Why the mandate was valid under taxing power

[dayman]

I know nobody cares but I do this not only for this board lol so don't worry.

 

The opinion covers why why it wasn't valid under commerce clause, and medicaid expansion. There are also dissents and concurrences (obviously). Since I am reading through the opinion anyway I copied out some text that address this one issue since some people keep saying "Constitution is dead" etc. That may be your view, even after reading this if you choose to, but if you want to know why it isn't Robert's view and don't want to read the opinion here is a 3 pages edit of the basic reasoning. Everything except underline portions is directly from the opinion and it's all in order...underline parts just describe what large areas were about that I skipped. Basically each paragraph break or "...." shows an area where a cut happened (if you care to know). Also I have no idea why the spacing sometimes is messed up it's just a formatting issue translating form adobe I guess but it isn't too bad.

 

 

 

 

 

 

 

Congress may also “lay and collect Taxes, Duties, Im¬posts and Excises, to pay the Debts and provide for thecommon Defence and general Welfare of the United States.” U. S. Const., Art. I, §8, cl. 1. Put simply, Con¬gress may tax and spend. This grant gives the FederalGovernment considerable influence even in areas where it cannot directly regulate. The Federal Government may enact a tax on an activity that it cannot authorize, forbid,or otherwise control. See, e.g., License Tax Cases, 5 Wall. 462, 471 (1867). And in exercising its spending power,Congress may offer funds to the States, and may condition those offers on compliance with specified conditions. See, e.g., College Savings Bank v. Florida Prepaid Postsecond¬ary Ed. Expense Bd., 527 U. S. 666, 686 (1999). These offers may well induce the States to adopt policies thatthe Federal Government itself could not impose. See, e.g., South Dakota v. Dole, 483 U. S. 203, 205–206 (1987) (con-ditioning federal highway funds on States raising their drinking age to 21).

 

The reach of the Federal Government’s enumerated powers is broader still because the Constitution authorizes Congress to “make all Laws which shall be necessary andproper for carrying into Execution the foregoing Powers.”Art. I, §8, cl. 18. We have long read this provision to giveCongress great latitude in exercising its powers:

 

Beginning in 2014, those who do not comply with themandate must make a “hared responsibility payment” to the Federal Government. §5000A(b)(1). That payment,which the Act describes as a “penalty,” is calculated as a percentage of household income, subject to a floor based ona specified dollar amount and a ceiling based on the aver¬age annual premium the individual would have to pay for qualifying private health insurance. §5000A©. In 2016, for example, the penalty will be 2.5 percent of an individ¬ual’s household income, but no less than $695 and no more than the average yearly premium for insurance that co¬vers 60 percent of the cost of 10 specified services (e.g., prescription drugs and hospitalization). Ibid.; 42 U. S. C. §18022. The Act provides that the penalty will be paid tothe Internal Revenue Service with an individual’s taxes, and “shall be assessed and collected in the same manner” as tax penalties, such as the penalty for claiming too large an income tax refund. 26 U. S. C. §5000A(g)(1). The Act, however, bars the IRS from using several of its nor¬mal enforcement tools, such as criminal prosecutions and levies. §5000A(g)(2). And some individuals who are sub¬ject to the mandate are nonetheless exempt from the penalty—for example, those with income below a certainthreshold and members of Indian tribes. §5000A(e).

 

[describes split lower court rulings some striking down on commerce clause others finding it a tax and refusing to rule until it goes into effect per anti-injunction act]

 

The text of a statute can sometimes have more than one possible meaning. To take a familiar example, a law that reads “no vehicles in the park” might, or might not, ban bicycles in the park. And it is well established that if a statute has two possible meanings, one of which violates the Constitution, courts should adopt the meaning thatdoes not do so. Justice Story said that 180 years ago: “No court ought, unless the terms of an act rendered it una¬voidable, to give a construction to it which should involve a violation, however unintentional, of the constitution.”

 

Justice Holmes made the same point a century later: “[T]he rule issettled that as between two possible interpretations of a statute, by one of which it would be unconstitutional and by the other valid, our plain duty is to adopt that whichwill save the Act.”

