Tuesday, June 12, 2012

The ObamaCare Tax? Regulation, taxation, and the insurance mandate

During the 2009 debate over the Patient Protection and Affordable Care Act, President Barack Obama insisted that the law’s “shared responsibility payment,” assessed on Americans who fail to obtain government-approved medical coverage, is not a tax. “I absolutely reject that notion,” he told ABC’s George Stephanopoulos that September. “For us to say that you’ve got to take a responsibility to get health insurance is absolutely not a tax increase.” 
After the law was enacted and challenged in court, the Obama administration changed its tune, arguing that the mandate is a legitimate exercise of Congress’ tax power. Although the Supreme Court may reject that argument with reference to this particular law, something very much like the mandate probably would be upheld if framed more clearly as a tax policy, rather than a regulation of interstate commerce. That possibility suggests how little may be at stake in this case when it comes to enforcing substantive limits on the federal government’s powers.
If the Supreme Court agrees with the U.S. Court of Appeals for the 11th Circuit that the Constitution’s Commerce Clause cannot be stretched to accommodate the insurance mandate, it may be “a huge symbolic victory for limited government,” as Georgetown University law professor Randy Barnett told The New York Times in March. But it will still leave in place an absurdly broad reading of the clause, one that has proven generous enough to allow virtually everything Congress has tried to do under this pretext since the New Deal. And if the Court overturns the mandate, enacting a revised version that could pass constitutional muster would be legally straightforward (if politically difficult), thanks to the enormous power Congress wields under its tax authority.

Read more: http://reason.com/archives/2012/06/12/the-obamacare-tax

No comments: