Obtuse Observer

June 28, 2012

Obamacare Upheld

Filed under: Obamacare — Obtuse Observer @ 10:02 am

This is all preliminary and based on early reports.  However, as I understand it the individual mandate was upheld under the taxing authority of Congress but denied under the authority of the Interstate Commerce Clause.  Constitutionally I have no problem with the ruling, Congress can use its tax authority to accomplish this policy goal. 

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However, Speaker Pelosi, Majority Leader Reid, President Obama etc etc etc argued that the mandate wasn’t a tax… until that was the only reed left to cling to.  I think the Court said that Congress and the President can lie (see video) through their teeth to the people as long as they tell the truth to the court (leaglly, I think they can… and did). 

This will be interesting to see how it plays out.  Will this help or hurt President Obama?  A very real potential problem in the category of unintended consequences may be that lots of people will actually lose their employer provided insurance when employers find it cheaper to pay the tax than pay the insurance premiums.  Do think most employers will do that?  No.  But a small percentage will result in a lot of people and their families without insurance.

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So, first, Obama’s car insurance analogy falls flat.  One can choose not to drive or own a car.  One cannot opt out of the mandate unless given a waiver by the President.  Secondly, apparently Obama meant to say that Stephanopolous was exactly right…  this is a tax.


Edit:  The ruling as intersting implications for federal power that I hadn’t really considered before.  The federal government can regulate behavior through the tax code.  As long as the regulated behavior meets the rational basis test for nearly everthing excepting fundamental rights (which would require strict scrutiny).

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  1. The 5-4 breakdown was fascinating with Roberts of all people siding with the Liberal 4 AND writing the majority (once he chose, was there any doubt he’d write it?). I thought from oral arguments that Kennedy was against and that the bill was sunk. Turns out I was half right. At any rate you are quite correct in that the gov’t can lie to the people and then tell the “truth” to the Court and be OK. All in all, mist everything but the mandate was a positive step, so you gotta take the good with the bad. You know who else is celebrating besides Obama…. the insurance companies.

    Comment by JBS — June 28, 2012 @ 5:25 pm

  2. No clue if most of the bill is a good idea or not. I’m satisfied that the court shored up the ICC rather than further distorted it. I’m satisfied that Roberts tossed the issue back to the political branches though the more I learn the more I worry he twisted himself in knots to do so. Apparently there is an old 19th century law that prohibits challenging a tax until it has been collected (anti-injunction law). As such, Roberts had to argue that this isn’t a tax for purposes of that law… but really it is a tax.

    Its aliens

    Comment by Obtuse Observer — June 30, 2012 @ 1:39 pm

  3. During oral arguments, Justice Kennedy (I believe) during the Anti-Injunction Act phase opened with something to the effect of, “Just so I have this straight, today you are going to argue that for the puposes of the Anti-Injunction Act that the bill is not a tax and will then turn around tomorrow and the next day and argue that it is?” I cannot do his words justice, but it was hilarious and absurd all at the same time. Honestly, I thought that it would be upheld under the Commerce Clause, but arguing it was a tax was a shrewd move by the gov’t and it obviously paid off.

    Comment by JBS — June 30, 2012 @ 10:56 pm

  4. Wasn’t shrewd, it was the only thing they had to cling to IMO.

    But, yes, I think the minority may have lost this battle but they made the other side have to sign on that exact argument….. It’s not a tax… but it is a tax. Gotcha.

    Comment by Obtuse Observer — July 2, 2012 @ 6:10 pm

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