As promised, I have read Judge Henry E. Hudson’s 42-page ruling invalidating the individual purchase mandate of Obamacare. In a nutshell, Judge Hudson ruled:
- That the individual purchase mandate (“Minimum Essential Coverage Provision”) is an unprecedented stretch of government power. In Hudson’s words, it “extends the Commerce Clause powers beyond its current high water mark.”
- Further, that the justification must come from Congress’s enumerated Commerce Clause power to regulate economic activities.
- But the law exceeds the enumerated powers of the Commerce Clause.
- The Congress’s efforts to bootstrap authority with findings and conclusions do not, in effect, amend the constitution (my words) to increase governmental power in this sphere.
- The fines for not purchasing insurance are a penalty and not a tax, and the general power of the government to tax is not applicable to the IPM.
- The individual purchase mandate is therefore, unconstitutional.
- The unconstitutional part of the law will be severed from the rest, so that Obamacare remains in effect.
- No injunction against Obamacare was issued because the unconstitutional part of the law does not take effect until 2014.
Now for some specifics of the decision. From the decision, at page 21:
Despite the laudable intentions of Congress in enacting a comprehensive and transformative health care regime, the legislative process must till operate within constitutional bounds. Salutatory goals and creative drafting have never been sufficient to offsent an absence of enumerated powers…Congressional findings, no matter how extensive, are insufficient to enlarge the Commerce Clause powers of Commerce.
Judge Hudson discusses several cases that set the “outer boundaries of the Commerce Clause power, at pages 21-22 (my emphasis):
In both cases, the activity under review was the product of a self-directed affirmative move to cultivate wheat or marijuana. This self initiated change of position voluntarily placed the subject within the stream of commerce. Absent the step, government regulations could have been avoided.
In other words, at its most encompassing point, the private economic activity that the government regulated was initiated voluntarily by the person regulated. Or to put it another way, the cultivators of wheat and marijuana respectively did not grow their crops because they were instructed to by the government. That is a factual difference that constitutes a crucial legal distinction–unless a negative can be construed as a positive. (Thank goodness this case didn’t arise in the Ninth Circuit!) From page 23 (again, my emphasis):
In surveying the legal landscape, several operative elements are commonly encountered in Commerce Clause decisions. First, to survive a constitutional challenge the subject matter must be economic in nature and affect interstate commerce, and second, it must involve activity. Every application of Commerce Clause power found to be constitutionally sound by the Supreme Court involved some form of action, transaction, or deed placed in motion by an individual or legal entity. The constitutional viability of the Minimum Essential Coverage Provision in this case turns on whether or not a person’s decision to refuse to purchase health insurance is such an activity…(p.24) Neither the Supreme Court nor any federal circuit court of appeals has extended Commerce Clause powers to compel an individual to involuntarily enter the stream of commerce by purchasing a commodity in the private market.
Because the purchase mandate is “beyond the historic reach” of the Commerce Clause, it can only be based on an enumerated power. (No penumbras, here!) The Government argued that it can be found in the general taxation power, meaning that the fines for not purchasing insurance are really a tax rather than a penalty (despite the POTUS’s many assertions during the debate to the contrary). Judge Hudson disagreed, beginning at the bottom of page 32:
The only revenue generated under the Provision is incidental to a citizen’s failure to obey the law by requiring the minimum level of insurance coverage. The resulting revenue is “extraneous to any tax need” [citation omitted]. Compelling evidence of the intent of Congress can be found in the Act itself. In the preface to section 150, Congress specifically recites the constitutional basis for its actions and includes findings of fact. “The individual…[mandate] is commercial and economic in nature, and substantially affects interstate commerce…”
[p. 34] In the final version of the ACA enacted by the Senate on December 24, 2009, the term “penalty” [in earlier versions of the legislation] was substituted for “tax” in section 150(b)(1). A logical inference can be drawn that the substitution of the critical language was a conscious and deliberate act on the part of Congress. This shift in terminology during the final hours preceding an extremely close floor vote undermines the contention that the terms “penalty” and “tax” are synonymous.
Placing the purchase mandate in the Internal Revenue Code under “miscellaneous excise taxes” doesn’t make it so, (starting at 35):
This Court is therefore unpersuaded that section 1501(b)(1) is a bona fide revenue raising measure enacted under the taxing power of Congress…[p. 36] Having concluded that Section 1501(b)(1) is, in form and substance, a penalty as opposed to a tax, it must be linked to an enumerated power other than the General Welfare Clause…It is clear that the…underlying regulatory scheme was conceived as an exercise of the Commerce Clause powers. [p. 37] Earlier in this opinion, the Court concluded that Congress lacked power under the Commerce Clause…to compel an individual to involuntarily engage in a private commercial transaction…The absence of a constitutional viable exercise this enumerated power is fatal to the accompanying sanction for non compliance.
And the coup d’ grace on page 38:
On careful review, this Court must conclude that Section 1502 of the Patient Prevention Affordable Care Act–specifically the Minimum Coverage Provision–exceeds the constitutional boundaries of congressional power.
