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Constitutionality of Individual Mandate

James R. Copland

As the Supreme Court holds oral arguments to consider challenges to the 2010 Patient Protection and Affordable Care Act on constitutional grounds, Point of Law is hosting a featured discussion that we hope will help shed light on the legal issues involved, as well as those that seem to be of particular interest to the justices. We're delighted to welcome the following legal scholars and analysts--among the leaders in their fields--to Point of Law:

Erwin Chemerinsky, University of California, Irvine School of Law

Richard Epstein, New York University Law School

Orin Kerr, George Washington Law School

Gillian Metzger, Columbia University Law School

Michael Rosman, General Counsel of the Center for Individual Rights

Nadine Strossen, New York Law School, formerly president of the American Civil Liberties Union

On Tuesday, March 27, after one day's oral argument, we'll be kicking off with comments from Professor Chemerinsky, Professor Strossen, and Mr. Rosman. Our discussion will continue over the next two weeks--come back and visit what promises to be an exceptional conversation.

Erwin Chemerinsky
Dean and Distinguished Professor of Law,
University of California, Irvine School of Law

Under current constitutional law, the federal health care law is clearly constitutional. I predict that the Court will uphold the Act and that the decision will not be close.

Perhaps the most important question before the Supreme Court is whether Congress has the authority to require that individuals either purchase health insurance or pay a penalty. This is constitutional under Congress's power, pursuant to Article I, section 8 of the Constitution to regulate commerce among the states.

Michael E. Rosman
General Counsel, The Center for Individual Rights

I'm going to focus on the constitutionality of the "individual mandate" (the requirement that almost everyone have insurance meeting certain "minimum essential requirements"). And I'd like to open the discussion by suggesting that some of the better arguments regarding the Commerce Clause are somewhat unprecedented because they focus on somewhat different text.

The Commerce Clause gives Congress the power "[t]o regulate commerce with foreign Nations, and among the several States, and with the Indian tribes." In past Commerce Clause cases, it was pretty clear what was being regulated, and the question was whether that something was regulable under the Commerce Clause. For example, in United States v. Lopez, 514 U.S. 549 (1995), Congress was regulating the possession of guns within 1000 feet of a school. In United States v. Morrison, 529 U.S. 598 (2000), it was gender-based, animus-motivated violent crimes.

Nadine Strossen
Professor of Law, New York Law School
President, American Civil Liberties Union (ACLU), 1991-2008

Although today's argument focused on a threshold issue about the timing of this litigation, U.S. Solicitor General Donald Verilli used it as an opportunity to preview tomorrow's argument about the most controversial substantive issue: whether Congress had power to pass the minimum coverage provision. At the very outset of his argument today, Verilli asserted that this provision "is an exercise of Congress's taxing power as well as its commerce power."

What is the link between the core constitutional issue of Congress's power and the seemingly disparate, technical issue on today's agenda: Whether an 1867 federal law, the Anti-Injunction Act (AIA), requires the Court to dismiss the litigation as premature? The AIA bars any "suit for the purpose of restraining the assessment or collection of any tax." Its purpose was well-captured in the opening argument by attorney Robert Long: it "imposes a pay first, litigate later rule that is central to Federal tax assessment and collection."

Gillian Metzger
Vice Dean and Stanley H. Fuld Professor of Law, Columbia Law School

Erwin Chemerinsky's post well-states the argument for the constitutionality of the individual mandate---the requirement that individuals purchase health insurance or pay a penalty---under the Commerce Clause. I agree that the mandate falls well within the existing scope of Congress's commerce power: It is a regulation of quintessential economic activity, specifically individuals' actions in accessing and paying for health care. As Judge Sutton put it, "No one is inactive when deciding to pay for health care, as self-insurance and private insurance are two forms of action for addressing the same risk. Each requires affirmative choices; one is no less active than the other; and both affect commerce." Thomas More Law Center v. Obama, 651 F.3d 529, 561 (6th Cir. 2011). And while Michael Rosman argues that requiring insurance is not the same thing as regulating how people pay for health care, I think the link between the two is plainly sufficient to fall within the broad deference given to Congress when it is addressing economic activity that substantially affects interstate commerce.

Richard A. Epstein
Laurence A. Tisch Professor of Law, New York University School of Law

Professor Erwin Chemerinsky pushes all the right buttons for the government in making out the claim that the imposition of the individual mandate is in his words "clearly constitutional" under today's law. I have written here and here that the current Commerce Clause jurisprudence of the Supreme Court is wholly inconsistent with the original vision of the Constitution as giving the federal government few and enumerated powers.

