Diatribes of Jay

This is a blog of essays on public policy. It shuns ideology and applies facts, logic and math to economic, social and political problems. It has a subject-matter index, a list of recent posts, and permalinks at the ends of posts. Comments are moderated and may take time to appear. Note: Profile updated 4/7/12

01 July 2012

Chief Justice Roberts on “Obamacare”

By now, the whole world knows who saved the Patient Protection and Affordable Care Act of 2010, or so-called “Obamacare.” It was not, as everyone had expected, the “swing man” on the Court, Justice Kennedy. Instead, it was the Court’s young Chief Justice, John Roberts.

Chief Justice Roberts upheld the statute’s economic heart: the so-called “individual mandate,” that healthy people buy insurance or pay a “penalty.” He found it beyond Congress’ power to regulate interstate commerce. But because the only consequence of failing to comply is paying the “penalty,” he found it within Congress’ power to tax. He therefore upheld the mandate and kept the new law economically viable.

The Chief Justice also preserved the so-called “Medicaid expansion.” This is a complex and comprehensive expansion of state-administered Medicaid, i.e., health insurance for the poor and needy. Its main feature is expanding eligibility from specified categories of needy people to virtually anyone who has income below a specified threshold.

The Chief Justice ruled that the Executive and Congress cannot force the expansion on the states by depriving them of all Medicaid funding (including funding for existing programs) if they refuse. He thus gave the states the power to “opt out” of the expansion if they choose, preserving their sovereignty.

But in so doing, he invalidated only a single provision of the new law. He left the federal government with power to enforce its conditions by less draconian means.

His decision thus preserved nearly all of the new law, including the many requirements now in effect that are already easing the burden of consumers with pre-existing conditions and adult children dependent on their parents for health care. The only thing the Chief Justice rejected was the all-or-nothing means of imposing the Medicaid expansion on the states.

I write “rejected, “ruled” and “invalidated,” as if Justice Roberts were the sole arbiter and the other eight Justices mere ciphers. But that was the effect of his extraordinary opinion in a deeply divided Court.

He took a road that neither side in the Court’s ideological wars fully endorsed. And because the two sides were split four-four, as usual, his opinion has the force of law. It alone preserves the hard-fought result of a century of political struggle over how the world’s wealthiest nation shares the benefits of an ongoing revolution in medicine among its people.

The Chief Justice’s long opinion is notable for what it did not do. It did not get into politics or policy or tread on Congress’ or the President’s turf. “[W]e possess neither the expertise nor the prerogative to make policy judgments[,]” the Chief Justice wrote. “It is not our job to protect the people from the consequences of their political choices.”

Not only did the Chief Justice avoid politics, as he and his colleagues are supposed to do. He drafted his opinion narrowly. He rejected the individual mandate under the Commerce Clause because it tried to “regulate” an “activity” (buying health insurance) that had not yet happened and that millions of citizens have no intention to perform. He made clear the limits of his rejection and emphasized its basis: that Congress cannot exceed its enumerated powers, although the states, as true sovereigns, could enact similar laws.

To reach his unique conclusions, the Chief Justice had to view the individual mandate differently in two different contexts. He first considered the Anti-Injunction Act, which outlaws suits to prevent tax collection. In that context, he saw the payment enforcing the individual mandate as a “penalty,” not a tax, because Congress had so called it. Therefore the Anti-Injunction Act didn’t apply, the suit was viable and the Court could rule.

But in addressing Congress’ power to tax, the Chief Justice viewed the individual-mandate payment as a permissible tax. This time, he considered substance, not just labels.

To non-lawyers, viewing the same thing differently like that might seem odd. But in law, it happens every day. In law, context is all.

The Chief Justice well explained the differences, and they made sense. Like the health-insurance law, the Anti-Injunction Act is an act of Congress, so Congress can classify it as it wishes. It did so in calling the mandate-payment a “penalty,” not a tax.

But when the Supreme Court has to enforce constitutional limits on Congress’ power—thereby perhaps thwarting the people’s will—it must look beyond labels to what Congress is actually trying to do. In that context, a small penalty, levied and collected by the IRS in the same manner and at the same time as income taxes, looks like a tax.

In upholding the payment as a tax, the Chief Justice emphasized three points. First, there is no other consequence, let alone any criminal sanctions, for failing to buy health insurance. A health-insurance rejectionist who pays the penalty is fully compliant with the law.

Second, the penalty itself is relatively minor. The cost of health insurance dwarfs it, so it is not practically coercive. Anyone who wants to save money would rather pay the penalty than the greater cost of insurance.

Finally, the Court must, if it can, construe any law passed by Congress as constitutional. This is an adamant rule, with a long tradition going back to our Founding. And there is also great precedent for disregarding Congress’ own inaccurate labels, both to uphold and condemn legislation under constitutional scrutiny. (With a large fraction of members of Congress in thrall to the Evil Troll Grover Norquist, any legislative staffer who called anything a “tax” would be likely to lose her job.) The Chief Justice cited this precedent but mercifully limited his writing to the most relevant cases.

All in all, the Chief Justice’s opinion was remarkable for its restraint. In a court rife with activism and politics, he found a way to uphold the solution to a problem that elected leaders had struggled with for a century. And he did so without doing damage to the law or straining its fabric for future cases.

Where he imposed limits (on the commerce power and on conditions that Congress can impose on programs, like the Medicaid expansion, that it funds), he emphasized the narrowness of his reasoning and wove it into the pre-existing fabric of the law. The uniqueness of the route he took recalled the great Justice Benjamin Cardozo in both wisdom and adroitness.

