On
June 28, 2012, the Supreme Court announced its decision in National Federation of Independent Business v. Sebellius, No.
11-393 (U.S. 6/28/12). You can find a
link to the decision here. The four
opinions run 193 pages. This is
partially due to the fact that the Justices were writing for the ages with
lengthy expositions full of quotable language.
The volume was also due to the fact that there were three competing
camps within the Court. Justices
Scalia, writing for himself and Justices Alito, Kennedy and Thomas, authored a
tour de force on limited government, while Justice Ginsberg, writing for
herself and Justices Breyer, Kagan and Sotomayor, made their case for a robust
federal government able to confront the nation’s problems. Chief Justice Roberts, acting as the umpire
between the factions, took the pragmatic approach, paring back Congress’s power
somewhat without rendering an overly ideological opinion.
What the Case Was About:
The
Supreme Court considered constitutional challenges to two provisions of the
Patient Protection and Affordable Care Act of 2010 which is sometimes referred
to as Obamacare. The two provisions
that the Court considered were:
1. The
requirement that individuals purchase a minimum level of health insurance or
else pay a penalty (the individual mandate); and
2. An expansion of Medicaid, which gives funds to the States on the
condition that they provide specified health care to all citizens whose income
falls below 133% of the poverty level.
The
Affordable Care Act contained over 2,000 pages so the Court reviewed only a
small portion of its provisions.
However, the individual mandate was by far the most controversial aspect
of the law.
The
Supreme Court considered four questions with regard to these provisions:
1. Did
the Anti-Injunction Act prohibit the Court from considering the
constitutionality of the individual mandate until after someone had actually
paid the penalty? Under the
Anti-Injunction Act, a tax may not be challenged until someone has paid it.
2. Did
Congress have constitutional authority to enact the individual mandate?
3. If
the individual mandate was struck down did the Court have to invalidate the
entire statute?
4. Did
Congress have authority to expand Medicaid and withhold all Medicaid funding
from states that did not participate?
Of
these four questions, two were narrow and technical, while the two issues about
the authority of Congress raised major questions about the power of Congress
under the Constitution. I will write
more about the competing viewpoints later on.
The Result
1. The
Anti-Injunction Act Does Not Apply
All
nine justices agreed that the Anti-Injunction Act did not prevent them from
considering the case. They all agreed
that because the Affordable Care Act classified the exaction to be paid for
failure to maintain health insurance as a “penalty” that it was not a “tax”
that had to be paid first in order to be challenged. If the Court had ruled the other way, it
would have been required to rule that the challenge was premature and require
the parties to wait until someone actually paid the penalty before it could be
challenged. This would not have
occurred until 2014 at the earliest because the provision does not take effect
until 2013 and the penalty is payable along with the taxpayer’s federal tax
return. All nine justices agreed that
it was not necessary to make the country wait another five years to find out
whether the individual mandate was constitutional.
2. The
Individual Mandate Is Upheld But the Justices Disagree on Why
Chief
Justice Roberts and Justices Scalia, Alito, Kennedy and Thomas formed a
majority holding that the individual mandate could not be upheld under either
the Commerce Clause or the Necessary and Proper Clause. On the other hand, Chief Justice Roberts
and Justices Breyer, Ginsberg, Kagan and Sotomayor ruled that the individual
mandate could be justified as a tax.
This required the majority to do some dexterous distinguishing. They had just unanimously ruled that the
penalty was not a tax under the Anti-Injunction Act; however, the majority
ruled that it was a tax under the power to tax clause. The majority said simply that the Act
turned on the label given to the payment so that calling it a penalty made it a
penalty. However, for purposes of the
Constitution, they could look at its substance. For example, the penalty was payable to the
Internal Revenue Service and was payable along with the taxpayer’s federal
income tax return. Was this a
rationalization? Yes, but the
alternative for the justices who felt that this was a tax was to leave the
country in limbo for another four years.
The justices did the country a service by giving an answer even if they
had to contort themselves to do so.
3. Because
the Justices Found the Individual Mandate to Be Constitutional, They Did Not
Decide Whether They Would Have Been Required to Strike Down the Entire Statute.
Justices
Scalia, Alito, Kennedy and Thomas who dissented would have struck down the law
in its entirety finding that the individual mandate was too critical to the law
to allow the Affordable Care Act to survive without it.
4. Congress
Could Not Coerce The States to Accept a Medicaid Expansion on Penalty of Losing
Their Existing Funding, But The Program Could Still Be Extended.
Chief
Justice Roberts and Justices Alito, Breyer, Kagan, Kennedy, Scalia and Thomas
all agreed that Congress could not tell the states to expand their
participation in the Medicaid program to include the working poor on condition
of losing their existing Medicaid funding.
