federalism

Some Follow-up Thoughts on the Significance of the Tenth Amendment and National Government

September 10, 2012 by Curt Bentley 2 Comments

* This post is a follow-up to a brief post on the Tenth Amendment from last summer.

In the months between Abraham Lincoln’s election and the start of the Civil War on April 12, 1861, Americans became embroiled in something of a philosophical conversation about their relationship to their own national government. Was the American Union nothing more than a collection of states — a “club,” so to speak, that states voluntarily joined and could leave at any time and for any reason? Or was it something more — a creation of the people designed to perpetuate intact despite the desires of the people of any one state?

Abraham Lincoln addressed this issue in his First Inaugural Address as follows:

It is seventy-two years since the first inauguration of a President under our National Constitution. During that period fifteen different and greatly distinguished citizens have in succession administered the executive branch of the Government. They have conducted it through many perils, and generally with great success. Yet, with all this scope of precedent, I now enter upon the same task for the brief constitutional term of four years under great and peculiar difficulty. A disruption of the Federal Union, heretofore only menaced, is now formidably attempted.

I hold that in contemplation of universal law and of the Constitution the Union of these States is perpetual. Perpetuity is implied, if not expressed, in the fundamental law of all national governments. It is safe to assert that no government proper ever had a provision in its organic law for its own termination. Continue to execute all the express provisions of our National Constitution, and the Union will endure forever, it being impossible to destroy it except by some action not provided for in the instrument itself.

Again: If the United States be not a government proper, but an association of States in the nature of contract merely, can it, as a contract, be peaceably unmade by less than all the parties who made it? One party to a contract may violate it—break it, so to speak—but does it not require all to lawfully rescind it?

Descending from these general principles, we find the proposition that in legal contemplation the Union is perpetual confirmed by the history of the Union itself. The Union is much older than the Constitution. It was formed, in fact, by the Articles of Association in 1774. It was matured and continued by the Declaration of Independence in 1776. It was further matured, and the faith of all the then thirteen States expressly plighted and engaged that it should be perpetual, by the Articles of Confederation in 1778. And finally, in 1787, one of the declared objects for ordaining and establishing the Constitution was “to form a more perfect Union.”

But if destruction of the Union by one or by a part only of the States be lawfully possible, the Union is less perfect than before the Constitution, having lost the vital element of perpetuity.

It follows from these views that no State upon its own mere motion can lawfully get out of the Union; that resolves and ordinances to that effect are legally void, and that acts of violence within any State or States against the authority of the United States are insurrectionary or revolutionary, according to circumstances.

And going back approximately four score and seven years, James Madison, in Federalist 45, spoke on the subject in response to Antifederalist concerns about how adoption of the Constitution would affect the rights of states:

Was, then, the American Revolution effected, was the American Confederacy formed, was the precious blood of thousands spilt, and the hard-earned substance of millions lavished, not that the people of America should enjoy peace, liberty, and safety, but that the governments of the individual States, that particular municipal establishments, might enjoy a certain extent of power and be arrayed with certain dignities and attributes of sovereignty? We have heard of the impious doctrine in the old world, that the people were made for kings, not kings for the people. Is the same doctrine to be revived in the new, in another shape — that the solid happiness of the people is to be sacrificed to the views of political institutions of a different form? It is too early for politicians to presume on our forgetting that the public good, the real welfare of the great body of the people, is the supreme object to be pursued; and that no form of government whatever has any other value than as it may be fitted for the attainment of this object.

It took a bloody Civil War over the extension of slavery to enshrine Lincoln’s vision of a Constitution that created a perpetual union and placed the states in a position clearly inferior to the national government of the people. But though you might think the issue was conclusively settled in 1865, if you listen carefully, you’ll hear echos — some subtle, some not so subtle — of the controversy persisting today.

Arguments about states rights, federalism, and even overregulation, have roots in the ongoing debate over the nature of the Union created by the Constitution. So is the (somehow) revived debate about the merits of state nullification of federal law.

Ultimately, the Constitutional language and the history are ambiguous enough on this matter (as on many others) that it’s impossible to know exactly what the Framers intended when they created the Constitution. Almost certainly, they collectively had a number of intentions, and even more certainly, some of them changed their minds over time about just what it was they had done. And whatever intentions were for America at the start, the whole American experiment was substantially redone in the 5 years following the end of the Civil War.

But despite the general ambiguity, we do have some clues. And, one of those clues is, I think, the 10th Amendment.

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

The 10th Amendment speaks conclusively about the reservation of powers not delegated to the national government–but it speaks ambiguously about to whom the non-delegated powers are reserved: ”to the states respectively, or to the people.”

The Articles of Confederation contained a similar provision to the 10th Amendment, which stated:

Each state retains its sovereignty, freedom, and independence, and every power, jurisdiction, and right, which is not by this Confederation expressly delegated to the United States, in Congress assembled.

While its Articles of Confederation equivalent is written in the active voice, from the perspective of a state, the 10th Amendment is fully passive. The 10th Amendment is also less agressive in that it does not expressly declare each state’s independence and sovereignty, and omits the word “expressly” when referring to delegated powers (presumably to comport with the existence of the Necessary and Proper Clause in the Constitution). Finally, the 10th Amendment speaks about “the people,” whereas the Articles of Confederation provision referred only to states.

As an aside, Wikipedia — citing an article by Henry Rollins (!) describing his visit to the National Archives in Washington D.C. – asserts that the phrase (“to the people”) was added to the 10th Amendment as a handwritten edition as the draft amendment circulated between houses of Congress . . . suggesting, I’m not sure what, exactly. But it is fascinating.

I’ve long been puzzled by the existence of the “or to the people” clause of the 10th Amendment. What should we make of it?

If it was the states that formed the Constitution, and therefore the states that delegated power to the national government, why mention the people at all? If it was the people, as a national whole, who formed the national government and delegated its powers, why mention the states? Maybe the drafters and ratifiers of the 10th Amendment (and we should remember, we’re technically talking Congress in 1791, not the Constitutional Convention) conceived of the national government is a creation of the people, who have delegated some power to their state and local governments and some power to their national government, and, as a result, retain whatever powers they have not delegated. Therefore, to the extent people have not already delegated power to any particular level of government, that power resides in the people. Or maybe the phrase “or to the people” was added simply to make it clear that the 10th Amendment encompassed all rights — rights that the people could delegate to their government (i.e., rights involving the exercise of coercive authority) and rights that they really couldn’t because they are conceived of as residing in individuals (e.g., the rights to speak and worship). Of course, the ambiguity could always be a matter of political expediency — perhaps the ratifiers couldn’t agree on what to put in the 10th Amendment and therefore comprised by including both the states and the people as the beneficiaries of reserved powers?

But — to me — the fact that the 10th Amendment mentions both the states and the people counts for something.

How much significance does this all have? I’m not sure. But it seems to me that the 10th Amendment’s ambiguity lends support Lincoln’s conception of the American Union (even pre-Civil War) and whatever consequences that may have.

Filed Under: American Constitution Post-1787, Law, Opinion, Slider Tagged With: 10th amendment, abraham lincoln, articles of confederation, civil war, constitution, federalism, first inaugural address, fourteenth amendment, law, madison, original intent, states rights

H.B. 351, Opt-Out of Order on White House Rural Council — Rep. Ivory

February 28, 2012 by Curt Bentley 2 Comments

After a long, work-induced hiatus from blogging, Utah Political Summary returns today with some brief commentary on H.B. 351, a bill sponsored by Representative Ken Ivory.

H.B. 351 is part of our legislature’s ongoing effort to step federal government meddling in local government by preemptive state meddling in local government. Specifically, it’s a response to Executive Order 13575 (“EO13575″), which was issued by President Obama last June and creates a White House Rural Council (“WHRC”) to “enhance Federal engagement with rural communities.”

EO13575

The WHRC would be chaired by a representative of the Department of Agriculture, comprised of a representative of every other federal department, and tasked with the mission of “coordinat[ing] development of policy recommendations to promote economic prosperity and quality of life in rural America,” and “coordinate[ing] [the Obama] Administration’s engagement with rural communities.”

Specifically, the WHRC will:

Make recommendations to President Obama on how to streamline and leverage the impact of federal investment dollars in rural communities;
Coordinate and increase the effectiveness of federal engagement with rural America’s stakeholders; and
Identify and facilitate rural energy development, outdoor recreation and conservation-related opportunities.

On its face, EO13575 appears to be nothing more than an attempt to coordinate efforts across departments, to make the administration’s “rural policy” more cohesive and effective.

But it’s got Representative Ivory up in arms. In fact, he refers to it on his Facebook page as an order creating “White House zoning and planning authority over all ‘rural America.’” So he’s crafted H.B. 351 — a legislative response consistent with his apparent alarm.

H.B. 351

Representative Ivory’s bill, which was passed out of committee on February 27, 2012, would require any “department or agency of the state” that wants to implement a “directive” of the White House Rural Council created by EO13575, to file a report to the legislature’s Natural Resources, Agriculture, and Environment Interim Committee containing the following information:

(3) (a) The report required under Subsection (1)(a) shall include:

(i) the directive from the White House Rural Council; and

(ii) a description of:

(A) the requirements imposed by the directive and how the agency would implement the directive;

(B) the effect of implementing or not implementing the directive;

(C) the cost to the state or its citizens of implementing the directive; and

(D) the consequences to the state if the state does not comply with the directive.

(b) The report required under Subsection (1) may include an analysis by the agency or department that addresses whether a directive from the White House Rural Council:

(i) affects the distribution of power and responsibility among the state and national government;

(ii) limits the policymaking discretion of the state;

(iii) impacts a power or a right reserved to the state or its citizens by the Ninth or Tenth Amendment to the United States Constitution; or

(iv) impacts the sovereignty rights and interest of the state or a political subdivision to provide for the health, safety, and welfare of, and to promote the prosperity of, the state’s or the political subdivision’s citizens.

The required report is designed to give the legislature an opportunity to legislate in opposition to the “directive,” if it so chooses. In fact, after receiving the report from the “department or agency of the state,” the Natural Resources, Agriculture, and Environment Interim Committee can recommend to the legislature that it enact legislation that either specifically authorizes or prohibits compliance with the “directive.”

The supreme irony in the whole situation? Representative Ivory’s bill would be codified at Utah Code Ann. 63M-1-1607 et seq., as part of Utah’s already existing Rural Development Program, which is operated out of the Governor’s Office of Economic Development through the Office of Rural Development, which in conjunction with the Rural Coordinating Committee, provides support to the Governor’s Rural Partnership Board.

And the mission of the state’s Rural Development Program? Here’s a bulleted list:

Facilitate within the Governor’s Office of Economic Development implementation of the strategic plan;
Work to enhance the capacity of the Governor’s Office of Economic Development to address rural economic development, planning, and leadership training challenges and opportunities by establishing partnerships and positive working relationships with appropriate public and private sector entities, individuals, and institutions;
Work with the Rural Coordinating Committee to coordinate and focus available resources in ways that address the economic development, planning, and leadership training challenges and priorities in rural Utah; and
Coordinate relations between the state, rural governments, public/private groups engaged in rural economic planning and development, and federal agencies.

Some Thoughts

I think it’s pretty clear that Representative Ivory sees the White House Rural Council as another front on the war over western state lands. Perhaps it is. I don’t know. But there’s nothing in EO13575 or the duties set out for the WHRC authorizing it to make “directives” to local governments, and certainly nothing in it that authorizes it to engage in nationwide zoning.

President Obama, like other Presidents before him, undoubtedly has a “plan” for rural America, and will go about implementing his “plan” in whatever way he can, including, presumably, by conditioning the receipt of federal funds on local governments implementing plan objectives. But it’s questionable whether such “incentives” can fairly be characterized as “directives.” Thus, to have any effect, it appears that Representative Ivory’s bill would require all “departments or agencies of the state,” any time they want to implement a suggestion or recommendation originating from the WHRC, to first create a burdensome report for the state legislature. This is turf-war level of micromanagement that would do the most overreaching federal agency proud.

Now, Representative Ivory may believe that the Constitution grants the state exclusive authority to make recommendations to local governments and rural America. After all, Article II of the Constitution is pretty sparse . . . . But at some point, he, and the other members of the Utah GOP’s club of constitutional crusaders need to contemplate the extent to which their near myopic obsession over their own version of constitutional federalism is turning them is seriously undermining their core conservative governing principles.

If President Obama issues an order emanating from the WHRC that unconstitutionally dictates to rural Utahns what they may or may not do, then legislate against it or fight it in court as appropriate. But why borrow trouble and micromanage just out of antipathy toward one particular administration? President Obama will eventually leave office, the WHRC he created will be dissolved, and a Republican will be elected President again . . . but legislation persists. H.B. 351 is unnecessary, misguided, and not worth our legislature’s time.

Filed Under: Bill Summaries, Law, News, Opinion, Slider Tagged With: 2012 legislative session, barack obama, constitution, federalism, ken ivory, law, utah, utah legislature, white house rural council

Dan Liljenquist and State Level Medicaid Reform

December 15, 2011 by Curt Bentley Leave a Comment

If you’ve ever attended one of his “fiscal reality” town hall meetings, you’ll notice the passion with which Senator Dan Liljenquist talk about entitlement reform. He’ll tell you it’s what pulled him out of the private sector and into politics. You can hear the excitement in his voice when he talks about how Rhode Island — the bluest of all blue states — enacted sweeping pension reform legislation this past year to forestall a fiscal collapse. And you feel his real frustration when he speaks about the fact that a “mid-level bureacrat” is holding up Utah’s Medicaid waiver request over small proposed co-pay increases.

Liljenquist has built quite a name for himself as the state level entitlement reform guy nationwide. It’s what he does, and, thus far, he appears to have done it in impressive fashion. So these days, he’s the guy that other people talk to when they want to do it, too.

But despite all the notoriety, I suspect there are quite a few people, especially here in Utah, that don’t understand what exactly it is that Liljenquist has done when it comes to entitlements. So I wanted to put up this post summarizing the nature of Liljenquist’s Medicaid reforms here in Utah, and then offer some brief thoughts on the future of state-level Medicaid reform (and how it may tie in with Liljenquist’s future political plans, which may be the worst kept secret in Utah).

What’s Been Done

Liljenquist’s reform efforts were prompted by some alarming numbers. In the case of his Medicaid reforms, it was the accelerating growth of Medicaid as a percentage of Utah’s budget.

Medicaid, though jointly implemented by the federal government and the states, is a federal program. And the federal government sets uniform eligibility requirements for state Medicaid programs, while each state (with significant federal funding assistance, of course) is left to meet those requirements with its state level programs. The continually soaring cost of health insurance — whether employer-funded and privately purchased — together with the difficult economy has led to a rapid rise in eligibility for benefits. As a result, states are being forced to budget ever larger shares of their shrinking (or stagnant) revenue streams to meet the increased demand. And Obamacare, when fully implemented in 2014, will expand eligibility even further. These days, Medicaid expenses are growing fast enough, and becoming large enough, that they legitimately threaten to crowd out other important state services, including public education.

So, what to do?

Well, the federal government could grant limited waivers to Medicaid eligibility requirements for states who need them. But it won’t.

Kathleen Sebelius (President Obama’s Secretary of Health and Human Services) has made clear that states cannot expect any flexibility with Medicaid when it comes to eligibility; the current federal administration is not about to let Utah, or any other state, reduce eligibility requirements, even (and maybe especially) in the middle of a recession. And the two most reviled statutes in recent memory (at least from the right side) — the stimulus and Obamacare — both contain provisions protecting Medicaid eligibility.

Although Utah cannot control the number of people who are eligible for Medicaid benefits from the state level, Sebelius has suggested that states — as they have been in the past — will be given some flexibility when it comes to the nature of benefits themselves, and that’s the starting point for Liljenquist’s proposals.

The essence of Liljenquist’s reforms involve limiting costs by (1) tying Medicaid expenses to budget growth and (2) changing treatment incentives. These two components are designed to reduce total cost as well as to make expenses predictable in relation to each year’s revenue (which obviously fluctuates due to a number of different factors).