 

Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes. See §5000A(b). That, according to the Government,means the mandate can be regarded as establishing acondition—not owning health insurance—that triggers atax—the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance.Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earn¬ing income.

 

It is of course true that the Act describes the payment asa “penalty,” not a “tax.” But while that label is fatal to the application of the Anti-Injunction Act, supra, at 12–13, it does not determine whether the payment may be viewedas an exercise of Congress’s taxing power. It is up to Con¬gress whether to apply the Anti-Injunction Act to anyparticular statute, so it makes sense to be guided by Con¬gress’s choice of label on that question. That choice does not, however, control whether an exaction is within Con¬gress’s constitutional power to tax.

 

[speaks of precedent where they decide what is and is not in taxing power regardless of Congress calling it a tax (child labor cases…liquor license cases, etc)]

 

 

(“[M]agic words or labels” should not “disable an otherwise constitutional levy” (internal quotation marks omitted)); Nelson v. Sears, Roebuck & Co., 312 U. S. 359, 363 (1941) (“In passing on the constitutionality of a tax law, we are concerned only with its practical operation,not its definition or the precise form of descriptive wordswhich may be applied to it”

[more case law on functional approach to court analysis]

 

[more case law on functional approach to court analysis]

 

The same analysis here suggests that the shared re¬sponsibility payment may for constitutional purposes be considered a tax, not a penalty: First, for most Americans the amount due will be far less than the price of insur¬ance, and, by statute, it can never be more. Second, the individual mandate contains no scienter requirement. Third, the payment is collected solely by theIRS through the normal means of taxation—except thatthe Service is not allowed to use those means most sugges¬tive of a punitive sanction, such as criminal prosecution

 

None of this is to say that the payment is not intended to affect individual conduct. Although the payment willraise considerable revenue, it is plainly designed to ex¬pand health insurance coverage. But taxes that seek to influence conduct are nothing new. …. Today, federal and state taxes can compose more than half the retail price of cigarettes not just to raise more money, but to encourage people to quit smoking.

 

Neither the Act nor any other law attaches negative legal consequences to not buying health insur-ance, beyond requiring a payment to the IRS. The Gov¬ernment agrees with that reading, confirming that ifsomeone chooses to pay rather than obtain health insur¬ance, they have fully complied with the law.

 

Indeed, it is estimated that four million people each year will choose to pay the IRS rather than buy insurance. … Congress did not think it was creating four million outlaws.

 

Sup¬pose Congress enacted a statute providing that every taxpayer who owns a house without energy efficient win¬dows must pay $50 to the IRS. The amount due is adjusted based on factors such as taxable income and joint filing status, and is paid along with the taxpayer’s income tax return. Those whose income is below the filing thresholdneed not pay. The required payment is not called a “tax,”a “penalty,” or anything else. No one would doubt that this law imposed a tax, and was within Congress’s power to tax. That conclusion should not change simply because Congress used the word “penalty” to describe the pay¬ment. Interpreting such a law to be a tax would hardly “mpos[e] a tax through judicial legislation.”

 

Our precedent demonstrates that Congress had thepower to impose the exaction in §5000A under the taxing power, and that §5000A need not be read to do more thanimpose a tax. That is sufficient to sustain it. The “ques¬tion of the constitutionality of action taken by Congressdoes not depend on recitals of the power which it under¬takes to exercise.”

 

[talks extensively about direct tax evolution to rebut argument this tax is not “fairly apportioned” and sites case law that shows this cannot be considered a direct tax possibly since the days of Madison and at least since the late 1880s]

 

 

A tax on going without health insurance does not fall within any recognized category of direct tax.

 

If it is troubling to interpret the Commerce Clause as authorizing Congress to regulate those who abstainfrom commerce, perhaps it should be similarly troubling topermit Congress to impose a tax for not doing something.

