administration is legal and will probably go into effect in 2014 no matter what happens in the election. Obama praised the Court decision but Romney said: "What the court did not do on its last day in session, I will do on my first day if elected president of the United States. And that is, I will act to repeal Obamacare." Notice the precise wording. To low-information voters, it sounds like he will repeal Obamacare on his first day in office. But of course he knows very well that Presidents cannot repeal laws. Only Congress can. So what he really meant was: "On my first day in office, I'll ask Congress to repeal it."

But if the Democrats control either chamber of Congress, nothing will happen and the law will go into effect as planned. If the Republicans control both chambers, then Romney can expect a Democratic filibuster to prevent repeal. What is possible is to use the budget reconciliation process to repeal that part of the law that affects the budget but reconciliation cannot be used to repeal things that don't affect the budget. Now that the penalty for not buying insurance is officially a tax, the Republicans could reduce the tax to $0 using reconciliation, but the Byrd Rule requires offsetting revenues. If the tax is as huge as they say it is, they would have to raise major revenue from some other source to make the whole operation budgetarily neutral. If the Republicans control everything and decide to go this route, do they really want to spend months wrangling over repeal and thus opening themselves to attacks in 2014 for ignoring the jobs issue?

The big unknown at this point is who gains from the Court's decision. It will be very difficult for Republicans to label Roberts as a liberal activist judge, so they are faced with the fact that a very conservative justice has said Obama was right. Now that the penalty has been declared to be a tax (sort of), they can certainly attack the Democrats for levying an onerous new tax on the population, but that is unlikely to gain traction since (1) most people won't be paying it and (2) it won't even cut in until 2014. Of course, they will continue to say they will repeal and replace the law, but so far no Republican has said what they would replace it with. They are unlikely to do so because eliminating the mandate while keeping the ban on pre-existing conditions will cause insurance premiums to spike.

It is likely that Romney will continue to rail against Obamacare without saying why, without saying what he would replace it with, and without explaining why it is so much worse than Romneycare. He will keep the discussion as general as possible and avoid all details.

In contrast, the Court's decision gives Obama an opening to talk about the details, all of which except the mandate are quite popular. If his strategist David Axelrod wants to play hardball, the TV ads practically write themselves. How about one featuring an adorable 6-year girl whose mother is in tears because her daughter has cancer but no insurance company will take her due to her pre-existing condition? But thanks to Obamacare, no insurance company may refuse her now so she can be saved. Best done with melodramatic violin music in the background. Or how about a middle-aged man with congenital heart disease saying that he needs heart surgery but he has hit his lifetime limit on insurance payouts so he can't have the operation. But with Obamacare, lifetime limits are illegal. There is a lot of material to work with. Of course, this decision will fire up the Republican base, but it does not provide Romney the kind of material that Obama has to make emotional TV ads. Maybe something about (nonexistent) death panels, although when you say something that is blatantly not true it could become a news story in itself.

A number of pundits have said that Romney should be relieved that Romneycare is now legal, but that is nonsense. The Constitution enumerates the powers of the federal government and the tenth amendment leaves everything else to the states. No one really doubts that if a state wants to mandate that its inhabitants eat broccoli every day, that is probably legal. It is just the federal government that can't do it--unless it imposes a tax on nonbroccoli eaters.

Today's Presidential Polls

State Obama Romney   Start End Pollster
Michigan 47% 43%   Jun 24 Jun 25 Marist Coll.
North Carolina 46% 44%   Jun 24 Jun 25 Marist Coll.
New Hampshire 45% 45%   Jun 24 Jun 25 Marist Coll.

Today's Senate Polls

State Democrat D % Republican R % I I % Start End Pollster
Arizona Richard Carmona 31% Jeff Flake 47%     Jun 26 Jun 26 Rasmussen

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