With ObamaCare, the Congress has stretched that overbroad power even further, by allowing the government to impose taxes on individuals who have not engaged in any form of activity at all. Chemerinsky takes the view that this benign intervention is intended to make sure that individuals who will always be in the need of health care will be prevented from free riding on the system by showing up without insurance coverage or cash at an emergency room.

Orin Kerr
Professor of Law, George Washington Law School

What a day. The challengers need to sweep all four of the Republican nominees who are potentially in play -- Roberts, Alito, Scalia, and Kennedy. Based on today's argument, it looks like all four of those Justices accepted the basic framing of the case offered by the challengers to the mandate. In particular, they all seem to accept that a legal requirement of action is quite different from a legal requirement regulating action, and that therefore the expansive Commerce Clause precedents like Raich did not apply to this case. That was the key move Randy Barnett introduced, and the four key Justices the challengers needed seemed to accept it. That was an enormous accomplishment for the challengers.

It's the Kennedy Court

March 29, 2012 8:05 AM

Erwin Chemerinsky
Dean and Distinguished Professor of Law,
University of California, Irvine School of Law

Two hours of oral arguments on Tuesday about the constitutionality of the individual mandate leave little doubt of what everyone expected all along: the outcome almost surely depends on Justice Anthony Kennedy. Justice Kennedy asked tough questions of both sides that allow either to be optimistic or pessimistic.

At one point, Justice Kennedy asked Paul Clement, the attorney for the states challenging the law, why the individual mandate was beyond the scope of Congress's power since it clearly could create a national health care system, tax people to fund it, and exempt those with health insurance. Justice Sotomayor expressed this forcefully when she said to Clement: "Could we have an exemption? Could the government say everybody pays a shared health care responsibility payment to offset all the money that we're forced to spend on health care, we the government; but anybody who has an insurance policy is exempt from that tax? Could the government do that?"

It's not about individual liberty

March 29, 2012 8:24 AM

Nadine Strossen
Professor of Law, New York Law School
President, American Civil Liberties Union (ACLU), 1991-2008

Many critics of the health care law's minimum coverage provision have invoked libertarian rhetoric, including their chosen, intendedly stigmatizing, label for it: "the individual mandate." They have trotted out a "parade of horribles," arguing that if the federal government can enforce this provision, then it could also subject us to countless intrusive regulations. "Broccoli" now connotes this alleged government power even to dictate what we ingest into our own bodies - as invoked several times during Tuesday's argument.

As a civil libertarian, I would be delighted if the challenge to the minimum coverage provision actually advanced individuals' rights to remain free from unwarranted government regulation. But Tuesday's arguments underscored that this is not the concern of either the challengers or the Justices who indicated support for their position.

The Limits of Limiting Principles

March 29, 2012 8:30 AM

Michael E. Rosman
General Counsel, The Center for Individual Rights

Today, I'd like to discuss General Verrilli's effort to define a limiting principle to his theories.

When pressed, General Verrilli insisted that his theories had one and relied on the tried and true commerce clause formulation that Congress must be regulating economic activity with a substantial effect on interstate commerce. (Tr. 30.) But if not buying something was "economic activity," that still left open the possibility that Congress could require people to purchase any product at all, a suggestion that made some Justices uncomfortable. To avoid that possibility, General Verrilli insisted (until he summed up and perhaps slipped a little) that Congress was not regulating the purchase and sale of insurance, and not mandating a purchase or creating commerce, but rather regulating the financing and payment associated with existing health care transactions. (Tr. 4-5, 16-17, 18, 20, 42.)

Richard A. Epstein
Laurence A. Tisch Professor of Law, New York University School of Law

In this post, I want to highlight the issue that I ducked the first time around, which deals with the relationship of ObamaCare to the original design of the Constitution. To many this little exercise could be regarded as an exploration into lost causes, but I think that it is instructive because it shows you how subtle permutations in arguments can lead, under the guise of the living constitution, to a massive revision of the basic constitutional structure--for the worse.

