June 29, 2012

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

Reason Magazine
written by Damon W. Root
Thursday June 28, 2012

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)

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