According to Liljenquist, Utah’s current Medicaid model — a combination of managed care and fee for service — incentivizes overtreatment by hospitals and physicians, and, more importantly, irresponsible overuse by Medicaid recipients (e.g., unnecessary trips to the emergency room). Liljenquist proposes moving Utah’s Medicaid system to a managed care+ philosophy designed to encourage more cost effective treatment. Here are the highlights:

The state would allocate what amounts to block grants of its Medicaid funds to groups of healthcare providers known as Accountable Care Organizations (“ACOs”) on a statistically calculated (based on disease rates and risk profiles) per patient basis.
Each patient would be assigned what’s called a “medical home,” and a healthcare provider would be assigned to manage that patient’s care. Patients would have a limited ability to choose their initial ACO and would have an option to switch ACOs once per year during an open enrollment period.
The ACOs would profit from Medicaid to the extent they facilitate effective and responsible treatment for their patients; since Medicaid payments would no longer be tied to specific treatment services provided, Liljenquist’s reforms would reduce the incentive to over treat for profit.
The state would offer some incentives, such as reduced co-pays or even cash rewards, for ACOs and patients who take advantage of preventative treatment options.
The system seeks to avoid the potential incentive to under treat patients by requiring that ACOs maintain a quality of treatment equivalent with that provided under the current system.
Compensation for services provided would remain in line with compensation under the current system; any expected savings would be generated by a relative predominance of more preventative and cost-effective treatment options.
The state would infuse some predictability into Medicaid funding by tying it to budget growth going forward. In years where there is a surplus, the surplus would be put into a rainy day fund. In years where enrollment growth exceeds expectations, benefits would be reduced across the board according to a predetermined schedule.
The state would seek modest increases in co-pay requirements for certain health services for those on Medicaid.

The Utah legislature’s fiscal analysts office estimates that the proposed reforms would result in savings of $770 million over the first seven years they’re implemented.

Liljenquist’s reform effort is just beginning, and can’t be implemented without permission from the U.S. Department of Health (USDHHS) and Human Services. The specific reform bill, S.B. 180, passed unanimously by the Utah legislature during the 2011 session, required the Utah Department of Health to develop the specific details of a reform plan, and submit a request for waiver to USDHHS, which it did on July 1, 2011. The waiver request is available online, for those interested in getting down into the details. If the waiver request is granted in time, the initial reforms are set to be implemented in July 2012.

Where Do We Go From Here? And What’s the Future for State Level Medicaid Reform?

Liljenquist’s proposed reforms are an attempt to work within the present system, frustrating as that system may be for reformers. And Utah’s new approach does seem promising. Of course, only time will tell whether the projected cost savings are realized and whether the quality of treatment for patients on Medicaid remain high. But what Utah is proposing to do, while not wholly innovative, is a significant step forward in deal with the problems created by partially-funded federal mandates that result in unpredictable expenses.

But ultimately, thanks to that pesky Supremacy Clause, state level Medicaid reform can only get you so far. Furthermore, you can never be certain that the reforms will be enduring, as they are subject not only to Congressional changes in course (see, e.g., Obamacare), but also to a somewhat unpredictable bureaucracy, subject to changes in approach based on the four-year Presidential election cycle. Finally, there is the oft-cited concept as the states as laboratories of democracy for federal policy; the irony in this case is that if state reforms are successful in providing effective care at a reduced cost, they might serve as models for National Health 2.0 — “Hey, Utah’s got this great approach to effective cost, statewide government funded health care, let’s try it nationwide!” Indeed, when I started investigating Liljenquist’s proposal, I thought to myself, if this works are well as they say it’s going to, it sounds like something that could go national and be, relatively speaking, cost effective.

All this reminds us, simply, is that Medicaid, despite the promise of state reforms, is a federal program, and real, fundamental change must happen at the federal level. The drivers of the Medicaid problem are eligibility and benefit standards, and, as a result, the basic components of real, substantive reform involves dealing with questions of eligibility and tiered-benefits, not just increased effectiveness in treatment and care delivery (which treat the symptoms).

The premise of Medicaid is about setting creating a safety net and setting a basic floor for those who can’t afford health care coverage. I think that’s a good thing, and I think that it’s probably something that should be done on a national level. This is, after all, all about people and not about states — and a person is a person, no matter what state they live in. But if Medicaid is going to continue to be implemented and significantly funded by the states, the overall national structure needs to provide, at minimum, necessary flexibility for states with vastly different budgetary needs and obligations and populations with different health profiles.

That can’t be done from a state legislature, no matter how many great ideas you’ve got. The future of Medicaid reform is not at the state level. Liljenquist knows that, and I suspect it’s a big part of what’s informing his future career plans.

Filed Under: Bill Summaries, Law, News, Opinion, Slider Tagged With: constitution, dan liljenquist, entitlement reform, federalism, medicaid, obamacare, reform, supremacy clause, utah legislature, waiver

The Seventeenth Amendment — Good Idea, or the Beginning of the End?

December 2, 2011 by Curt Bentley 5 Comments

When the Constitution was first ratified in 1791, it provided that United States senators were selected by the legislatures of the individual states. In 1913, the states ratified the 17th Amendment, which required senators to be elected by the people of the several states.

For most of the almost 100 years that have passed since the 17th Amendment was ratified, it has been largely ignored; the business of government has moved on and the amendment has received little comment — especially in comparison to the amendments which bookend it (the 16th Amendment, which authorizes a national income tax; and the 18th Amendment, which constitutionalized Prohibition).

Recently, however, the 17th Amendment has become something of a cause de jour, garnering a good deal of attention from today’s limited government federalists who, confronted by what they view as massive, unconstitutional federal overreach, find in the 17th Amendment a principal villan.

Why don’t they like the 17th Amendment?

Anti-17th-ers believe that the 17th Amendment dealt state sovereignty a death blow. According to them, the Founders, as a check on national government supremacy, structured the Senate to represent the interests of the states, in contrast to the popularly elected President (well, kind of) and House of Representatives. But this carefully constructed balance was all undone, they say, by the direct election of senators. Rather than being the champion of state sovereignty in the national government, as the Founders intended, they argue that the Senate is now little more than House of Representatives-lite, the only difference between the two bodies is the length of term and breadth of constituency. And the Anti-17th crowd can point to the American historical timeline in support of their claims: the temporal convergence of the ratification of the 17th Amendment; the ascendency of social welfare legislation; the adoption of the 16th Amendment, which authorized a national income tax; and the expansion of the national government begun during WWI. They have a point when they say that the states have never been quite the same since.

So, are they right? Is one of the keys to a meaningful federalism is indirect election of senators? And have we betrayed our constitutional heritage by adopting the 17th Amendment?

I don’t think so.

17th Amendment = Decline of State Sovereignty?

The concentration of policy and power in the national government is not in any way, shape, or form a result of the elimination of a state check on national authority. Instead, it’s due to a combination of factors, the most important of which are the superior resources of the federal government, the civil rights movement, the judiciary preferring to take a very hands-off approach to Congressional action, and people demanding national-level policy on a whole host of issues.

To the extent indirect election of Senators and the movement of the center of government toward Washington, D.C., are related, it’s because they are both victims of the 20th Century progressive, internationalist turn in American politics, not because one was a cause (in any meaningful sense) the other.

Inconsistent with Original Intent?

Furthermore, the evidence that the Founders left the election of senators with state legislators in order to protect states from the national government is scant at best, resting essentially on a single statement by George Mason. The fifth resolution of Madison’s Virginia Plan (which was used to frame the debates at the Constitutional Convention) provided that “members of the second branch of the National Legislature ought to be elected by those of the first, out of a proper number of persons nominated by the individual Legislatures.”

In other words, Madison proposed that that each state’s House delegation choose its senators. From the beginning, the Founders fixated on indirect election of the Senate, never seriously considering having senators be elected directly by the people. Why? Because they assumed that indirect election would result in more virtuous men serving in the Senate (i.e., they distrusted the people) and thought statewide popular elections were impractical. While the delegates considered other indirect options for choosing senators — including having senators elected by the House or appointed by the President — they rejected them all because they would compromise the principle of separation of powers. In short, there’s little or not\ evidence that they placed the responsibility to elect senator on state legislatures out of an overriding concern for state sovereignty — there was no just where else to put the responsibility other than the people.

