June 18, 2012 11:47 AM
The Supreme Court announced four decisions today, three of them decided by slender 5-to-4 margins, but not the long-awaited ruling about the constitutionality of Obamacare. I discuss these four decisions at this link. Two of the three decisions in which the court split 5-to-4 were cases in which there was no ideological division among the justices, and both liberal and "conservative" justices joined the majority opinion. That, too, is unremarkable, as I explain here, and Point of Law explained explained earlier, contrary to the false conventional wisdom that depicts 5-to-4 splits as being caused only by politics or ideological divisions on the Court.
Although there was no ruling in the Obamacare case today, it is expected within a couple weeks. In The Washington Post, a disillusioned Robert Samuelson, who writes about economic topics for the newspaper, gives Obamacare a thumbs down, in an article entitled "The Folly of Obamacare." He notes that Obamacare "discourages job creation by raising the price of hiring," "worsens the federal budget problem," and effectively "discriminates against the young."
May 15, 2012 8:00 AM
Obamacare will drive up costs for most patients and insurance policyholders. Yet "health-insurance companies must tell customers who get a premium rebate this summer that the check is the result of the Obama administration's health-care law, according to federal guidelines released Friday. . . .Rules finalized by the Department of Health and Human Services on Friday instruct insurers to notify recipients of rebates in the first paragraph of the mailing by writing: 'This letter is to inform you that you will receive a rebate of a portion of your health insurance premiums. This rebate is required by the Affordable Care Act-the health reform law.'" Never mind that Obamacare has already caused sizeable hikes in insurance premiums for some policyholders.
Earlier, HHS Secretary Sebelius warned insurers not to inform policyholders that their premiums were rising due to Obamacare, even though that was the truth. Obama’s HHS secretary sought to gag insurers that disclosed how Obamacare’s mandates are increasing the cost of health insurance, even though such speech is clearly protected by the First Amendment, telling them if they did so, they could be excluded from health insurance exchanges. Prior to that, the Obama administration attempted to gag insurers from disclosing how Obamacare harms Medicare Advantage participants, drawing criticism from First Amendment experts like UCLA law professor Eugene Volokh, the author of two First Amendment textbooks.
Forcing companies to make politicized disclosures to customers implicates the First Amendment, as does interfering with the content of their speech to customers in billings. In International Dairy Foods v. Amestoy, 92 F.3d 67 (2d Cir. 1996), an appeals court struck down a Vermont law that required labeling for milk derived from animals treated with bovine growth hormones, where the labeling could not be justified on consumer deception or public health grounds.
April 2, 2012 11:45 AM
Typically, after the economy suffers an unusually severe recession, it bounces back in an unusually rapid recovery -- what some economists and others refer to as the "rubber-band effect." But not now. Despite the huge worldwide recession in 2008-09, the economy has experienced only a weak recovery, with fewer people employed in America today than when President Obama took office. "At this point in the typical post-World War II recovery, the economy was growing at an average pace of nearly 5 percent. The Obama recovery has managed just over 2 percent." As James Pethokoukis notes in the New York Post,
A Federal Reserve study from late last year looked at the behavior of recoveries from recessions across 59 advanced and emerging market economies during the last 40 years. The Fed found, to no great surprise, that recoveries “tend to be faster” after severe recessions, such as the one we just had. . .The deeper the downturn, the more robust the rebound — unless government messes things up.
For example, during the 1981-82 recession, output fell by 2.7 percent and then rose by 15.9 percent over the next 10 quarters (at an average pace of 6.0 percent). During the Great Recession, output fell even more, by 5.1 percent. But during the 10 quarters since, total economic output is up only a paltry 6.2 percent. Score one for Reaganomics.
But what about the depressing effect of Wall Street’s near-death experience back in 2008 and 2009? Well, that same Fed study found that bank or other financial crises “do not affect the strength” of subsequent recoveries. . .[What] might explain half of the Obama recovery’s underperformance versus the Reagan recovery. . .? Maybe we can attribute that to policy differences.
While one president cut long-term marginal tax rates, the other tried a massive burst of federal spending. One empowered private enterprise; the other empowered government.
