July 9, 2012
Barnett & Roberts’ Tax Analysis

After I posted this quote from Randy Barnett last night, a reader asks:

Would you mind explaining the implications of the quotation you just posted about Roberts’ reading of the tax power with regard to drug laws?

Sure.  What Barnett was trying to get people to think about is whether there’s a meaningful distinction between the power to regulate economic activity under the Commerce Clause, and the power to regulate economic activity under Congress’s taxing power, flowing from Art. I, §§ 2, 8, 9, and Amendment XVI.  Roberts’ tax analysis in the recent healthcare decision seemed to imply that validating the Mandate under Congress’s taxing power places meaningful limits on how Congress may regulate “inactivity.”  Here are the operative paragraphs of Roberts’ opinion:

Congress’s ability to use its taxing power to influence conduct is not without limits.  A few of our cases policed these limits aggressively, invalidating punitive exactions obviously designed to regulate behavior otherwise regarded at the time as beyond federal authority … More often and more recently  we have declined to closely examine the regulatory motive or effect of revenue-raising measures.  [citations omitted].  We have nonetheless  maintained that “‘there comes a time in the extension of  the penalizing features of the so-called tax when it loses its character as such and becomes a mere penalty with the  characteristics of regulation and punishment.’”  [citation omitted].  

…

[A]lthough the breadth of Congress’s power to tax is greater than its power to regulate commerce, the taxing power does not give Congress the same degree of control over individual behavior. Once we recognize that Congress may regulate a particular decision under the Commerce Clause, the Federal Government can bring its full  weight to bear. Congress may simply command individuals to do as it directs.  An individual who disobeys may  be subjected to criminal sanctions.  Those sanctions can  include not only fines and imprisonment, but all the attendant consequences of being branded a criminal: deprivation of otherwise protected civil rights, such as the right to bear arms or vote in elections; loss of employment opportunities; social stigma; and severe disabilities in other controversies, such as custody or immigration disputes.  By contrast, Congress’s authority under the taxing power is limited to requiring an individual to pay money into the Federal Treasury, no more. If a tax is properly paid, the Government has no power to compel or punish individuals subject to it. 

 What Barnett is doing, I suspect, is slyly referencing the Marihuana Tax Act of 1937, in which Congress essentially pulled a rather insidious two-step: first, they made it illegal to sell marijuana without paying a tax, for which one would receive a validating stamp indicating the tax had been paid.  But then the government would, in some cases, arbitrarily refuse to issue the stamps.  Also, the tax itself was prohibitively high ($100 per pound of hemp), meaning many manufacturers either stopped selling, or just disregarded the tax altogether.  Unfortunately, in the latter case, this subjected them to harsh criminal penalties, including upwards of four years in prison.  In other words, Congress used its taxing power to create a statute that effectively operated as a criminal prohibition.  The limited taxing power described by Roberts arguably opens a back door to the sort of harsh sanctions that Roberts claims aren’t available under the tax provisions of the Constitution.

It’s a strong argument, and one I respect Barnett for making (assuming that was actually his intent).  Yet from a broader angle, my disagreement with Barnett, and other critics of the Mandate, remains the fact that I think they’ve misconstrued bad policy with unconstitutional policy.  Congress can make terrible, even catastrophic laws that would pass Constitutional muster.  The Constitution, for better or worse, does not say “Congress shall pass no law which is really, really bad.”  Americans are in virulent disagreement as to what that even means, given the fact that some people think the Affordable Care Act is the Second Coming, while others think it has hearkened the opening of the Seventh Seal.  

All of this notwithstanding: Barnett deserves credit for making the observation. It’s not hard to conceive of a way in which Congress could use its taxing power, as interpreted by Roberts, in a way that is more oppressive than Roberts claims it can be used.  Whether that will actually happen, or whether a future Court would in fact strike it down, remains to be seen.

8:44pm  |   URL: http://tmblr.co/ZMMjnxP1XhtO
(Notes: 2)
  
Filed under: politics justice roberts randy barnett affordable care act 
June 28, 2012
The Roberts Court: Now With Jokes

As I was reading through the healthcare opinion earlier, this statement from Justice Roberts’ Commerce Clause analysis caught my eye (pg. 26):

The Commerce Clause is not a general license to regulate an individual from cradle to grave, simply because he will predictably engage in particular transactions.  Any police power to regulate individuals as such, as opposed to their activities, remains vested in the States. 

