Supreme Court

Supreme Court Rejects Obama's Commerce Clause Arguments, Upholds ObamaCare Anyway Under Tax and Spend Clause


Chief Justice John Roberts' majority decision today upholding the Patient Protection and Affordable Care Act makes a number of very important points. First, Roberts completely rejected the Obama administration's unprecedented argument that the individual mandate was constitutional under Congress' power "to regulate commerce…among the several states." As Roberts wrote:

The Constitution grants Congress the power to "regulate Commerce." Art. I, §8, cl. 3 (emphasis added).  The power to regulate commerce presupposes the existence of commercial activity to be regulated.  If the power to "regulate"  something included the power to create it, many of the provisions in the Constitution would be superfluous….

Our precedent also reflects this understanding.  As expansive as our cases construing the scope of the commerce power have been, they all have one thing in common: They uniformly describe the power as reaching "activity." It is nearly impossible to avoid the word when
quoting them….

The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce.  Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority.

That's important. When you also count the four dissenters (Justices Kennedy, Scalia, Thomas, and Alito), a majority of the Supreme Court refused to buy the government's sweeping interpretation of the Commerce Clause.

But that also turned out not to matter for the fate of the ObamaCare, because Roberts and the Court's four liberals voted to uphold the individual mandate under Congress' power to "lay and collect Taxes." Here's part of how Roberts makes the case:

Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes. That, according to the Government, means the mandate can be regarded as establishing a condition—not owning health insurance—that triggers a tax—the required payment to the IRS.  Under that theory, the mandate is not a legal command to buy insurance. Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earning income.  And if the mandate is in effect just a tax hike on certain taxpayers who do not have health insurance, it may be within Congress's constitutional power to tax.

The question is not whether that is the most natural interpretation of the mandate, but only whether it is a "fairly possible" one. As we have explained, "every reasonable construction must be resorted to, in order to save a statute from unconstitutionality." The Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution. Granting the Act the full measure of deference owed to federal statutes, it can be so read. (Citations omitted)

NEXT: Sen. Rand Paul Reacts to SCOTUS Ruling on Obamacare: "This now means we fight every hour, every day until November to elect a new President and a new Senate to repeal Obamacare"

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  1. Honestly, I think this outcome is one of the most farcical ones possible.

    As we have explained, “every reasonable construction must be resorted to, in order to save a statute from unconstitutionality.”

    The “Separate But Equal” justification of segregation would definitely stand up under such a rubric.

  2. But that also turned out not to matter for the fate of the ObamaCare,

    Or anything else.

    First, its nonbinding dicta, so future courts are free to ignore it without disturbing stare decisis.

    Second, the tax ruling is a roadmap for getting around the purely decorative bits of the opinion on the Commerce Clause. A roadmap which future Congresses will follow.

    1. That, according to the Government, means the mandate can be regarded as establishing a condition?not owning health insurance?that triggers a tax?the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance.

      Huh? Wha? I don’t get it.

      This is a terrible ruling, but I’m taking a little pleasure in the fact that it wasn’t as bad as it could have been.

  3. Well, there’s only one thing to do. Eliminate the tax power and force Congress to collect revenue directly from the state governments in proportion to their Congressional representation. Call it the Contrapositive No Taxation Without Representation Amendment.

  4. I don’t want to be dramatic, but is there anything the government can’t order us to do now? If the power to tax includes, “do this or we take all your money” then this whole “limited government” thing is just over, huh?

    1. Yes.

  5. FYI: Intrade was wrong. Yesterday, 75% chance of the law getting struck down.

    1. That means they still had 25% that it would stand.

      1. To elaborate: if you have 4 balls in a back and 3 are blue, you can say “There is a 75% chance that the ball I pick will be blue”. If it comes out red that doesn’t mean you were wrong.

  6. “As we have explained, ‘every reasonable construction must be resorted to, in order to save a statute from unconstitutionality.'”

    If a statute is unconstitutional, then it’s unconstitutional. No need to “save” the fucking thing. Just toss it out and save the fucking Constitution!

    1. The Supreme Court seems to have forgotten what its actual job is.

  7. There is an existing SCOTUS precedent under US. v Butler that held that the government can not use the power to tax in order to obtain an end it could not have obtained by direct legislation.….._v._Butler

    I keep coming back to this critical and forgotten precedent.

    If the federal government can impose a tax and then waive the tax if a citizen waives a right, there is nothing the federal government cannot do.

    There is no reason, under the ACA precedent Roberts just wrote, that the federal government would be barred from passing a 100% income tax, with an 80% waiver if a citizen just signs a document waiving all their enumerated rights – unless the Butler precedent is still good.

    1. If the butler precedent was still valid, wouldn’t the taxing argument have failed for Obamacare?

      1. Perhaps a citizen would have to actually face the tax and then litigate it under this precedent, and not under the Commerce Clause.

