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If your interested in the politics of the United States for the next few months or at least until November then read me out. Their are powers reserved for Congress and those are enumerated in the constitution all others belong to the states. The Supreme Court has no precedent for legislation that, like the new health insurance bill, forces a citizen to purchase a product from a private vender. The problem is not the new benefits that the health care bill promises nor the costs, in my opinion, but the possible expansion of powers. Specifically worrisome is the ability to legislate inactivity because a connection can be made to interstate commerce. This is not like making every American donate to their social security retirement plan because that legislation was created via powers enumerated in the constitution for Congress, like the power to wage war, tax etc. Keep in mind that difference between enumerated powers and an expansive interpretation of enumerated powers. States can create mandates but when Congress reaches out to mandate or give incentive it must reach using a tool called the commerce clause: Congress must justify every use of this tool.
It is my contention that progressives, liberals and even well intended conservatives that assisted in passing (H.R. 3590) or the health care reform bill are trapped within a paradigm but what is needed now is a paradigm shift and quickly. This path to health care reform is leading to an expansion of powers for Congress that in the future could be dangerous for individual rights. A professor once showed me an image but this image appeared in a autostereogram (click here to see a few of these images on line) which at first glance was difficult to identify. In that image there appeared a random assortment of black and white dotes along with black and white splotches which all appeared randomly placed. Without the proper viewing technique it was not easy to see the image of a Dalmatian which the professor pointed out to the class. Once a person has seen the image the viewer can never go back or they cannot un-see the image. So what follows is a different way of looking at the picture of health care reform or insurance reform.
“don’t worry the fines are really taxes” or “if a state can use mandates so can the federal government.” Quotes from The Media
The issue of mandating health care or penalizing individuals for not participating is not an issue that is going away soon considering cases have already been filed in federal courts. There are plenty of good hearted people that want this issue to go away or are brushing it off as silly but take a closer look and consider what could happen if the Supreme Court decides to hear those cases. The high court could decide that Congress has over reached its powers. The issue is not whether the republicans are hypocrites for filing law suits against the new mandates to purchase health insurance. After all the GOP first brought up this concept of “mandating” the purchase of health care insurance from a private entity years ago during their fight against the Clintons “Hilary Care” in the early 1990s.
The issue is whether Congress can regulate inactivity using the Commerce Clause in the United States Constitution or Article I, Section 8, Clause 3. In United States v. Five Gambling Devices, the court stated that "The principle is old and deeply imbedded in our jurisprudence that this Court will construe a statute in a manner that requires decision of serious constitutional questions only if the statutory language leaves no reasonable alternative". The new health care bill mandates purchasing insurance from private venders without a reasonable alternative like a public option or not buying insurance at all which simply means the court just might hear the cases.
Facts. Congress has passed a bill (H.R. 3590) and this new law mandates all citizens to purchase health care coverage from a private insurance company but can only purchase a policy from an insurance company specific for their state. Citizens that refuse to buy insurance are penalized with a fine which is collected by the IRS who will investigate everyone on a monthly bases to assure they comply.
ISSUE -- Does congress have the power to regulate inactivity or does mandating that an individual purchase insurance from a private insurance company exceed the powers granted to Congress by the Interstate Commerce Clause? Is a mandate to buy insurance from a private vender an expansion of power justifiable as a noble purpose?
Rule -- 1 Article one section eight of the constitution states that
“Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States; --- To borrow money on the credit of the United States; --- To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes…”
In United States v. Lopez the court pointed out that there are three broad categories of activity that Congress can regulate under the Commerce Clause: 1. the channels of interstate commerce, 2. the instrumentalities of interstate commerce, or persons or things in interstate commerce, and 3. activities that substantially affect or substantially relate to interstate commerce
Rule -- 2 The tenth amendment of the U.S constitution states that all powers not delegated to the United States Federal government are reserved to the states.
Analysis -- In Wickard v. Filburn, the Court upheld that:
"[E]ven if appellee's activity be local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce, and this irrespective of whether such effect is what might at some earlier time have been defined as `direct' or `indirect.' " Id., at 125. The Wickard Court emphasized that although the farmers own contribution to the demand for wheat may have been trivial by itself, that was not "enough to remove him from the scope of federal regulation where, as here, his contribution, taken together with that of many others similarly situated, is far from trivial." Id., at 127-128.
So, what is happening here is that the farmer was engaged in an activity or he grew and processed wheat for sale and for his own use, the activity was in the physical work. Not buying wheat on the market for his family is not the inactivity that the court was granting congress the power to regulate. Rather the court referred to the activity of growing and processing the extra wheat as that activity which led to not buying wheat on the market. What is crucial to understand here is that it is activity or growing and processing extra wheat which is at issue. If many farmers grew extra wheat for thier own needs and so did not purchase their needs on the market they would cumalitivly effect comerrece.