Direct or Indirect?

Are we better off with the 17th Amendment? Or would we be better off repealing it?

I think we’re better off where we’re at.

I don’t know that indirect election of senators would have many significant policy impacts at the federal level. Does anyone really believe that the Vermont senate delegation, if elected by the Vermont legislature, would play a watchdog role on the federal government? Or that the Utah senate delegation, if elected by the Utah state legislature, would come down on states rights any different than it already does? If the people want national level policy, they’ll get it. If they want to return power to the states by limiting the federal sphere of action, they’ll get that, too (witness Mike Lee, Rand Paul, et al)

Furthermore, when senators are elected by state legislatures, state legislatures are tied to Congress. With indirect election of senators, you run the risk of making the position of state legislator at least as much about federal elections as state policymaking. In addition to campaigning to state legislators, Senate candidates would campaign to the people on behalf of their friends who are either in the state legislature or campaigning for the state legislature. During at least two election cycles every six years, we would elect state legislators based primarily on who they would support for senator in the next election.

There is also an increased potential for corruption. Indeed, the fear that state legislatures were “selling” Senate seats is one of the reasons commonly given for adopting the 17th Amendment. While there is some dispute over the frequency this actually occurred, it was a reason that resonated with the public. Returning the election to the people eliminates, if nothing else, the appearance of corruption on this basis.

Finally, a Republican form of government is supposed to be about people electing a representative to govern for them, not about a representatives electing other representatives. The Founders set things up the way they did because they thought the probability of more enlightened representation outweighed moving the government a bit further from the people. Turns out that it’s pretty clear they were overly optimistic on this point and overly pessimistic on some others. Indirect election of public officials distances the people from their representatives and erodes confidence in government.

Conclusion

Let’s remember that this government is about people, not states. We can have (and restore, to the extent it’s been lost) a meaningful federalism in America whether or not Senators are elected directly by the people.

The 17th Amendment was a good amendment to the Constitution and should be left alone.

Filed Under: American Constitution Post-1787, Law, Opinion, Slider Tagged With: constitution, federalism, founders, republic v. democracy, seventeenth amendment

Is the MCAP Act the Republican Version of Obamacare (Federalist-ly Speaking)?

October 29, 2011 by Curt Bentley 1 Comment

Hat tip to Daniel Burton at Publius Online for this interesting story about potential federalism hypocrisy from the right side of the U.S. Senate.

In preparing its response to President Obama’s famous “pass this” jobs bill, Senate Republicans — specifically Senators Inhofe, Vitter, Burr, Cornyn, and Alexander — are resurrecting a prior house bill (previously known as the Help Efficient Access Timely Healthcare, or “HEALTH”) as the Medical Care Access Protection Act of 2011 (“MCAP”).

MCAP is nationwide tort reform, which would create a federal law of medical negligence that would not only govern medical tort suits in federal courts, but would govern medical tort suits in state courts and medical tort claims in private non-judicial proceedings, such as mediation and arbitration.

What MCAP Does

Specifically, MCAP would:

Impose a nationwide statute of limitations of 3 years on any tort claim based on the the provision of “healthcare goods or services” by any “healthcare provider” or “healthcare institution” (collectively encompassing everyone from nurses to hospitals).
Impose, for the above-referenced class of cases, a cap on noneconomic damages (defined as noncompensatory damages, i.e., punitive damages) of $250,000 per claim per defendant (capped at $500,000 total).
Impose, for the above-referenced class of cases, a mandatory minimum sanction for state (or federal) Rule 11 violations (Rule 11 is the rule that, as a practical matter, prohibits frivolous lawsuits). Ordinarily, the decision to sanction, and severity of the sanction, is left to the discretion of the trial court.
Require, in the above-referenced class of cases, the assessment of pure comparative fault and not allow damages to be assessed against any party for an amount inconsistent with its proportion of fault (i.e., no absolute or modified [51%] contributory negligence bar).
Allow a court to alter or veto any contingent fee arrangement the court deems unfair, and to redirect monies that would, under a contingent fee arrangement, go to attorneys, to a plaintiff if the court concludes that doing so would be in the “interests of justice.”

MCAP does qualify its impact on state law somewhat. For example, MCAP allows for states to set their own maximum cap for noneconomic damages — whether that amount is greater or lesser than the $250,000/$500,000 cap that MCAP would otherwise imposed. In other words, MCAP only sets a limit on noneconomic damages where state law has not already set a limit. Furthermore, MCAP does not prohibit states from enacting laws providing greater protections to healthcare providers.

Despite those qualifications, MCAP, if it were passed, would be a major — indeed, almost unprecedented (?) — legislative encroachment on the autonomy of state courts, even though it would not alter much of the substantive law governing medical tort claims. The current consensus seems that the bill has zero chance of being passed in its current form, but let’s not allow that to prevent us from dissecting it.

Constitutional Basis

I know the question you’re dying to ask: Is this kind of encroachment constitutional?

Here’s the purported constitutional basis for MCAP:

Congress finds that the health care and insurance industries are industries affecting interstate commerce and the health care liability litigation systems existing throughout the United States are activities that affect interstate commerce by contributing to the high costs of health care and premiums for health care liability insurance purchased by health care system providers.

Sound familiar? It should. Read this from Patient Protection and Affordable Care Act (a/k/a Obamacare):

(1) IN GENERAL — The individual responsibility requirement provided for in this section (in this section referred to as “the requirement”) is commercial and economic in nature, and substantially affects interstate commerce, as a result of the effects described in paragraph (2).

(2) EFFECTS OF THE NATIONAL ECONOMIC AND INTERSTATE COMMERCE — The effects described in this paragraph are the following:

(A) The requirement regulates activity that is commercial and economic in nature: economic and financial decisions about how and when health care is paid for, and when health insurance is purchased.

(B) Health insurance and health care services are a significant part of the national economy. . . .

(C) The requirement, together with the other provisions of this Act, will add millions of new consumers to the health insurance market, increasing the supply of, and demand for, health care services. . . .
. . .

(E) Half of all personal bankruptcies are caused in part by medical expenses. . . . .

(F) Under the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 et seq.), the Public Health Service Act (42 U.S.C. 201 et seq.), and this Act, the Federal Government has a significant role in regulating health insurance which is in interstate commerce.

A Federalism of Convenience?

Both MCAP and Obamacare involve health care. The Democrats justified Obamacare by reference to the so-called “substantial effects” doctrine of the Commerce Clause, and the Republicans do the same for MCAP. Is this just pure hypocrisy from the Republicans, or is there a legitimate basis for distinguishing (at least as a matter of constitutional enacting authority) Obamacare and MCAP?

As a matter of constitutional law, I don’t think there is a basis for distinction. Both bills claim on the Commerce Clause as enacting authority, involve the same industry, and rely on the Wickard v. Filburn substantial effects line of cases.

So, yes, there’s clearly some hypocrisy here. But I don’t think that Republican support for MCAP is pure hypocrisy (please note the emphasis), either, and let me tell you why. I suspect that if you were to press Republicans on the differences between the two bills they would say something like, “MCAP doesn’t require you to do (or buy) anything, while Obamacare does.”

An admission like this helps us drill down to what the furor over Obamacare’s insurance mandate is really about. In the judicial challenges to Obamacare, Republicans are trying to use federalism to do the constitutional heavy lifting that, in a prior time, would have been done by the Due Process Clauses of the Fifth and Fourteenth Amendments. As much as Republicans claim the judicial challenges to Obamacare are about ensuring that enforceable limits to Congress’ Commerce Clause authority remain (and make no mistake about it, they can make a good case for their position), what these challenges are really about is constitutionally enforcing a nationwide sense — a very smart federal judge referred to it as an intuition — that government should not be telling us what to buy and what not to buy when it comes to matters of our personal health.