        1. Hmm, maybe. Though didn’t the Court use its multiple-personality-disorder to rule that the mandate didn’t meet the requirements of a tax for the purposes of the Anti Injunction Act?.

          1. If so, that would make it easier to litigate, not harder, since the Anti-Injunction Act pisses on the rights of taxpayers by forcing them to pay the tax before they can file suit against it. If the act doesn’t apply, you should be able to NOT pay it and litigate it.

            1. Which means they could have addressed the tax argument now, in this ruling.

        2. I hope that happens.

  8. So with Wickard v. Filburn they could stop you growing wheat on your own land for your own use

    Now with this they can tax you if you don’t grow wheat on your own land.

    1. But they “can’t” stop you from growing the wheat.

      I mean, unless they tax you more than the money you have.

    2. Apparently not. The “bright line” they’ve drawn is this:

      The Government can stop you from growing wheat on your own land for your own use.

      The Government can not force you to grow wheat.

      The Government can ask you to grow wheat, and increase your tax rate if you refuse.

      I’m moving to one of those Honduran charter cities. This place smells like horse shit.

  9. “Tax and Spend Clause”

    The Democrat party platform.

  10. So when they say we have to eat broccoli at every meal, we’re boned.

    I hate broccoli.

    1. You’re only boned if you can’t afford to pay the tax associated with not eating broccoli.

    2. There are worse things to be worried about. Just wait until the Republicans take over completely and pass a law saying you have to pay an extra tax if you fail to tithe to a government approved church.

  11. Roberts was citing a rule of interpreting statutes – a statute should, if possible, be read in such a way as to be consistent with the constitution.

    If the individual mandate is a tax, Roberts is saying, it would be constitutional, so the ACA should if possible be interpreted so as to make the mandate a tax. Otherwise, says Roberts, it would be unconstitutional since no other constitutional clause would save it – certainly not the Commerce Clause.

    1. The conservative dissenters said sure, if a statute can fairly be given a constitutionally-valid construction this should be done – that is, if it could fairly be read as a tax, it should be considered a tax in order to make it valid. But no such interpretation could fairly be made, said the conservatives. Not without rewriting the statute which is not the same as interpreting it.

      So Roberts and the conservatives are disagreeing on issues of statutory construction.

      If Congress passed a straight-up tax bill, saying “we increase income tax rates to such-and-such, with an exemption for those who have such-and-such kinds of insurance,” the conservatives might have upheld it, but Congress didn’t do this.

      The conservatives said: “Imposing a tax through judicial legislation inverts the constitutional scheme, and places the power to tax in the branch ofgovernment least accountable to the citizenry.”

      1. The problem: The ACA describes the penalty with words like “shall” – comply or pay a penalty. That’s not the same as a tax, which says sure, you can do such-and-such, you just have to pay for it.

        1. And the conservative dissenters opened up the possibility that, as a tax, the mandate would be unconstitutional as a unapportioned direct tax (long story).

  12. John Roberts just slapped Obama silly and no one – especially on the right seems to see it yet.

    Roberts managed to preserve the reputation of the court, limited a new power-expanding precedent by voting against the commerce clause and NP arguments, and basically saddled Obama with this shitstorm – it’s now written Supreme Court precedent that Obama RAISED TAXES – for the rest of the campaign. Overturning it all the way would have let Obama off the hook.

    Roberts is a ninja and they’ll be talking about this ruling in law schools as brilliant for years and years to come.

    Seriously, this is fucking brilliant politics on Roberts’s part, and it’s not even really politics. It’s awesome.

    1. Dude, Roberts decision rests on his philosophical point-of-view that the Supreme Court is subject to the Legislation Branch. It’s written in his opinion: The “commerce clause” argument was unconstitutional, but in order to find something to “save” the statute, he reconciled it with Congress’s power to tax.

      No need for some cynical “cunning ninja” theory. Roberts is a quintessential TEAM RED statist.

    2. Bullshit. 47% of the people don’t pay federal taxes now. You think they care if taxes go up? Who you think they’ll vote for?

  13. No, Roberts is an idiot, siding with the other idiots, who decided to cast in his lot for a horrible president who has been just fine pissing and moaning about the “partisan judiciary” on the rare occasion they dont rubberstamp his monarchial overreach.

    All this sounds like is “Well, you failed horribly at defending an awful piece of legislation. BUTt we know what you *really* meant, and it’s not like we give a shit about the Constitution, so we’re gonna give you a mulligan and put better words in your mouth (that STILL suck) as justification for this law.”

    That the majority refers to the Social Security Act (that’s currently driving us to insolvency) as an admirable example of fiscal irresponsibility and crushing govt overreach in service of a feel-good safety net, we’re well and truly fucked.

  14. Good news for the GOP.
    The election is a referendum on Obamacare and Obama can’t run as a victim of the white reactionaries on the Supreme Court

  15. The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce.

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