Four years ago, after his confirmation hearings, I speculated that Justice Roberts, with his cool intellect and dispassionate temperament, might be just the man for our turbulent times. So far, I have been disappointed. My disappointment was especially acute with his dissenting opinion in Bush v. Boumediene, a case on habeas corpus of millennial importance. There he seemed to crawl into bed with Justice Scalia, who began his own dissenting opinion with a ringing battle cry: “America is at war with radical Islamists.” It would be hard to top that for politics and judicial activism, let alone from a Justice who regularly accuses others of his own sins.

Yet this time, Chief Justice Roberts kept his own counsel and stayed his own man. He acted and wrote like a real chief justice. He stuck to the law and reasoned narrowly. He managed to find a way to uphold the results of a century-long political struggle. And this time, it was the other justices, on both sides of the ideological divide, who leaned on policy.

In retrospect, it is possible to discern in his opinion in Boumediene, which appallingly oversimplified the most relevant precedent, a consistent theme of deference to political authority. There it was the Executive, who everyone then believed was fighting a “war” against a noun, “terrorism.” Here, in an infinitely more persuasive opinion, the Chief Justice again deferred to the political branches, emphasizing how compelling the law must be to do otherwise.

It is still too early to tell. But the Chief Justice may now be emerging as the man he portrayed in his confirmation hearings—an “umpire” who just calls balls and strikes and leaves the play to the political teams. If so, he may yet lead the Supreme Court away from the political wars in which its members have become entangled and back to the neutrality and respect it must command to survive.

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  • At Mon Jul 02, 05:39:00 PM EDT, Anonymous Anonymous said…

    Jay, I hope you are right. There are legitimate fears that in fact this decision is part of a longer game on Roberts' part. It's possible that I'm being paranoid (but really, is it paranoia when they really are after you?), but here are some possibilities. He knows that the devil in healthcare reform will be implementation, and the GOP is lining up at the state level to negate the Medicaid expansion (on which of the much increased coverage depends) and deny creation of the state level exchanges (where the uninsured of means will get coverage). Then you have a whole layer of federal funding of different elements where the national GOP will get to play mischief. Also, he knows that keeping "Obamacare" as an issue is one that energizes the rightwing base (like abortion, it could be the gift that keeps on giving) so it might (emphasize the MIGHT, as I think the decision also gives Obama a chance to "re-sell" the program that didn't get done well the first time) help Rmoney, and then he can dismantle it without the SC's help. Finally, by restricting the scope of the Commerce Clause, he is setting up future challenges to other social net programs. I'll need to see more evidence before I believe that this leopard's spots are changing....

    Hope you are staying cool... it is a shame that Al Gore is so fat, because something bad is happening to our weather. Best, Doug in DC

  • At Mon Jul 02, 09:41:00 PM EDT, Blogger Denis J. Kucharski said…

    Professor Dratler, thank you for this great analysis of the opinion. Believe it or not, the media coverage of the actual body of the opinion has been terrible. I agree with your analysis of how this will affect the Commerce Clause 100%. This was a narrow decision that helped to avoid a real disaster. Roberts proved that he was something beyond a partisan hack.

  • At Fri Aug 03, 11:35:00 AM EDT, Blogger Jay Dratler, Jr., Ph.D., J.D. said…

    Dear Doug and Denis,

    I deeply regret taking so long to post and reply to your comments. For technical reasons, I didn’t realize I had new non-spam comments until today. (My bad. I know now how to keep that from happening again.)

    When I confessed renewed admiration for Roberts, it was not for his politics. He made his personal position on “Obamacare” clear when he wrote that “It is not our job to protect the people from the consequences of their political choices.”

    In tone, that may be the snidest thing he will ever write. But its substance is spot on: the Supreme Court is not a political body.

    When the Supreme Court becomes political, it takes one long, cold step toward the gulags. For the last two decades, small minds like Scalia’s, Thomas’, and now Alito’s have done just that. (So did the late Chief Justice Rehnquist, with his self-anointed four bars on his robe. Did he always want to be a general?)

    These men are transparent ideologues. They have a nasty tendency to distort words—including their own previous pronouncements—to reach a predetermined ideological end. And after so many years, their extreme and inflexible positions have begun to provoke intransigence on the other side.

    I don’t expect Roberts to become a liberal. Like everyone else, including this blogger, he’s entitled to his personal views. But a justice on the Supreme Court must recognize that he or she is not granted life tenure to impose personal views on the nation. He or she is there to preserve our liberties and the separation of powers that is one of their most important guarantees.

    Like the conservative that he is, Roberts wrote a decisive opinion that limited Congress’ power under the Commerce Clause. It rejected Congress’ authority to regulate “commerce” where none yet exists or to force people to buy something.

    The several states can do both, because in our system they are true sovereigns, with residual “police power.” Congress can’t, because it has only the limited powers enumerated in Article I, Section 8.

    I don’t agree with Roberts’ distinction between buying and not buying, between regulating and coercing purchases. In my mind a mandate and a prohibition are, always have been, and always will be equivalent exercises of governmental power.

    But the distinction is reasonable and has a long pedigree in the law. It’s a reasonable place for a conservative to draw the line on congressional power.

    And that’s precisely the point. There is a huge difference between taking a reasonable position with which you disagree, and taking a position like “all taxes are evil,” “abortion is murder no matter what the circumstances,” or “a trade war with China would be a good thing—let’s get it on!”

    If we Yanks are to arrest our still-steep decline and restore our greatness as a culture, we are going to have to learn to see that difference again and respect disagreement when it’s reasonable. We are going to have to relearn to compromise and work together.

    Chief Justice Roberts leading opinion on “Obamacare” was a strong step in that direction, and I salute him for it. He will never become a liberal, but he could become a great chief justice and help repair our broken culture.

    Besides him, the President and Elizabeth Warren, I don’t see anyone prominent in public life today with that potential. So when someone—anyone—in a high position shows that quality, appreciation is due.




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