The federal government can entice states to participate in federal
programs by offering benefits, but cannot coerce them to do so. Thus, the federal government could legally
withhold part of a state’s highway dollars if it did not increase the drinking
age to 21. However, where all citizens
of states are currently required to pay Medicare tax, telling the states that
they had to expand Medicaid or lose their existing funding constituted
unconstitutional coercion. Only
Justices Ginsberg and Sotomayor would have allowed this. However, Chief Justice Roberts and the four
liberals all held that it was permissible to allow the Medicaid expansion to
proceed so long as states had a free choice to participate or not. Because the federal government was paying
the entire cost of the expansion, a state would be foolish to turn down these
benefits. However, the majority gave
them the option to do so. The
curmudgeonly quartet of Scalia, Alito, Kennedy and Thomas would have struck
down the entire expansion on the basis that they would be required to re-write
the law to reach the majority’s result.
Threading the Needle
Part
I of the Opinion, which was authored by Chief Justice Roberts and joined in by
Justices Breyer, Ginsberg, Kagan and Sotomayor, set the tone for Chief Justice
Roberts to attempt to thread the need between striking down the Act for
political reasons and granting unlimited power to Congress. Early on, he stated:
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.
In our federal system, the National Government possesses only
limited powers; the States and the people retain the remainder. Nearly two
centuries ago, Chief Justice Marshall observed that “the question respecting
the extent of the powers actually granted” to the Federal Government “is
perpetually arising, and will probably continue to arise, as long as our system
shall exist.” (citation omitted). In
this case we must again determine whether the Constitution grants Congress
powers it now asserts, but which many States and individuals believe it does
not possess. Resolving this controversy requires us to examine both the limits
of the Government’s power, and our own limited role in policing those
boundaries.
Opinion, page 2. This
statement epitomizes Chief Justice Roberts’ view of the Court as an umpire
calling balls and strikes but not playing the game. The Chief Justice took pains to stake out
that he was not endorsing Obamacare; instead, he was merely determining whether
the pitch was inside the strike zone or not.
Immediately following, he stated:
The Federal
Government “is acknowledged by all to be one of enumerated powers.” (citation
omitted). That is, rather than granting general authority to perform all
the conceivable functions of government, the Constitution lists, or
enumerates, the Federal Government’s powers. Congress may, for example, “coin
Money,” “establish Post Offices,”and “raise and support Armies.” Art. I, §8,
cls. 5, 7, 12. The enumeration of powers is also a limitation of powers,
because “[t]he enumeration presupposes something not enumerated.” (citation
omitted).The Constitution’s express conferral of some powers makes clear that
it does not grant others. And the Federal Government “can exercise only the
powers granted to it.” (citation
omitted).
Today, the
restrictions on government power foremost in many Americans’ minds are likely
to be affirmative prohibitions, such as contained in the Bill of Rights. These
affirmative prohibitions come into play, however, only where the Government
possesses authority to act in the first place. If no enumerated power
authorizes Congress to pass a certain law, that law may not be enacted, even if
it would not violate any of the express prohibitions in the Bill of Rights or
elsewhere in the Constitution.
Opinion,
pp. 2-3. This passage is significant
because it shows an acknowledgement by all nine justices that under the
Constitution, Congress must act within its enumerated powers. While the justices may not agree on the
extent of those enumerated powers, they are united in the basic principal.
Two Views of the Role of Government
Stepping
back from the minutiae of the decision, it is really about two competing
visions about the role of government. On
the one hand, Justices Breyer, Ginsberg, Kagan and Sotomayor believe that the
Constitution contains broad authorization for the people to act through their
elected representatives. On the other
hand, Justices Scalia, Alito, Kennedy and Thomas wish to restrain the power of
Congress kept within strict limits.
Straddling the middle was Chief Justice Roberts.
While Chief Justice Roberts ultimately
carried the day, the real debate over the scope and role of government is
contained in the opinions of Justices Ginsberg and Scalia.
Justice
Ginsberg viewed the Commerce Clause as authorizing Congress to solve problems
that affect the economy on a national basis.
Much of her concurring opinion was devoted to why the Court should have
sustained the individual mandate under the Commerce Clause.
Justice
Ginsberg began her opinion by comparing health care to retirement
benefits. He stated:
The provision of health care is today a concern of national
dimension, just as the provision of old-age and survivors’ benefits was in the
1930’s. In the Social Security Act, Congress installed a federal system to
provide monthly benefits to retired wage earners and, eventually, to their
survivors. Beyond question, Congress could have adopted a similar scheme for
health care. Congress chose, instead, to preserve a central role for private
insurers and state governments. According to THE CHIEF JUSTICE, the Commerce
Clause does not permit that preservation. This rigid reading of the Clause
makes scant sense and is stunningly retrogressive.
