Why the I.R.S. Should Receive No Deference from the Federal Courts

When the U.S. Court of Appeals for the 4th Circuit voted last month to uphold the legality of an I.R.S. rule which provides tax credits to individuals who purchased health care under the Affordable Care Act from federally run health care exchanges, it did so on the grounds of judicial deference. "We cannot discern whether Congress intended one way or another to make the tax credits available on HHS-facilitated Exchanges. The relevant statutory sections appear to conflict with one another, yielding different possible interpretations," the 4th Circuit held in the Obamacare case King v. Burwell. "Confronted with the Act's ambiguity, the IRS crafted a rule ensuring the credits' broad availability and furthering the goals of the law. In the face of this permissible construction, we must defer to the IRS Rule."

As an authority for this deferential posture, the 4th Circuit cited the U.S. Supreme Court's 1984 precedent in Chevron U.S.A., Inc. v. Natural Resources Defense Council, which says that when the federal courts are faced with an "ambiguous" statute, the courts should bow to the interpretative judgment of the government agency tasked with enforcing that statute. Thus the 4th Circuit bowed to the I.R.S. rule governing access to Obamacare's tax credits.

Writing at the Library of Law & Liberty, historian Richard Samuelson says that it's time to ask "whether the Chevron Doctrine itself is mistaken. I would argue that it has deeply troubling implications for republican self-government." According to Samuelson, it's one thing for the courts to defer to the wishes of Congress, whose members are at least accountable to the electorate. But "a like deference emphatically is not owed to the federal bureaucracy." Here's the heart of his case:

It may be that it is necessary, in 21st century America, for unelected bureaucrats to write much of our legal code. But if we are to sustain the separation of powers in general, and if we are to continue to have our laws written by the people's Representatives and Senators, we need to proceed with caution. The very logic that suggests that courts should defer to Congress cuts the other way when bureaucratic rule-making is concerned. Tenured civil servants are not the people's representatives. The Constitution, for that reason, does not give them the authority to write our legal code.

For more on the role that Chevron deference is playing in the latest Obamacare legal battles, see here.

Comments

[Swiss Servator, spare a franc?]

KNEEL BEFORE ZOD TEH IRS!

[UnCivilServant]

Kal'El: Zod was a common name on Krypton, sort of like 'Bob'

Bruce Wayne: 'Kneel before Bob' doesn't sound any more comforting.

Every time someone mentions it, this quip keeps coming back to my mind.

[WTF]

...the 4th Circuit cited the U.S. Supreme Court's 1984 precedent in Chevron U.S.A., Inc. v. Natural Resources Defense Council, which says that when the federal courts are faced with an "ambiguous" statute,...

Except there's nothing ambiguous about the plain language regarding eligibility for the subsidies. This is just a straight up FYTW from the 4th circuit.

[Scruffy Nerfherder]

Exactly. It's almost as bad as the penaltax argument.

[Swiss Servator, spare a franc?]

Correct - ambiguity is one thing I am quite familiar with in the law (insurance law is chock full of decisions on "ambiguity" in policy language).

If they had not been so specific in their requirements, then this argument might have had a chance - but it is as bad as the NJ SCT and letting the Donkeys swap Lautenberg in after Torricelli got radioactively scandal mired - you just ignore the plain letter of the law and go with FYTW.

[Agammamon]

Here's what I don't get. In *criminal* law, if there's an ambiguity in the law you are supposed to defer to the interpretation most beneficial to the defendant - ie the defendant (the non-government guy in the case) gets the benefit of the doubt.

While in administrative law, its the opposite.

[Brandon]

What the fuck happened to Constitutional deference?

[Swiss Servator, spare a franc?]

Shot in the back of the head, left in a coma, and later smothered with its own pillow. Quiet funeral was held after the "penaltax" decision.

[sarcasmic]

when the federal courts are faced with an "ambiguous" statute, the courts should bow to the interpretative judgment of the government agency tasked with enforcing that statute

This whole deference thing sickens me. Congress gives the power of writing law to regulatory agencies, and the courts give their interpretive power to regulatory agencies.

Why have a legislative branch or judicial branch when the executive can do it all?

[UnCivilServant]

I think the name of the system should be 'Totalitarian Bureaucracy'. Because it doesn't matter all that much who's in office.

[antisocial-ist]

Why have a legislative branch or judicial branch when the executive can do it all?

For the same reason Palpatine kept the Senate around, at first.

[Joe_in_Indiana]

Multiple times in the Act it is stated the same way. I find no ambiguity.

Who stated that the law was ambiguous? The IRS?

Let's see what SCOTUS will say.

[See Double You]

The left has interpreted "ambiguity" to mean "reading the language as it is written means the statute won't do what we want it to do now, so the otherwise plain language is really ambiguous, and thus we can avoid the give and take of Congressional amendment and just let the Executive rewrite the law."

[blcartwright]

IOW "We've changed our minds since we wrote it"

[wagnert in atlanta]

Or, "we passed it and found out we didn't like what was in it. Not our fault, really. Give us a mulligan."

[See Double You]

I would argue the 4th Circuit engaged in judicial activism rather than judicial deference: the 4th Circuit essentially engaged in legislative amendment by sanctifying the IRS's rewrite of the statute.

[PapayaSF]

Yes to both of your comments.

[Another David]

The problem is that without Chevron, you get unelected judges rewriting the law to fit their policy preferences instead of unelected bureaucrats doing the same. The core problem remains, there's just more nitpicking involved.

[Mainer2]

Ambiguity seems like a reason to strike down a law.

Congress could pass a law that says, "The Secretary of HHS is authorized to do some things to make health insurance work better and some junk."...Pretty ambiguous, so therefore...Deference !

[Longtorso, Johnny]

It's not ambiguous, and federal exchange subsidies dropped out of the bill between drafts, which ordinarily means its settled that they were intentionally left out.

[wagnert in atlanta]

Consider the alternative. Add and drop all the possible variations to a law in committee and conference. Then pass the law with a selection of the variations. When the law works badly, add and subtract the deleted variations as desired. That way lies madness, and the courts should stomp on that theory with great vigor.

[dannye]

Professional courtesy?

[bassjoe]

God forbid Congress actually deal with ambiguous legislation itself...

Chevron's passage has opened the door to incredible expansions in government power and allowed the fools in Congress to get away with doing even less and campaigning more. Congress-critters can tell their constituents: "I didn't mean for that law to be interpreted in that ridiculous way when I voted for its passage and I can get the other congress-critters to change it if you send me back".

But, of course, those laws are rarely changed (even when there is a large coalition with the will to change it). It's much easier to blame a faceless bureaucracy for the problems with a law than take the effort to change it.

[Mercutio]

It's much easier to blame a faceless bureaucracy for the problems with a law than take the effort to change it, and risk pissing off another special interest group.

FTFY

[Scarecrow Repair]

It's really really simple.

If a law is ambiguous, throw it out altogether instead of trying to guess what the authors meant.

An a multi-judge court is divided, throw the law out altogether instead of maority rules. If unanimity is good enough for criminal juries, it's far more important for the laws which judges, juries, and people themselves have to go by.

[Harun]

I think the answer to this is to allow Congress to have more staff that directly writes the administrative law.

IOW, Congress would hire staffers to write the regs not the agency. Yes, more government, but a small check on the agency and then all cases like this go back to Congress.

[RickCaird]

Worse for the 4th circuit is there was nothing "ambiguous" about the legislation. It simply did not include the Federal exchanges as eligible for subsidies. The only way that is "ambiguous" is if the court wanted to rule a certain way regardless of what the legislation stated.
]
There should be 3 judges looking for new jobs.