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D.C. Circuit Upholds Obamacare

November 8, 2011 by Leave a Comment
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Watching Obamacare wend its way through the federal courts is great sport for court-watching types like myself.  It’s fascinating to watch some very, very intelligent and thoughtful federal judges wrestle with the significant constitutional questions posed by the individual mandate — questions that strike at the heart of some of America’s most basic constitutional principles:  separation of powers, federalism, and due process.

This morning, the United Staes Court of Appeals for the District of Columbia Circuit released an opinion upholding the constitutionality of Obamacare’s individual mandate.  The opinion was authored by Judge Silberman (appointed by President Reagan), joined by Judge Edwards (appointed by President Carter), and dissented from by Judge Kavanaugh (appointed by President George W. Bush).

Judge Silberman and Judge Edwards reached the merits of the plaintiffs’ challenge (i.e. actually decided their Commerce Clause argument), while Judge Kavanaugh would have dismissed the plaintiffs’ challenge for lack of subject matter jurisdiction pursuant to the Anti-Injunction Act.

For those of you keeping score on Obamacare, this puts the federal appellate decisions at 2-1-1 in favor of upholding Obamacare (6th and D.C. Circuits vote to uphold, 11th Circuit votes to strike down, and 4th Circuit punts on subject matter jurisdiction grounds).

Anti-Injunction Act

I won’t spend much time on the Anti-Injunction Act argument. Suffice it to say the argument there is essentially one of timing.  The Anti-Injunction Act prohibits any efforts to enjoin the collection of taxes prior to when the tax has gone into effect.  Essentially, Judge Kavanaugh was of the opinion that, under the Anti-Injunction Act, no challenge to Obamacare’s individual mandate could be brought before the individual mandate was enforced.  Judge Silberman (joined by Judge Edwards) rejected the Anti-Injunction Act argument, concluding that (1) the purpose of the Anti-Injunction Act was to prohibit suits designed to compromise the government’s ability to raise revenue, and (2) the purpose of the individual mandate was not to raise revenue to but to enable the functioning of the government’s national health care effort.  For a detailed discussion, read the opinions.

But it is significant to note that this is essentially a 3-0 rejection of the plaintiffs’ challenge to Obamacare (Kavanaugh, though not reaching the merits, would have dismissed their suit under the Anti-Injunction Act).

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The Merits (i.e., Commerce Clause, Federal Police Power, and Such) 

Each of the plaintiff groups challenging Obamacare has taken a bit of a different tack in challenging the individual mandate.  The plaintiffs in the D.C. Circuit case brought a facial, as opposed to an as-applied, challenge to the mandate.  A plaintiff bringing a facial challenge to Obamacare’s individual mandate is required to demonstrate that the mandate is unconstitutional in all, as opposed to only some, of its applications.  Here’s how the plaintiffs attempted to meet their heavy burden:

As is apparent, appellants have brought a facial challenge to the individual mandate. Appellants recognize that a facial challenge theoretically must establish “that no set of circumstances exists under which the [law] would be valid.”  United States v. Salerno, 481 U.S. 739, 745 (1987). But unlike the plaintiffs before the Sixth Circuit, appellants were careful to avoid conceding there were any valid applications of the law.  Cf. Thomas More, 651 F.3d at 556, 561-62, 564 (Sutton, J., concurring). Instead, appellants’ theory of the Commerce Clause would invalidate virtually all conceivable applications of the mandate.

Since, according to appellants, Congress only has the power to regulate individuals who are affirmatively acting in ways that affect a market, and for the duration of their activity, Congress also categorically lacks authority to compel individuals to maintain participation in a market into the future. No one currently active in the health insurance market will necessarily be active in 2014, when the mandate goes into effect, or remain active in that market in perpetuity, absent the mandate. Nor do appellants here concede that Congress could impose a mandate to require individuals to purchase insurance when they arrive at a hospital for treatment and maintain that insurance indefinitely.  The requirement to maintain coverage into the future, under their theory, dooms the mandate in its entirety.

Although the court admitted it was intrigued by the plaintiffs’ arguments, it ultimately rejected them, reasoning that the plaintiffs’ argument about activity/non-activity was just as novel as the individual mandate itself and had no basis in either in the text of the Constitution or past Supreme Court precedent:

The mandate, it should be recognized, is indeed somewhat novel, but so too, for all its elegance, is appellants’ argument. No Supreme Court case has ever held or implied that Congress’s Commerce Clause authority is limited to individuals who are presently engaging in an activity involving, or substantially affecting, interstate commerce.

