What Fresh Hell Is This?

December 19, 2010

Jack Kelly Sunday

In this week's Post-Gazette column Jack Kelly (a non-lawyer as far as I know) does some non-legal analysis on the recent ruling by Virginia federal district judge Henry Hudson, who found that the "individual mandate" section of the recently passed Health Care Reform as unconstitutional.

Being a non-lawyer myself, I guess I can do some non-lawyerly analysis on Jack's non-lawyerly analysis without running the risk of practicing law without a license. (Which is a very serious crime, or so I am told.)

After parroting some poll data from the GOP-leaning Rasmussen, Jack shows his stuff:
The same day a federal district judge in Virginia ruled the key provision in Obamacare, which requires Americans to buy health insurance or pay a hefty fine (2.5 percent of annual income), is unconstitutional.

Two other federal district judges, one in Michigan and another in Virginia, have ruled the individual mandate is constitutional.

The issue is whether the authority granted to Congress by the Constitution "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes" permits Congress to require private citizens to buy a particular product.
Good for Jack for pointing out the two judges who ruled the individual mandate as constitutional.

Here's how Jack on the legal basis of Hudson's findings:
But the Supreme Court tortured the Commerce Clause in the 1940 case of Wickard v. Filburn, in which it held Congress could regulate how much wheat an Ohio farmer could grow on his own land to feed his own livestock. This was interstate commerce, the Court "reasoned," because if Filburn didn't grow his own wheat, he'd have had to buy wheat to feed his livestock, and he might have bought it from out of state.

Wickard v. Filburn is a vile precedent which should be overturned. But courts respect precedents, even bad ones.
It leads directly to the next question: What did those other two judges have to say? One, Judge Norman Moon of the Western District of Virginia, addresses whether the Commerce Clause can regulate "inactivity":
Far from "inactivity," by choosing to forgo insurance, Plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now, through the purchase of insurance. As Congress found, the total incidence of these economic decisions has a substantial impact on the national market for health care by collectively shifting billions of dollars on to other market participants and driving up the prices of insurance policies.
The other, Judge George Steeh of the Eastern District of Michigan, had a little more:
There is a rational basis to conclude that, in the aggregate, decisions to forego insurance coverage in preference to attempting to pay for health care out of pocket drive up the cost of insurance. The costs of caring for the uninsured who prove unable to pay are shifted to health care providers, to the insured population in the form of higher premiums, to governments, and to taxpayers. The decision whether to purchase insurance or to attempt to pay for health care out of pocket, is plainly economic. These decisions, viewed in the aggregate, have clear and direct impacts on health care providers, taxpayers, and the insured population who ultimately pay for the care provided to those who go without insurance. These are the economic effects addressed by Congress in enacting the Act and the minimum coverage provision.
So what's this Wickard v. Filburn case? It's not just about wheat and the rights of an individual farmer. From the decision:
Commerce among the states in wheat is large and important. Although wheat is raised in every state but one, production in most states is not equal to consumption. Sixteen states on average have had a surplus of wheat above their own requirements for feed, seed, and food. Thirty-two states and the District of Columbia, where production has been below consumption, have looked to these surplus-producing states for their supply as well as for wheat for export and carryover.
It is well established by decisions of this Court that the power to regulate commerce includes the power to regulate the prices at which commodities in that commerce are dealt in and practices affecting such prices. One of the primary purposes of the Act in question was to increase the market price of wheat and to that end to limit the volume thereof that could affect the market. It can hardly be denied that a factor of such volume and variability as home-consumed wheat would have a substantial influence on price and market conditions. This may arise because being in marketable condition such wheat overhangs the market and if induced by rising prices tends to flow into the market and check price increases. But if we assume that it is never marketed, it supplies a need of the man who grew it which would otherwise be reflected by purchases in the open market. Home-grown wheat in this sense competes with wheat in commerce. The stimulation of commerce is a use of the regulatory function quite as definitely as prohibitions or restrictions thereon. This record leaves us in no doubt that Congress may properly have considered that wheat consumed on the farm where grown if wholly outside the scheme of regulation would have a substantial effect in defeating and obstructing its purpose to stimulate trade therein at increased prices.
Taken in aggregate, Congress can, under he Commerce Clause (Article I, Section 8, Clause 3) and the Necessary and Proper Clause (Article I, Section 8, Clause 18) regulate who much a farmer can grow in his/her own farm. Vile or not, that's what the Supreme Court said.

But is Judge Hudson's reasoning beyond that sound? As I am still not a lawyer so let's check in with some (h/t mediamatters.org). Here's Orin Kerr from the conservative/libertarian Volokh Conspiracy:
I’ve had a chance to read Judge Hudson’s opinion, and it seems to me it has a fairly obvious and quite significant error. Judge Hudson assumes that the power granted to Congress by the Necessary and Proper Clause — “To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers” — does not expand Congress’s power beyond the Commerce Clause itself. The key line is on page 18:
If a person’s decision not to purchase health insurance at a particular point in time does not constitute the type of economic activity subject to regulation under the Commerce Clause, then logically an attempt to enforce such provision under the Necessary and Proper Clause is equally offensive to the Constitution.
Judge Hudson does not cite any authority for this conclusion: He seems to believe it is required by logic. But it is incorrect. The point of the Necessary and Proper clause is that it grants Congress the power to use means outside the enumerated list of of Article I powers to achieve the ends listed in Article I. If you say, as a matter of “logic” or otherwise, that the Necessary and Proper Clause only permits Congress to regulate using means that are themselves covered by the Commerce Clause, then the Necessary and Proper Clause is rendered a nullity. But that’s not how the Supreme Court has interpreted the Clause, from Chief Justice Marshall onwards. Indeed, as far as I know, not even the most vociferous critics of the mandate have suggested that the Necessary and Proper Clause can be read this way.

Given that existing Supreme Court caselaw gives the federal government a fairly straightforward argument in support of the mandate under the Necessary and Proper clause, Judge Hudson’s error leads him to assume away as a matter of “logic” what is the major question in the case. That is unfortunate, I think.
We can agree, I should think, that Hudson's decision isn't as solid as Jack would like us to think.

I think he'd have us believe the party's over, let's call it a day. But if Hudson's opinion is all he has so far, the game is far from over.


NorthPGH Progressive said...

How has it been completely ignored that our Medicare sytem(Part B and D) already has a late enrollment penalty for those that don't participate from the first day they are eligible.

Part D is essentially the same exact concept as the healthcare plan that was passed this spring. It just is on a smaller level and handles medicine:


Part B: http://www.medicare.gov/MedicareEligibility/home.asp?dest=NAV%7CHome%7CResources%7CSurchargeCalcQuestions%7CResourcesOverview&version=default&browser=IE%7C8%7CWinXP&language=English

CSI w/o Dead Bodies said...

I think Jack Kelly should read this post about Rasmussen polling and their biases. http://csiwodeadbodies.blogspot.com/2010/12/us-and-republicans-want-health-care-law.html