To do so, let me take two sentences, one from Gillian Metzger's instructive post on the taxation question, and one from Erwin Chemerinsky on the scope of the Commerce Clause. The common thread that links these together is that the Constitutional charter as now understood gives Congress a broad range of authority over both taxation and regulation that easily legitimates the scope of both the individual mandate and the Medicaid extension. But note the moves that it takes to do this. Thus Professor Metzger says with regrettable correctness that in dealing with the taxing power "there's no constitutional prohibition on forcing the young and healthy to help subsidize the old and infirm." That proposition is surely true, along with its converse, which is that there is no constitutional prohibition in asking the rich, who are elderly, to help subsidize, the poor who are not. Indeed, there is nothing in the current system of constitutional law that prevents multiple redistributive taxes working at cross purposes with each other.

But what does the spending clause actually say. Namely this:

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; . . .
The question is how to get from this text to the conventional wisdom that Metzger accurately conveys. It is not possible except by sleight of hand. Obviously, the taxing power was new to the Constitution. The general welfare is mentioned after the repayment of debts and the common defence. These are classic public goods that must be supplied to all if they are supplied to any persons. The basic theory is that government could tax to deal with those issues to overcome a collective action problem. The general welfare is linked to these, and it bound at the end by reference to the words "of the United States," which refers to the entity whose general welfare is at stake. The system of madcap redistribution is the antithesis of a public good, because far from benefiting everyone uniformly to the extent institutions can do so, it authorizes transfer payments that help some and hurt others. The redefinition of general welfare to include transfer payments is of stupendous importance. It expands the definition of a public good a thousand-fold, and opens the door to factional strife in the bargain.

Professor Chemerinsky is equally casual with the original Constitution design. His view of the living Constitution led him to observe that "[t]he framers could not have anticipated a country with 50 million people without health insurance or the enormous costs that imposes on the economy." Actually, they did, after a fashion, because they knew the dangers of any major departure from fundamental principles.

What Chemerinsky fails to ask is why there are 50 million uninsured. It is not a brute or necessary fact of nature. It is in fact a function of the very failed policies that he continues to support. Introduce a system of limited federal powers, and strong protections for economic liberties, and you don't get into the box where state and federal regulations and mandates can close down the voluntary market. And you certainly do get to unsustainable system of government rigged exchanges that are all too likely to increase the number of persons who will be forced to do with no or inferior health care.

Perhaps the living constitution allows this nation to move rapidly in reverse, but the laws of supply and demand are not so malleable. So when the government chooses a system that raises costs to produce and clamps down on their revenues, it is destined to fail. The correct intellectual response is not an apology for ObamaCare, but a sober understanding that the living constitution (which always evolves, alas, in collectivist fashion) is fraught with political and economic risks that will lead to the long-term decline of the United States. Striking down the ACA is a good way in which to reaffirm the founding principles, which by any standard of political wisdom and social welfare beat the living constitution hands down in any head-to-head competition.

Gillian Metzger
Vice Dean and Stanley H. Fuld Professor of Law, Columbia Law School

The argument on Tuesday made two key points clear. First, the five more conservative Justices are worried that allowing Congress to require individuals to buy health insurance before they seek healthcare would mean Congress's power has no bounds. Second, and as important, these Justices appear to accept that Congress could require individuals to obtain insurance when they do seek healthcare---presumably, because at that point, individuals are engaging in economic activity on their own volition. Indeed, both Paul Clement and Michael Carvin agreed that Congress could require insurance as a condition of getting healthcare.

Put these two points together, and the facial challenge to the mandate has to fail---even if a majority of the Court rejects the argument that everyone is active in the market for healthcare because everyone will seek healthcare at some point in their lives. That's because tens of millions of uninsured currently seek healthcare each year---57% of the 40 million uninsured, to quote a leading study. On the reasoning above, the mandate is constitutional as applied to this substantial group of people. Whether the test for a facial challenge is that it can only succeed if there's no constitutional application, or that it can succeed only when a challenged provision lacks any plainly legitimate sweep, the mandate meets it. As a result, the Court plainly should reject the facial challenge, and at most hold the mandate unconstitutional as applied to individuals who do not use healthcare in a given year.

Of course, that's assuming the Court adheres to its current doctrine that facial challenges are disfavored and that courts should avoid invalidating more of a statute than necessary. Resistance to facial challenges has been a pronounced characteristic of the Roberts Court. But the arguments on both Tuesday and Wednesday suggested that adherence to current doctrine isn't exactly the Court's paramount concern in these cases. The conservative Justices seemed unconcerned about the mandate's central role in ensuring the effectiveness of the ACA's regulation of insurers, even though in 2005 they sustained regulation of local noneconomic activity in Gonzales v. Raich on these grounds. They also seemed undeterred by the Court's repeated acceptance of conditional spending arrangements. If the Court is willing to cast aside core doctrines that have governed its assessment of congressional power challenges since the New Deal, asking for consistency on the facial challenges front may well be unrealistic.

