Capitalism Institute

I couldn’t believe it when I saw it on SCOTUSblog at 10:08 a.m, ET. “The individual mandate survives as a tax.”

In those seven words, Amy Howe, the SCOTUSblog reporter who typed the entry, informed the world that Congress now has the “constitutionally” protected power to deny individuals their right to choose whether to participate in the health insurance market.

I was shocked. I was expecting the Court to take a middle-of-the road approach by striking down the individual mandate (and perhaps a few associated provisions) and leaving the rest of the bill intact. I was mentally prepared for much of the bill to remain in place–and ready to remind people that the job was far from finished.

Those seven words proved that no reminder was necessary.

How did we get here?

Let’s rewind a bit. The Senate passed the bill in the dead of night on Christmas Eve. Americans woke up on Christmas morning to the reality that the Affordable Care Act (ACA, a.k.a. “Obamacare”) was one step away from the president’s desk. Sure enough, several months later, the bill was passed by the House and signed by President Obama on March 21, 2010.

Shortly before the House passed the bill, then House Speaker Nancy Pelosi told Americans that “We have to pass the bill so you can find out what’s in it.”  In April, after Obamacare was signed into law, Rep. Phil Hare (D-Ill.) said that “I don’t worry about the Constitution on this, to be honest.”  When some people worried that the individual mandate was an unconstitutional tax on an individual’s right to deny participation in the health insurance market, President Obama and numerous Democrats went on the record saying that the individual mandate was not a tax. At the time, this was supposed to be a semantic legal issue: regardless of whether or not it was a tax, it represented a new power for the federal government to force people into the health insurance market by levying a coercive penalty/tax/fine.

Thankfully, many state governments launched into action to legally oppose Obamacare. They developed multiple angles of attack against the law. Along the way, they heard the federal government’s legal team argue that the individual mandate was, after all, a tax! The reason was because the federal government relied upon two constitutional justifications for the enforcement of the individual mandate, and they needed a back-up in case their first defense strategy failed:

• Commerce Clause: Article I, Sec. 8 gives the Congress the power to regulate interstate commerce. The federal government argued that health insurance markets had such a substantial effect on interstate commerce that it was within the purview of Congress to regulate it (this was, in part, based on expansive commerce clause precedent set in previous cases such as Wickard v. Filburn)
• The power to tax: Article I, Sec. 8 also gives the Congress the power to “lay and collect Taxes, Duties, Imposts and Excises.” Assuming that the individual mandate was indeed a tax, then Obamacare could be justified legally under this authority.

Thus, the “tax” argument was the backup plan in case the commerce clause argument failed.  While Obama and the Democrats argued that the individual mandate wasn’t a tax for political purposes prior to its passage, but solicitor general Verrilli argued that it was a tax for legal purposes after its passage.

Oh yeah, and freedom is slavery too.

Chief Justice Roberts: Redefining “Benedict Arnold”

As the solicitor general, Donald Verrilli, literally stumbled through his arguments in defense of the constitutionality of Obamacare, liberty-lovers across the nation began to see a glimmer of hope. When Michael Carvin and Paul Clement eloquently attacked the constitutionality of the health care law, and particularly destroyed the alleged constitutionality of the individual mandate, the floodgates of optimism were opened. A 5-4 conservative majority among the justices, fumbling and bumbling solicitor general, and powerful legal argumentation by Clement and Carvin represented the perfect recipe for at least destroying the constitutionality of the individual mandate–if not the entire law.

Fast-forward to 10:10 a.m. on Thursday, June 28, 2012.  The latest SCOTUSblog update from a reporter named Tom read as follows:

“So the mandate is constitutional. Chief Justice Roberts joins the left of the Court.”

Yep, you read that right.  After the bastardized and unconstitutional birth of Obamacare and its subsequent flaws, mysteries, and inconsistencies were revealed for the world to see, the alleged conservative chief justice of the Supreme Court ruled that it was somehow constitutional.

