The Corner

The Government We Deserve: Health-Care Edition

I am not a legal scholar so I cannot comment on the legal impact of yesterday’s health care ruling. However, I am having a hard time seeing this as a victory for federalism like many others around me. Also, like Rivkin and Casey in this morning Wall Street Journal, I find the move to uphold the mandate as a tax strange to say the least:

The law was not passed as a tax, and both the president and ObamaCare’s congressional supporters persistently proclaimed that they were not raising taxes. The court itself was forced to concede that “the statute reads more naturally as a command to buy insurance than as a tax.”

In order to reach its conclusion that the mandate was a tax, and avoid the political fallout of striking down President Obama’s signature achievement in an election year, the court did more than overlook the statutory text’s natural meaning. It ignored congressional enactment of the mandate in a separate provision from any penalty. As Justices Scalia, Kennedy, Thomas and Alito wrote in dissent, “to say that the Individual Mandate merely imposes a tax is not to interpret the statute but to rewrite it.”

I like Volokh Conspiracy contributor and George Mason law professor David Berstein’s suggestion to Republicans:

I’d schedule a new vote in the House on the individual mandate, but replace the “penalty language” with language specifically acknowledging that the “penalty” is actually a tax. If the Democrats vote “aye,” they’ve acknowledged breaking the Obama pledge not to raise taxes on the middle class. If the Democrats–specifically those who already voted for the mandate–vote “nay”, what becomes of the tax argument in future litigation? Seems to me that Roberts was only able to argue that the mandate is a tax because no one [officially, by Congressional vote] specifically said it wasn’t. At least it would look very peculiar that the Court upheld the law on a theory that Congressional supporters of the law refuse to adopt. (And if they vote “nay” on the theory that the Senate won’t vote for repeal anyway, it looks bad for the president that he can’t get members of his own party to publicly support his “signature” piece of legislation).

#more#There is one area that will be interesting (in a dark twisted way) to follow is the Court’s ruling that states can opt out of the health-care law’s Medicaid expansion? As I wrote in this morning NRO Symposium about the ruling:

In principle I see the limitation imposed by the Court as a good thing, but it could have some serious fiscal implications. As Avik Roy explains at Forbes, by allowing states to opt out, SCOTUS may have paved the way to dramatically increased deficits. Individuals who would have received coverage through Medicaid, but who won’t if their states opt out, may now be eligible for subsidies under the exchange, which is more expensive. Under this scenario, taxpayers will pick up the tab.

Over at E21, my colleague Chuck Blahous seems to share this fear:

Much attention has been given to the argument that without the individual purchase mandate, other parts of the health care law would become unworkable. Much less attention has been given to the fact that without the states forced to be on board with the Medicaid expansion, the law’s health exchange subsidies might be fiscally unworkable. The Supreme Court may have just set in motion of chain of events that could lead to the law’s being found as busting the budget, even under the highly favorable scoring methods used last time around.

Now, one thing is sure, this ruling didn’t shrink the size of the federal government. It is also unlikely to increase our freedom today or tomorrow.

But I will say this: With or without this Supreme Court decision, we are and we will remain in terrible financial shape. We are in this mess today because for years now free marketeers and conservatives in Congress, along with the pundits and the policy people who support them, have agreed to significant compromises of their principles, often in the name of practicality or the claim that the other party’s proposal would have been worse (think about the Republicans’ argument for Medicare Part D). These compromises have produced the government we have today: It is big and it will get bigger; it is overreaching; it is inefficient (including the Department of Defense); it is wasteful; it corrupts the private sector and gets corrupted in return; and it doesn’t effectively help Americans, especially the poor.

Thanks to Jason Fichtner for sending me the Wall Street Journal piece.

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