Orin S. Kerr
Professor of Law, George Washington Law School

Based on this week's oral arguments, there is a very real chance that the Supreme Court might strike down the Affordable Care Act in whole or in part. What might change if that happens, beyond the obvious difference that the invalidated parts of the law would no longer be in effect?

Many have speculated about how such a decision might impact the 2012 race. I don't think there's an easy answer. On the Democratic side, such a decision might help because it lets Obama run against the Supreme Court; it might hurt because it denies Obama his most significant legislative accomplishment. On the Republican side, such a decision might help because it helps sell the narrative that Obama has gone too far; it might hurt because it takes away an unpopular law that Republicans could run against. Which of these possibilities are strongest? I just don't know.

The decision might also help reorient the basic constitutional narratives of the two parties. Since the Nixon Era, politicians from the two parties have each generally sounded a simple theme. Democrats generally endorse some form of a living Constitution and an active Supreme Court; Republicans generally endorse some form of strict construction and not legislating from the bench. There have been many variations from this theme over time. But, for the most part, that basic narrative has held its rhetorical force. If the Supreme Court strikes down the ACA on a 5-4 vote, however, those two sides just might flip. We may see Democrats come to extol judicial restraint and Republicans come to celebrate judicial power.

Finally, a decision striking down the ACA would inject the Supreme Court into the political arena in a way we haven't seen in many years. Remember the timing. The basic theory for why the ACA might be unconstitutional wasn't articulated until around the time the legislation was enacted. That theory quickly became an article of faith on one side of the aisle and the object of derision on the other side. If the Court uses those theories to knock down the legislation on a party line vote of 5 Republican nominees to 4 Democratic nominees, many will view the decision as politics masquerading as constitutional law - sort of a Bush v. Gore but with more lasting impact on constitutional law.

Nadine Strossen
Professor of Law, New York Law School
President, American Civil Liberties Union (ACLU), 1991-2008

At the conclusion of his argument in the Court's final session last Wednesday afternoon, U.S. Solicitor General Donald Verilli moved beyond the specific Medicaid expansion issue then on the Court's agenda, to argue more broadly that the Medicaid expansion, as well as the minimum coverage provision and other core aspects of the new law, will promote the equal "opportunity to enjoy the blessings of liberty." As Verilli urged, "it's important that we not lose sight of" the important ways in which the law advances liberty and equality, especially because its detractors have demonized the minimum coverage provision as violating both core constitutional concerns.

Three major national civil liberties and civil rights organizations - the American Civil Liberties Union, the NAACP Legal Defense & Educational Fund, and the Leadership Conference on Civil and Human Rights -- filed a friend of the court brief in the Supreme Court precisely to make the case that the minimum coverage provision has an overall positive impact on the intertwined constitutional guarantee of individual liberty and equal opportunity. For example, the ACLU summarized its "substantial interest in" this issue as being due to "its potential impact on the ability of millions of uninsured Americans to participate more fully in the economic, political, and social life of the Nation." This important perspective hasn't received as much attention as it deserves.

Numerous studies have documented that the uninsured are less likely to obtain adequate health care, thereby suffering many lost opportunities, which decreases both the quality and length of their lives. For example, children with untreated health problems are less likely to attend and to perform well in school. Being uninsured also correlates with other adverse educational outcomes, including failing to graduate from high school or to attend college.

The burdens of costly health care, and of being uninsured, are imposed disproportionately on members of our society who are relatively disempowered within the political system, including people of color, people with disabilities, low-income families, women, and senior citizens. Individuals in these groups inordinately experience unemployment, jobs that do not offer health insurance, and lower incomes that make insurance premiums unaffordable. The United Nations Committee that oversees compliance with the international Convention on the Elimination of all Forms of Racial Discrimination - to which the U.S. is a party -- recently noted its concern that in our country, "a large number of persons belonging to racial, ethnic, and national minorities still remain without health insurance and face numerous obstacles to access to adequate health care."

In sum, by lowering the cost of health insurance, the minimum coverage provision will make health care more affordable and accessible, thus enhancing liberty and equality for the millions of uninsured Americans. In contrast, this provision imposes only minimal burdens on individual liberty.

