Supreme Court to America: Surprise!

This article first appeared in the Pittsburgh Post-Gazette on July 4, 2012.

Now voters will decide whether to overrule the justices on Obama’s health care law

By David J. Porter

The Supreme Court’s 5-4 decision upholding the Affordable Care Act gives new significance to then-Speaker Nancy Pelosi’s prophetic assertion that congressional Democrats had to pass Obamacare before we could find out what is in it. Now that the bill is law, Chief Justice John Roberts has informed the country that its most controversial provisions are not, as everyone believed, a regulation of individuals and health care markets, but in fact a huge tax.

The court’s decision is surprising in several respects. First, the Obama administration and Congress deliberately structured the individual mandate as a penalty assessed for failure to comply with the new legal requirement to purchase health insurance. Indeed, congressional Democrats rejected an earlier version of the ACA precisely because it imposed a tax for noncompliance when the enforcement mechanism they really wanted, and ultimately used, was a penalty. The administration primarily defended the law in court as a penalty. Even Chief Justice Roberts acknowledged that his interpretation exceeds the most natural reading of the statute. The court’s ruling sits uneasily with the law’s history, structure and text.

Second, 26 states and other challengers successfully focused the entire country’s attention on Congress’ constitutional authority to compel individual purchases through a regulatory mandate. More important, the court agreed with them, holding that Congress lacks power under the Commerce Clause to impose such mandates. By fully embracing the challengers’ interpretation of the Commerce Clause and the Necessary and Proper Clause, the court laid down a bright marker further defining the outer reach of congressional power. It is unsettling that the ACA challengers were able to define and prevail on the central legal issue in the case and yet lose.

Third, before the court’s decision, when many expected the individual mandate to be stricken as an unconstitutional overreach of congressional power, liberal politicians and commentators mounted a pre-emptive attack on Chief Justice Roberts, openly questioning his integrity by characterizing the Roberts Court as hyper-partisan. In the immediate wake of the ACA decision, it has been amusing to hear Chief Justice Roberts’ erstwhile critics praise him as the guardian of a newly credible judiciary.

The final sense in which the Obamacare decision is surprising involves legislative process and public accountability. Over and over again, President Barack Obama, administration officials and congressional Democrats denied that the unpopular individual mandate is a tax and assured the nation that the ACA does not raise taxes on the middle class. The court’s majority opinion shows that those representations were false. Regardless of whether one believes Obamacare is sound policy, its judicial validation on grounds that Congress rejected and the law’s supporters strenuously disclaimed should give everyone pause.

In one sense, National Federation of Independent Business et al v. Sebelius is a classic lesson in federalism, one of the key structural features (along with separation of powers, checks and balances, and judicial review) of the constitutional design and the founders’ unique contribution to political theory. In addition to imposing real limits on Congress’ power under the Commerce Clause, seven justices accepted the challengers’ argument that states may not be “coerced” through onerous conditions attached to federal spending grants. On that basis, the court held that the ACA’s extensive Medicaid expansion provisions are unconstitutional and essentially made them optional.

The court has always treaded lightly around what it once endearingly called “Our Federalism,” and in recent decades the justices have reminded us why federalism matters. The Constitution does not protect state sovereignty as an end in itself or out of regard for some hoary notion of states’ rights. Rather, the court has explained, “federalism secures to citizens the liberties that derive from the diffusion of sovereign power.” That is surely what Justice Anthony M. Kennedy had in mind when he suggested at oral argument that the individual mandate “changes the relationship of the federal government to the individual in a very fundamental way.” Tellingly, Chief Justice Roberts’ majority opinion employed the same language.

But whereas Chief Justice Roberts limited Congress’ power in this important respect, he expanded it through a broad reading of the taxing power. In 1819, Chief Justice John Marshall famously warned that the power to tax is the power to destroy. It may therefore be cold comfort to those concerned about excessive federal power that Congress can reach through taxation what it may not regulate directly.

On the other hand, Americans tend to have strong opinions about tax increases and elected officials enact new taxes at considerable political peril. Now that the Supreme Court has explained how congressional Democrats enacted a massive tax disguised as a penalty, it will presumably be much harder for another Congress ever to do it again.

Aside from the fascinating legal issues, NFIB v. Sebelius is a political thunderclap. The court’s decision upholding President Obama’s signature legislative accomplishment will likely conjure up some of the passions of 2009-2010, with only a few months remaining until the presidential election. The original anxiety over the legal fate of Obamacare will be replaced by new uncertainty until the nation decides at the polls this fall whether to sustain or overrule the Supreme Court.

David J. Porter is an attorney with Buchanan Ingersoll & Rooney PC (david.porter@bipc.com). The opinions expressed here are his own.
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