Opinion of Ginsberg, p. 2.
She went through an
extended discussion of the effect of health care on the national economy,
noting among other things that health care accounts for 17.6% of the national
economy and that 99.5% of persons over age 65 will have visited a doctor. However, because medical providers must
provide care regardless of ability to pay, those with insurance subsidize those
without it. Further, persons with
pre-existing conditions may not have access to coverage at all. Interestingly enough, in making this argument,
Justice Ginsberg cited extensively to Congressional findings, news articles,
medical journals and even news blogs.
In order to adequately describe the problem, she went far beyond mere
legal precedent.
To Justice Ginsberg,
this represented a national problem which required a national solution. She stated:
Aware that a national
solution was required, Congress could have taken over the health-insurance
market by establishing a tax-and-spend federal program like Social Security.
Such a program, commonly referred to as a single-payer system (where the sole
payer is the Federal Government), would have left little, if any, room for
private enterprise or the States. Instead of going this route, Congress enacted
the ACA, a solution that retains a robust role for private insurers and state
governments. To make its chosen approach work, however, Congress had to use
some new tools, including a requirement that most individuals obtain private
health insurance coverage.
Opinion of Ginsberg,
pp. 8-9.
Well into her opinion, Justice Ginsberg finally lays out her vision of the Commerce
Clause. He describes how he believes the Commerce
Clause was intended by the framers.
What was needed was a
“national Government . . . armed with a positive & compleat authority in
all cases where uniform measures are necessary.” See Letter from James Madison
to Edmund Randolph (Apr. 8, 1787), in 9 Papers of James Madison 368, 370 (R.
Rutland ed. 1975). See also Letter from George Washington to James Madison
(Nov. 30, 1785), in 8 id., at 428, 429 (“We are either a United people,
or we are not. If the former, let us, in all matters of general concern act as
a nation, which ha[s] national objects to promote, and a national character to
support.”). The Framers’ solution was the Commerce Clause, which, as they
perceived it, granted Congress the authority to enact economic legislation “in
all Cases for the general Interests of the Union, and also in those Cases to
which the States are separately incompetent.”
Opinion of Ginsberg, p. 13.
She also described the
Commerce Clause as giving Congress “the power to regulate economic activities
‘that substantially affect interstate commerce.’” Opinion of Ginsberg, p 15.
Given this expansive view, it not surprising that Justice Ginsberg
would have upheld the Affordable Care Act under the Commerce Clause. She stated:
Straightforward application of these principles would require the
Court to hold that the minimum coverage provision is proper Commerce Clause
legislation. Beyond dispute, Congress had a rational basis for concluding that the
uninsured, as a class, substantially affect interstate commerce. Those without
insurance consume billions of dollars of health-care products and services each
year. (citation omitted). Those goods are produced, sold, and delivered largely
by national and regional companies who routinely transact business across state
lines. The uninsured also cross state lines to receive care. Some have medical
emergencies while away from home. Others, when sick, go to a neighboring State
that provides better care for those who have not prepaid for care.
Opinion of Ginsberg, p. 16.
She
also thrashed the notion that the Affordable Care Act required persons to
purchase an unwanted product.
Virtually everyone, I reiterate, consumes health care at some
point in his or her life. (citation omitted). Health insurance is a means of
paying for this care, nothing more. In requiring individuals to obtain
insurance, Congress is therefore not mandating the purchase of a discrete,
unwanted product. Rather, Congress is merely defining the terms on which
individuals pay for an interstate good they consume: Persons subject to the
mandate must now pay for medical care in advance (instead of at the point of
service) and through insurance (instead of out of pocket). Establishing payment
terms for goods in or affecting interstate commerce is quintessential economic
regulation well within Congress’ domain.
Opinion of Ginsberg, p. 22.
Thus, Justice
Ginsberg took a view of the Constitution as authorizing a robust federal
government to solve problems of national importance through its authority under
the Commerce Clause. Justice Scalia and
his fellow dissenters took a much more constrained view. They viewed commerce as a specific and
limited activity which could be regulated but not compelled.
In a direct rebuff to
the liberal justices, Justice Scalia wrote:
The dissent treats the Constitution as though it is an enumeration
of those problems that the Federal Government can address—among which, it
finds, is “the Nation’s course in the economic and social welfare realm,” ibid.,
and more specifically “the problem of the uninsured,” ante, at 7. The
Constitution is not that. It enumerates not federally soluble problems,
but federally available powers. The Federal Government can address
whatever problems it wants but can bring to their solution only those powers
that the Constitution confers, among which is the power to regulate commerce.
