daring to disagree: the unconstitutionality of Obamacare, part I
By Josiah Parker:
In the wake of the passage of historic healthcare-overhaul legislation on March 21, 2010, promised by its acolytes to extend health insurance coverage to an estimated 36 million uninsured Americans—and dreaded by its opponents to engorge an ever-expanding federal leviathan with an additional 17% of the U.S. economy—scholars and pundits on both sides of the political spectrum have been debating the bill vociferously. Neither the wisdom of such legislation from a policy perspective, nor the constitutionality of the undertaking have been absent from the national discussion. And in the latter category such constitutional heavy-weights as Akil Amar and Erwin Chemerinsky have weighed in, both recently having written op-eds in the Los Angeles Times assuring America in almost incredulous tones that this legislation is indeed constitutional—and pretty clearly so.
But despite the pre-eminence of both scholars in the field of constitutional law—Chemerinsky is the dean of Law at UC Irvine, and Amar is professor of constitutional law at that backwater joint known as Yale—I can’t help but be exceedingly underwhelmed by their arguments. Indeed, even granting that op-eds are written for a general audience, both come off as if written by dismissive, second year law-student bloggers. The analyses of both scholars miss the “gravamen” issues, and poor legal analogies are centrally featured. Strong words, I know.
But let me explain, with due fear and trepidation, why I think that both scholars are mistaken; that is, why the recently passed healthcare legislation is unconstitutional…and if I may hazard, pretty clearly so.
Let’s begin with a general constitutional principle we all learn in high-school civics: the American government is a government of enumerated powers. The constitution specifically grants the different branches of the federal government authority to act in certain domains, carefully circumscribing the scope of their respective powers. Any power lacked by the federal government is reserved to the states under the 10th Amendment. Despite the violence that has been done to many of these provisions by the Supreme Court over the years, clear boundaries remain. Article 1, section 8 of the constitution expressly enumerates the legislative objectives Congress may pursue, and notwithstanding the great deference that the Supreme Court has historically granted to Congress in passing legislation (with a nod to Article 1’s “necessary and proper” clause), any laws unanchored by a constitutionally specified objective will be swiftly struck down.
The section that has historically provided the greatest regulatory authority to Congress—and the one that has been appealed to by constitutional defenders of the healthcare bill—is the “Commerce Clause.” Article 1, section 8, cl. 3 of the constitution grants Congress the authority to “regulate Commerce with foreign Nations, and among the several States…” Much case law has gone into defining the current scope of legislative power furnished by the Commerce Clause. Because the lynchpin of the recently passed bill is the so-called “individual mandate” which compels certain Americans (those who are not dependents, persons receiving Medicare or Medicaid, military families, persons living overseas, persons with religious objections, or persons who already get health insurance from their employers under a qualified plan) to buy government-approved health insurance or face steep fines and/or prison time, much of the constitutional debate has centered on whether Congress, pursuant to the Commerce Clause, has the authority to pass such a mandate.
Supporters of the bill point to the line of Commerce Clause jurisprudence granting Congress extensive powers to regulate intrastate activity which has a “substantial economic effect” on interstate commerce. In the case of Wickard v. Filburn, for instance, Filburn, a small plot-farmer, was fined for growing more wheat on his farm than was permitted under the federal Agricultural Adjustment Act of 1938, which imposed strict limits on wheat production based on acreage in order to drive up wheat prices during the Great Depression. Filburn brought suit against the United States, challenging the government’s right to set a quota on the wheat which he raised and consumed on his own farm on the grounds that this was a purely local activity beyond the reach of federal control. In ruling in favor of the United States, the Supreme Court found that consumption of home-grown wheat is a large and variable factor in the economics of the wheat market. Because the aggregate effect of such home-grown consumption might have a substantial effect on the interstate wheat market by decreasing demand, Congress had authority to regulate, or indeed proscribe, such activity under the Commerce Clause.