We look first to the text of the Constitution. Article I, § 8, cl. 3, states: “The Congress shall have Power . . . To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” (emphasis added). At the time the Constitution was fashioned, to “regulate” meant, as it does now, “[t]o adjust by rule or method,” as well as “[t]o direct.”  To “direct,” in turn, included “[t]o prescribe certain measure[s]; to mark out a certain course,” and “[t]o order; to command.”  In other words, to “regulate” can mean to require action, and nothing in the definition appears to limit that power only to those already active in relation to an interstate market. Nor was the term “commerce” limited to only existing commerce. There is therefore no textual support for appellants’ argument.

As to Wickard v. Filburn, specifically, Judge Silberman had this to say:

Whether any “particular person . . . is, or is not, also engaged in interstate commerce,” the Supreme Court expressly held, is a mere “fortuitous circumstance” that has no bearing on Congress’s power to regulate an injury to interstate commerce. Id.

Wickard is very much in that vein. In Wickard, it mattered not that Filburn’s annual wheat output was trivial in relation to national production. Nor did it matter that Filburn was being penalized for behavior that had only the most tenuous impact on interstate commerce in of itself, since Filburn never intended the wheat to be used for commercial purposes, never sold it, and used it only to sustain his home farm. It was also irrelevant that the wheat quota could compel even those farmers with no intention of selling any wheat, in any market, to enter the interstate market. All that mattered were the overall dynamics of the wheat market–in other words, generalizations about likely, future economic behavior. If farmers like Filburn all exceeded their quotas, the mechanics of the wheat market made it inevitable that the interstate market would be impacted–either by the likelihood that the high price of wheat Congress was trying to maintain would induce some unspecified number of farmers to sell wheat at market after all, or the probability that farmers who had enough wheat for their own use would stop buying wheat at market. Either way, these economic forecasts–and not any affirmative acts by people like Filburn–were enough to sustain the law. 317 U.S. at 117, 126-28.

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Often times, the most interesting parts of these Obamacare opinions come toward the end when the court provides some insight into how it views the case from a broader perspective.  Judge Silberman’s opinion is no exception.  Here are a few of the more interesting paragraphs:

Appellants’ view that an individual cannot be subject to Commerce Clause regulation absent voluntary, affirmative acts that enter him or her into, or affect, the interstate market expresses a concern for individual liberty that seems more redolent of Due Process Clause arguments. But it has no foundation in the Commerce Clause.

[I]t is irrelevant that an indeterminate number of healthy, uninsured persons will never consume health care, and will therefore never affect the interstate market. Broad regulation is an inherent feature of Congress’s constitutional authority in this area; to regulate complex, nationwide economic problems is to necessarily deal in generalities. Congress reasonably determined that as a class, the uninsured create market failures; thus, the lack of harm attributable to any particular uninsured individual, like their lack of overt participation in a market, is of no consequence.

Finally, appellants’ position would not preserve state sovereignty.  A state that requires all its citizens to purchase health insurance is making them “active” in the interstate market; if the state thereby cedes control over its health care policy to the federal government, its experimentation is tantamount to a relinquishment of its own power.  Thomas More, 651 F.3d at 561-62 (Sutton, J., concurring); cf. Veazie v. Moor, 14 How. 568, 574 (1853).

That a direct requirement for most Americans to purchase any product or service seems an intrusive exercise of legislative power surely explains why Congress has not used this authority before–but that seems to us a political judgment rather than a recognition of constitutional limitations. It certainly is an encroachment on individual liberty, but it is no more so than a command that restaurants or hotels are obliged to serve all customers regardless of race, that gravely ill individuals cannot use a substance their doctors described as the only effective palliative for excruciating pain, or that a farmer cannot grow enough wheat to support his own family.  The right to be free from federal regulation is not absolute, and yields to the imperative that Congress be free to forge national solutions to national problems, no matter how local–or seemingly passive–their individual origins. See Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241, 258-59 (1964).

Some Thoughts

Any thoughts on the opinion?  Here are a couple of my bullet points:

  • Federalism v. Due Process.  This is the second time we’re getting a suggestion from a federal appellate court that the federalism challenge to Obamacare is really not about federalism at all, but is about due process.  Could Obamacare revive Lochner-era economic due process challenges?  Stay tuned.
  • Which Way are we Leaping?  Judge Silberman does a good job with his contention that, at least when it comes to federalism and the Commerce Clause, the plaintiffs’ arguments RE the unconstitutionality of compelling people to enter commerce are just as unique as the idea of an individual mandate itself.  In other words, Silberman is saying that, while the plaintiffs arguments may have a familiar ring to them when it comes to Due Process, when it comes to federalism the Obamacare plaintiffs are asking courts to make just as much of a leap as Congress is with the individual mandate.  This adds a new dimension to the arguments.
  • Lots of Ammo for the SCOTUS.  The Supreme Court is going to have a lot to draw on by the time this one gets before them.  It will be interesting to watch — not only which way they decide to rule, but how they decide to go about it.
  • Anti-Injunction Act Gaining Momentum?  Will we see a 5-4 decision to uphold Obamacare, with the 5 Justices voting to uphold splitting on whether to uphold on the merits or to uphold based on the courts’ lack of subject matter jurisdiction over the plaintiffs challenge?
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Lessons in American Constitutional History, Post-1787: Volume 2 — Some Thoughts on The Fourteenth Amendment