First, although its detractors refer to the minimum coverage provision as a "mandate," it does not in fact require anyone to purchase insurance. Rather, anyone may opt instead to pay a financial penalty, which is enforced through an offset of any tax refund that the government would otherwise have to pay. This arrangement certainly does not constitute direct government compulsion, and in many situations may well exert only limited influence on an individual's choice whether to buy insurance.

More fundamentally, this provision doesn't implicate any liberty interest that the Court has deemed constitutionally protected. For example, it doesn't force anyone to undergo any medical treatment or to receive any health services - which would infringe on fundamental freedoms of bodily integrity and medical decision-making. Instead, because the minimum coverage provision is an economic regulation, the asserted right to resist it is akin to the long-repudiated "liberty of contract" that the pre-1937 Supreme Court had read into the Constitution, substituting its own laissez-faire economic philosophy for our elected officials' policy choices.

Such judicial invalidation of economic regulations designed to promote equal access to health and welfare for the most vulnerable groups in our society, in the service of a judge-created "freedom of contract," has long been discredited as inappropriate judicial activism. If the Roberts Court resuscitated this approach, it would be promoting not individual liberty, but rather, judicial hegemony.

Michael E. Rosman
General Counsel, The Center for Individual Rights

Under the Necessary & Proper Clause, Congress has the power "to make all laws which shall be necessary and proper for carrying into execution the foregoing powers." The N&P Argument for the individual mandate is fairly straightforward, and perhaps the government's best argument. Congress relied on its Commerce Clause authority to regulate insurance company practices in the individual market, requiring the companies to adhere to "guaranteed issue" and "community rating" principles. (Everyone gets a policy and those with health issues cannot be charged more because of them.) With those principles, the argument goes, people might wait until they get sick before buying a policy; with only the sick buying policies, the costs to insurers will skyrocket and they will charge more for each policy, making the policies themselves much more expensive. The individual mandate precludes people from gaming the system like that, and thus is a "necessary and proper" addition to the insurance company regulations.

To this, the challengers reply that Congress cannot create the problem that requires fixing, or its powers would be unlimited. As the private challengers noted, Congress could "compel the purchase of any product burdened in any way by federal regulation, which is every product." The challengers and their amici focused on the requirement that laws must be "for carrying into execution the foregoing powers." One can fully execute a law by eliminating barriers to its enforcement, not by regulating third parties outside of the original regulation who can help lower the burdens of that initial law. They argue that the insurance company regulations (and, thus, Congress's Commerce Clause authority) could be perfectly executed without the individual mandate. The N&P Clause may give Congress the authority to punish insurers who fail to comply with its regulations, but it does not give Congress the authority to regulate outside of the enumerated powers solely to make the insurance regulations more desirable.

The authors of a recent scholarly book on the history and origins of the N&P Clause added their own enlightening amicus brief. According to them, the "necessary" requirement meant an "inferior" power deemed a necessary or customary means of executing a greater power - e.g., creating a national bank to collect revenues and make expenditures or adopting criminal laws or civil fines to deter violation of another law. The "proper" requirement invoked certain kinds of fiduciary responsibilities like impartiality and good faith. Under the proper understanding of the clause, they argued, the "individual mandate" failed to meet either requirement.

So the Court has much to choose from in analyzing whether the individual mandate is justified under the Necessary & Proper Clause. We can only hope that its decision will at least address some of the arguments noted here.

* * *

I want to close by responding briefly to Professor Metzger's suggestion that the Court cannot declare the statute facially unconstitutional under its precedents. This ignores the unique posture of Commerce Clause cases in which Congress's power to regulate activities "substantially affecting commerce" are decided. As Professor Metzger's well-known Columbia Law Review article itself noted, the Court's "class of activities" test in that area has rendered as-applied challenges "in practice impossible." (105 Col. L. Rev. at 906.) Moreover, Alfonso Lopez was actually being paid to deliver a gun and Christy Brzonkala (the private plaintiff in Morrison) argued strenuously that the statute there could be upheld as applied because it affected financial transactions she would have made with her college. If the Court ignores any "as applied" possibilities here, it will be nothing new. To the contrary, it will be consistent with its practice in this area.

Thanks to Point of Law and the Manhattan Institute for letting me participate in this excellent discussion!