None of our cases say anything else. Article I contains no
whatever-it-takes-to-solve-a-national problem power.
Opinion of Scalia, pp. 14-15. I love this passage because it captures the essence of the argument and spits it back out in plain language.
In numerous passages,
Justice Scalia sounded the theme that failure to engage in commerce was not
commerce.
That clear principle
carries the day here. The striking case of Wickard v. Filburn,
317 U. S. 111 (1942), which held that the economic activity of growing wheat,
even for one’s own consumption, affected commerce sufficiently that it could be
regulated, always has been regarded as the ne plus ultra of expansive
Commerce Clause jurisprudence. To go beyond that, and to say the failure to
grow wheat (which is not an economic activity, or any activity at all)
nonetheless affects commerce and therefore can be federally regulated, is to
make mere breathing in and out the basis for federal prescription and to extend
federal power to virtually all human activity.
Opinion of Scalia, pp. 2-3. (“Ne
plus ultra” means the highest point or the exteme. It is not clear how saying it in Latin makes
it any more meaningful).
Article I, §8, of the
Constitution gives Congress the power to “regulate Commerce . . . among the
several States.” The Individual Mandate in the Act commands that every
“applicable individual shall for each month beginning after 2013 ensure that
the individual, and any dependent of the individual who is an applicable
individual, is covered under minimum essential coverage.”(citation omitted).
If this provision “regulates” anything, it is the failure to maintain
minimum essential coverage. One might argue that it regulates that failure by
requiring it to be accompanied by payment of a penalty. But that failure—that
abstention from commerce—is not “Commerce.” To be sure, purchasing insurance
is ”Commerce”; but one does not regulate commerce that does not exist by
compelling its existence.
***
We do not doubt that the buying and selling of health insurance
contracts is commerce generally subject to federal regulation. But when
Congress provides that (nearly) all citizens must buy an insurance contract, it
goes beyond “adjust[ing] by rule or method,” (citation omitted), or
“direct[ing] according to rule,” (citation omitted), it directs the
creation of commerce.
***
Here, however, Congress has impressed into service third parties,
healthy individuals who could be but are not customers of the relevant
industry, to offset the undesirable consequences of the regulation. Congress’
desire to force these individuals to purchase insurance is motivated by the
fact that they are further removed from the market than unhealthy individuals
with pre-existing conditions, because they are less likely to need extensive
care in the near future.
Opinion of Scalia, pp. 4, 5, 8.
But the health care “market” that is the object of the Individual
Mandate not only includes but principally
consists of goods and services that the young people primarily affected by the
Mandate do not purchase. They are quite simply not participants in that
market, and cannot be made so (and thereby subjected to regulation) by the
simple device of defining participants to include all those who will, later in
their lifetime, probably purchase the goods or services covered by the mandated
insurance.
Such a definition of market participants is unprecedented, and
were it to be a premise for the exercise of national power, it would have no
principled limits.
***
If
all inactivity affecting commerce is commerce, commerce is everything.
***
It threatens that order because it gives such an expansive meaning
to the Commerce Clause that all private conduct (including failure to
act) becomes subject to federal control, effectively destroying the
Constitution’s division of governmental powers.
Opinion of Scalia, pp. 11-12, 13, 14 (emphasis in original). Justice Scalia’s viewpoint is aptly
summarized in the quote above stating that “(i)f all inactivity affecting
commerce is commerce, commerce is everything.” To Justice Scalia, governmental powers must
be defined and limited. Therefore, an
all-encompassing view of commerce is anathema to him.
Justice Scalia also stressed the need to restrain
the powers of the federal government lest it become all powerful.
If Congress can reach out and command even those furthest removed
from an interstate market to participate in the market, then the Commerce
Clause becomes a font of unlimited power, or in Hamilton’s words, “the hideous
monster whose devouring jaws . . . spare neither sex nor age, nor high nor low,
nor sacred nor profane.” The Federalist No. 33, p. 202 (C. Rossiter ed. 1961).
Opinion of Scalia, p. 8.
