Law, Policy, and Politics are not the Same Things
The PPACA, the fight over it, and the Sibelius ruling all underscore this fact.
Ok, first it was a mandate that derived from Congress’s Article I, Section 8 powers to regulate interstate commerce and now it is, depending on one’s preferred terminology, a tax or a penalty (see Doug Mataconis’ post from yesterday). Or so has been the focus of the political and legal debate.
Now, what is important here: all that (and more) is about the politics of the bill, not about the policy it creates. Indeed, the theories laid out in court, whether they were about a specific definition of commerce or were about pending forced broccoli consumption, were just that: theories (or really, debating points founded in theory) that were attempts to persuade judges in various courts. Even said theories are not about the law and policy themselves, but are about defending or opposing them.
What am I getting at here?
Well, the point is: there is a difference between what actually is in legislation and the political rhetoric used to defend it as well as a difference between what is actually in legislation and the argument used in court to defend or oppose it. However, the public does not see it that way and politicians certainly don’t talk that way (even when they know better). And, also, lawyers are trained in arguing their side of the case, no matter what. Lawyers are not philosophers engaged in a give and take that can lead to changing the mind of the other lawyers. That’s not their job. They are to advocate for their side and to be as creative as possible in the endeavor. That are not supposed to have open minds about their side. And if we throw in some political ideological and partisanship, we end up with retrenched sides talking past one another. (Granted, this is nothing new). This is one of the reasons I am not a fan of watching lawyers argue on partisan talk shows.
All of this hinders understanding in the public. Now, of course, a lot of people (most, in fact) aren’t really interested in understanding, but rather they want their side to win (or, at least, for their side to score points).
Consider this whole question of whether the individual mandate is a tax or not and to do we have to bifurcate the discussion into two pieces: one about the law as passed and the policy regime it creates, and one about politics, rhetoric, legal arguments, and the like.
I would argue that the mandate has always been a tax based on Congress’s taxing power (based on looking at the bill), but it was justified by the commerce power because people don’t like taxes, even taxes on other people (the politics of it all).
The Law Itself
I decided to do something radical and go look at the appropriate segment of the law itself (yes, I know, it is like I am not a pundit or something).
It is true that the text of the law makes an implicit commerce clause argument. A portion is as follows:
PART I–INDIVIDUAL RESPONSIBILITY
SEC. 1501. <<NOTE: 42 USC 18091.>> REQUIREMENT TO MAINTAIN MINIMUM
(a) Findings.–Congress makes the following findings:
(1) In general.–The individual responsibility requirement
provided for in this section (in this subsection referred to as
the “requirement”) is commercial and economic in nature, and
substantially affects interstate commerce, as a result of the
effects described in paragraph (2).
This, it is worth noting, a finding and not a change in a specific policy. That comes with changing the tax code. In other words, this is a declaration, not an action.
Also, in an amendment, we find the following:
(a) <<NOTE: 42 USC 18091.>> Section 1501(a)(2) of this Act is
amended to read as follows:
“(2) Effects on the national economy and interstate
commerce.–The effects described in this paragraph are the
“(A) The requirement regulates activity that is
commercial and economic in nature: economic and
financial decisions about how and when health care is
paid for, and when health insurance is purchased. In the
absence of the requirement, some individuals would make
an economic and financial decision to forego health
insurance coverage and attempt to self-insure, which
increases financial risks to households and medical
“(B) Health insurance and health care services are
a significant part of the national economy. National
health spending is projected to increase from
$2,500,000,000,000, or 17.6 percent of the economy, in
2009 to $4,700,000,000,000 in 2019. Private health
insurance spending is projected to be $854,000,000,000
in 2009, and pays for medical supplies, drugs, and
equipment that are shipped in interstate commerce. Since
most health insurance is sold by national or regional
health insurance companies, health insurance is sold in
interstate commerce and claims payments flow through
[[Page 124 STAT. 908]]
“(C) The requirement, together with the other
provisions of this Act, will add millions of new
consumers to the health insurance market, increasing the
supply of, and demand for, health care services, and
will increase the number and share of Americans who are
“(D) The requirement achieves near-universal
coverage by building upon and strengthening the private
employer-based health insurance system, which covers
176,000,000 Americans nationwide. In Massachusetts, a
similar requirement has strengthened private employer-
based coverage: despite the economic downturn, the
number of workers offered employer-based coverage has
To be honest, I must confess that all of this makes a pretty clear case that the health care industry is part of interstate commerce. But, of course, the issue at hand here is not whether that is true or not, because it is: the issue is whether the mandate to purchase insurance can be imposed as a result.