I couldn’t help but chuckle when I read this, as it made me think of the following photo:

There are logical, sound, reasonable arguments for reserving certain powers to state governments rather than to the federal government.  But tyranny by any other name is tyranny nonetheless.  Yes, one of the advantages of federalism is that if you don’t like the laws of a particular state, you can move.  But the same argument applies to the country writ large.  So too does the obvious objection to the former: most people can’t simply pick up and move when things get bad.  Human beings tend to develop localized networks of social, economic, professional, and emotional support that they rely on in their daily lives in order to thrive.  You can’t bring those networks with you when you leave a state.  There’s always significant sacrifices to be made, not least of which is the loss of familiarity with your surroundings, forced distance from loved ones, and the professional relationships you may be forced to leave behind.  

The police power of the states, in my opinion, is a far broader and scarier thing than the Commerce Clause ever has been or ever will be.  And unlike the federal constitution, state constitutions are fairly easy to amend.  While this makes onerous provisions easier to abolish, it also makes rights and guarantees much less resilient.  This is both the blessing and curse of decentralized polities.

It should also not be forgotten that at many points in history, it has been the federal constitution, enforced by the federal government, which has prevented American citizens from suffering at the hands of state lawmakers.  The darkest periods in our nation’s history, viz. Slavery and Jim Crow, were justified by the police power of the states.  If you review the arguments of state attorneys general in old cases, you find that discrimination against women was justified by the police power of the states.  You find that anti-miscegenation laws were justified by the police power of the states.  You find that discrimination against gays was and is justified by the police power of the states.  You find that onerous restrictions on expression and free speech have been justified by the police power of the states.  The breath of state laws that imposed onerous restrictions upon unpopular classes of citizens is long and painful to apprehend; as are the multifarious and unfortunate indignities visited upon various marginalized groups of people throughout American history.

Yet in virtually every case, it was the federal constitution, and in many cases the federal government, that helped end these various forms of oppression.  Local state governments with popular support legislated against unpopular minorities, and federal power stopped them.  That could not have happened if we held up the Tenth Amendment and the doctrine of enumerated powers as the supreme guideposts of constitutional interpretation.

The true benefit of federalism is that it creates a system of dialectical power-sharing. The states are granted the purview to serve as “laboratories of democracy” to come up with novel ways to solve problems.  But when a purely local solution cannot be efficiently implemented in isolation from the rest of the country, the federal government has the scope of jurisdiction to address it.  The founders recognized that not every problem was within the power of an individual state to solve.  That is why they gave the federal government the ability to regulate interstate commerce in the first place.  It is also why the founders gave the federal government the authority to print money, to regulate immigration policy, and to have the final word in international relations.  They wanted the federal government to be able to craft policy in areas where economic and national security realities would render a localized solution ineffective.  As our nation’s history evolved, and the Fourteenth Amendment was passed, the federal government’s power to regulate areas of national concern became a check on state power, in addition to addressing matters of national concern.  This allows the federal government to protect people when states abuse the obscenely broad authority that the police power inherently grants them.  It also allows the federal government to protect people where the states have failed to do so.

Conversely, when it is the federal government fails to act, states can implement their own laws to protect the rights of their citizens.  We see this exemplified in the relatively recent trend of state legislative enactments legalizing same-sex marriage.    We also see it in the criminal justice system, where certain states have rejected the Supreme Court’s rather loose interpretation of the Fourth Amendment’s Search and Seizure Clause, and used state constitutions and statutes to protect their citizens from unreasonable intrusions by law enforcement officials.  Yet here again, the federal government fills a necessary gap: 42 USC § 1983 provides a civil remedy against state government actors who violate their constitutional rights.  This remedy abrogates the sovereign immunity of the states granted by the Eleventh Amendment.  Where the states refuse to protect citizens from lawless government actors, the federal government steps in to protect them, and vice versa.  At least that’s the way it’s supposed to work.

It is this simultaneously antagonistic and symbiotic relationship that creates a healthy federalism.  It is the same federalism that grants the federal government the power to come up with a national solution to a problem like healthcare, where our nation’s woes are shared across state lines, and consequently, do not easily admit of a local solution.  Keep in mind that this is not an argument about private v. public sector.  It is about state government v. federal government.  And to the extent that the former retains a broad an untamed police power, I am more than happy to see the federal government entertain a broad authority under the Commerce Clause.  And I think this is also the reason why previous Supreme Courts, throughout history, have interpreted the Commerce Clause broadly.  They were able to see that not every problem can be solved at the local level.  And though government is by definition an imperfect institution, that imperfection is manifest in ill-advised state law as much as it is in federal law.

And so I disagree with Roberts’ Commerce Clause analysis.  I think the activity/inactivity distinction is vacuous and unprincipled; many a constitutionally enacted law places affirmative obligations on people to act, at a cost to themselves, where they otherwise wouldn’t.  But more importantly, I think proponents of Roberts’ interpretation of the Commerce Clause fail to give due consideration to the much broader police power of the states, which Roberts has declared perfectly encompasses the ability to regulate inactivity.  This may Give Mitt Romney a colorable premise for distinguishing his Massachusetts healthcare reforms from the Affordable Care Act.  But it does not give me much comfort to know that the state governments may oppress me in ways the federal government is restrained from doing.  

