Thursday, June 28, 2012

One more thought

I am no lawyer and no expert on Obamacare. Perhaps the tax argument was just fine in this case. I'll defer to others on that.

The more obvious argument to me in the lead up to this ruling was to say that Congress unambiguously has the authority to spend for the general welfare (and it's doing a lot of that with this reform), and it unambiguously has the authority to do anything "necessary and proper" to accomplish anything that it has the authority to do under Article 1 Section 8. You could make a good argument that the mandate is "necessary" and "proper" for carrying out its spending for the general welfare. Ergo, it's perfectly constitutional.


  1. In order to make that case, I think the mandate should have been structured as an actual tax, whereby the government then directly pays for the insurance claim of anyone without care. As I read the current mandate (which may be incorrect), individuals must pay for healthcare or face being taxed by the govt. Where I struggle with this ruling, is what happens if Congress decides everyone must be renters/auto/home/life insurance or be taxed? How about buy a car/house or be taxed? This topic is certainly not my strength but it appears those outcomes are now constitutionally acceptable.

    1. We face different tax rates for all kinds of things. People who pay mortgage interest pay different taxes than others. People without children pay higher taxes. This is all constitutional. The Congress has the authority to lay taxes.

      If it's constitutional for people without kids to pay a higher tax, why isn't it constitutional for people without insurance to pay a higher tax?

    2. If it's constitutional for people without kids to pay a higher tax, why isn't it constitutional for people without _______ to pay a higher tax?

      Is there any limit here Daniel? What will not go into the blank, according to your argument? What about: Evidence of voting? An electric car? A smart phone? Are you saying that ANY non-act can be punished?

      ACA: You haven't done x, therefore you're punished.
      Crime: You have done x, therefore you're punished.

      If it's constitutional to imprison for unapproved active behaviors, then why not for unapproved passive behaviors?

      Draw a line, Daniel. Where does this stop?

    3. Daniel,

      It's true we pay taxes at different rates and its also true that we receive different amounts of goods or services for those taxes. The mandate however does not collect any taxes in order to provide a good or service to the public. The mandate forces you to pay a tax if you don't purchase a good from a private company. If the taxes were collected by the state and then paid to insurance companies your argument would hold, but that's not the case. Regardless, the court upheld the law so now we can all, on average, pay more for health insurance.

  2. It turns out that under article I section 8, Congress did not have authority to pass the mandate as the court decided. It wasn't cafeteria constitutionalism. This was a hard case.

    As for the argument that it is a tax, I disagree with the outcome. Mostly, I find it troubling that Congress could use its taxing authority while telling everyone that they are not passing a tax. But there are also some actual legal arguments which just happened to not prevail.

  3. Luckily none of this is relevant to me (I've never paid taxes and I always have had insurance). That's probably the only reason that I don't really care one way or the other.

    1. Well, except for FICA and sales. That's why I prefer 1099 work.

  4. Article I section 8 grants congress the power to impose taxes.

    In making this argument in favour of the mandate you're essentially arguing that in order to enable congress to impose a tax it is 'necessary and proper' not to impose a tax.

    1. You need to explain this a little more (or perhaps you're misunderstanding my argument). The whole point is I'm not sure talking about this as a tax is the most sensible way to approach it. I defer on the tax argument. Obviously if that works then the discussion is over.

      But my point is that the more natural argument for me seems to be:

      1. Ginsburg's argument that the government has an obvious Article 1 Section 8 authority to regulate interstate commerce, and given the way insurance markets work a mandate is both necessary and proper for regulating commerce in the way they want to regulate it, or (what I prefer):

      2. The argument that the government has an obvious Article 1 Section 8 authority to provide for the general welfare, which they are doing in this act, and given the way insurance markets work a mandate is both necessary and proper for providing for the general welfare in the way they want to provide for it.

      In other words

      Commerce + Necessary and Proper or
      General welfare + Necessary and Proper

      Makes more sense to me than taxing power. But of course if you accept that it's a tax your work is done and you don't need to invoke Necessary and Proper. The point is that even if one rejects that it's a tax these necessary and proper arguments are still quite strong. This law is unquestionably constitutional.

  5. The tax argument is fine and unlimited. The structure of the tax was awkward but then the intent is as well which is not the payment of the tax but the purchase of insurance, but taxes are imposed in diverse ways on diverse targets. Taxes are not limited to transactions, property taxes are imposed on ownership. Taxes are usually imposed and then deductibles and credits offered for benefit and the ruling does see through the arbitrariness of form in applying to a penalty, but tax law is full of penalties for not doing other things, like not filing in the first place. There are some practical limits such as not collecting more than exists, but the only limitation of government is passage of such taxes in the first place, but then that is quite a high bar these days.


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