This broad authority was upheld in the 2005 case of Gonzales v. Raich, in which the Supreme Court found that passage of the Controlled Substances Act (CSA), making it a crime to possess, manufacture, or sell marijuana, was within Congress’ Commerce Clause authority. Just as Congress in Wickard rationally feared that “when viewed in the aggregate, leaving home consumed wheat to be outside the regulatory scheme would have a substantial influence on price and market conditions,” so, here, Congress had “a rational basis for concluding that even the home consumed marijuana outside federal control would similarly affect price and market conditions.” Of particular importance in this decision was Justice Stevens’ finding that the activity regulated was “quintessentially economic,” which he went on to define as referring to the “production, distribution, and consumption of commodities.” Because the CSA regulated the “production, distribution, and consumption of commodities for which there was an established, and lucrative interstate market” (i.e., the marijuana market), and because the Court had long recognized that prohibiting the intrastate manufacture or possession of an article of commerce was a rational means of regulating interstate commerce in that product, the intrastate regulation of marijuana easily fell within Congress’s commerce powers.
Despite the sweeping authority granted by such decisions as Wickard and Raich, Congress has not been victorious every time it has attempted to flex its Commerce Clause powers. In the 1995 case of United States v. Lopez, the Court struck down the federal Gun-Free School Zone Act, which made it a federal crime to possess a gun within 1000 feet of a school. The Court found that the possession of a gun within the proximity of a school was non-economic in nature; it was neither “transactional” nor of a “supply and demand” character. Similarly, in the 2000 case of United States v. Morrison, the Court struck down the federal Violence Against Women Act of 1994, which granted to victims of violent gender-motivated crime the right to bring civil suit against the perpetrator in federal court. The Court found that “gender motivated crimes of violence are not, in any sense of the phrase, economic activity.” It further reasoned that while Congress had provided detailed findings that gender motivated violence deterred potential victims from traveling interstate or from being employed in intrastate businesses, virtually no deference should be given to these findings because they established far too attenuated a causal connection to interstate commerce: “if accepted [this] reasoning would allow Congress to regulate any crime as long as the nationwide, aggregated impact…has substantial effects on employment, production, transit, or consumption. Indeed, if Congress may regulate gender motivated violence, it would be able to regulate murder or any other type of violence…” (activity which has traditionally been within the regulatory authority of the state).
The lessons to be drawn from these cases for our purposes are clear. Not just any activity falls within the constitutionally permissible regulatory zone of the Commerce Clause, but only activity which is “economic in nature,” i.e., referring to the “production, distribution, and consumption of commodities” (Raich), “transactional,” or of a “supply-demand” character (Lopez), and bears rather close (“non-attenuated”) connection to interstate commerce (Morrison). Does the individual mandate meet these criteria?
Supporters of the healthcare bill have been less than careful in framing the inquiry, instead opting to emphasize the case-law featuring the reach of the Commerce Clause, but not its limits. Thus, Chermerinsky recently argued,
“A few years ago, for example, the court held that Congress could prohibit individuals from cultivating and possessing small amounts of marijuana for personal medicinal use because marijuana is bought and sold in interstate commerce. The relationship between healthcare coverage and the national economy is even clearer. In 2007, healthcare expenditures amounted to $2.2 trillion, or $7,421 a person, and accounted for 16.2% of the gross domestic product.”
Analogizing the regulation of marijuana to the regulation of healthcare in general misses the point. Surely Congress can and does regulate the healthcare industry in general all the time (witness the regulatory regime which has steadily driven up the cost of healthcare since the 1920s). The question is whether Congress has the authority to pass the individual mandate, an unprecedented demand by Congress that individuals purchase health insurance or face stiff fines and/or prison time. Surely a mere reference to the integrality of the healthcare industry to the U.S. economy does nothing to answer this question.
Does Amar’s framing of the issue fare any better? According to Amar,
“Under the interstate commerce clause of Article I, activities whose effects are confined within a given state are to be regulated by that state government, or simply left unregulated. But the federal government is specifically empowered to address matters that have significant spillover effects across state lines or international borders…[T]he founders authorized Congress to act even in situations that did not involve explicit markets, so long as the activities truly crossed state lines or national borders.”
Now, I hate to simply say that Amar is wrong about the facts here, but the Commerce Clause jurisprudence which we surveyed above—the relevant line of Commerce Clause cases, that is, which does not focus on the channels, articles, or instrumentalities of commerce, but the specifically in-state activities which affect interstate commerce—was quite explicit that it is not merely matters that have “significant spillover effects across state lines or international borders” that can be regulated by Congress, but specifically activity that is “economic in nature” and that bears a close causal connection to interstate commerce. Amar’s framing of Congress’ Commerce Clause powers here is so broad as to make Congress virtually sovereign. In doing so he may have given Congress enough regulatory room to pass the individual mandate—indeed, if Congress can regulate any “matter” that has “significant spillover effects” across state lines or international borders, it can regulate virtually anything—but his “achievement” is completely spurious; it does violence to the relevant case law, as well as to the very structure of the American federalist system of enumerated powers—a system that even few liberal constitutional scholars are willing to abandon.