Perhaps this just signified that chief justice Roberts never really was a conservative and was really a soft-hearted moderate all along. Perhaps this just means that he was caving to political pressure on the part of the Obama administration. Perhaps it was just an evil genius ploy to motivate the Republican base into supporting Romney (one of the absolutely worst arguments I have heard from conservatives thus far to get Roberts off the hook).

Regardless of whatever motivated Roberts to decide in favor of Obamacare (and against the Constitution), the fact of the matter is that he did it. The cost of Obamacare is on his hands as much as it is on Obama’s, Pelosi’s, and Ried’s.  He had a chance to strike down the law (which he should have taken in light of all the relevant moral, legal, and economic considerations), but he did not.

That’s not even ultimately what’s most upsetting. The fact of the matter is that Chief Justice Roberts was appointed on the understanding that he would uphold the United States Constitution–a duty that included providing a check on unconstitutional growths of federal power. We knew that the four liberal justices (Ginsburg, Sotamayor, Kagan, and Breyer) were going to uphold the law…but we did not expect a traitor to the Constitution from a supposedly constitutional conservative member of the bench.

The simple fact of the matter is that Chief Justice Roberts betrayed the Constitution.  Nothing can justify that, even if the conspiracy theory running around about some grand political scheming on Roberts’ part is true (which I highly doubt).  But even if it is true, political scheming is the last thing that a justice of the court should be doing.

No matter what, Roberts is guilty of betraying the Constitution.

It’s a tax, but it’s not!

What was once supposed to be a semantic legal technicality that served to demonstrate the absurd contradictions of the federal government’s case for Obamacare became the cornerstone of Roberts’ decision in favor of Obamacare.

Secretary general Verrilli pushed hard to find legal basis for Obamacare in the commerce clause. Unsurprisingly, Justice Roberts dismissed the constitutionality of Obamacare under the commerce clause, rightfully pointing out that:

“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.”

In other words, the government’s top argument for constitutional justification, the commerce clause, is null and void. Fireworks and champagne! Obamacare’s dead, right?

Wrong. Inexplicably, Roberts decided to convert the most ho-hum and perhaps laughable argument of the federal government into the bedrock for affirming the legal validity of Obamacare. That’s right, he decided to say that the individual mandate was justified under Congress’s power to tax. What’s even more absurd is that he decided to arbitrarily accept the federal government’s interpretation that the individual mandate was not really a mandate at all, nor was it a fine, nor was it a penalty. Rather, it was a tax on one’s decision not to buy insurance.

But I thought it wasn’t a tax, President Obama?

Here’s the kicker: either way, the answer should have been that the individual mandate (and thus, the law due to severability) is unconstitutional. Roger Pilon at the Cato Institute points out that, even if you were to accept the interpretation that the individual mandate represents a tax on an individual’s decision not to buy insurance, it’s still not a type of tax listed in the Constitution:

“Congress can ‘tax’ those who don’t buy government approved health insurance. Don’t ask what kind of a ‘tax’ that is! It’s not an income tax. Nor is it a duty, impost, or excise tax, the only kinds of taxes recognized under the Tax Clause of the Constitution, where Roberts purports to rest Congress’s power; and it certainly isn’t ‘uniform throughout the United States,’ as is required for those taxes. It’s sui generis, which is a polite way of saying it’s unconstitutional — if we take the Constitution seriously.” – Roger Pilon

Thus, if the individual mandate had been ruled as not a tax, (which its political defenders all still claim to be true), then it could have only derived its justification from the commerce clause–which Justice Roberts had already shown was invalid.

Let me put it this way: based upon pure legal reasoning and the fact that this was a 5-4 decision, libertarians and conservatives were inches away from their biggest legal victory in the Supreme Court in decades. Sure, this decision would not have overturned disastrous commerce clause precedent set during the New Deal era and afterwards, however, it would have put a check upon the federal government’s limits. It would have overturned the health care law en toto, since the four dissenting justices realized that they could not legally sever the individual mandate from the rest of the law.

Instead of taking this monumental step to reign in governmental power according to the Constitution’s limits, Chief Justice Roberts decided to improperly use the constitutional power to tax as a justification for granting Congress with plenary (i.e. unlimited) authority to force individuals into a market by introducing fines and legally calling them “taxes.”