 

Three considerations allay this concern. First, and most importantly, it is abundantly clear the Constitution does not guarantee that individuals may avoid taxation through inactivity. Second, Congress’s ability to use its taxing power toinfluence conduct is not without limits. A few of our cases policed these limits aggressively, invalidating punitiveexactions obviously designed to regulate behavior other¬wise regarded at the time as beyond federal authority. …. “‘there comes a time in the extension of the penalizing features of the so-called tax when it losesits character as such and becomes a mere penalty with the characteristics of regulation and punishment.’” ….. We have already explained that the shared responsibil¬ity payment’s practical characteristics pass muster as atax under our narrowest interpretations of the taxing power. Third, although the breadth of Congress’s power to taxis greater than its power to regulate commerce, the taxingpower does not give Congress the same degree of controlover individual behavior. ….. Congress’s authority under the taxingpower is limited to requiring an individual to pay money into the Federal Treasury, no more.

 

The Affordable Care Act’s requirement that certain in¬dividuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Be¬cause the Constitution permits such a tax, it is not our roleto forbid it, or to pass upon its wisdom or fairness.

Edited June 29, 2012 by TheNewBills

[LeviF]

This is a good snippet, NewBills.

[Doc]

Except that nowhere was it ever called a tax. And Barry vehemently denied it was a tax.

[Joe Miner]

Good write up.

 

But a difference of opinion could be whether the word penalty was up to interpretation.

 

Had they said charged or fee, that could be up for interpretation. Penalty is a different word with a different meaning than tax. There should be some ambiguity necessitating the need for interpretation.

 

There has to be some kind of line drawn as to when words or statements are open for interpretation and when they aren't. I think they drew that line incorrectly this time.

Edited June 28, 2012 by Joe Miner

[3rdnlng]

Good write up.

 

But a difference of opinion could be whether the word penalty was up to interpretation.

 

Had they said charged or fee, that could be up for interpretation. Penalty is a different word with a different meaning than tax. There should be some ambiguity necessitating the need for interpretation.

 

There has to be some kind of line drawn as to when words or statements are open for interpretation and when they aren't. I think they drew that line incorrectly this time.

 

It doesn't pass the smell test. Would the act have been passed in Congress if it was called a tax? They specifically said it wasn't a tax. As soon as it was challenged in court they called it a tax. Nowhere in the bill do they call it a tax. It was pure bait and switch.

[Doc]

It doesn't pass the smell test. Would the act have been passed in Congress if it was called a tax? They specifically said it wasn't a tax. As soon as it was challenged in court they called it a tax. Nowhere in the bill do they call it a tax. It was pure bait and switch.

Nope.

[dayman]

Thanks for reading all of you (even if not this then the actual opinion). And I know you all know I lean left and I know you all lean right but I do love debating this stuff with anyone who will entertain it so even if we have different views while I (may arguably ) cross the line into blatant partisanship elsewhere I would like to somehow declare (not that I can lol) that it is not what I intend to do here.

 

Except that nowhere was it ever called a tax. And Barry vehemently denied it was a tax.

 

It doesn't matter what someone calls something though that isn't how the law works. If they called it a tax and it was clearly a penalty outside the scope of commerce clause that would not get it through. Constitutional analysis is substance over form. Same all over the law. If you draft your will wrong your corpse is SOL. If you **** up your contract w/ someone you are SOL. If you try to assign and interest in land and what you've actually done is lease it you are SOL. Etc...

 

 

Good write up.

 

But a difference of opinion could be whether the word penalty was up to interpretation.

 

Had they said charged or fee, that could be up for interpretation. Penalty is a different word with a different meaning than tax. There should be some ambiguity necessitating the need for interpretation.

 

There has to be some kind of line drawn as to when words or statements are open for interpretation and when they aren't. I think they drew that line incorrectly this time.

 

That's fair. And personally to hear that criticism from fellow citizens is infinitely more promising than to hear people say they agree w/ Scalia's approach. I won't get into it now in this post but fundamentally I am not an "originalist" (b/c unlike Scalia I don't know the minds of more than a dozen non-homogeneous framers) or a "strict textualist" in the slightest and it's not political I've read a lot of the mans opinions many of them are absurd...far more absurd than most find this one to be. I may do a write up on his dissent re: tax argument but it's brutal...reading his opinions...

 

Point being acknowledging that you should look to function over form and that they just got it wrong here is miles better than the word splicing you will get from Scalia.

 

 

It doesn't pass the smell test. Would the act have been passed in Congress if it was called a tax? They specifically said it wasn't a tax. As soon as it was challenged in court they called it a tax. Nowhere in the bill do they call it a tax. It was pure bait and switch.