When an individual is not participating in the health care plan there is not an activity that substantially effects commerce. The individual just does not have health insurance which is unlike the wheat farmer who had his home grown wheat. The farmer supplies his needs at home and does not buy the products on the market which would have an exponential effect if many farmers were involved. The alternative is not to grow the private wheat and purchase on the market but here the alternative is just to take a personal chance. Automobile insurance is different because the person takes a chance with the lives of other people when they drive. In United States v. Lopez, the “…Court, through Chief Justice Marshall, first defined the nature of Congress' commerce power in Gibbons v. Ogden, 9 Wheat. 1, 189-190 (1824): "Commerce, undoubtedly, is traffic, but it is something more: it is intercourse…” Not wanting to participate in the new health care plan is hardly “intercourse.” There are many people that can afford health insurance but do not purchase a policy and just pay their medical bills. How are people that choose to pay their medical bills having a negative effect on interstate commerce and was that what congress intended?
Also in United States v. Lopez, 514 U.S. 549 (1995) the court stated:
“But even these modern era precedents which have expanded congressional power under the Commerce Clause confirm that this power is subject to outer limits. In Jones & Laughlin Steel, the Court warned that the scope of the interstate commerce power "must be considered in the light of our dual system of government and may not be extended so as to embrace effects upon interstate commerce so indirect and remote that to embrace them, in view of our complex society, would effectually obliterate the distinction between what is national and what is local and create a completely centralized government."
So, the court finds it important to respect the idea that the constitution wants to limit the federal governments power and the power of states which keeps a distinction between them both. One very important way to do this is by defining “commerce.” The word commerce includes the idea of trade and in order to trade something requires activity. This means that inactivity is too weakly associated with trade and so weakly associated with commerce. Otherwise Congress is asking to regulate things that do not happen in interstate commerce. In Lopez “…our case law has not been clear whether an activity must "affect" or "substantially affect" interstate commerce in order to be within Congress' power to regulate it under the Commerce Clause... the Court has never declared that "Congress may use a relatively trivial impact on commerce as an excuse for broad general regulation of state or private activities. We conclude, consistent with the great weight of our case law, that the proper test requires an analysis of whether the regulated activity "substantially affects" interstate commerce.”
So, lets consider the power of Congress (look under “rule 1: above for the three criteria) to enact a mandate to buy insurance from a private vender in relation to the concept of “substantially affects” commerce. The first two categories of authority may be quickly disposed of because the health care bill is not justified as a regulation of the use of the channels of interstate commerce, nor is it an attempt to prohibit the interstate transportation of a commodity through the channels of commerce; nor can the bill be justified as a regulation by which Congress has sought to protect an instrumentality of interstate commerce or a thing in interstate commerce. Thus, if the mandates are to be sustained, it must be because the bill falls under the third category as a regulation of an activity that substantially affects interstate commerce.
In Wickard v. Filburn, the Court upheld that "[E]ven if appellee's activity be local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce …” The key word in the phrase above is activity. People that do not have health insurance and then go to emergency rooms for assistance cost tax payers who pay for these services. The public seeks relief from these costs and claims a substantial effect on interstate commerce is occurring which justifies an increase of power to congress. However choosing to mandate hospitals to help the uninsured is just that a choice that the citizens made because they thought that was important. This was a very noble endeavor but now that the bill or costs are getting too expensive, Congress seeks to alleviate the cost of a new project it chose to start. Again, how does a citizen that chooses to pay for their own medical bills negatively effect commerce?
The mandate to purchase insurance is not an essential part of a larger regulation of economic activity, in which the regulatory scheme could be undercut unless the intrastate activity were regulated. The high court might not sustain the mandates under cases, as in Lopez, “…upholding regulations of activities that arise out of or are connected with a commercial transaction, which viewed in the aggregate, substantially affects interstate commerce… In United States v. Bass, 404 U.S. 336 (1971), the Court interpreted former 18 U.S.C. § 1202(a), which made it a crime for a felon to "receiv[e], posses[s], or transpor[t] in commerce or affecting commerce . . . any firearm." 404 U. S., at 337. The Court interpreted the possession component of §1202(a) to require an additional nexus to interstate commerce both because the statute was ambiguous and because "unless Congress conveys its purpose clearly, it will not be deemed to have significantly changed the federal state balance." Id., at 349
The Governments’ contention, is that the mandates are valid because non compliance at the local level does indeed substantially affect interstate commerce. The Government argues that not purchasing insurance may results in emergency room visits and that can be expected to affect the functioning of the national economy in two ways. First, the costs are substantial, and, through the mechanism of insurance, those costs are spread throughout the population. Second a healthy population will lead to a healthy economy. The Government, under its "costs of non participation" reasoning, could regulate not only purchasing health insurance, but all inactivity that might lead to being unhealthy, regardless of how tenuously they relate to interstate commerce. Similarly, under the Government's "national productivity" reasoning, Congress could regulate any activity that it found was related to the economic productivity of individual citizens. As said in Lopez “Under the theories that the Government presents" in support of its mandates, "it is difficult to perceive any limitation on federal power, even in areas such as criminal law enforcement or education where States historically have been sovereign. Thus, if the Government's arguments are accepted, it is difficult to posit any activity by an individual that Congress is without power to regulate.”