Notwithstanding the fact that both Amar and Chemerinsky framed their arguments so as to avoid the crucial issue, it seems difficult to imagine how either scholar would go about arguing that the individual mandate regulates activity that has to do with the “production, distribution, and consumption of commodities” or that is “transactional” in nature. For the individual mandate is in no way dependent upon a citizen’s entering into ANY transaction. Indeed, the mandate applies even if a citizen does nothing at all. To the extent that the Supreme Court has specifically differentiated between activity which is “economic in nature” and activity that is non-economic in nature, finding that only the former activity is regulable, it is difficult to see how doing nothing could fall anywhere but in the latter category. Likewise, to the extent that the Court has differentiated between activity which bears a close causal connection to interstate commerce and activity which bears an attenuated connection, finding that only the former activity is regulable, it is difficult to see how doing nothing could fall anywhere but in the latter category.
Now, I can already hear the cries of you critics: “The way YOU framed the issue is what is disingenuous. People who do not buy health insurance enter into the stream of interstate commerce by purchasing all manner of over-the-counter medical products, doctor and hospital services at the point of consumption, and often times need emergency room care. They substitute these activities for paying premiums to health insurance companies. All these activities are economic, and they have a cumulative effect on interstate commerce in a manner similar to Wickard and Raich. Thus, not buying health insurance really is an economic activity within the scope of permissible Commerce Clause regulation.”
Despite the fact that our hypothetical critic is correct about the cumulate interstate effect of such activities, the individual mandate does not attach to any such activities. Perhaps it’s the case that individuals who do not purchase health insurance are more likely to purchase the listed products and services, but the individual mandate does not directly regulate such economic transactions at all. The mandate is not an excise tax on the purchase of over-the-counter medical products; it is not a consumption tax triggered when an uninsured person enters a doctor’s office or is brought to an emergency room by ambulance. Congress could very well have directly taxed such activities, and it would have been constitutional according to the “non-attenuated, economic-in-nature” standard set by contemporary Commerce Clause jurisprudence. The problem with such measures, however, was both political and economic. Politically, the Democratic Party wanted to avoid the PR consequences of being perceived as hiking taxes so drastically; economically, they wanted to be capable of accruing sufficient revenue to provide health insurance coverage for millions more Americans, and all such “trigger-taxes” would have accomplished is the deterrence of the public consumption of medical products and services in a way that would have left the insurance of millions severely underfunded, and the medical industry reeling from lost profits.
Thus, while there are ways that Congress could have regulated the intrastate healthcare industry that is within Congress’ Commerce Clause authority, the individual mandate is not one of them. Were the Supreme Court to recognize the authority of Congress to pass the individual mandate, it would all but eviscerate any meaningful limitations on the Congress’ Commerce Clause powers. It would open the door to not only the compelled purchasing of anything that Congress deems reasonable to promote interstate commerce (like the purchase of a car from one of the new U.S. owned companies), but the compelled compliance of citizens to engage in any non-economic activity which Congress determines has an effect on interstate commerce. To illustrate, it’s not just the purchase or non-purchase of health insurance which has an economic effect on the interstate healthcare economy: all manner of lifestyle choices go into the frequency with which the average American needs medical care. But if Congress has the Commerce Clause authority to compel Americans to buy health insurance because of the effect of its non-purchase on the interstate healthcare market, it seems that it must also have the Commerce Clause authority to compel Americans to regularly exercise because of the effect of the failure of certain Americans to regularly exercise on the interstate healthcare market. While the implementation of a “comprehensive exercise regime” may present certain practical difficulties that the individual mandate does not, the important point is that there is no clear principled difference in the rationale behind the two measures—and as already mentioned, both run afoul of the express limitations articulated by the Supreme Court in Lopez, Morrison, and Raich.
If you think that these musings are a bit extreme, I ask you to articulate the constitutional limitations once merely existing gives Congress the authority to compel individuals to enter into contracts with third parties—I can tell you, whatever you may come up with is not the standard set by the Supreme Court.