In other words, if it wasn’t clear already, MCAP just makes it more clear that Republicans’ problem with Obamacare isn’t that it upsets the federal division of powers, it’s that it runs afoul of their idea of basic economic liberty. I referenced this briefly in a prior post dealing with Republican Presidential candidate Michelle Bachmann’s stance on state health insurance mandates, and received some interesting comments, especially from Ben Lusty, that I would recommend to readers interested in the relationship between economic liberty and health decisions.

So, do I think MCAP is just a matter of Republican hypocrisy on federalism? Well, to a point, yes, and Republicans should be called on it. Cries of hypocrisy are the price of embracing federalism primarily as a convenient stand-in for substantive policy provisions. But I also think that for many Republicans (whether these lawmakers are among them, I’m not sure) it’s not conscious hypocrisy. To many of today’s Republican federalist-types, what they really mean by federalism is substantive — as opposed to subject-based — limits on the legislative power of the national government. And when you look at MCAP from that perspective, Obamacare is quite easily distinguishable, and I suppose MCAP isn’t hypocritical at all.

Filed Under: Law, News, Opinion, Slider Tagged With: commerce clause, constitution, due process clause, economic liberty, federalism, law, lochner, mcap, michelle bachman, obamacare, tort reform

Judge Conner of the Third Circuit District Court Weighs in on Obamacare, in a Judicially Modest Way

September 13, 2011 by Curt Bentley 1 Comment

Another Obamacare decision was released today, this one at the district court level in the Third Circuit: Goudy-Bachman v. U.S. Dept. Health & Human Servs. This latest decision, striking down the individual mandate as an unconstitutional exercise of Congress’ Commerce Clause authority, was authored by Judge Christopher C. Conner, a George W. Bush appointee, and is, in my view, high-quality legal analysis that improves on the initial district court decisions (and some of the appellate level opinions) addressing the constitutionality of Obamacare. This is not surprising, as Judge Conner had all the previous decisions to draw from and consider when drafting his opinion.

[adsenseyu2] As you might expect, much of Judge Conner’s analysis is duplicated in prior opinions and need not be rehashed here. But there are a couple of interesting aspects to his opinion that I wanted to highlight. Feel free to post your thoughts as comments using the form below.

1. Careful Emphasis on Judicial Role

Throughout his opinion, Judge Conner was careful to note that it was his job, as the spokesman for an inferior federal court, to assess how far the United States Supreme Court had taken the Commerce Clause and take it no further than was clearly justified. Somewhat paradoxically, he began by noting that past Supreme Court precedent was not particularly helpful:

Given the unique factual circumstances of this case, both the Bachmans and the government can effectively distinguish Commerce Clause jurisprudence that appears unsupportive of their respective positions. Therefore, the Supreme Court decisions in Wickard, Lopez, Morrison, and Raich provide only limited guidance for the court’s analysis. Quite simply, this is a case of first impression.

Having determined that Obamacare presented unique legal questions not squarely addressed by prior Supreme Court precedent, Judge Conner turned to the decisions of the various Courts of Appeals that have split on the constitutionality of Obamacare’s individual mandate and to his own analysis of the relevant constitutional questions.

Ultimately, Judge Conner determined that nothing in Supreme Court precedent or the text of the relevant constitutional provision itself went so far as to mandate (pun intended) upholding Obamacare’s individual mandate as a constitutional exercise of Congress’ Commerce Clause authority. Essentially, he said: ”Until the Supreme Court says this is constitutional, I’m not going to step out on a ledge and say so.” Here are some quotes from his opinion:

As set forth below, this Court’s ratio decidendi is straightforward: Heretofore, the Supreme Court has never sanctioned, under the auspices of the Commerce Clause, the enactment of a broad scale economic mandate in anticipation of a probable but uncertain future transaction. The Supreme Court’s Commerce Clause jurisprudence does not lend itself to such an expansive interpretation. Until the Supreme Court interprets the commerce power to permit these anticipatory mandates, I am bound by stare decisis to conclude that Section 5000A is unconstitutional.

Thus, both decisions spotlight the individual mandate’s voyage into unchartered territory of constitutional law. Whether the extension of power is logical or appropriate, the fact of the matter is that Commerce Clause jurisprudence is bereft of authority clearly permitting the extension.

This court’s interpretation of existing precedent, including Lopez and Morrison, leads the court to the conclusion that the Supreme Court would not construe the Commerce power to have such expansive reach. The extension of the Commerce Clause in the manner the government suggests is unsupported by precedent and therefore beyond the scope of this court’s proper function to grant. An expansive interpretation of the commerce power that will permit Congress to equate the individual financial decision to forego health insurance with commercial activity having a substantial effect on interstate commerce, must come from the Supreme Court.

It would be uncharitable (and inaccurate) to say that Judge Connor simply punted and said, “I’ll leave it for the Supreme Court to address the issue.” He ultimately reached his own conclusions about how he thought the Supreme Court was likely to rule given his reading of precedent. But there’s no doubt he crafted his opinion very carefully and that, in addition to how he may have felt as to the merits of the challenge himself, he felt uncomfortable as a lower-tier federal judge (though obviously a very able one) in unilaterally extending the commerce clause based on his own reading of the text and marginally-applicable precedent. This is an effort in judicial modesty that does the federal judiciary proud, in my opinion! And lawyers should pay attention — this strikes me as something that can be a very persuasive approach to argument that can win you a lot of cases.

2. Response to Anti-Obamacare Hyperbole

The second aspect of Judge Conner’s opinion that’s quite notable is his approach to what he obviously considered to be hyperbole in the plaintiffs’ arguments (though he more charitably identified it as overstatement accompanying “zealous advocacy” in a footnote). Judge Conner himself rejected the contention, which we hear so often, that upholding Obamacare would necessarily lead to either (1) laws mandating broccoli consumption, or (2) acceptance of the constitutionality of laws mandating broccoli consumption.

Judge Conner specifically noted that he himself had no doubt that the market for healthcare was unique and that it was entirely possible to craft a constitutional standard that could distinguish between a health insurance mandate and a broccoli consumption mandate — he just refused to be the one to do it:

It is clear to the court that the health care services market is unique. In other markets, including other insurance markets, when an individual suffers a loss or is in need of a commodity or service (such as food, transportation, or housing) there is no obligation that society compensate for that loss or provide the commodity or service without advance payment. In the health care services market, however, against the backdrop of state and federal laws such as Emergency Medical Treatment and Active Labor Act, individuals can and do receive medical treatment regardless of their ability to pay.

Uniqueness as a limiting principle presents the court with a wholly novel question in Commerce Clause jurisprudence. The text of the Constitution itself does not admit such a limiting principle. Moreover, the court has been unable to find any precedent, and the parties have been unable to direct the court to any precedent, that permits the expansion of the Commerce Clause authority to regulate individuals prior to their engagement in commercial activity on the basis of the unique nature of the market being regulated. This court is bound by the principles of stare decisis and must reasonably interpret, not create, law. This court’s interpretation of existing precedent, including Lopez and Morrison, leads the court to the conclusion that the Supreme Court would not construe the Commerce power to have such expansive reach. The extension of the Commerce Clause in the manner the government suggests is unsupported by precedent and therefore beyond the scope of this court’s proper function to grant. An expansive interpretation of the commerce power that will permit Congress to equate the individual financial decision to forego health insurance with commercial activity having a substantial effect on interstate commerce, must come from the Supreme Court.

The Framers carefully constructed our national government with a system of checks and balances. This court’s role in that system is to assess the matters presented before it on the basis of the constitutional text and Supreme Court guidance, consonant with the principles of stare decisis. The minimum coverage provision of the Patient Protection and Affordable Care Act exceeds Congress’s authority under the Commerce Clause of the United States Constitution. The court does not reach this conclusion because the alternative would be disastrous to this nation’s future, such as the Bachman’s prediction of America evolving into a socialist state. These suggestions of cataclysmic results stemming from Article III authorization of an individual mandate are both unproductive and unpersuasive. Should the Supreme Court determine that the Commerce Clause extends to anticipatory mandates, or, that the health care market is unique for purposes of Commerce Clause analysis, the Supreme Court will delineate clear limits to that power. Until that occurs, the minimum coverage provision of the Patent Protection and Affordable Care Act cannot withstand constitutional scrutiny.