As long as “…Congress' authority is limited to those powers enumerated in the Constitution, and so long as those enumerated powers are interpreted as having judicially enforceable outer limits, congressional legislation under the Commerce Clause always will engender "legal uncertainty" as Chief Justice Marshall stated in McCulloch v. Maryland. The ability to legislate inactivity is beyond enforceable outer limits.
When an individual pays their medical bills, out of pocket, it is in no sense an economic activity that might, through repetition elsewhere, have a substantially negative affect on interstate commerce which Congress intended to avoid. Not participating in the new health care plan is less an activity that effects interstate commerce than it is an activity that only effects a health care statute.
The Constitution's enumeration of powers "presuppose something not enumerated", (Gibbons v. Ogden) and that envisions a distinction between what is truly national and what is truly local.
Conclusion. No. Health care insurance is a noble cause but not connected enough or tangentially related to commerce and so does not justify an expansion of congressional powers to regulate the inactivity of an individual. This legislation significantly changes the federal and state balance of power which was unintended.
Many aspects of this insurance reform bill are very important and needed but they do not justify an expansion of power that can easily be foreseen as a tool that could be misused in the future. Our collective euphoric feeling for having passed health insurance reform should not blind us to the danger that an expansion of power like this could mean for our future.
The GOP is contending that they wish to comply with the constitution while lowering premiums and that they intend to draft the replacement bill to comply with the guidance of the Supreme Court, that is, after that body hears a few cases on the issue of “mandates,“ Click here to read what Politico had to say about the mandates. Law professor, Randy E. Barnett, asked the same question
“Can Congress really require that every person purchase health insurance from a private company or face a penalty? The answer lies in the commerce clause of the Constitution, which grants Congress the power "to regulate commerce . . . among the several states." Historically, insurance contracts were not considered commerce, which referred to trade and carriage of merchandise. That's why insurance has traditionally been regulated by states. But the Supreme Court has long allowed Congress to regulate and prohibit all sorts of "economic" activities that are not, strictly speaking, commerce. The key is that those activities substantially affect interstate commerce, and that's how the court would probably view the regulation of health insurance.
"But the individual mandate extends the commerce clause's power beyond economic activity, to economic inactivity. That is unprecedented. While Congress has used its taxing power to fund Social Security and Medicare, never before has it used its commerce power to mandate that an individual person engage in an economic transaction with a private company. Regulating the auto industry or paying "cash for clunkers" is one thing; making everyone buy a Chevy is quite another. Even during World War II, the federal government did not mandate that individual citizens purchase war bonds. If you choose to drive a car, then maybe you can be made to buy insurance against the possibility of inflicting harm on others. But making you buy insurance merely because you are alive is a claim of power from which many Americans instinctively shrink. Senate Republicans made this objection, and it was defeated on a party-line vote, but it will return.”
That analysis is part of a longer post titled “The individual mandate.” If the mandate is stricken by the court as over reaching the bill goes back through the Senate and the House of representatives. Without a mandate to purchase insurance, this will make the insurance companies vulnerable because H.R. 3590 prohibits denying coverage to children and later adults but without a mandate people will only buy insurance when they’re sick or ill. Insurance companies will not have enough individuals paying into the system but will find themselves confronting and challenging their legal obligation to accept all applicants with preexisting condition which is going to lead to even more cases filed with the courts. Without this mandate, the insurance industry would declare a deal breaker. If people are not forced to participate and fined for not doing so the pool of resources shrinks and the system can not afford to pay for the patients with preexisting conditions.
Most laws are crafted to withstand constitutional scrutiny but that does not mean that the Supreme Court agrees. What the drafters of the health care bill failed to consider was that an increase of such power would be based on criteria that can reasonably be foreseen as a possible hazard to other personal rights, creates an imbalance of power by expanding a centralized government, and obliterates any outer limit to the commerce clause
Including a n opt-out option, or Public Option or the ability of purchasing out of state policies may have saved this bill from being undercut by the Supreme Court becuase it over reaches congressional power.
Rafael Buelna
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