March 29, 2012 3:42 PM
Conservatives are ebullient over the unexpected hostility and skepticism the government's lawyers faced from the Supreme Court Justices over the three days of hearings on the constitutionality of Obamacare. In fact, so withering was the interrogation that the consensus of the Beltway-NYC elite has shifted virtually overnight from "Of course the Court will uphold it!" to "Oh my God! The individual mandate is doomed!"
It is heartening to see the Justices take the constitutional question seriously, and entertaining to see them pick apart the very weak case(s) for the individual mandate that every American purchase health insurance or face government sanction. And it certainly seems more possible now than it did last week that the Court may throw the baby out, and the bath water too, for good measure.
However, it is possible that this focus on constitutionality may someday backfire on conservatives.
If the law is upheld, that will take a lot of the steam out of the opposition to Obamacare. In the minds of many voters, rightly or wrongly, the imprimatur of the Supreme Court may function as a sort of ne plus ultra for the whole debate. Voters may figure, "Oh yeah, Obamacare. Didn't the Supreme Court settle that? So what's the big deal?" On the other hand, if the law goes down the left will say, "See, we tried that individual mandate that conservatives came up with, and it didn't work. Time for single-payer national health care!" Which, of course, is what they've really wanted all along.
March 28, 2012 11:03 AM
Over at the Daily Caller, I go over some possible explanations for the different results and conclude:
Obamacare Harms State Finances, Imposes Unfunded Mandates, Drives Up State Budget Deficits; Even Democrats Criticize ProvisionsMarch 28, 2012 11:00 AM
While public attention has focused on Obamacare's unconstitutional "individual mandate," challenged yesterday in oral arguments at the Supreme Court, other parts of the health care law are more worrisome to governors facing massive state budget deficits that will be aggravated by Obamacare.
As the National Governors Association noted in its Fall 2011 "Fiscal Survey Of States," "state spending on Medicaid is likely to continue to see above average growth due to… the implementation of the Affordable Care Act.” (Obamacare is known as the "Affordable Care Act" or PPACA.) A congressional report, "Medicaid Expansion In The New Health Law: Costs To The States," "conservatively estimates that PPACA will cost state taxpayers at least $118.04 billion through 2023.”
Even Democratic governors call its impact "devastating," saying things like "I have no idea how we're going to pay for it." Gov. Steve Beshear (D-Ky.) notes that "starting in 2016, Washington will begin shifting that additional costs to the states. ‘I have no idea how we’re going to pay for it,’ Beshear said candidly.” (Editorial, “Medicaid Expansion Will Cost Taxpayers,” The Paducah Sun, Feb. 13, 2011). Gov. Brian Schweitzer (D-Mont.) laments that “I'm going to have to double my patient load and run the risk of bankrupting Montana.” (“Montana Looks North For Health Care That Works ," Yes Magazine, Oct. 21, 2011.) “In 2014, when the PPACA kicks in, many of the uninsured will be given the opportunity to enroll in Medicaid. With this change, Schweitzer expects the state's Medicaid population to double, creating a huge financial burden on the state of Montana under the current health care system.” “The governor told Marguerite Salazar, a regional director of the Department of Health and Human Services, that Congress has designed a ‘pack of crap’ that gives away far too much” to special interests. California Governor Jerry Brown says, “We will be further disadvantaged under the Medicaid expansions mandated under the Affordable Care Act … proposals to shift several billion dollars in Medicaid costs to California would be devastating and would clearly move us in the wrong direction.” (Gov. Jerry Brown, Letter To President Obama, June 27, 2011)
March 26, 2012 11:44 AM
At CNN, George Mason University law professor Ilya Somin explains why Obamacare's requirement that individuals buy health insurance is beyond Congress's power under the Interstate Commerce Clause. GMU law professor David Bernstein explains why Obamacare's defenders are wrong, and have contradicted themselves, in trying to defend Obamacare based on a cost-shifting rationale. Vanderbilt law professor James Blumstein, an advisor to former Governor Phil Bredesen (D-Tenn.), argues that Obamacare's Medicaid mandate is a violation of the Tenth Amendment and exceeds Congress's power under the Spending Clause. GMU's Somin rebuts the "everyone uses healthcare" argument for Obamacare here.