Some Thoughts in Conclusion

Ultimately, I suspect Judge Conner’s decision will polarize people a bit, even though it shouldn’t. There will be some that will view him as equivocating, trying to avoid meeting the issue head on by saying, “The mandate’s not all evil, but I don’t have authority to uphold it at this point.” Others, like myself, will really like his approach, even if they don’t necessarily agree with all his analysis.

This is a very carefully considered decision that deserves a close read. Once you’ve reviewed it, I’d love to hear your thoughts.

Filed Under: Law, News, Slider Tagged With: christopher c. connor, commerce clause, constitution, federalism, law, obamacare

Lessons in American Constitutional History, Post-1787: Volume 2 — Some Thoughts on The Fourteenth Amendment

September 13, 2011 by Curt Bentley Leave a Comment

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.

Filed Under: American Constitution Post-1787, Law, Slider Tagged With: bill of rights, constitution, constitutional law, due process, equal protection clause, federalism, fourteenth amendment, individual rights, law, privileges or immunities clause, second founding, slaughterhouse cases, substantive due process

Briefly, On the Tenth Amendment

August 17, 2011 by Curt Bentley 1 Comment

Does the Tenth Amendment actually do anything?

The substance of the Tenth Amendment is that all powers not delegated to the federal government are reserved. All it does is refer the reader back to Article I and reflect the basic structure of the Constitution. My Con Law professor from law school was fond of telling us over and over again that the Tenth Amendment was nothing more than a tautology: Whatever’s not delegated is retained. Look to Article I. Nothing to see here.

Interestingly, this seems to be the view underlying the tack taken by the plaintiffs in the Eleventh Circuit Obamacare lawsuit, who apparently didn’t argue the Tenth Amendment to the court in their briefing on the individual mandate (see footnote 129 to the majority opinion), instead arguing only Article I and the Necessary and Proper Clause – though it’s hard to discern this from the court opinions, which, collectively, mention the Tenth Amendment 36 times.

I’m generally inclined to agree with my professor’s view. But there’s one thing that has always given me just a little bit of pause about writing the Tenth Amendment off as superfluous. It’s the language right at the end — you know, the ambiguous language that talks about non-delegated powers being “reserved to the States, respectively, or to the People.”

What are we supposed to make of this (supposedly intentional) ambiguity, if anything?

Just who was it that delegated power to the national government? The states who ratified the Constitution? Or the people as a national whole, just happening to act (for convenience’s sake) through state ratifying conventions? Is there any meaningful difference between the two? And more importantly, is there any practical (or theoretical) consequence that derives from accepting one view over the other?

Additionally, just who is it that retains non-delegated powers — the states or the people? And which powers do they each retain? Is all this just defined by the constitutions of the individual states, which allocate power between the state governments and their citizens? And if “the people,” as some kind of national whole, do retain non-delegated powers what does that say about the relationship between our three primary actors (the national government, the states, and the people)? In particular I’m getting at the question of what the 10th Amendment means for doctrines like secession and nullification, which take as their premise the notion of the Union as a collection of states.

I very well may be making a mountain out of a molehill with this one, but I can’t help but think there’s something significant about the Tenth Amendment, which, though it may not do anything as far as enforceable federalism is concerned, may nonetheless suggest something important about the relationship between the American people and their national government.

And before I go, here’s another nut for you to chew on. This is what appears to be the Tenth Amendment’s predecessor from the Articles of Confederation:

Each state retains its sovereignty, freedom, and independence, and every power, jurisdiction, and right, which is not by this Confederation expressly delegated to the United States, in Congress assembled.

No mention of “the people” in this provision . . . so, my lawyer friends, which way does that cut??

Have at it! Anxious to hear your thoughts . . . .

Filed Under: Law Tagged With: articles of confederation, constitution, federalism, law, obamacare, states rights, tenth amendment, union

11th Circuit Strikes Down Obamacare Mandate — But Leaves the Rest Intact

August 12, 2011 by Curt Bentley 3 Comments

Wow, very interesting news out of the Eleventh Circuit today, which, in a 2-1 decision, struck down Obamacare’s health insurance mandate while leaving the rest of the statute intact. This affirmed and reversed in part the decision of Judge Vinson of the federal district court, which had held that mandate unconstitutional and struck down the entire statute as nonseverable.

The court’s opinion is 304 pages long. Yep, you read that right. There’s so much there that it’s going to take a few posts to get through it all. But it’s very interesting and I wanted to just get up some initial thoughts quickly.

1. Not a Tax.

The court declined to allow the federal government to use its taxing power as the constitutional authority for the mandate. Citing that fact that the United States Supreme Court had declined to equate a penalty with a tax, and the fact that, both in the statute itself and the legislative history of the statute, the consequences for failing to comply with the mandate were referred to as penalties, the court essentially said to the government: ”You chose your horse at the starting gate, ride it all the way to the end of the race.”

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2. Differentiating Wickard v. Filburn

All of these Obamacare cases are going to have to deal in some way with the Supreme Court precedent of Wickard v. Filburn, in which the Supreme Court upheld Congress’ authority, under the Commerce Clause, to regulate wheat production intended solely for personal use. Here’s how the Eleventh Circuit’s majority opinion dealt with that case:

Wickard is striking not for its similarity to our present case, but in how different it is. Although Wickard represents the zenith of Congress’s powers under the Commerce Clause, the wheat regulation therein is remarkably less intrusive than the individual mandate.

Despite the fact that Filburn was a commercial farmer and thus far more amenable to Congress’s commerce power than an ordinary citizen, the legislative act did not require him to purchase more wheat. Instead, Filburn had any number of other options open to him. He could have decided to make do with the amount of wheat he was allowed to grow. He could have redirected his efforts to agricultural endeavors that required less wheat. He could have even ceased part of his farming operations. The wheat-acreage regulation imposed by Congress, even though it lies at the outer bounds of the commerce power, was a limitation—not a mandate—and left Filburn with a choice. The Act’s economic mandate to purchase insurance, on the contrary, leaves no choice and is more far-reaching.

Ultimately, the majority concluded that Wickard was only applicable in cases where the regulation itself was commercial in character. And the majority didn’t believe that a decision not to enter a commercial market could be deemed commercial in character without opening the whole field of human activity to congressional regulation:

The question before us is whether Congress may regulate individuals outside the stream of commerce, on the theory that those “economic and financial decisions” to avoid commerce themselves substantially affect interstate commerce. Applying aggregation principles to an individual’s decision not to purchase a product would expand the substantial effects doctrine to one of unlimited scope. . . . From a doctrinal standpoint, we see no way to cabin the government’s theory only to decisions not to purchase health insurance. If an individual’s mere decision not to purchase insurance were subject to Wickard’s aggregation principle, we are unable to conceive of any product whose purchase Congress could not mandate under this line of argument. Although any decision not to purchase a good or service entails commercial consequences, this does not warrant the facile conclusion that Congress may therefore regulate these decisions pursuant to the Commerce Clause.

Thus, even assuming that decisions not to buy insurance substantially affect interstate commerce, that fact alone hardly renders them a suitable subject for regulation. Instead, what matters is the regulated subject matter’s connection to interstate commerce. That nexus is lacking here. It is immaterial whether we perceive Congress to be regulating inactivity or a financial decision to forego insurance. Under any framing, the regulated conduct is defined by the absence of both commerce or even the “the production, distribution, and consumption of commodities”—the broad definition of economics in Raich. To connect this conduct to interstate commerce would require a “but-for causal chain” that the Supreme Court has rejected, as it would allow Congress to regulate anything.