Demonstrating judicial restraint, Hudson severed the mandatory purchase mandate from the rest of the Obamacare law, “following the time-honored rule to sever with circumspection.” Thus, the rest of Obamacare remains in effect, although it seems to me that it’s heart has been removed. Also, he did not issue an injunction because “irreparable harm” is not currently threatened, given that the unconstitutional provision will not become effective until 2014. I think that was the right decision from a legal POV, although politically, I wish the court could have stopped the bureaucracy in its tracks.
The reasoning, care, judicial restraint, and logical progression of Judge Hudson’s decision seems legally unassailable. I think it will have tremendous influence with the Justices when it reaches the Supreme Court, and as I stated earlier, I believe it is the first nail in Obamacare’s coffin, which even its most ardent supporters must acknowledge is seriously ill.
December 13th, 2010 | 2:30 pm
[...] More analysis with quotes from the ruling over at Secondhand Smoke. Comments (0) [...]
December 13th, 2010 | 2:57 pm
So says ONE Republican judge. I think I’ll wait to see what the Supreme Court has to say about it. Meanwhile, Wesley, you can go on celebrating in anticipation of 30-40 million Americans being without affordable health insurance. Oh, and give us a few more lectures on “the importance of being human” while you’re at it. I’m sure you’re an expert on the subject.
December 13th, 2010 | 2:59 pm
[...] This post was mentioned on Twitter by Vince Humphreys and Stand In The Gap, Wesley J. Smith. Wesley J. Smith said: Obamacare: Individual Purchase Mandate “Exceeds the Commerce Clause powers vested in Congress unde.. http://bit.ly/f2DOBV [...]
December 13th, 2010 | 3:53 pm
HW misstates a tad. The “30-40 million Americans…” without affordable healthcare are more likely 10-15 million Americans and 20-25 million illegal [oops] immigrants. But that’s not important when one wants to bankrupt the country.
December 13th, 2010 | 4:58 pm
“Are you serious? Are you serious?”
So answered Speaker Pelosi when asked this question by CNSNEWS.com
CNSNews.com: “Madam Speaker, where specifically does the Constitution grant Congress the authority to enact an individual health insurance mandate?
CNS further reports that “Her press spokesman, Nadeam Elshami, then told CNSNews.com that asking the speaker of the House where the Constitution authorized Congress to mandated that individual Americans buy health insurance as not a ‘serious question.’”
“’You can put this on the record,’” said Elshami. ‘That is not a serious question. That is not a serious question.’”
http://www.cnsnews.com/node/55971
I guess it’s serious.
December 13th, 2010 | 6:09 pm
Pace HistoryWriter: It does not follow from a mandate that every individual buy health insurance that the insurance will be affordable. This problem has been rearing its ugly head under the Massachusetts state mandate, but the media have largely ignored it.
If the government were next to try to mandate that every individual buy a house in response to the current housing market crises, watch the prices of houses skyrocket. Mandated health insurance will work the same way.
The judge’s ruling was correct. And in any event, Obamacare is much more about the federal government controlling individuals and their activities than it is about solving any health insurance problem. The playbook is straight out of Clintoncare circa 1993, which in turn was based on the highly punitive and domineering (to Americans, anyway) German healthcare system and its myriad rules and thou-shalt-nots and thou-musts.
December 14th, 2010 | 1:28 am
I think the judge was right–this was heard on motions for summary judgement and the other 400 provisions were not involved. The doctrine of severability does not allow the dumping of an entire law in the absence of a severability provision, just all those provisions intertwined with the provision which is struck down. And that is exactly what Judge Hudson has done.
December 14th, 2010 | 1:30 am
The history of the interpretation of the Commerce Clause is such that one cannot say what it does or does not mean with any great confidence. If buying something without they buyer or seller crossing state lines in any way is a form of INTERstate commerce, well then, this clause is flexible indeed. Flexible enough to mean that an activity that is mandated is also something that can be regulated. In fact, the latter interpretation is much less of stretch than the former.
December 14th, 2010 | 8:47 am
The district judge severed the mandate from the remainder of the ACA (there is no such thing as ‘Obamacare’).
Even if higher courts uphold his opinion, it’s hardly the death knell for health care reform that the HCRH (health care reform hysterics) trumpet.
Wesley J. Smith Reply:
December 14th, 2010 at 10:25 am
Read the decision. It was the opposite of judicial activism, and his severing of the unconstitutional provision proves it.
But it will destroy Obamacare because without it, there will be no private insurance industry. It will go broke. Some may want that to force SP. But I am betting the Congress will not pull that trigger. It will, instead, pull back the current mess and make proper adjustments to provide reform without centralized autocracy. Either way though, Obamacare doesn’t survive.
December 14th, 2010 | 10:52 am
Certainly, one can see points made, on both the Republican, and Democratic side, of this health care debate, but I cannot, see the reasoning of those who claim, one has a “personal liberty right” to not have health care! What’s next, the “right” not to have a drivers’ license, or a license plate, or, not give one’s name to a police officer? This seems to be getting a little out of hand.