 

Well actually things would have went much better if the DOJ would have been willing to call it tax more readily. They basically would do that only as a last resort. And in any event...Supreme Court isn't applying the smell test regardless of either side.

 

 

 

 

I didn't post the anti-injunction section but it is fairly straight forward and there is legal reasoning but I wouldn't be able to say with a straight face there was absolutely no judicial acrobatics involved there. That said that act is not the constitution and the analysis and history of it's application (as C.J. points out) requires a different analysis. But I understand how "it's a penalty for the anti-injunction act" and "it's a tax per when given constitutional muster" doesn't sit well with anyone but fellow lawyers. lol...that much is clear

Edited June 29, 2012 by TheNewBills

[3rdnlng]

Thanks for reading all of you (even if not this then the actual opinion). And I know you all know I lean left and I know you all lean right but I do love debating this stuff with anyone who will entertain it so even if we have different views while I (may arguably ) cross the line into blatant partisanship elsewhere I would like to somehow declare (not that I can lol) that it is not what I intend to do here.

 

 

 

It doesn't matter what someone calls something though that isn't how the law works. If they called it a tax and it was clearly a penalty outside the scope of commerce clause that would not get it through. Constitutional analysis is substance over form. Same all over the law. If you draft your will wrong your corpse is SOL. If you **** up your contract w/ someone you are SOL. If you try to assign and interest in land and what you've actually done is lease it you are SOL. Etc...

 

 

 

 

That's fair. And personally to hear that criticism from fellow citizens is infinitely more promising than to hear people say they agree w/ Scalia's approach. I won't get into it now in this post but fundamentally I am not an "originalist" (b/c unlike Scalia I don't know the minds of more than a dozen non-homogeneous framers) or a "strict textualist" in the slightest and it's not political I've read a lot of the mans opinions many of them are absurd...far more absurd than most find this one to be. I may do a write up on his dissent re: tax argument but it's brutal...reading his opinions...

 

Point being acknowledging that you should look to function over form and that they just got it wrong here is miles better than the word splicing you will get from Scalia.

 

 

 

 

Well actually things would have went much better if the DOJ would have been willing to call it tax more readily. They basically would do that only as a last resort. And in any event...Supreme Court isn't applying the smell test regardless of either side.

 

 

 

 

I didn't post the anti-injunction section but it is fairly straight forward and there is legal reasoning but I wouldn't be able to say with a straight face there was absolutely no judicial acrobatics involved there. That said that act is not the constitution and the analysis and history of it's application (as C.J. points out) requires a different analysis. But I understand how "it's a penalty for the anti-injunction act" and "it's a tax per when given constitutional muster" doesn't sit well with anyone but fellow lawyers. lol...that much is clear

 

So, you're a lawyer?

[dayman]

So, you're a lawyer?

 

 

It doesn't matter what I am. I am just a person. But yes. And that is all I will say about it

[3rdnlng]

It doesn't matter what I am. I am just a person. But yes. And that is all I will say about it

 

 

We could fix the cost of health care with tort reform.

[dayman]

We could fix the cost of health care with tort reform.

 

LOL I absolutely knew that was coming. 100%. My view stands, just b/c I'm a lawyer does not mean I would not be against tort reform and I am not in MedMal anyway. In any event, Obamacare actually has some tort reform in it you would like.

 

Edit: And as I stated anyway I am not staunchly opposed to "all" tort reform just most of it.

Edited June 29, 2012 by TheNewBills

[3rdnlng]

LOL I absolutely knew that was coming. 100%. My view stands, just b/c I'm a lawyer does not mean I would not be against tort reform and I am not in MedMal anyway. In any event, Obamacare actually has some tort reform in it you would like.

 

Edit: And as I stated anyway I am not staunchly opposed to "all" tort reform just most of it.

 

Just remember in the future that I have a litany of lawyer jokes and will use them in rebuttal.

[MARCELL DAREUS POWER]

It doesn't pass the smell test. Would the act have been passed in Congress if it was called a tax? They specifically said it wasn't a tax. As soon as it was challenged in court they called it a tax. Nowhere in the bill do they call it a tax. It was pure bait and switch.