3. Overinclusiveness Analysis in Commerce Clause Cases

One of the more odd things about the majority opinion — at least in my humble opinion — is its use of an overinclusiveness argument to support its decision. Over/underinclusiveness is a consideration in individual rights cases, but, in my opinion, has no role to play when it comes to evaluating a Congressional action under the Commerce Clause. The over/underinclusiveness analysis is designed to get at the sincerity of a legislature’s expressed motivations. For example, if a legislature regulates more broadly (or narrowly) than necessary to solve a particular problem, one might infer that it may be dislike for a certain group, rather than a desire to solve the stated problem, that motivates the legislature action. Here’s how the majority employed the overinclusiveness analysis:

The individual mandate’s attempt to reduce the number of the uninsured and correct the cost-shifting problem is woefully overinclusive. The language of the mandate is not tied to those who do not pay for a portion of their health care (i.e., the cost-shifters). It is not even tied to those who consume health care. Rather, the language of the mandate is unlimited, and covers even those who do not enter the health care market at all. Although overinclusiveness may not be fatal for constitutional purposes, the Supreme Court has indicated that it is a factor to be added to the constitutional equation.

The majority cites to Supreme Court decisions — especially relying on United States v. Lopez — in which the Court suggested that use of language designed to make the law only applicable in clearly interstate, economic cases would ensure constitutionality. But I don’t believe that the language from Lopez, or any other case, imposes any requirement, under the Commerce Clause, that a statute be “tailored” such that it eliminates over and underinclusiveness — though, to be fair, it’s been a while since I’ve read these cases. Still, I wouldn’t even go so far to say, as the majority suggests, that overinclusiveness is even a factor that should be considered when determining whether a Congressional action is authorized by Article I. The Article I inquiry is supposed to be rational basis review, and, at this point in the majority’s opinion, it starts to look very much like the majority is subjecting Obamacare to strict scrutiny.

The dissent went further than I’m willing to go here, and (though a bit timidly) hinted at its opinion that the majority, at the request of the plaintiffs, had actually covertly converted this case into a liberty/economic substantive due process case reminiscent of decision like those prevelant during the Supreme Court’s so-called “Lochner” era:

At the trial court, the plaintiffs squarely raised a Fifth Amendment substantive due process challenge to the individual mandate, which the district court flatly rejected. And while the plaintiffs also challenged the individual mandate on Tenth Amendment grounds, the district court addressed this challenge only implicitly in ruling that the mandate exceeded Congress’ commerce power.

On appeal, the plaintiffs have expressly disclaimed any substantive due process challenge to the individual mandate, although they appear still to advance a Tenth Amendment challenge. Nevertheless, it is clear that individual liberty concerns lurk just beneath the surface, inflecting the plaintiffs’ argument throughout, although largely dressed up in Commerce Clause and Necessary and Proper Clause terms. For example, the state plaintiffs go so far as to say that the individual mandate is “one of the Act’s principal threats to individual liberty,” and that upholding it would “sound the death knell for our constitutional structure and individual liberties.” Similarly, the private plaintiffs claim that the individual mandate “exemplifies the threat to individual liberty when Congress exceeds its enumerated powers and attempts to wield a plenary police power.” Sounding almost entirely in economic substantive due process, the private plaintiffs also assert that “[a]mong the most longstanding and fundamental rights of Americans is their freedom from being forced to give their property to, or contract with, other private parties.”

“The substantive component [of the Due Process Clause] protects fundamental rights that are so implicit in the concept of ordered liberty that neither liberty nor justice would exist if they were sacrificed.” This narrow band of fundamental rights is largely protected from governmental action, regardless of the procedures employed. And any law, whether federal or state, that infringes upon these rights will undergo strict scrutiny review, which means that the law must be “narrowly tailored to serve a compelling state interest.” Today, substantive due process protects only a small class of fundamental rights, including “the rights to marry, to have children, to direct the education and upbringing of one’s children, to marital privacy, to use contraception, to bodily integrity, and to abortion” — a list the Supreme Court has been “very reluctant to expand.”

In a bygone period known as “the Lochner era,” however, substantive due process was more broadly interpreted as also encompassing and protecting the right, liberty, or freedom of contract. Through this interpretation of the Due Process Clause, the Supreme Court struck down many federal and state laws that sought to regulate business and industrial conditions.

However, the Supreme Court has long since abandoned the sweeping protection of economic rights through substantive due process. Today, economic regulations are presumed constitutional, and are subject only to rational basis review.

. . .

Here, Congress rationally found that the individual mandate would address the powerful economic problems associated with cost shifting from the uninsured to the insured and to health care providers, and with the inability of millions of uninsured individuals to obtain health insurance. Thus, to the extent the plaintiffs’ individual liberty concerns are rooted in the Fifth Amendment’s Due Process Clause, they must fail.

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4. Cost-Shifting, Health Care Needs, and Point of Consumption Regulation

One of the federal government’s primary arguments for the constitutionality of Obamacare was that health care is unique among services, given that (virtually) everyone needs access to health care at some point in their life. Because of this uniqueness, goes the argument, you can be certain that an individual’s decision to remain uninsured will, over the course of time, have commercial consequences. In other words, it is rational to assume that, at some point, every person will enter the market for health care, even if it’s not rational to assume that about other goods or services. The majority responded to this argument by claiming, essentially, that it puts the cart before the horse — if and when an uninsured individual needs care, and therefore enters the health care market, the law could regulate them at that point, but not before. From the majority opinion:

But the individual mandate does not regulate behavior at the point of consumption. Indeed, the language of the individual mandate does not truly regulate “how and when health care is paid for.” It does not even require those who consume health care to pay for it with insurance when doing so. Instead, the language of the individual mandate in fact regulates a related, but different, subject matter: “when health insurance is purchased.” If an individual’s participation in the health care market is uncertain, their participation in the insurance market is even more so.

In sum, the individual mandate is breathtaking in its expansive scope. It regulates those who have not entered the health care market at all. It regulates those who have entered the health care market, but have not entered the insurance market (and have no intention of doing so). It is overinclusive in when it regulates: it conflates those who presently consume health care with those who will not consume health care for many years into the future. The government’s position amounts to an argument that the mere fact of an individual’s existence substantially affects interstate commerce, and therefore Congress may regulate them at every point of their life. This theory affords no limiting principles in which to confine Congress’s enumerated power. (emphasis added)

The language emphasized in the quotation above really constitutes what I view as the core of the majority’s opinion, and its quite a strong one. But the dissent responded quite forcefully to it, in a vein that reminded me a bit of Judge Sutton’s concurrence to the Sixth Circuit’s recent opinion upholding Obamacare:

The plaintiffs and the majority would view the uninsured in a freeze-framed still, captured, like a photograph, in a single moment in time. They contend that Congress cannot constitutionally regulate the uninsured as a class at that single moment, because at that moment any particular uninsured individual may be healthy, may be sitting in his living room, or may be doing nothing at all. The only way the plaintiffs and the majority can round even the first base of their argument against the mandate is by excluding from Congress’ purview, for no principled reason that I can discern, the cost-shifting problems that arise in the health care services market.

This blinkered approach cannot readily be squared with the well-settled principle that, in reviewing whether Congress has acted within its enumerated powers, courts must look at the nature of the problem Congress sought to address, based on economic and practical realities.

When the individual mandate is viewed through a more pragmatic and less stilted lens, it is clear that Congress has addressed a substantial economic problem: the uninsured get sick or injured, seek health care services they cannot afford, and shift these unpaid costs onto others.

. . .

Thus, all of the parties agree that, at the time of health care consumption, Congress may lawfully cut across a distinct market and impose a financial penalty designed to compel the uninsured to obtain health insurance. And Congress may do so even where the uninsured would otherwise voluntarily choose to finance the consumption of health care services out of pocket, without buying insurance.

If the plaintiffs had argued that Congress cannot constitutionally force anyone to buy health insurance at any time as a means of paying for health care, they at least would have evinced the virtue of consistency. But instead, the plaintiffs’ concession undermines their claim that Congress has exceeded its rule- making power by regulating in one industry to address a problem found in another, at least where the two industries are so closely bound together. After all, even at the point of consuming health care services, individuals may wish to remain “inactive” in the health insurance market. But the plaintiffs and the majority concede that Congress may nevertheless compel individuals at that point to purchase a private insurance product.

. . .

The plaintiffs and the majority would have Congress wait at the water’s edge until the uninsured literally enter the emergency room. In other words, they say, Congress may not legislate prophylactically, but instead must wait until the cost-shifting problem has boiled over, causing huge increases in costs for those who have health care insurance (through increased premiums), and for those who provide health care services.