September 13, 2011 by Leave a Comment
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Despite the noise coming from groups like the Article I Society and Tea Party constitutional federalists, the center of American constitutional law is not Article I, Section 8 of the Constitution — it’s the Constitution’s Fourteenth Amendment — more accurately, in Section 1 of the Fourteenth Amendment — ratified nearly 80 after the drafting of the original document.

As a friend recently told me, the Fourteenth Amendment is (thus far, anyway) the culmination of the American and English constitutional traditions; it’s the true protection for individual rights that was only foreshadowed by even the most significant of the amendments contained in the Bill of Rights.

I’ve quoted Section 1 of the Fourteenth Amendment before and I’ll continue to quote it again.  Here’s what it says:

Section 1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Now, I’m no Fourteenth Amendment expert, and I’m not here to give a detailed history, but I do want to take a few minutes and offer some of my thoughts on what it does and why it matters so much.

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One way of looking at the Fourteenth Amendment is that it simply takes the restrictions on Congress found into the Bill of Rights and applies them to the states, adding the additional requirement of equal protection.  This view, though not altogether wrong, doesn’t really capture the full essence of the sea change that the Fourteenth Amendment wrought in American constitutional law, for a number of reasons.

First, it seems to suggest that the Equal Protection Clause is a little bit of an afterthought, which couldn’t be further from the truth.  As even a casual observer of constitutional law can tell you, equal protection is the primary ground on which most constitutional battles are fought today.  It’s an incredibly significant addition that has helped frame the debate over many of the most important constitutional and societal questions of the last 100 years.

Second, unlike the Bill of Rights, the Fourteenth Amendment was adopted at a time when judicial review was an acknowledged fact, and, as such, amounts to a clear, intentional, and fundamental realignment of the relationship between the national and state governments.  Even if, at the time of the Founding and prior to the Civil War, the (a?) primary concern of those who drafted the Constitution had been preserving the sphere of sovereignty of the states from encroachment by the national government, since the ratification of the Fourteenth Amendment it is clear that the foremost constitutional concern was the rights of individuals and not the sovereignty of the states.  Indeed, the Fourteenth Amendment made clear made clear that restrictions on government power are real substantive limits on what government can do, and not just guidelines about where certain laws must originate.

Finally, and although this one may not get much press, it is the Fourteenth Amendment that has ultimately resulted in infusing the Due Process Clauses with content.  This one deserves a separate post all its own (and will get one if my schedule allows), but suffice it to say the clear import of what the Fourteenth Amendment was designed to accomplish, combined with a very limited Supreme Court interpretation of the amendment’s Privileges or Immunities Clause in the Slaughterhouse Cases forced some arguments onto a more awkward ground and gave us what we refer to today as substantive due process.

So, in all the Constitution-reading that goes on these days, take some time to move beyond Article I and the Bill of Rights, and spend some time with the Fourteenth Amendment, the cornerstone of America’s Second Founding.

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Bachmann — Federal Constitution Prohibits State Insurance Mandates

September 5, 2011 by 9 Comments
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At today’s Palmetto Freedom Forum debate, sponsored by the good Constitutional Reverend Senator Jim DeMint, Republican Presidential candidate Michele Bachmann ratcheted up the constitutional political rhetoric with a claim that, not only does the federal Constitution preclude Congress from enacting a health insurance mandate, it precludes state governments from mandating health coverage as well:

I believe it is also unconstitutional for states to mandate as a … condition of citizenship, that an individual would have to purchase a product or service even at the state government’s behest.

When pressed about the constitutional authority for her statement, Bachmann said only that she believed it was “inherent in the Constitution.”

As Mitt Romney has discovered, Republican voters aren’t just upset about Obamacare because it was done by the wrong entity — though they employ this argument freely — they hate the idea of a mandate, period.  Yet, up till today, all of the major Republican contenders have been content to fight the state-level battle on old-fashioned policy grounds , without invoking all the constitutional rhetoric.

There are good reasons for this, as the two potential grounds for Bachmann’s position are fraught with some uncomfortable logical and ideological consequences.