Gillian Metzger
Vice Dean and Stanley H. Fuld Professor of Law, Columbia Law School

One well-established federalism argument was notably absent for most of the oral argument last week: the role that political accountability plays in checking Congress. Political accountability repeatedly appears in congressional power decisions, going back to Chief Justice Marshall's decisions in McCulloch v. Maryland and Gibbons v. Ogden. In more recent years, the Court famously invoked political accountability as a reason for the Court to not exempt the states from generally applicable legislation in Garcia v. San Antonio Metropolitan Transit Authority, and then subsequently as a justification for the Court to protect states from federal commandeering in New York v. United States and Printz v. United States.

But political accountability barely surfaced in the argument on the individual mandate, raised primarily by Justice Breyer who described political accountability as "the greatest limiting principle of all" on Congress, but one "which not too many accept." (Tr. 76). It was not until midway through the last ACA argument, on the Medicaid expansion, that the topic of political accountability was more fully engaged. Political accountability was Paul Clement's answer when Justice Kennedy asked "[h]ow are the interests of federalism concerned if ... there are huge Federal bureaucracies doing what this bill allows the state bureaucracies to do?" (Tr. 37). Justice Kennedy then pushed Solicitor General Verrilli on the subject, asking "do you agree that there still is ... necessary for the idea of federalism, that there be a clear line of accountability so the citizen knows that it's the Federal or the State government who should be held responsible for their program?"(Tr. 65-66).

This largely one-sided invocation of political accountability on behalf of the ACA's challengers should be surprising. To begin with, political accountability would seem to count in favor of the Medicaid expansion. Political pressure from their citizens is a major reason that the states feel compelled to participate in Medicaid; turning down the substantial federal funds offered to subsidize healthcare for poor state residents is not a popular political choice. Thus, what the states are seeking is to be freed from political accountability for such a decision, rather than to have their accountability enhanced. Nor does the claim that state voters are confused about which government to blame for features of federally-funded state programs fit recent experience. States have had no difficulty pointing the finger at the feds for the impact Medicaid requirements have on state budgets, or for the testing and accountability measures mandated by No Child Left Behind's conditions on federal educational funds.

As important, this one-sided approach obscures the extent to which the ACA is a product of longstanding political debate over how to assure individuals and families in this nation affordable access to healthcare.The rejection of the "public option" in favor of a model based on private insurance reflected, in part, the judgment of Congress that the former would constitute too dramatic and intrusive move on the part of the federal government. Political pressure is also responsible for the central role accorded to the states in key reforms, such as the reliance on state health exchanges and state insurance regulators. Recognizing that the political safeguards of federalism still have potency does not mean that the Court should stay out and leave federalism enforcement to Congress. But it underscores that Congress is not simply out to expand its own powers, and that its legislative judgments about how best to balance federal and state functions need to be taken seriously.

Finally, in response to my earlier post on facial challenges, Michael Rosman argues that sustaining a facial challenge to the mandate is consistent with the Court's commerce clause precedent in United States v. Lopez and United States v. Morrison. In fact, the opposite conclusion follows. Rosman is correct that in those cases the Court sustained facial challenges. But it did so after concluding that the class of activities regulated by the legislation at issue in those cases was noneconomic activity that fell outside of the scope of the commerce power. The point I was highlighting is that a similar conclusion is hard to justify here, given the seeming agreement that a broad swath of the activity regulated by the mandate would indeed fall within Congress's power. Put differently, as a regulation of the class of activity of accessing and financing healthcare, the mandate is facially constitutional. If the Court views Lopez and Morrison as limiting it to facial resolution in the commerce power context, then it should stop there; the tests for facial invalidation simply are not met. Moreover, the Roberts Court has repeatedly emphasized that facial challenges should be viewed with disfavor, which should counsel heavily against suddenly switching to a more lenient approach to facial challenges.

Many thanks for the chance to participate in this engaged debate.

Ideologies of Federalism

April 3, 2012 11:59 AM

Erwin Chemerinsky
Dean and Distinguished Professor of Law,
University of California, Irvine School of Law

Since the country's earliest days, federalism has been used as a political argument primarily in support of conservative causes. During the early 19th century, John Calhoun argued that states had independent sovereignty and could interpose their authority between the federal government and the people to nullify federal actions restricting slavery.

In the early 20th century, federalism was successfully used as the basis for challenging federal laws regulating child labor, imposing the minimum wage, and protecting consumers. During the depression, conservatives objected to President Franklin Roosevelt's proposals, such as Social Security, on the ground that they usurped functions properly left to state governments.

