Unlike the States, which have broad police power to pass laws promoting the general welfare of their people, the actions of the United States government are limited by the Constitution which vests its three branches with specific authority while reserving all other powers “to the States respectively, or to the people.” Congress’ lawmaking powers are laid out in Article I, Section 8, and all Acts of Congress must fall under one of these provisions. These include the power to levy taxes, raise and support an army, declare war, establish post offices, and grant patents and copyrights. But the vast majority of federal laws are enacted under the aegis of the commerce clause which grants Congress the authority “to regulate commerce with foreign nations, among the several states, and with the Indian tribes.”
In the early days of the Republic, the United States government was relatively modest with regards to the number and scope of the laws it passed. Jurists and statesmen debated over what activities fit under the definition of “interstate commerce.” In Gibbons v. Ogden (1824), the Marshall Supreme Court ruled that commerce included not only the trade of commodities but also navigation of waterways and all other forms of intercourse. On the other hand, Alexander Hamilton, in the Federalist Papers, argued that such productive activities as agriculture and mining did not fall within the label of “commerce” but were rather something that occurred prior to commerce.
The issue came to a head in the 1930s; in 1933, President Roosevelt signed into law the National Recovery Act-- a sweeping system of economic and societal reforms meant to alleviate the hardships of the Great Depression. In 1935, however, the Supreme Court struck down many of the new law’s provisions, applying a narrow construction of the commerce clause. Among other things, the Court ruled that the United States government could not regulate labor (e.g. wages, workplace conditions) because this was not commerce but something which occurred alongside commerce (in 1918 the Court had struck down a law banning child labor).
Roosevelt, who enjoyed wide political support in the legislature and among voters, was none too pleased with these court decisions, and he proposed a law in 1937 which would increase the number of justices on the Supreme Court (the Constitution is silent in regards to the Court’s composition) thus allowing the president to “pack” the court with judges who would support a more agreeable interpretation of the commerce clause. Critics argued that this was a cynical political move that would destroy any pretense of an independent judiciary; some called it dictatorial.
At any rate, the Judicial Procedures Reform Bill of 1937 failed, but by the end of Roosevelt’s presidency the Court had adopted the more expansive interpretation of the commerce clause. This was due in large part to the fact that, during his four terms in office, President Roosevelt had the opportunity to replace several justices who retired or died; moreover one justice underwent a “philosophical conversion” in 1937 and came out in favor of a broader definition of commerce-- a move referred to by judicial historians as “the switch in time that saved nine.”
After that it started looking as though there was effectively no limit to the types of federal laws that could be enacted: until the 1990s, students were taught that the commerce clause had become a rubber stamp and that Congress could pass any law it wanted so long as its text paid some lip service to “interstate commerce” or “the United States postal service.”
But then, in the 1995 case United States v Lopez, the Rehnquist Court struck down the Gun-Free School Zones Act, which made possession of firearms within the vicinity of a school a federal crime, finding that the connection between guns in school zones and interstate commerce was too tenuous. Likewise, in a 2000 decision (United States v Morrison), the Court ruled that Congress had overstepped its bounds in passing the Violence Against Women Act. The government’s arguments that domestic violence affected commerce because it kept women away from the workplace and marketplace and that violence against women increased healthcare costs for employers and for the States were not enough to convince the Court.
The parties challenging the Act are being represented by Paul Clement, a former solicitor general under George W Bush. Clement argued seven cases before the Supreme Court this term and New York Magazine described him as “a sort of anti–solicitor general-- the go-to lawyer for some of the Republican Party’s most significant, and polarizing, legal causes.” Yet, the article also points out that he is admired and respected by liberals and conservatives alike and that he is known for being able to cut through the politics so as to tackle the legal question at the heart of a case. We can see this in the Obamacare case where his arguments are well- reasoned and focus on the limits to Congressional authority.
Clement argues that the individual mandate is unprecedented in that it forces citizens to purchase something and enter into contracts. Thus Congress is not merely regulating the market, but rather it is requiring people to enter the market (the health insurance market). During oral arguments, Justice Scalia suggested that if Congress could constrain citizens to buy health insurance policies-- for their own good and to contain the costs of healthcare for everyone-- then what’s to stop them requiring everyone to buy a gym membership (something else that would be good for their health and arguably reduce the money spent treating obesity-related diseases).
It’s interesting to note that everyone agrees that if Congress had enacted a “single payer system”-- where citizens paid an extra tax to the federal government and, in return, the government provided them with health insurance coverage-- that this would pass constitutional muster. Such a scheme would be analogous to Social Security, where all workers are required to pay into the system and in return they receive a government pension when they reach retirement age. This falls under Congress’ power to levy taxes. Of course during the healthcare debate the idea of a single payer system was quickly rejected for political reasons. Many dismissed it as too radical, and critics pointed to the shortcomings of the National Health Service in countries like the UK. Furthermore, it’s unclear what position would be left for private health insurance companies under such a system, and these are of course large, profitable corporations with a powerful lobby.