This formidable
power, if not checked in any way, would present a grave threat to the system of
federalism created by our Constitution. If Congress’ “Spending Clause power to
pursue objectives outside of Article I’s enumerated legislative fields (citation omitted)), is “limited only by
Congress’ notion of the general welfare, the reality, given the vast financial
resources of the Federal Government, is that the Spending Clause gives ‘power
to the Congress to tear down the barriers, to invade the states’ jurisdiction,
and to become a parliament of the whole people, subject to no restrictions save
such as are self-imposed,’(citation omitted). “[T]he Spending Clause power, if
wielded without concern for the federal balance, has the potential to obliterate
distinctions between national and local spheres of interest and power by
permitting the Federal Government to set policy in the most sensitive areas of
traditional state concern, areas which otherwise would lie outside its reach.” (citation
omitted).
Opinion of Scalia, p. 32. (Note, in the interest of brevity, I have
skipped over Justice Scalia’s discussion of the spending clause except for the
excerpt above. While there is a lot of
interesting material there, I could not find a way to condense it down to a
manageable discussion.).
In conclusion, Justice Scalia
stated his central thesis that liberty depended upon preserving the structural
protections contained in the Constitution.
The Constitution, though it dates
from the founding of the Republic, has powerful meaning and vital relevance to
our own times. The constitutional protections that this case involves are
protections of structure. Structural protections—notably, the restraints
imposed by federalism and separation of powers—are less romantic and have less
obvious a connection to personal freedom than the provisions of the Bill of
Rights or the Civil War Amendments. Hence they tend to be undervalued or even
forgotten by our citizens. It should be the responsibility of the Court to teach
otherwise, to remind our people that the Framers considered structural
protections of freedom the most important ones, for which reason they alone
were embodied in the original Constitution and not left to later amendment. The
fragmentation of power produced by the structure of our Government is central
to liberty, and when we destroy it, we place liberty at peril. Today’s decision
should have vindicated, should have taught, this truth; instead, our judgment
today has disregarded it.
Opinion of Scalia, p. 65.
Final Thoughts
1. The Justices could use an editor. The desire to write monumental opinions
combined with the time pressure to complete them within the same term results
in opinions that are much too long.
Tome-length opinions tend to confuse rather than clarify since there is
language to support virtually any proposition within the opinions.
2. Citing to the Founding Fathers is about as useful as citing to the
Bible. Because the Founding Fathers
did not always agree with each other and wrote profusely, it is possible to
find some support from the Founding Fathers for virtually any proposition. It is interesting that both Justices
Ginsberg and Scalia resort to the Founding Fathers for support of their diametrically
opposed views of the Commerce Clause.
In a passage that I wish I could have found a way to incorporate into
the post, Justice Scalia talks about the contrasting views of Madison and
Hamilton with regard to the scope of the Spending Clause. However, in most instances, the Founding Fathers
are cited as though they spoke with a monolithic voice when in fact, they did
not.
3. The dueling opinions of Roberts, Scalia and Ginsberg are
reflections of our national angst over the role of government. On the one hand, there is a fear that an all-powerful
government will strip us of our liberties.
On the other hand, there are an equal number who believe that a strong
government protects our liberties by providing security and protection from the
vagaries of life. If you go onto
Facebook, you will see people referring to the President as the
“Commander-in-Thief” or decrying the Koch Brothers and Citizens United as the end of democracy. In such a highly partisan atmosphere, it
is refreshing to see Chief Justice Roberts emerge as the responsible adult in
the room who tries to make people play nice despite their differences.
4. I believe that Chief Justice Roberts’ opinion was conservative in the
older sense of the word. Believe it or
not, the definition of conservative is not lock-step opposition to President
Obama. In the older sense, definitions
of conservative include emphasizing stability and continuity, tending to oppose
change, favoring traditional values and being restrained in style. In the judicial context, conservative means
employing the judicial power sparingly and deferring to the other branches of
government when appropriate. While the
Scalia opinion waxed eloquent on the virtues of separation of powers, it gave
very little deference to the role of Congress as an equal branch of
government. The Scalia opinion was not
deferential toward Congress; rather, it was hostile to the entire notion of
government. This strikes me as
activist rather than conservative. In
contrast, Chief Justice Roberts recognized that an open-ended Commerce Clause
power was no restriction at all, but that there were other avenues for the
government to act. Because Congress
could have authorized a single payer national health care system under the
power to tax and spend, it makes logical and conservative sense that a less
intrusive system based on the private sector would also be constitutional. Thus, upholding the statute was the conservative
choice.
5. While I come down on the side of Chief Justice Roberts, I think that all of the opinions make for a fascinating study in civics. While I don't agree with Justice Scalia this time, his writing is almost lyrical. This is good stuff, just a bit too much of it.
Mea culpa: The original version of this post changed Justice Ginsberg's gender. Several alert readers brought it to my attention and I have corrected it. My apologies to Justice Ruth Bader Ginsberg.