The actual policy change is to the IRS Code:
(b)(1) Section 5000A(b)(1) of the Internal Revenue Code of 1986, as
added by section 1501(b) of this Act, <<NOTE: 26 USC 5000A.>> is
amended to read as follows:
“(1) In general.–If a taxpayer who is an applicable
individual, or an applicable individual for whom the taxpayer is
liable under paragraph (3), fails to meet the requirement of
subsection (a) for 1 or more months, then, except as provided in
subsection (e), there is hereby imposed on the taxpayer a
penalty with respect to such failures in the amount determined
under subsection (c).”.
An important difference between the commerce regulating language and the tax code language is this: one makes an argument (i.e., seeks to justify a theory) and the other just changes the wording in the tax code.
The Court did not find the argument about commerce acceptable, but allowed the tax language to stay. Now, we can now debate what to call the changes that already passed Congress before John Roberts ever got a chance to read them, but the bottom line is that the tax code was changed in a way to modify behavior. There is nothing new about that (see, e.g., the mortgage interest deduction, and various tax credits that seek to modify behavior—the code is rife with them).
Indeed, there are a large number of reference to the Internal Revenue Code in the law, but of course this is, at least in part, because we have created this system in which health care is linked to employment. There are also some funding mechanism of relevance (e.g., an excise tax on indoor tanning services, elective cosmetic surgery, and on high end health care plans, to name a few). Indeed, all those are, quite clearly, tax increases in the bill.
It is true, as Roberts points out in his opinion, that the tax issue linked to the individual mandate is called a “penalty” and not a “tax” in the bill (although, it is a penalty that one pays via one’s taxes and is embedded in the IRS code—roses by other names and and all that).
The Politics of it All
A fundamental problem here is that the word “tax” has become the Voldemort of American politics, it is the Policy That Shall Not Be Named. To be be for a “tax” is almost like being for pedophilia. This leads to such interchanges as the one between President Obama and George Stephanopoulos (video here) in which Obama insists that the mandate is not a tax. I would note, however, that it doesn’t matter what Obama called it: such utterances have no legal significance. Further, from a legal standpoint it doesn’t matter what pundits said about it at the time, or even what was argued before the Court. All that matters is a) what was written in the law, and b) whether the Court upheld what was written or not.
Here’s the deal: regardless of what Obama wanted to call the thing at the time because of political considerations did not change the nature of the alterations to the Internal Revenue Code of 1986 any more than did Robert’s majority opinion change those words. Now, of course, the politics shift to the penalty v. tax argument (as if that makes any real difference).
Arguments over this issue now are really just about either philosophy, ideology, or pure electoral politics because the the policy in question stands (and stands in many ways on a long established taxing power).
To engage in my own philosophical aside, I must confess that I am a bit baffled by Robert’s reasoning on the commerce clause and the necessary and proper clause. First, it is clear that the health care industry is one that transcends state borders (and is, therefore, part of interstate commerce) and that choosing not to purchase health insurance is not inactivity unless one plans to never seek medical care, and second if Congress can use their tax powers here, then surely there is a necessary and proper argument to be made based on taxing power (although I can see that by Roberts’ logics there can not be one based on commerce powers). Still, this is just stuff for academics, lawyers, and politicians to debate (and from different perspectives for different reasons)
A fundamental point here: political rhetoric does not change the content of written legislation. Call it a tax, a penalty, Fred, whatever: the words on the page do not change; the policy in question is no different because of a label. For that matter, the policy is no different if the power that animates it is the commerce clause or simply the power to tax.
Another way to look at it: there is the issue of what is (the words on the page), another issue of why it may be (i.e., in this cases commerce clause or taxing power), and what an individual may want it to be (which philosophy or politics, depending on the situation).
Mostly, my inspiration for looking into this was the fact that it seems that many people discussing this topic really are not arguing from a grounded position, but rather are picking and choosing ideological talking points vested far more in the campaign (i.e., does it help Obama or does it help Romney) than anything else. Further, it seems that some people think that Roberts either re-wrote the law, or that he made up the tax code part on his own. However, this is not the case.
Another weird thing about the rhetoric: the opponents of the bill seem to be acting as if the Roberts’ ruling means some sort of generalized tax has now been imposed when, in fact, the tax in question is limited to only those persons who have no insurance and refuse to acquire it. This is a tax, therefore, on a fairly small slice of the electorate. Indeed, I would wager that nearly everyone up in arms (at least on TV, radio, and in print/on the internet) about this tax will not be paying it.
Really, is not the most bottom of bottom lines here that regardless of anything else, we are just seeing a transformation of the rhetoric by opponents and proponents of the bill?
I must confess, the more I listen to the arguments, the more they seem out of step with the actual policy and, further, the more confused I am as to the vociferous nature of the opposition. I can understand not liking the policy for a variety of reasons (and from various philosophical positions). I, myself, do not find it ideal by any stretch. However, why it is Armageddon to so many is vexing.