Monday, January 31, 2011

Ilya Somlin on Vinson's Decision

Voloch Conspiracy

January 31, 2011 8:01

Today’s Florida district court ruling that the individual mandate is unconstitutional is by far the best court opinion on this issue so far. Judge Roger Vinson provides a thorough and impressive analysis of the federal government’s arguments claiming that the mandate is authorized by the Commerce Clause and the Necessary and Proper Clause, and explains the flaws in each. He had already rejected the government’s claim that the mandate is constitutional because it is a tax in a previous ruling. So far, all three federal courts that have considered the tax argument have rejected it, instead ruling (in my view correctly) that the mandate is a penalty.

This is perhaps the most important of all the anti-mandate lawsuits because the plaintiffs include 26 state governments and the National Federation of Independent Business.

One of the best parts of today’s opinion is Judge Vinson’s critique of the federal government’s argument that the mandate is constitutional under the Commerce Clause because the Clause gives it the power to regulate “economic decisions”:

The problem with this legal rationale, however, is it would essentially have unlimited application. There is quite literally no decision that, in the natural course of events, does not have an economic impact of some sort. The decisions of whether and when (or not) to buy a house, a car, a television, a dinner, or even a morning cup of coffee also have a financial impact that — when aggregated with similar economic decisions — affect the price of that particular product or service and have a substantial effect on interstate commerce. To be sure, it is not difficult to identify an economic decision that has a cumulatively substantial effect on interstate commerce; rather, the difficult task is to find a decision that does not....

The important distinction is that “economic decisions” are a much broader and far-reaching category than are “activities that substantially affect interstate commerce” [which Supreme Court precedent allows Congress to regulate]. While the latter necessarily encompasses the first, the reverse is not true. “Economic” cannot be equated to “commerce.” And “decisions” cannot be equated to “activities.” Every person throughout the course of his or her life makes hundreds or even thousands of life decisions that involve the same general sort of thought process that the defendants maintain is “economic activity.” There will be no stopping point if that should be deemed the equivalent of activity for Commerce Clause purposes.

Judge Vinson has a similarly compelling answer to the government’s claim that choosing not to purchase health insurance is an “economic activity” because everyone participates in the health care market at some point:

[T]here are lots of markets — especially if defined broadly enough — that people cannot “opt out” of. For example, everyone must participate in the food market. Instead of attempting to control wheat supply by regulating the acreage and amount of wheat a farmer could grow as in Wickard, under this logic, Congress could more directly raise too low wheat prices merely by increasing demand through mandating that every adult purchase and consume wheat bread daily, rationalized on the grounds that because everyone must participate in the market for food, non-consumers of wheat bread adversely affect prices in the wheat market. Or, as was discussed during oral argument, Congress could require that people buy and consume broccoli at regular intervals, not only because the required purchases will positively impact interstate commerce, but also because people who eat healthier tend to be healthier, and are thus more productive and put less of a strain on the health care system. Similarly, because virtually no one can be divorced from the transportation market, Congress could require that everyone above a certain income threshold buy a General Motors automobile — now partially government-owned — because those who do not buy GM cars (or those who buy foreign cars) are adversely impacting commerce and a taxpayer-subsidized business....

As Vinson explains, both the “economic decisions” argument and the “health care is special” argument ultimately amount to giving Congress the power to mandate virtually anything, and therefore conflict with the text of the Constitution and Supreme Court precedent. I addressed both arguments in more detail here. Judge Vinson also notes that the scenarios he raises are not merely a “parade of horribles,” but have a realistic basis, a point that I discussed in this recent post.

Turning to the Necessary and Proper Clause, Judge Vinson concedes that the individual mandate is “necessary” under existing Supreme Court precedent, but argues that it isn’t “proper” because the government’s logic amounts to giving Congress virtually unlimited power. I think this is exactly right; Vinson’s analysis is actually very similar to my own in this post (which is not to even suggest that he got the idea there).

Vinson also notes that the mandate probably runs afoul of the five part test recently outlined by the Supreme Court in United States v. Comstock, though he ultimately does not base his ruling on this point. I advanced a similar interpretation of Comstock and its implications for the mandate case in this article (pp. 260–67). Overall, Judge Vinson’s analysis of the Necessary and Proper Clause is a big improvement on Judge Henry Hudson’s performance in the recent Virginia ruling striking down the mandate.

Unlike Judge Henry Hudson in the Virginia case, Judge Vinson ruled that the mandate is not “severable” from the rest of the health care bill, and therefore invalidated it in its entirety. I think this may be somewhat too sweeping. However, Vinson is on strong ground in ruling that the mandate cannot be severed from the bill’s provisions forcing insurance companies to cover people with preexisting conditions. As he emphasizes, the federal government itself has repeatedly stressed this point in the litigation.

Finally, Judge Vinson rejected the 26 states’ argument that the funding provisions of the bill are unconstitutionally “coercive.” I may have more to say on this issue in a later post.

As I have often noted in the past, this decision is just another step in an ongoing legal battle. Ultimately, the issue of the individual mandate will be resolved by the courts of appeals and probably by the Supreme Court. Still, Judge Vinson’s ruling is a victory for opponents of the mandate. It’s also extremely well-written, and thereby provides a potential road map for appellate judges who might be inclined to rule the same way.

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