At bottom, the plaintiffs’ argument seems to boil down only to a temporal question: can Congress, under the Commerce Clause, regulate how and when health care services are paid for by requiring individuals — virtually all of whom will consume health care services and most of whom have done so already — to pay now for those services through the mechanism of health insurance? As I see it, the answer to whether Congress can make this temporal jump under its Commerce Clause power is yes.

There is no doctrinal basis for requiring Congress to wait until the cost- shifting problem materializes for each uninsured person before it may regulate the uninsured as a class. The majority’s imposition of a strict temporal requirement that congressional regulation only apply to individuals who first engage in specific market transactions in the health care services market is at war with the idea that Congress may adopt “reasonable preventive measures” to avoid future disruptions of interstate commerce.

. . .

What’s more, and even more basic, here the disruption of interstate commerce is already occurring. The majority inexplicably claims that the individual mandate regulates “the mere possibility of future activity,” but as we speak, the uninsured are consuming health care services in large numbers and shifting costs onto others. By ignoring the close relationship between the health insurance and health care services markets, the plaintiffs and the majority seek to avoid the hard fact that the uninsured as a class are actively consuming substantial quantities of health care services now — not just next week, next month, or next year.

. . .

I am unable to draw a relevant constitutional distinction between the virtual inevitability of health care consumption and the absolute, 100% inevitability of health care consumption. There is less of a chance that an individual will go through his entire life without ever consuming health care services than there is that he will win the Irish Sweepstakes at the very moment he is struck by lightning.

5. Severability

This was, to me, the oddest part of the Court’s opinion. As I’ve stated before, there are good arguments on both sides of the Commerce Clause issue. But I never thought there was really much of a question that if the individual mandate was struck down the other key components of Obamacare would fall as well.

The majority hedged on this a bit, and seemed clearly uncomfortable with its decision, but ultimately upheld all the other pieces of Obamacare, including the provisions prohibiting denial of coverage for pre-existing conditions on the ground that it was not “evident” to them that those that provision would not have been enacted without the mandate.

I don’t know what else to say about this then I think it’s quite clearly wrong. And I’m not sure that the survival of Obamacare’s other provisions makes anyone happy. But in the event the Supreme Court strikes down the individual mandate, it will probably decline to sever the other key provisions. And, even if it goes the route of the Eleventh Circuit, Congress will act quickly to repeal the remaining inconsistent provisions. So, not much harm done, really.

I’ll have more to come on this decision in the future, but, for now, this has gone on long enough.

Filed Under: Law, News, Slider Tagged With: constitution, eleventh circuit, federalism, healthcare, law, liberty, obamacare, severability, states rights

Iowa Republican Presidential Debate: Let’s Talk Utah Candidates

August 12, 2011 by Curt Bentley 5 Comments

Yesterday’s Republican debate was a frustrating thing for just about anyone to watch — except, perhaps, for @BarackObama (our President’s twitter interns), who seemed to be gloating afterwards at all the weak performances. The highlights and lowlights of the debate probably came courtesy of our friends in Minnesota — with the highlight being the hour-long brawl between Tim Pawlenty and Michelle Bachman and the lowlight the moderator’s decision to ask Michelle Bachman if she would be “submissive” to her husband as President — though her trumpeting of the “Lightbulb Freedom of Choice Act” comes in a close second.

But I wanted to take a moment and comment on how the two candidates most connected to Utah — Mitt Romney and Jon Huntsman — did in the Republican Presidential debate last night. They entered the debate in two different places and with two different goals. Romney was the clear frontrunner and was looking to consolidate his status. Huntsman, in contrast, was the no-name looking to introduce himself and set himself apart as the reasonable, experienced guy in a weak field.

Romney did pretty well, though it would have been hard for him to mess this one up. He stayed on his message, which was that President Obama was simply in over his head when it came to the economy and Romney was the guy who could take it over. In fact, I thought one of Romney’s best moments came when he pointed out that, if voters were looking for someone with real world, business executive experience, they had to choose between him and Herman Cain . . . it was a smart line, especially given Cain’s performance. Romney also stayed with his consistent message about his healthcare reform history — that Romneycare was a Massachusetts solution to Massachusetts’ problems and doesn’t have the constitutional issues that plague Obamacare. Frankly, it’s a weak response, but probably the best he can do. And the Tenth Amendment always seems to play well these days. Romney was also helped by the moderater’s somewhat puzzling insistence that surely, if the a federal program is constitutionally suspect a similar state program is necessarily suspect as well. With all the constitutional politics of late, I thought that we were all clear on this point by now . . . .

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Huntsman made his introduction, but the audience didn’t really respond. Overall, I thought he did OK. He was, by and large, the candidate that those of us who have followed him expected him to be. His answers were satisfactory, though he was quite vague on his plans for the economy — not good in light of the events of the last few weeks. But though they were satisfactory, none of his answers seemed particularly inspired. He looked best when asked about serving as President Obama’s ambassador and his support for civil unions. His closing statement was also pretty good. He looked worst responding to questions about the economy and illegal immigration. He set himself apart as the clear moderate in the Republican field (though definitely to the right of where he was in Utah), but the audience wasn’t impressed. Overall, given the weak performances of the other candidates, I thought that Huntsman probably finished second to Mitt.

The news out of Utah this morning is that Romney is . . . well, embarrassing seems to be an apt word . . . Huntsman in the homeland. The Salt Lake Tribune reported that 71 percent of Utah Republicans self-classify as Romney supporters as opposed to only 13 percent of Utah Republicans that support Huntsman. As others have noted, it will be hard for Huntsman to gain traction nationwide while he’s losing this badly to his main primary opponent in his own state. Furthermore, it’s bad news for Huntsman that Romney seems to be getting stronger as he goes along. Huntsman’s best chance in this race, it always seemed to me, was to capitalize on the fact that the Republican field was extraordinarily weak, with no clear standout candidate. When it started, Romney was the frontrunner only by default. The weak field gave Huntsman the real opportunity to have voters who didn’t know him well give him a hard look as they searched for a “serious” Republican candidate with potential to win. Huntsman’s best argument to Republicans who don’t like him has been: ”If you’re looking for a guy to beat Obama, it’s me — and only me. The others are just too far right to do it.” But with Romney is looking stronger all the time, and Obama taking a beating on the economy (Romney’s best issue), that line probably isn’t playing as well right now — though that could change.

Still, I think you have to look at this field (pre-Rick Perry) and say to yourself — if it’s not Romney, its Huntsman. I just can’t envision any other of the other candidates being taken seriously, especially after last night. This probably ensures that Huntsman remains in the field for a good while longer. He’ll have other chances and he’s not done in the race yet. The more people see of Huntsman, the more they’ll like him, especially in comparison to the other candidates. Perry’s entry into the race certainly pushes Huntsman back to third, but Perry himself has some problems. So, the Utahns (or, perhaps better stated, Utah-connected candidates) will remain front and center in this one for a while. Should be fun to watch.

Here are the video highlights:

http://videos.nymag.com/video/Watch-Highlights-From-Foxs-Iowa

Filed Under: Election 2012, News, Slider Tagged With: civil unions, election 2012, federalism, jon huntsman, michelle bachman, mitt romney, obamacare, presidential election, republican debate, tenth amendment, tim pawlenty, utah

Some Follow-up Thoughts on the Significance of the Tenth Amendment and National Government

H.B. 351, Opt-Out of Order on White House Rural Council — Rep. Ivory

Dan Liljenquist and State Level Medicaid Reform

The Seventeenth Amendment — Good Idea, or the Beginning of the End?

Is the MCAP Act the Republican Version of Obamacare (Federalist-ly Speaking)?

Judge Conner of the Third Circuit District Court Weighs in on Obamacare, in a Judicially Modest Way

Lessons in American Constitutional History, Post-1787: Volume 2 — Some Thoughts on The Fourteenth Amendment

Briefly, On the Tenth Amendment

11th Circuit Strikes Down Obamacare Mandate — But Leaves the Rest Intact

Iowa Republican Presidential Debate: Let’s Talk Utah Candidates

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