The basis, for requiring everyone to have health insurance, is not only for each person’s financial well being, but the financial well being of society in general. Everyone, will have to pay a price, for the uninsured relying on emergency rooms for their care.
This is about financial responsibility. the Obama administration deserves credit, for tackling this glaring problem.
December 14th, 2010 | 11:19 am
HW, you seem quite upset. Have you stopped and considered though what the limit of government power is if they can force you to purchase private goods? What’s to stop Congress from forcing you to purchase something you don’t want, be it a Glenn Beck book or something else? Nothing constitutionally, per your sentiments. Remember, every action you take is directly related to your health in some way, and if we declare your health is a matter of interstate commerce, there’s no conceivable limit of power. It’s no different than the Stamp Act, where the unelected bureaucrats tell us what must be bought and what is verboten.
December 14th, 2010 | 12:50 pm
[...] For example, faithful Christian Scientists might never participate in the health care system. Moreover, as Judge Hudson noted in his splendidly reasoned ruling: In surveying the legal landscape, several operative elements are commonly encountered in Commerce [...]
December 14th, 2010 | 2:32 pm
“What’s to stop Congress from forcing you to purchase something you don’t want, be it a Glenn Beck book or something else?”
It’s the job of the Supreme Court to stop Congress from doing unconstitutional things, but it is not the job of the Supreme Court to stop Congress from doing really stupid things (i.e., making us read Glen Beck or perhaps enacting Obamacare): the latter is OUR job, which we accomplish by electing new representatives. It’s slow, not at all unreliable, but less dangerous than giving the SCOTUS the power to decide what is wise and what is unwise.
December 14th, 2010 | 3:01 pm
Bret:
“I cannot, see the reasoning of those who claim, one has a “personal liberty right” to not have health care! What’s next, the “right” not to have a drivers’ license, or a license plate, or, not give one’s name to a police officer?”
I come at this from a different angle – the American tradition is that we have a limited government with the right to do certain specified tasks and no more. If Washington can compel me to buy private health insurance, what *can’t* they compel me to do? I can avoid having a drivers’ license by not driving. I can avoid purchasing a license plate by not owning a car. If I can be made to buy insurance, can I be made to get more exercise? Give up red meat? Buy Barack Obama’s memoirs?
Wesley J. Smith Reply:
December 14th, 2010 at 3:43 pm
That is the debate. Are we going to continue to move toward a centralized controlling European style social democracy, or return to a more traditionally American self reliance, plus safety net?
December 14th, 2010 | 8:38 pm
SparcVark, this seems to be almost like cutting off our nose to spite our face, here. By requiring everyone to have health insurance, we’ll be able to have more money (by not having higher insurance premiums), or not have higher taxes, to pay for the care, of those, who, inevitably, will need care, but haven’t gotten any insurance, and will use up the emergency room care. Or, we could just not care for those who have no insurance, hardly a humane solution, that no one, who i’m aware of, advocates. And since we already have restrictions, such as drivers licenses, paying taxes, license plates,that haven’t resulted in slippery slope problems, there’s no a priori reason to believe, that, requiring everyone to have insurance, will inexoribly lead us to a socialist, or down the socialist trail.
Some things the government, must do to protect everyone, and this is one them.
December 14th, 2010 | 9:23 pm
Did my last comment go through? Thanks :)
December 15th, 2010 | 1:11 am
It seems from your comments Wesley and from reading the text that if the word “tax” was used instead of “penalty” regarding the IPM, that things might have come out differently. If this is true, the pressure to not tax was tremendous and no deal could have been cut without calling it a penalty and not a tax since the change was made in the heat of the battle to get the deal done.
Wesley J. Smith Reply:
December 15th, 2010 at 1:21 am
No. As Judge Hudson wrote, a tax and a penalty are two different things. You can call a penalty a tax, but if it is not a fund raising mechanism but a sanction for doing or failing to act, it is still a penalty. Just as sometimes a fee is called a tax, but is really a fee, in other contexts. In other words, it wasn’t just the lexicon, it was the nature of the beast. And since it was a penalty and not a tax, the law can’t be upheld based on the power of the government to tax.
Wasn’t it wonderful to read an opinion in which a judge only allowed the government to do what was an enumerated power? Imagine the thought! Forcing the Feds to live within the constraints on its power established by the Constitution!
January 31st, 2011 | 11:09 pm
[...] I think, very right on the law. But he also seems to have declared the whole law null and void, much further than the Virginia judge who also found the individual purchase mandate unconstitutional… (Remember, the law does not have a severability clause.) I will defer further comment on the ruling [...]
February 1st, 2011 | 1:20 pm
[...] states against Obamacare is a deeply reasoned decision that is, I think, not only right on the law, but alongside the earlier Virginia decision declaring the ACA’s unconstitutionality, creates a splendid model for the ultimate ruling by the United States Supreme Court. Moreover, [...]
Links
Blogs
Find Us
Contact