During the 1950s and the 1960s, objections to federal civil rights efforts were phrased primarily in terms of federalism. Southerners challenged Supreme Court decisions mandating desegregation and objected to proposed federal civil rights legislation by resurrecting the arguments of John Calhoun. Segregation and discrimination were defended not on the grounds that they were desirable practices, and more in terms of the states' rights to choose their own laws concerning race relations.

In the 1980s, President Ronald Reagan proclaimed a "new federalism" as the basis for attempting to dismantle federal social welfare programs. In his first presidential inaugural address, President Reagan said that he sought to "restore the balance between levels of government." Federalism was thus employed as the basis for cutting back on countless federal programs.

Hindsight reveals that federalism has been primarily a conservative argument used to resist progressive federal efforts, especially in the areas of civil rights and social welfare. It is no surprise, then, that in their questioning of the lawyers, the conservative justices expressed great skepticism about the constitutionality of key aspects of the Affordable Care Act.

But after reading the transcripts of the oral arguments (and listening to much of them), I remain convinced that this should be an easy case for the Court. The individual mandate is no different from social security tax that allows an exemption for those with their own retirement account. It is hard to imagine how Congress cannot regulate under its commerce power a segment of the economy that is $2.6 trillion, especially as Justices Scalia and Kennedy acknowledged because those who do not purchase insurance directly affect the rates of those who do. If Congress, under its commerce power, can regulate Angela Raich growing marijuana for her own personal use, surely it can regulate health insurance.

Nor should the constitutionality of the increased burden on the states to participate in the Medicaid program be a difficult question. No state is required to participate in the Medicaid program. If it chooses to do so, it must meet certain conditions. This is true of countless federal programs. Under the current Medicaid law, the federal government pays between 50 and 80% of a state's costs. But under the Affordable Care Act, the federal government initially pays 100% and in 2021 it becomes 90%. If the burden on the states under the Affordable Care Act violates the Tenth Amendment, then why doesn't the current law? There is a difference between forcing the states to do something and given them a strong financial inducement.

The oral arguments gave no clear sense of what the Court will do, except perhaps that there does not seem to be a majority to dismiss the case based on the Anti-Injunction Act. The justices asked hard questions of both sides and pundits offering predictions are just picking the ones that most support their views.

Every lower federal court judge appointed by a Republican President, with two exceptions, voted to strike down the law. Every lower federal court judge appointed by a Democratic President, with one exception, voted to uphold the law. The crucial question is whether the Supreme Court justices will see it any other way. Will the historic liberal and conservative divide over states' rights determine the outcome of this case? We'll know in June.

Richard A. Epstein
Laurence A. Tisch Professor of Law, New York University School of Law

The excellent posts by Gillian Metzger and Erwin Chemerinsky go beyond the particulars of the Affordable Care Act to address more general considerations of federalism. Stated in a nutshell, their view of the subject is that broad conceptions of political accountability afford the one key check that is needed on adventuresome legislation by which the federal government is respectful of the role that the states play in the structure of the political system. To Gillian Metzger, for example, the Medicaid expansion program should be approved because the states have to take political accountability for their decisions. She writes:

Political pressure from their citizens is a major reason that the states feel compelled to participate in Medicaid; turning down the substantial federal funds offered to subsidize healthcare for poor state residents is not a popular political choice.

This argument misses the force of the case against the Medicaid expansion. Why not divide the states into two classes? Those states that want to accept the program should, in my view, be entitled to participate even if key portions of the Medicaid expansions are cut. By the same token, the states that don't want to accept the program should be free to turn it down without having to sacrifice all the funds that are now contributed by the federal government to allow the states to run their programs for persons whose income is below poverty levels.

Put otherwise, the only objection here is to the unprecedented--to use everyone's favorite term--conditions that the federal government uses to bully states into the program. They are not allowed to reorganize the delivery of their services for the below-poverty line populations. And they must incur the very heavy administrative costs of running the expanded Medicaid program for new individuals.

In addition, Metzger's argument has to do work not only for this particular iteration of the Medicaid expansion, but also has to carry the day if the federal government added new burdens or new conditions to the Medicaid expansion. A state like California receives some $25 billion in Medicaid money for its current recipients. It will, as a moral certainty, be driven into the new program so long as its conditions cost it less than the money it forfeits.

We should, moreover, reject the reply that the loss of funds goes to the individual recipients and not to the state. But so what? This is not a condition wherein the federal government says to California that if you do not play along, then we shall take the money from Medicaid recipients in Oregon. Clearly the target was to drive the state which has all sorts of special obligations to its own citizens. One might as well say that there is no coercion involved when the gun man says give me your wallet or I will kill your mother.

