A loss for constitutionalists

John Yoo Professor, Berkeley Law
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Thursday’s Supreme Court decision upholding the national healthcare act handed President Barack Obama a victory and dealt constitutionalists a loss. But most importantly, the decision in NFIB v. Sebelius kicked the healthcare controversy back to elected politicians for solutions, and warned conservatives against placing all of their eggs in the basket of the courts.

In the case’s biggest surprise, Chief Justice John Roberts, a Reagan White House and Justice Department official and President George W. Bush appointment, not only joined the solid bloc of four liberal justices, but also wrote the majority opinion. He agreed with the four conservatives (Justices Scalia, Kennedy, Thomas and Alito) that the federal government could not use its power to regulate interstate commerce to compel individuals to purchase health insurance. But he then turned around and agreed with the liberals (Justices Ginsburg, Breyer, Sotomayor and Kagan) that Congress could enact the individual mandate under its power to tax, which is broader than its power to directly regulate.

Beyond the individual mandate, Roberts’s opinion contained something for everyone. A 7-2 majority decided that Congress had unconstitutionally coerced states when it threatened to cut off all Medicaid funding if they did not expand the program along federal guidelines. This is the first time since the fight over the New Deal that the court has enforced constitutional limits on Congress’s power to impose mandates along with federal funds. But he then concluded that finding this provision unconstitutional did not render the whole Obamacare statute unconstitutional — that the provision was in fact severable from the rest of the bill.

Conservatives consoled themselves yesterday with a few bits of silver lining. The court rejected the notion that the federal government could regulate inactivity. “The Framers gave Congress the power to regulate commerce, not to compel it, and for over 200 years both our decisions and Congress’s actions have reflected this understanding,” Roberts wrote. “There is no reason to depart from that understanding now.” This is the very argument that liberal congressmen and their legal experts mocked, best exemplified by then-Speaker Nancy Pelosi’s exclamation “are you serious?” in response to a question about the bill’s constitutionality.

The court’s refusal to bless the idea of a limitless Commerce Clause restored the central constitutional principle that the federal government has only limited powers. But it is mostly a symbolic victory that does little to limit the growth of our massive, unaccountable administrative state. As the challengers to Obamacare admitted during the oral arguments at the court, no other federal law depends on reading the Commerce Clause to include inactivity. Put another way, every other federal law in existence remains constitutional even after Sebelius. The federal government will continue to grow, add more billions to our federal deficit every day and limit more private freedoms with more regulations.

And what Roberts gave on the Commerce Clause, he quickly took away on the taxing power. He and the four liberal justices upheld the individual mandate as a tax because anyone who does not buy health insurance must pay a financial penalty. But Obamacare created a tax unlike any other before. The government has long imposed excise taxes, based on the sale of goods such as cigarettes or gasoline, or taxes based on income. Here, the Obama Congress forced a “tax” on anyone who refused to buy insurance. As the extraordinary joint dissent observed, the court has never classified as a tax a penalty for passively violating the law.

But worst of all, Chief Justice Roberts’s treatment of the individual mandate as a tax blows a hole in the Commerce Clause. To see this clearly, consider the much-discussed hypothetical about eating broccoli — which I am happy to say is only a hypothetical at my own dinner table. At oral argument, Justice Scalia had argued that the government’s claim that it could force people to buy health insurance meant that it could also force them to eat broccoli. Roberts agreed that a federal law forcing Americans to eat their vegetables must be unconstitutional. But, as the dissent argued, Roberts’s decision would allow Congress to pass a law that everyone must eat broccoli or pay a tax penalty. The federal government would exercise the unlimited power that the Framers did not want it to have, just so long as they re-characterize their regulations as tax penalties.

One last moment of cheer for conservatives apparently came with the majority’s finding that Obamacare’s expansion of Medicaid violated state sovereignty. Congress threatens to cut off all of a state’s Medicaid funding if it refuses to expand coverage as dictated by the federal government. Federal Medicaid grants average about 22 percent of all state expenditures. Seven justices agreed that threatening to cut off that much federal funding gave states little choice but to accept federal terms. Conservatives have long dreamed of placing limits on the spending power, through which the federal government extends its grasp into state areas such as the environment, education, housing and family matters in ways that the Framers would never have intended. Perhaps Sebelius will set the groundwork for expanded judicial scrutiny, or it could represent an outlier due to the large amount of funds at stake.

The conservatives still could have leveraged this small gain into overall victory. The court could have struck down the whole law because of the unconstitutionality of the Medicaid expansion. But Roberts would have none of it. Even though Congress failed to include a provision severing any unconstitutional provisions, Roberts and the four liberals agreed that the rest of Obamacare would remain in force. To avoid the natural conclusion that the whole law should be struck down because it created a complicated, interlocking regulatory scheme, the majority had to basically rewrite the law. As the dissenters wryly observed: “The Court today decides to save a statute Congress did not write.”

While a disappointing loss for both the economy and the Constitution, Sebelius contains an important lesson for conservatives. They cannot rely on the federal courts to save them from the ever-expanding liberal welfare state. Placing all of their eggs in the judicial basket led conservatives to forget the most important forum for making their case: the political process. The only way left to defeat Obamacare is for conservatives to win not just the White House, but also the House and Senate this November. The Supreme Court is not the place to make policy judgments. “Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them,” the majority declared. “It is not our job to protect the people from the consequences of their political choices.” That is one thing that Chief Justice Roberts got right this week.

John Yoo is a law professor at the University of California at Berkeley and a visiting scholar at the American Enterprise Institute. A Bush Justice Department official, he is the author most recently of Taming Globalization (Oxford U. Press 2012).