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Sunday, December 16, 2018

Obamacare, the Constitution and the Welfare State


No, Obamacare will not go away. Despite a federal judge ruling it unconstitutional, you can bet that Congress will find a way to keep it on the books.

There is a lot more at stake here than just Obamacare. If this case, known as Texas v Azar, goes all the way to the Supreme Court, it could set a precedent for other entitlement programs. For this reason alone, neither Democrats nor Republicans will let that happen.


More on that in a moment. First, let us get acquainted with the case itself. Here is the news story, in the form of an article in the Denver Post:
A conservative federal judge in Texas on Friday ruled the Affordable Care Act “invalid” on the eve of the sign-up deadline for next year. But with appeals certain, even the Trump White House said the law will remain in place for now.
This article is from the heavily left-leaning Denver Post, so a slanted comment about the Trump presidency is only to be expected. The president, of course, cannot remove a law at will. It is expectable, however, that a leftist publication would assume that he could; in the leftist mind, the constitution is an irritating restriction on their political power. High-end egalitarian scholars such as widely respected philosopher John Rawls actually prefer a system where "experts", not the people, run the country - and do so with unrestrained power.

Obamacare is sprung from this mindset. A group of "experts" sat around a table in Washington, DC and figured out how Americans should get their health care delivered and paid for. The mess that has followed is not exactly surprising, from the initial comments by Speaker Pelosi about how we all would just have to wait with understanding it until it was passed into law, to the repeal of the coverage mandate that only worsened the effects from Obamacare on our health insurance system.

This latest court ruling is just another addition to the mess created by the idea that government should provide for our health care needs - and, by extension, engage in economic redistribution in general. The Denver Post again:
In a 55-page opinion, U.S. District Judge Reed O’Connor ruled that last year’s tax cut bill knocked the constitutional foundation from under “Obamacare” by eliminating a penalty for not having coverage. The rest of the law cannot be separated from that provision and is therefore invalid, he wrote.
As the Post also reports, the left has predictably gone into their usual rhetorical tailspin over this. We don't have to waste our time listening to them; let us instead take a look at the actual text of Texas v Azar:
[Sometimes], a court must determine whether the Constitution grants Congress the power it asserts and what results if it does not. If a party shows that a policymaker exceeded the authority granted it by the Constitution, the fruit of that unauthorized action cannot stand.
In other words, the Constitution does not permit economic redistribution per se (which is what Obamacare really is all about). Congress has asserted its power to redistribute because it has the power to tax. Since it has the power to tax, it is implied, Congress can use that money however it wants to. It is that assertion that this case has centered in on:
Here, the Plaintiffs allege that, following passage of the Tax Cuts and Jobs Act of 2017 (TCJA), the Individual Mandate in the Patient Protection and Affordable Care Act (ACA) is unconstitutional. They say it is no longer fairly readable as an exercise of Congress’s Tax Power and continues to be unsustainable under the Interstate Commerce Clause.
Congress anchored Obamacare in the Constitution entirely through its taxation power. It was a clever move at the time, and understandable: over the decades, Congress has created countless entitlement programs, from Social Security to SCHIP, that are not in accordance with either the word or the intention of the Constitution. Yet at every turn they have gotten away with it. Whether that has been because of taxation powers or through other constitutional anchors, is of less importance; the fact that they have gotten away with it has created a formidable political precedent. Why would not the drafters of Obamacare be led to believe that they, too, could get away with applying the same legislative craftsmanship?

Back to Texas v Azar:
[The plaintiffs] further urge that, if they are correct, the balance of the ACA is untenable as inseverable from the Invalid Mandate. Resolution of these claims rests at the intersection of the ACA, the Supreme Court’s decision in NFIB, and the TCJA. In NFIB, the Supreme Court held the Individual Mandate was unconstitutional under the Interstate Commerce Clause but could fairly be read as an exercise of Congress’s Tax Power because it triggered a tax. The TCJA eliminated that tax. The Supreme Court’s reasoning in NFIB — buttressed by other binding precedent and plain text — thus compels the conclusion that the Individual Mandate may no longer be upheld under the Tax Power. And because the Individual Mandate continues to mandate the purchase of health insurance, it remains unsustainable under the Interstate Commerce Clause — as the Supreme Court already held.
And now for the best part:
Finally, Congress stated many times unequivocally — through enacted text signed by the President — that the Individual Mandate is “essential” to the ACA. And this essentiality, the ACA’s text makes clear, means the mandate must work “together with the other provisions” for the Act to function as intended. All nine Justices to review the ACA acknowledged this text and Congress’s manifest intent to establish the Individual Mandate as the ACA’s “essential” provision. The current and previous Administrations have recognized that, too. Because rewriting the ACA without its “essential” feature is beyond the power of an Article III court, the Court thus adheres to Congress’s textually expressed intent and binding Supreme Court precedent to find the Individual Mandate is inseverable from the ACA’s remaining provisions.
So there you have it. Because of the way Congress designed Obamacare, they have tow options: Either rewrite the law and find a new way to keep it constitutional, or abandon it.

Neither Republicans nor Democrats are going to abandon it. Depending on how long the appeals process will be, the rewrite process may not start until after the 2020 election. If the new liberal House majority is smart, they will work with the GOP majority in the Senate. That should not be much of a problem: there are enough Republican Senators who hate Trump more than they love America.

On the other side of the aisle, there are enough Republicans who like the welfare state enough to want to secure its continued existence. They will find a bipartisan way to redesign Obamacare to make it compliant with Texas v Azar, if for no other reason to avoid the consequences if the Supreme Court comes to the unlikely conclusion that the law is indeed unconstitutional.

Bottom line: the welfare state will prevail. It shouldn't, but it will. 

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