The Affordable Care Act Decision

In a surprise 5-4 ruling that will affect every American and change the landscape of healthcare in this nation, the U.S. Supreme Court constitutionally upheld most components of the sweeping legislation known as the Affordable Care Act. The court's ruling upheld the central controversy that has dominated discussion: that all Americans are mandated to obtain health insurance.

Lehigh University experts weigh in on the decision and the wisdom behind it. The polarizing law, dubbed Obamacare by some, is the signature legislation of Obama's time in office.

A Summary of the Decision

Matt Melone, who teaches Legal Environment of Business and Business Law, says the surprise is not in the decision but in the reasoning behind it.

The Obama Care decision, National Federation of Independent Business v. Sebelius, was a surprise not so much in result as in its reasoning.  The decision, by a 5-4 margin, held that the federal government does not have the authority to compel people to engage in commercial activities under the Constitution’s Commerce Clause. However, by a 5-4 margin, the Court held that the individual mandate is within the federal government’s taxing power. The majority held that, for constitutional purposes, whether Congress has labeled a provision as a penalty or a tax is not determinative of whether the power to enact the sanction is within the taxing power.

The decision is actually a win for both sides. Obviously, those who favor the legislation are pleased with the result. However, proponents of limited federal government have also achieved a victory. This is only the third case in 70 years that has denied the federal government the power to act under the Commerce Clause.  Despite the fact that the Court upheld the individual mandate under the taxing power, there are significant differences between the two clauses. Most importantly, Commerce Clause authority allows the federal government to bring the full weight of its power to bear in enforcing its requirements, including criminal sanctions. The taxing power limits the government to the imposition of a tax for failure to follow its desires. Moreover, use of the taxing power has very visible political consequences. You can bet that the next time Congress attempts to stealthily pass a tax with the label of a penalty that all political hell will break loose.

The Court also struck down a portion of the Medicaid expansion included in the law. In effect, the Court held that withholding of federal funds under pre-existing Medicaid rules from states that did not expand Medicaid coverage amounted to undue federal coercion and was unconstitutional.  This holding is a victory for states’ rights advocates and places some limitations on the power of the federal government to use federal funding to have states do its bidding.

I believe that Chief Justice Roberts also considered the institutional interests of the Court. Since Bush v. Gore over a decade ago, the public perception of the Court is that it has become more politicized.  This decision, like the Arizona immigration case earlier in the week, gave something to both sides.  Most people will, quite naturally, focus on the results of the case and be happy or disappointed on that basis alone. However, the denial of the commerce power in this case is a big deal. One disappointing aspect of this case is that, although the Chief Justice’s opinion stated that the taxing power is not unlimited and that punitive measures couched as a tax are subject to challenge, he provided little in the way of any principled guidance in this respect.

by George Nation, College of Business & Economics

The Supreme Court’s decision upholding the Constitutionality of Obama Care on the Federal government's taxing authority leaves the health care debate where it belongs- in the political arena. A majority of the Court clearly rejected the argument that the law’s individual mandate was a proper exercise of Congress’ power under the Commerce Clause or under the Necessary and Proper Clause. This part of the opinion is not ground breaking; it is consistent with the Commerce Clause jurisprudence of the past 80 years. I say this even though this is the first piece of economic legislation struck down by the Court on Commerce Clause grounds since the 1930s. We have always known that there must be a limit to the reach of federal authority under the Commerce Clause. If there were no limit, the federal government would not be a government of limited powers, but would have unlimited power and this is not Constitutionally permissible. The court reiterated this fundamental principal in Lopez in the '90s, though this case did not involve economic legislation. The problem with justifying the individual mandate via the Commerce clause is that it seeks to regulate non-activity, not economic activity. This part of the decision is not at all surprising

The majority's willingness (really Justice Roberts’ willingness) to uphold the individual mandate based on Congress’s taxing authority is somewhat surprising for two reasons. First, the proponents of the law made such a point of specifically denying that this provision was a tax that the court might have been justified in refusing to edit a poorly drafted law. Second, if Congress can’t regulate people just for being alive under the Commerce Clause, why is it Constitutionally acceptable to do the same thing under the taxing power? Justice Roberts’ opinion for the majority distinguishes the taxing power on three grounds. First, there is precedent for taxing non-activity in the long and frequent use of capitation taxes imposed by the government. Second, taxing something is not the same as regulating it under the Commerce Clause. With a tax, someone may choose not to engage in the desired conduct, buy health insurance, and the only fallout is the requirement to pay the tax. The government can demand no more nor impose any further sanction. If the federal government acts pursuant to Commerce Clause power, for example, it could impose criminal penalties for non-compliance. In addition, there are limits to the power to tax. That is, if the tax is too onerous it will be treated as a penalty and further restricted.

The Court has preserved the Constitutional system of limited federal power in this decision both with its Commerce Clause analysis and with its 10th Amendment analysis of the Medicaid expansion. Most importantly the Court has properly left the health care debate where it belongs, in the political arena. Stay tuned for November and Election Day!

Nation recently argued one side of the case in The Morning Call.

Our Lucky President

Saladin Ambar is a political scientist and Huffington Post blogger very much surprised by the President’s luck these last few years.

In the accompanying video, political scientist Brian Pinaire discusses how he thought the decision would play out back in May, exactly the way it has with Chief Justice John Roberts crossing sides and taking control of the scope, tenor, and logic of the entire ruling.

“Pragmatically, Roberts probably saw this as the least offensive option—it’s not forcing the public to buy anything. It merely penalizes with a tax. If for some reason you don’t, that’s fine.

“It’s a nice, safe middle ground. He’ll still get hammered on talk radio. But it was shrewd.”

Pinaire also sees a shift in the way the Commerce Clause will be used in the future, after 50 years of being the precedent for broader Congressional power. “Roberts went out of his way to make it clear that the Commerce Clause authority that had traditionally applied to commercial activity does not apply to inactivity. It leads to discussions about eating your broccoli. By stating that justification failed, he may have ushered in—after 50 years of Commerce Clause discussion—a new era of using taxation authority.

“Roberts did a nice job as the author of the majority. It expertly curbs future uses of federal authority while still upholding this one specific law for the most part. A bone thrown to both sides. Shrewd.”

Dewey Defeats Truman & The Blow Against Partisan Gridlock

James Peterson is Director of Africana Studies at Lehigh and a Huffington Post contributor and frequent guest on MSNBC’s The Ed Show and Bashir Live.

“Today is an important day for millions of Americans who are uninsured, have preexisting conditions, or are between the ages of 22 and 26.

“But I am struck by three somewhat unrelated things.  As the news was breaking, CNN reported the exact opposite of what ended up being the facts of the story.  They reported that the Supreme Court had struck down the individual mandate.  Wolf Blitzer, John King and others immediately began to dissect the Affordable Care Act with surgical precision.  They were at the ready with the fallout narratives from a decision that they had predicted (maybe even wanted) but did not come to fruition.  I am not sure I can watch CNN in the same way after today.

“Secondly, Justice Roberts struck a blow against partisan gridlock politics and in favor of the institutional viability of the SCOTUS.  Whether we agree with ACA or not; think that it goes too far or not far enough, Chief Justice Roberts has given us some hope for our government's capacity to transcend the limitations of partisan politics.

Finally, President Obama's so-called signature piece of legislation reflects his willingness to LEAD on issues that are NOT politically expedient.  Making healthcare affordable for all is something that is in the POTUS' heart - not his political calculus.”