The Cato Institute's briefs, which CEI joined, explain why Obamacare's individual mandate is not valid under the Constitution's Interstate Commerce Clause and tax provisions. The brief CEI filed in the Eleventh Circuit Court of Appeals for Minnesota and North Carolina legislators explains why Obamacare's Medicaid mandate violates the Tenth Amendment, and in its last section, explains why the government's cost-shifting rationale for the individual mandate is baseless. CEI also explained in a more recent brief why the court need not invalidate just the unconstitutional individual mandate, since it is interrelated with other provisions of the Obamacare statute, which logically should be invalidated along with it. Law professor and former University of Chicago Law Dean Richard Epstein explains how Obamacare is an "unconstitutional misadventure" here.
The Supreme Court, which is rather deferential to Congress, has only invalidated two federal statutes as beyond Congress's power under the Commerce Clause since 1936, and it has been even more reluctant to enforce Tenth Amendment limits on Congress's spending-clause powers. On the other hand, if the government can force people to engage in economic activity under the Commerce Clause, and do so based on the sweeping rationales advanced by the government in this case, there will effectively be no limit on Congress's power under the Commerce Clause. The language and logic of the Supreme Court's Morrison and Lopez decisions cut against the government's arguments, and the Morrison decision requires more than a simple quantitative relationship to interstate commerce for an activity to be federally regulated; but these were 5-to-4 decisions unpopular with the largely liberal legal community.
March 13, 2012 4:46 PM
As Daniel Foster notes, "When it was being debated, Democrats told you ACA [Obamacare] would cost $940 billion over ten years . . . But now . . . the CBO is out with new cost estimates. They ain’t pretty”:
Today, the CBO released new projections from 2013 extending through 2022, and the results are as critics expected: the ten-year cost of the law’s core provisions to expand health insurance coverage has now ballooned to $1.76 trillion. That’s because we now have estimates for Obamacare’s first nine years of full implementation, rather than the mere six when it was signed into law. Only next year will we get a true ten-year cost estimate, if the law isn’t overturned by the Supreme Court or repealed by then. Given that in 2022, the last year available, the gross cost of the coverage expansions are $265 billion, we’re likely looking at about $2 trillion over the first decade, or more than double what Obama advertised.”
March 1, 2012 1:16 PM
In just a few week the Supreme Court will hear oral arguments regarding the legal challenges to the administration's controversial health-care overhaul, especially the constitutionality of the so-called "individual mandate" that requires every American to purchase government-approved insurance.
The Court's finding on the matter will be the most consequential ruling in that august institutions long history, excepting only perhaps the infamous 1857 Dred Scott decision. If the Supreme Court upholds the law, there will officially be no limits to the federal government's scope, no ceiling on its powers, no real liberty in America, economic or otherwise.
(It is hard to believe it has come to this, that a people who once set a continent in flames over a trifling tax have been reduced to hoping a court will save them from enslaving legislation passed by the very officials they have elected. Yet here we are.)
And if the Court does not save us? Some cling to the hope that new politicians, put into power in some future elections, will undo what Barack Obama has done. Perhaps. Anything is possible.
February 19, 2012 9:54 PM
On December 31, shortly after the November election, tax rates will rise across the board in what congressional aides call "Taxmageddon," notes The Washington Post. Not only will the Bush tax cuts come to an end, but new taxes will kick in to pay for Obamacare's rising costs:
On Dec. 31, the George W. Bush-era tax cuts are scheduled to expire, raising rates on investment income, estates and gifts, and earnings at all levels. Overnight, the marriage penalty for joint filers will spring back to life, the value of the child credit will drop from $1,000 to $500, and the rate everyone pays on the first $8,700 of wages will jump from 10 percent to 15 percent.
The Social Security payroll tax will pop back up to 6.2 percent from 4.2 percent under the deal approved Friday by Congress. And new Medicare taxes enacted as part of President Obama’s health-care initiative will for the first time strike high-income households.
And this doesn't even take account into new tax increases Obama has proposed, including but not limited to the "Buffett Tax." Liberals want to raise taxes to European levels to pay for an expanded welfare state. But many American wealthy people already pay more in taxes than they would in much of Europe, so this idea won't pay for all the new government entitlements liberals yearn for. (Thus, major liberal spending proposals will inevitably require large middle-class tax increases.) Indeed, the U.S. tax code is already more progressive than the tax codes of France, Germany, Belgium, or the United Kingdom. And America already has higher capital gains taxes and taxes on investment income than most countries, and soon, that will get much worse, since "the tax on dividends will skyrocket from 15 percent to 43.4 percent."