So Much For the Commerce Clause Challenge to Individual Mandate Being “Frivolous”
Randy Barnett • July 18, 2010 11:45 am
Remember when the Commerce Clause challenge to the individual insurance mandate was dismissed by all serious and knowledgeable constitutional law professors and Nancy Pelosi as “frivolous”? Well, as Jonathan notes below, the administration is now apparently telling the New York Times that the individual insurance “requirement” and “penalty” is really an exercise of the Tax Power of Congress.
Administration officials say the tax argument is a linchpin of their legal case in defense of the health care overhaul and its individual mandate, now being challenged in court by more than 20 states and several private organizations.
Let that sink in for a moment. If the Commerce Clause claim of power were a slam dunk, as previously alleged, would there be any need now to change or supplement that theory? Maybe the administration lawyers confronted the inconvenient fact that the Commerce Clause has never in history been used to mandate that all Americans enter into a commercial relationship with a private company on pain of a “penalty” enforced by the IRS. So there is no Supreme Court ruling that such a claim of power is constitutional. In short, this claim of power is both factually and judicially unprecedented.
Remarkably, and to its credit, the NYT informs its readers about 2 key facts that pose a problem with the tax theory–and without even attributing these to the measure’s opponents.
Congress anticipated a constitutional challenge to the individual mandate. Accordingly, the law includes 10 detailed findings meant to show that the mandate regulates commercial activity important to the nationÂ’s economy. Nowhere does Congress cite its taxing power as a source of authority.
And
The law describes the levy on the uninsured as a “penalty” rather than a tax.
This is a sign that NYTÂ’s reporter Robert Pear is on the ball. But wait! There is more that is not in the article...
So, like the invocation of the Commerce Clause, this invocation of the Tax Power is factually and judicially unprecedented. It is yet another unprecedented claim of Congressional power. Only this one is even more sweeping and dangerous than the Commerce Clause theory.
I responded to this theory in the Wall Street Journal back in April, in an op-ed the editors entitled The Insurance Mandate In Peril. Here is a key passage from my op-ed:
Supporters of the mandate cite U.S. v. Kahriger (1953), where the Court upheld a punitive tax on gambling by saying that “nless there are provisions extraneous to any tax need, courts are without authority to limit the exercise of the taxing power.” Yet the Court in Kahriger also cited Bailey with approval. The key to understanding Kahriger is the proposition the Court there rejected: “it is said that Congress, under the pretense of exercising its power to tax has attempted to penalize illegal intrastate gambling through the regulatory features of the Act” (emphasis added).
In other words, the Court in Kahriger declined to look behind Congress’s assertion that it was exercising its tax power to see whether a measure was really a regulatory penalty. As the Court said in Sonzinsky v. U.S. (1937), “nquiry into the hidden motives which may move Congress to exercise a power constitutionally conferred upon it is beyond the competency of courts.” But this principle cuts both ways. Neither will the Court look behind Congress’s inadequate assertion of its commerce power to speculate as to whether a measure was “really” a tax. The Court will read the cards as Congress dealt them.
My piece is not behind a subscription wall so interested readers can read (or reread) the whole thing.
Now the usual caveat. Just because the constitutional challenge to the health insurance mandate is not frivolous does not mean it will prevail. The odds are always that the Supreme Court will uphold an act of Congress. Given the wording of the Act, however, the implications of doing so using the Tax Power are so sweeping and dangerous that I doubt a majority of the Court would adopt this claim of power on these facts.
But the argument is far from over.