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Option 1:  The Dormant Commerce Clause

First, by claiming that a state health insurance mandate was “inherently” prohibited by the federal Constitution, Bachmann could be arguing that state laws mandating health insurance coverage violate the Constitution’s so-called Dormant Commerce Clause.  The Dormant Commerce Clause is a wholly-judicial creation designed to be a mirror image of the affirmative authority granted to Congress over interstate commerce (per Wikipedia):

The Commerce Clause expressly grants Congress the power to regulate commerce “among the several states.” The idea behind the Dormant Commerce Clause is that this grant of power implies a negative converse — a restriction prohibiting a state from passing legislation that improperly burdens or discriminates against interstate commerce. The restriction is self-executing and applies even in the absence of a conflicting federal statute.

For you judicial types out there, the Dormant Commerce Clause is the constitutional equivalent of field preemption.  While states are ordinarily viewed to possess the authority to legislate in the absence of inconsistent federal legislation, the Dormant Commerce Clause prohibits states from legislating in certain ways even when Congress has not passed any inconsistent statutes.  Why?  I suppose it’s because the Supreme Court assumes, at least when it comes to interstate commerce, that the constitutional grant of authority to Congress is conflicting authority that says, in effect, to the states:  ”Not only can Congress legislate to correct interstate commercial messes created by inconsistent state regulations, the states lack the authority to create some of those messes to begin with.”  This is not the case with most other Article 1, Section 8 powers.

So, why haven’t Republicans embraced the Dormant Commerce Clause as a tool in the fight against state-level government-run healthcare?  I can see three good reasons:

1.  I think it’s pretty clear that the doctrine, as formulated by the Supreme Court, wouldn’t prohibit states from enacting health insurance mandates.  It’s just a losing argument.  But that hasn’t always stopped determined advocates — in both parties — from making politically palatable losing arguments part of their stump speech.

2.  The Dormant Commerce Clause is a judicial creation that appears nowhere in the Constitution.  And it’s just really sad for die-hard originalist, anti-Supreme Court types to rely on a judicially-created constitutional doctrine to make their case.  This is post 1787, after all.

3.  Reliance on the Dormant Commerce Clause creates a troubling logical corollary for those convinced of Obamacare’s unconstitutionality.  If the Constitution precludes the states from passing a health insurance mandate on the ground that the authority to do those types of things is reserved to Congress . . . then Obamacare is constitutional.  Game over.  Checkmate.

So, let’s give Bachmann the benefit of the doubt and assume she wasn’t talking about the Dormant Commerce Clause.

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Option 2:  The Due Process Clause

It’s more likely Bachmann’s statement was based a different ground.  The constitutional guarantee of due process of law, applicable to the states through the Fourteenth Amendment, could provide the basis for her contention that states are unable to enact a health insurance mandate.  The Due Process Clauses of the Fifth and Fourteenth Amendments prohibit governments from depriving people of “life, liberty, or property,” without “due process of law.”

Although most straightforwardly applicable to procedural guarantees in courts of law, there is a long tradition, both in this country and England, America’s primary constitutional wellspring, of viewing the constitutional guarantee of due process as more than just an assurance of proper procedural safeguards, but also as a substantive protection of fundamental rights.  The substantive component of the guarantee of due process is called, not surprisingly, substantive due process.  Substantive due process is the basis for United States Supreme Court striking down statutes criminalizing abortion and homosexuality.

The primary benefit of the substantive due process approach to the fight against government healthcare is readily apparent — by putting a health insurance mandate outside of the legislative domain entirely, conservatives avoid the most significant problem associated with the federalism/dormant commerce approaches:  The possibility that all the constitutional battle over Obamacare gets them is 50 separate government-run healthcare schemes, instead of a single one.  But in avoiding this problem, the substantive due process approach creates some other issues.

First, it forces conservatives to make some awkward distinctions.  For example, if state health insurance mandates are prohibited by the Constitution, what about automobile insurance mandates (and please spare me the arguments about how driving a car is “optional”)?  Second, and more importantly, the substantive due process approach would require conservatives to embrace the same judicial doctrine used to justify the current constitutional right to an abortion.  Just as conservatives have argued for years that, “The Constitution says nothing about a right to an abortion,” liberals are sure to respond to Bachmann, “Where is the constitutional right to be free from economic mandates?”

In fact, this is precisely how the Roosevelt Administration responded when conservatives argued, 75 years ago, that individuals and businesses had a constitutional right to be free from troublesome social welfare legislation like maximum hour and child labor laws.  It was conservatives’ insistence in pursuing the constitutional solution to state social welfare legislation that led to the Supreme Court abandoning economic substantive due process in a string of decisions that arguably culminated with that Tea Party favorite:  Wickard v. Filburn.  Sensing a troubling pattern here?  Conservatives should (and most do).  If nothing else, history counsels trying something new this time.

So, which is it, Candidate Bachmann — dormant commerce or substantive due process — that prohibits Romneycare and other state solutions?

I predict the Bachmann team begins an orderly retraction of this statement starting in 3, 2, 1 . . . .

 

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