That is why, as the sun begins to dawn tomorrow morning, we are staring into the future, facing monumental increases in healthcare prices, monopolistic trends in health insurance practices, and substantially decreased quality of healthcare.

All because a tax is not a tax. Except that it is.

As Michael Cannon put it, either “The Supreme Court just enacted a law that Congress never would have passed,” or “The Court just told Congress it is okay to lie to the people to avoid political accountability.”

Justice Kennedy: The Forgotten Hero

Finally, lost in all of the madness of Chief Justice Roberts’ logic, is the fact that Justice Kennedy wrote the dissenting opinion calling for a complete overturning of Obamacare in its totality.

Let me repeat that: Justice Kennedy, along with Thomas, Scalia, and Alito would have overturned Obamacare in its entirety if Chief Justice Roberts would have joined them.

For all of the flak that Justice Kennedy has received for being a moderate swing vote in recent years, I think he buys himself a major “get out of jail free” card with his performance in the health care ruling. The one guy that conservatives were doubting stepped up to the plate and hit a grand slam. Unfortunately, it was not enough–thanks to Chief Justice Roberts treasonous and unforgiveable decision to justify Obamacare with his fellow liberals on the bench.

Nevertheless, my hat is off to Justice Kennedy, Justice Scalia, Justice Alito, and Justice Thomas. I trust that both conservatives and libertarians will never forget their stand against the arbitrary tyranny of Roberts and his counterparts in this decision.

Liberty and Tyranny: What Next?

Obamacare is bad law. Today’s decision does not change that. Nobody can change the fact that congressional members have blatantly dismissed the Constitution as non-binding when referring to Obamacare. No one can deny that any members of Congress actually knew what was in the bill when they passed it. No one can refute the fact that the individual mandate was indeed not severable from the rest of the law and that everything should have been struck down. No one can refute the fact that the majority of Americans don’t want this law.

But yet, we still have it.

Today, the Supreme Court ruled that the federal government has the authority to throw you in jail if you don’t buy health insurance. Don’t believe me? Guess what happens if you don’t pay your taxes. And if the individual mandate is really a tax, then that means individuals will be required to pay it or face fines and jail time. Granting Congress this level of power essentially grants them the power to force us (through taxation) to do whatever Congress wants us to do.

Politically, it’s tyranny.

Constitutionally, it’s unconstitutional.

Economically, it’s the epitome of perverse incentives.

Ethically, it’s evil.

The fight has only just begun. States now will have the option to refuse to set up the mandated health exchanges required by the law, a strategy long endorsed by Michael Cannon at the Cato Institute in case the law were to be upheld. It remains to be seen which states, if any will pursue this strategy, but this has to be the line of defense that citizens angry about the ruling have to fall back to.

On an individual level, the most important thing is to not let go of our love for liberty, for free markets, and for justice. Many of us are angry and rightfully so. However, time and again, when threatened by government encroachments, Americans get angry for a time and then they forget. It’s time to hold on to our desperation a little longer this time. The stakes are higher than they probably have ever been. This is not a call to riot in the streets or encourage lawlessness…we’ll leave that up to union workers in Wisconsin.

However, it is a call to more fervently embrace the principles of limited government, capitalism, liberty, and justice–and to continue spreading that message of liberty to others. We have the winning argument, but the time is running out to convince people.

We’ve been dealt a bad hand, but that doesn’t prevent us from making the most of it.

“…the germ of dissolution of our federal government is in the constitution of the federal judiciary; an irresponsible body (for impeachment is scarcely a scarecrow) working like gravity by night and by day, gaining a little today and little tomorrow, and advancing its noiseless step like a thief, over the field of jurisdiction, until all shall be usurped from the States, and the government of all be consolidated into one. To this I am opposed; because, when all government, domestic and foreign, in little as in great things, shall be drawn to Washington as the center of all power, it will render powerless the checks provided of one government or another, and will become as venal and oppressive as the government from which we separated.” – Thomas Jefferson, Letter to C. Hammond (1821)