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Roberts strikes balance with ‘tax’ interpretation

- The Washington Times - Thursday, June 28, 2012

Chief Justice John G. Roberts Jr. ignored President Obama's words and thereby found a way to uphold the president's health care law in Thursday's Supreme Court ruling.

Despite the president's repeated assertions during the debates in 2009 and 2010 that the Internal Revenue Service penalty imposed on those who don't obtain insurance wasn't a tax, Chief Justice Roberts said it was, in fact, a tax - and the individual insurance mandate is constitutional because it's an exercise of Congress' broad taxing powers.

At the same time, the chief justice undercut Mr. Obama and others who had argued for broad federal powers under the Commerce Clause, saying that part of the Constitution cannot be stretched to compel economic activity. In doing so, he set a limit on Congress' powers under that clause, ending decades of steadily expanding congressional authority.

"The most important thing at stake in this case was whether Congress had the Commerce Clause power to make everybody go into business with a private company, and there was not a majority for that," said Georgetown University law professor Randy Barnett, a leading intellectual light for the health care law's opponents. "We've turned away the most dangerous claim."

The decision amounted to a 4-1-4 ruling, with four liberal-leaning justices saying the mandate should be upheld under both the Commerce Clause and taxing powers, and four other justices saying it exceeds government limits no matter which power is cited.

That left the chief justice in the middle, and his controlling opinion tried to strike a careful balance, affirming Congress' well-established power to tax but denying lawmakers the limitless tool of the Commerce Clause.

At root, he said, the government cannot force individuals to engage in economic activity: "Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority."

But he said Congress' decisions under the taxing power does apply - and said it doesn't matter what lawmakers call it during political debates.

He also said the taxing power doesn't have the same compulsion because it gives Americans a choice - they can perform the action or pay more money to the government.

"Whether the mandate can be upheld under the Commerce Clause is a question about the scope of federal authority. Its answer depends on whether Congress can exercise what all acknowledge to be the novel course of directing individuals to purchase insurance. Congress' use of the Taxing Clause to encourage buying something is, by contrast, not new," he said.

"Upholding the individual mandate under the Taxing Clause thus does not recognize any new federal power. It determines that Congress has used an existing one," he wrote.

In defaulting to the taxing power, the court rescued the Obama administration from itself - and in some cases the justices reversed their own take on the law compared with March, when they held oral arguments.

"Here we have a case in which Congress determinedly said this is not a tax," said Justice Elena Kagan, as she and the other justices prodded the government's chief lawyer over the issue during the three days of arguments.

At another point, Justice Ruth Bader Ginsburg chimed in that she didn't believe the government could rely on taxing power.

"A tax is to raise revenue, tax is a revenue-raising device," she said. "This penalty is designed to affect conduct. The conduct is [buying] health protection, [buying] health insurance before you have a need for medical care. That's what the penalty is designed to do, not to raise revenue."

The health care law requires most Americans to obtain health coverage, and imposed an IRS penalty on those who fail to do so. During the debate, Mr. Obama said that wasn't a tax: "For us to say 'You have to take responsibility to get health insurance' is absolutely not a tax increase."

By the time the lawsuits started to roll in, the administration had changed its argument, asking courts to uphold the law's mandate as a valid exercise of taxing power.

Lower courts rejected that argument and at oral argument before the Supreme Court, even the chief justice seemed incredulous.

"You're telling me they thought of it as a tax, they defended it on the tax power. Why didn't they say it was a tax?" he asked Solicitor General Donald B. Verrilli Jr.

In his majority opinion, however, the chief justice embraced that argument.

"The Affordable Care Act's requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness," he wrote.

Paige Winfield Cunningham contributed to this report.

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