None of these dire conclusions are softened by the political accountability doctrine.Taken to its limits, the doctrine means that the Constitution imposes no limits whatsoever on what the federal government can do in its relationships with the state by taxation, regulation and spending. Indeed, it goes so far that the terrible decision in South Dakota v. Dole is needlessly protective of the state because there is no such thing as coercion in the use of any of its powers. Yet if the doctrine does not go that far, then just how far does it go? Neither Metzger, nor any other defender of the doctrine explain its limits.

Indeed the situation is worse than this, because Metzger offers no explanation as to why there is not tremendous political exposure to those states that wish to reject the funds, just as there is to those states that want to accept them. This is one of the major decisions that state governments have to make, and if they make the wrong one, they will pay a price. Put otherwise, there is always political accountability. The key question therefore, is to get the federalism arrangements correct. It is not to use this doctrine as a trump that obviates the need to make a closer review of the overall situation.

Space does not permit a full examination of the Chemerinsky post that engages in too much name-calling and not enough analysis. There are many uses and abuses of federalism in dealing with federal state relationships. There are also many explicit limitations that the Constitution places on the states through the Fourteenth Amendment that it authorizes the Congress to enforce against the states by appropriate legislation. John Calhoun no longer walks the halls of Congress, and indeed the great sin of the Reconstruction period was its narrow construction of the Privileges or Immunities Clause, which allowed southern states exclusive and abusive control over the criminal justice system.

What that has to do with the current issue is anyone's guess. For different, the invocation of competitive federalism in connection with the child labor laws raises other issues, only here competitive federalism worked far better than a national standard. Chemerinsky is so committed to progressive causes that he is blind to the way in which his own brand of politics is used to sanctify the New Deal transformation of a Constitution of limited federal powers into one that allows federal force to control markets where it ought not to enter. It is, alas, too late to turn back the clock on Wickard v. Filburn. It is high time to recognize its massive errors by refusing to extend its logic one inch further.

Let us hope that the Supreme Court will exorcize the political accountability doctrine, and strike down both Title I and Title II of the ACA.

A Sense of Deja Vu

April 4, 2012 11:51 AM

Orin S. Kerr
Professor of Law, George Washington Law School

Five years ago, I participated in an online debate much like this one with several of the participants in our exchange today. The discussion focused on a pending case, the then-recent decision of the Fourth Circuit in al-Marri v. Wright. Al Marri had held that a suspected al Qaeda terrorist who was seized in the United States could not be held in military detention. Erwin Chemerinsky weighed in, as did Richard Epstein and myself.

Five years later, the band is back together. Or at least some of us are. A different President is in power, and the political stakes have changed. It's a different website. And this time around we're discussing the scope of Congressional power, not the detention power. Judicial power has switched from a liberal position to a conservative one, and judicial restraint from a conservative position to a liberal one. But the debate seems to be similar, even though many analysts have changed sides.

I drew the comparison earlier, but I think it's worth revisiting. In both the health care and the detention debates, the general disagreement boils down to judicial deference versus adherence to constitutional norms seen as embedded in the text. In the detention cases the text was the Habeas Clause, and the norm was that the Great Writ must guarantee judicial review of detention. In the case of the health care litigation, the text is the Commerce Clause, and the norm is that the federal government must be a government of limited powers. In both cases, the opposing side acknowledges the basic principle but concludes that it does not require invalidating the law or practice at issue, especially in light of the need to defer to the elected branches. It's not exactly the same question, of course. But I think there are some very interesting similarities.

However the Court rules, I suppose we can all look forward to 2017, when we'll be back to debate the next round in the separation of powers battle among the three branches.






Obamacare Decision: Reactions, July 2012
Law School Faculty Diversity, May-June 2012
Class Actions, May 2012
Constitutionality of Individual Mandate, March 2012
Human Rights and International Law, February-March 2012
The constitutionality of President Obama's recess appointments, January 2012
Do caps on medical malpractice damages hurt consumers?, December 2011
Trial Lawyers Inc.: State Attorneys General, October 2011
Wal-Mart v. Dukes, April 2011
Kagan Supreme Court nomination, May-June 2010
Election roundtable, November-December 2006
Who's the boss, September 2006
Medical judgement, July 2006
Lawyer Licensing, May 2006
Contingent claims, April 2006
Smoking guns, July 2004

Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.