 

 

its only a tax if you say you dont need healthcare insurance, when obviously you do. its a fact. personal responsibility, stop being a free loader...

Edited June 29, 2012 by MARCELL DAREUS POWER

[Doc]

its only a tax if you say you dont need healthcare insurance, when obviously you do. its a fact. personal responsibility, stop being a free loader...

No one needs heath insurance. If you get sick, your are free to refuse care that might bankrupt you and/or make you a free-loader.

[dayman]

its only a tax if you say you dont need healthcare insurance, when obviously you do. its a fact. personal responsibility, stop being a free loader...

 

 

But...but...then the GOP can't play the tape over and over again where Obama is asked why it isn't fair to characterize the bill as a TAX INCREASE (referring to the mandate) and objecting to that (b/c it's a tax penalty)...and claim he was saying it wasn't a "tax." And in any event, even had he claimed that it is technically wrong b/c people making over 200K a year will experience a .9% tax increase in 2 years so it is a tax anyway...the point being...it takes money to fix problems and this was designed to take as little as we could figure out while preserving private health care insurance (which most Americans want). So no, the mandate is not a tax increase it is a tax penalty. Yes the ACA has a tax increase for some in it (.9% for those making over 200K a year). But the point it...WHO CARES. You can't fix it "with out costing you a dime" like idiot Bachmann said on O'Reilly today. It's nonsense. At some point political have to be honest with themselves. STOP IT!

[Doc]

But...but...then the GOP can't play the tape over and over again where Obama is asked why it isn't fair to characterize the bill as a TAX INCREASE (referring to the mandate) and objecting to that (b/c it's a tax penalty)...and claim he was saying it wasn't a "tax." And in any event, even had he claimed that it is technically wrong b/c people making over 200K a year will experience a .9% tax increase in 2 years so it is a tax anyway...the point being...it takes money to fix problems and this was designed to take as little as we could figure out while preserving private health care insurance (which most Americans want). So no, the mandate is not a tax increase it is a tax penalty. Yes the ACA has a tax increase for some in it (.9% for those making over 200K a year). But the point it...WHO CARES. You can't fix it "with out costing you a dime" like idiot Bachmann said on O'Reilly today. It's nonsense. At some point political have to be honest with themselves. STOP IT!

As the saying goes, the problem with socialism is you eventually run out of other people's money.

[dayman]

It is my fault for posting that here. Let's debate the policy in the other topic. Lets keep it legal in here.

[DC Tom]

It is my fault for posting that here. Let's debate the policy in the other topic. Lets keep it legal in here.

 

That is a cogent, well-thought decision (if the snippet you posted is accurate - I'll give you the benefit of the doubt, however.)

 

I still think it's a horrible, stupid law not based in anything resembling economic reality. But just because rainbow-farting unicorns aren't real, doesn't make them unconstitutional.

[UConn James]

It doesn't matter what I am. I am just a person. But yes. And that is all I will say about it

 

Mickey??? You owe me money!

[dayman]

That is a cogent, well-thought decision (if the snippet you posted is accurate - I'll give you the benefit of the doubt, however.)

 

I still think it's a horrible, stupid law not based in anything resembling economic reality. But just because rainbow-farting unicorns aren't real, doesn't make them unconstitutional.

 

LOL c'mon Tom. You think I would put my high value PPP reputation (as the clear cut most brilliant and nonpartisan speaker of the truth) on the line by falsifying something that would within a matter of minutes (or months on PPP or CNN) be corrected? No way.

 

(It goes w/ out saying if anyone really wants to understand it in true detail you just have to read it...but as I said it's not out of order it's merely edited so people can get the gist w/ out reading 80 pages I didn't distort it to my knowledge beyond shortening it)

 

And in any event I should synthesize Scalia (if nothing more than to prompt discussion) and why it isn't a tax, the man is more learned than I will ever be but his methods of reason are nuts to me ... so it may be a bit. I once thought I was a Scalia fan long ago before I read ... so it will be fun to me since I'm lame.

 

(and honestly if Scalia was the majority he would be what you see above first...b/c he would be the law)

Edited June 29, 2012 by TheNewBills