What might I do to avoid this tyranny?  As a New Yorker, I suppose I could always move to Massachusetts.  But after being in Springfield during the lead-up to the 2004 World Series, I don’t think I could tolerate the oppression of Red Sox fans, who I must admit I now fear more than the states’ police power.  But given the Red Sox’ track record since then, perhaps I shouldn’t be too worried.  Perhaps.

9:48pm  |   URL: http://tmblr.co/ZMMjnxOKOlR0
(Notes: 23)
  
Filed under: politics healthcare healthcare reform justice roberts ppaca police power commerce clause 
June 28, 2012
"It is not our job to protect the people from the consequences of their political choices."

—

Justice Roberts, from today’s healthcare decision.

This statement will be quoted in future decisions that have nothing to do with healthcare.  It may even eventually find itself in the same diaspora as  “the constitution is not a suicide pact,” and “stare decisis is not an inexorable command,” though such proliferations tend to be organic and difficult to predict.  Nonetheless, this is an affirmative statement about judicial deference to the elected branches that Roberts likely inherited from Rehnquist, who was far more afraid of judicial tyranny than congressional tyranny.  

It’s becoming increasingly clear that Roberts used this decision as an opportunity to outline his theory of federalism in clear, concise terms.  This decision will be cited for far more propositions than the question of whether mandates are constitutional.  Roberts has written his magnum opus.

5:08pm  |   URL: http://tmblr.co/ZMMjnxOJJTpu
(Notes: 21)
  
Filed under: politics healthcare reform ppaca justice roberts 
June 28, 2012
The Healthcare Ruling Is A Blessing In Disguise For Advocates Of A Smaller Commerce Clause

After reading through the opinion, I was going to make a post about how this decision is actually a blessing in disguise for people who want a smaller Commerce Clause.  But it looks like Tom Scocca got to this before I could.  Here’s the operative piece of Roberts’ opinion:

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.  Congress already possesses expansive power to regulate what people do. Upholding the Affordable Care Act under the Commerce Clause would give Congress the same license to regulate what people do not do. The Framers knew the difference between doing something and doing nothing. They gave Congress the power toregulatecommerce, not tocompelit. Ignoring that distinction would undermine the principle that the Federal Government is a government of limited and enumerated powers. The individual mandate thus cannot be sustained under Congress’s power to “regulate Commerce.”

Scocca elaborates:

The business about “new and potentially vast” authority is a fig leaf. This is a substantial rollback of Congress’ regulatory powers, and the chief justice knows it. It is what Roberts has been pursuing ever since he signed up with the Federalist Society. In 2005,Sen. Barack Obama spoke in opposition to Roberts’ nomination, saying he did not trust his political philosophy on tough questions such as “whether the Commerce Clause empowers Congress to speak on those issues of broad national concern that may be only tangentially related to what is easily defined as interstate commerce.” Today, Roberts did what Obama predicted he would do.

Conclusion:

Roberts’ genius was in pushing this health care decision through without attaching it to the coattails of an ugly, narrow partisan victory. Obama wins on policy, this time. And Roberts rewrites Congress’ power to regulate, opening the door for countless future challenges. In the long term, supporters of curtailing the federal government should be glad to have made that trade.

There is a silver lining to this decision for advocates of a smaller Commerce Clause.  I am quite sure that Roberts signed on to this opinion in exchange for being allowed to insert language that will plant the seeds for future Commerce Clause jurisprudence.  Ginsburg didn’t join this analysis, so the precedental value of Roberts’ Commerce Clause language is limited.  But time will tell if it signals a turning point for the Court’s Commerce Clause jurisprudence.

1:57pm  |   URL: http://tmblr.co/ZMMjnxOIcS5u
(Notes: 18)
  
Filed under: politics commerce clause justice roberts ppaca healthcare healthcare reform 
June 28, 2012
"[T]hrough it all, it turns out, John Roberts remained a lawyer at heart, and a pragmatic one. I haven’t yet read the full opinion, but the very fact that he sustained the Act as a tax shows that he has a deeply anti-formalist streak. That was apparent during the oral arguments, when he, more than anyone, expressed puzzlement over how one could even say that the law contained a “mandate” when its only enforcement mechanism was tax liability for some and nothing for others. And in the end, it turns out that was enough for him."

— Mike Dorf, who clerked for Justice Kennedy in the early 90’s.

11:45am  |   URL: http://tmblr.co/ZMMjnxOIADgk
(Notes: 10)
  
Filed under: politics healthcare healthcare reform justice roberts ppaca 
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