Belmont Club

Who Decides?

Randy Barnett at the Volokh Conspiracy quotes Kurt Lash in analyzing the recent opinion of Judge Henry Hudson striking down the individual mandate within Obamacare. Critics of Hudson believe the judge did not take full account of the Necessary and Proper clause as a justification for the individual mandate. Lash believes critics are wrong to say that Hudson ignored the Necessary and Proper clause, not just because the government itself did not articulate that argument more strongly,  but because Necessary and Proper would have to be invoked in an almost blanket fashion to make the individual mandate valid. Hudson wrote, “[a]lthough the Necessary and Proper Clause vests Congress with broad authority to exercise means, which are not themselves an enumerated power, to implement legislation, it is not without limitation.”

This is a key assertion in Hudson’s opinion—one that he makes in regard to both the Commerce Clause and the Necessary and Proper Clause. If upholding the individual insurance mandate required an interpretation of federal power that removed all serious limits on federal authority, then such an interpretation could not be correct under a Constitution of limited federal power. According to Hudson, “the same reasoning,” which supported the mandate “could apply to transportation, housing, or nutritional decisions. This broad definition of the economic activity subject to congressional regulation lacks logical limitation.” Any interpretation of federal power that has no logical limit cannot be correct, regardless of the textual source of such power. As Hudson puts it, [the Necessary and Proper Clause] is not unbridled.” …

In short, Judge Hudson did not ignore the Necessary and Proper Clause, nor did he reduce the Clause to a nullity. He simply concluded that assertions of unlimited power fall beyond any reasonable interpretation of congressional power, whatever its purported source.

Don Surber, reacting to the decision, agreed that the Necessary and Proper Clause had to have some limits in matter of individual mandates. Otherwise government could tell hippies to have haircuts.

Eric Holder and Kathleen Sebelius, reacting to the Hudson decision, made a public-policy rebuttal stressing the underlying reason for for passing Obamacare in the first place: the government needs to help people and no judge should really stand in the way of a beneficial intent. The suits challenging Obamacare — the judges who uphold the suits — are implicitly troublemakers, standing between the poor and the helpful state.

In March, New Hampshire preschool teacher Gail O’Brien, who was unable to obtain health insurance through her employer, was diagnosed with an aggressive form of lymphoma. Her subsequent applications for health insurance were rejected because of her condition. With each round of chemotherapy costing $16,000, she delayed treatment because she knew her savings wouldn’t last. …

That’s what makes the recent lawsuits challenging the Affordable Care Act so troubling. … As these lawsuits continue, Americans should be clear about what the opponents of reform are asking the courts to do. Striking down the individual responsibility provision means slamming the door on millions of Americans like Gail O’Brien, who’ve been locked out of our health insurance markets, and shifting more costs onto families who’ve acted responsibly.

Regarding the “hippie haircut” argument, Holder and Sebelius argue that government has long had the power to control bad economic choices.  That makes healthcare different from barbers because unregulated individual choices create unwelcome economic effects. “As two federal courts have already held, this unfair cost-shifting harms the marketplace. For decades, Supreme Court decisions have made clear that the Constitution allows Congress to adopt rules to deal with such harmful economic effects, which is what the law does – it regulates how we pay for health care by ensuring that those who have insurance don’t continue to pay for those who don’t.” And therein lies the justification for regulating this particular form of commerce.

It is also the core of the real battle over Obamacare. The legal challenges will be fought out by lawyers in the courts but its political aspect is primary, and will be decided in the electoral arena by elected officials and between the different branches of government, both Federal and State. The current Congress has asserted it can control one sixth of the American economy to prevent unfair cost-shifting and promote its desired outcomes.

But Congress asserts this so in an political environment when the Federal Government share of GDP is at a peacetime high, when it has $50 trillion in unfunded mandates in Medicare. In the context, the Holder/Sebelius assertion that ‘government is here to help you — and you may not hinder it from doing so’ will not go unchallenged. It simply cannot go unchallenged. Legalities aside, government intervention itself has cumulatively produced vast economic effects. The proposition that Government has the right to regulate commerce, becomes, in the era of monster deficits, the question of “who regulates the Government’s impact on commerce?” And the obvious answer is the political process.

What is missing from the purely legal wrangles over Hudson’s ruling is the wider policy problem, which Holder and Sebelius introduce at their peril: if they want to talk about outcomes, they ought to talk about outcomes. Gail O’Brien who cannot afford cancer treatment, has already been saddled with $304,000 in Federal Debt — even before she begins any treatment designed to help her. While legally irrelevant, the claim that government has the power to compel behavior in a huge medical industry it has helped to bloat is crucially different from a claim in the abstract that it has the right to help people.  Where government intervention is unlikely to help, based on its previous track record, the argument that it must be allowed to help slightly weakens.

The political environment cannot be ignored. A majority of Americans, according to a recent Washington Post poll, oppose Obama’s health care policies. Sixty eight percent want the individual mandate repealed. This unpopularity had been pooh-poohed in the past.  Ezra Klein, writing in the Washington Post back in April 2010 claimed that healthcare popularity didn’t matter if there was ‘something in it’ for the average voter.

Health-care reform is unpopular. But if you actually tell people what’s in the health-care reform bill, then it becomes quite popular. A recent Newsweek poll found the same thing: “The majority of Americans are opposed to President Obama’s health-care reform plan — until they learn the details.” … Voters don’t pay very close attention to politics, and they pay even less attention to policy.

Unfortunately for the Klein theory, attempts to re-frame Obamacare by casting in terms that will be appealing to the public have failed. No matter how you slice it, baloney appears to be baloney. The first indication was the 2010 election in which elected officials who supported Obamacare were punished by the voters. The second sign was the continued decline of the policy’s popularity in the polls. The policy had been in trouble for months.

Coming on top of inability to sell the Hudson decision is just the crowning catastrophe, the cherry on top of a sundae of setbacks, not the bulk of the problem itself.  The major difficulties of Obamacare are two. Who decides how the healthcare industry should be architected or reformed? Second, who’s going to pay for it? One thing appears to be true. A Federal Government that can’t pay the piper is in a poor position to call the tune. To paraphrase Klein’s Newsweek quote, “The majority of Americans are opposed to President Obama’s health-care reform plan — until they learn the details –and then they become even more opposed when they realize the promised details cannot be afforded.”

These are problems that won’t go away, even if the decision is reversed by another judge. It is a circle the administration can’t square.

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