The Supreme Court also concedes that Congress would have the power to require the uninsured to purchase a policy at the time they avail themselves of the healthcare market (e.g. when they are “on the operating table”). Obviously a system where people could wait until they need medical treatment to purchase insurance would be unsustainable.
It is the job of the solicitor general to represent the United States government before the Supreme Court, and thus to defend the constitutionality of federal laws. In response to the challengers’ argument that the individual mandate forces people to enter the market, supporters assert that the relevant market here is not the health insurance market but the healthcare industry as a whole-- and everyone will need to avail themselves of this market sooner or later.
The healthcare industry is unique, and uninsured individuals have an enormous, deleterious impact on the system. Hospitals and healthcare providers take it for granted that some of the people who require emergency treatment will prove to be uninsured and thus almost assuredly unable to pay for the services provided; this is factored into their financial calculations, and it raises the cost for everyone: individuals are charged higher prices for medical treatment, employers spend more to provide workers with health insurance, and the state’s healthcare expenses continue to grow.
Alternatively, the Act’s defenders argue that the individual mandate is allowable under Congress’ power to levy taxes. The penalty charged to uninsured individuals is comparable to a tax (when the law was pushed through Congress everyone was careful to clarify that the penalty was not a new tax-- for political reasons--, but this isn’t necessarily dispositive). Indeed, one could say that the assertion that the mandate forces citizens to purchase health insurance is incorrect: they have the choice of either maintaining an insurance policy or paying a penalty.
During oral arguments, supporters claimed that the only thing distinguishing Obamacare from Social Security was the involvement of private companies. If we accept that the government could act as insurer itself and require everyone to pay a tax, why can’t it provide insurance through private intermediaries who receive through premiums the money that would otherwise be paid to the government?
Judicial analysts were taken by surprise when the Supreme Court showed that it was seriously considering invalidating the law. Indeed, several conservative judges in the lower courts confidently ruled that Obamacare presented no constitutional problems.
Judging by the questions asked during oral arguments-- not always a good indication of the opinion justices will arrive at in the Court’s final decision--, Justices Scalia and Alito seem most antagonistic to the individual mandate. Justice Thomas never participates in oral arguments, but it is safe to assume that he will vote to strike down the law (Thomas actually wrote a concurring opinion in Lopez stating that the Court should return to a Hamiltonian interpretation of the commerce clause which would preclude federal laws regulating mining or agriculture). On the left, Justices Sotomayor, Kagan, Ginzburg and Breyer all appear ready to uphold Obamacare; I would say that, during the hearings, Sotomayor was the most vocal. Observers have stated that Justice Kennedy (the notorious swing voter who leans slightly to the right) and-- to a much lesser extent-- Chief Justice Roberts might be on the fence although both appear more likely than not to declare the mandate unconstitutional.
It seems to me that there are three types of questions justices raise during oral arguments. First, there are the antagonistic questions from justices who clearly oppose the position being put forward-- either pointing out holes in the party’s argument or else just arguing with counsel (on occasion the justices even argue among themselves). A favorable assessment of the motivation behind these questions would be that the justice is trying to persuade his colleagues; a more cynical person might think they just serve to put the attorney on the spot or to satisfy the justice’s own vanity. Next, there are the softball questions thrown out by sympathetic justices who often clarify the attorney’s line of reasoning or even put forward their own arguments supporting the party’s position. And finally, the third type is comprised of those questions which represent legitimate requests for additional explanations-- perhaps asking the attorney how he believes the legal interpretation he is advancing would apply to a given hypothetical situation. This third type can appear to be the least common; it can also be hard to distinguish the sincere questions from the antagonistic.
If the Supreme Court ultimately strikes down the individual mandate (and this appears to be a definite possibility), it would then need to decide whether the remainder of the law can stand without this key provision. It is hard to question the fact that the healthcare system envisioned under the new law could not function the way lawmakers intended if participation is not obligatory. As the justices put it, all the healthy 23 year olds can choose to opt out of purchasing health insurance: not only do insurers need regular payments from healthy individuals to offset the cost of treatment for the infirm (this is how insurance works), but the small percentage of these 23 year olds who end up seriously injured in an accident or diagnosed with some serious disease will rack up medical bills they cannot pay thus burdening healthcare providers-- raising the cost of treatment for everyone and the cost of the Affordable Care program for taxpayers.
Photo of National Archives, Washington DC taken by Meeg on March 11, 2012 using Hipstamatic