The Commerce Clause argument in Virginia v. Sebelius, among others

Yesterday, the headlines shouted that individual mandate of the Affordable Health Care for America Act (let’s just call it “the Act” for short) was found unconstitutional by a federal court in Virginia. (see my short post on it here) Partisan critics of the ruling were quick to point out that there have already been two cases upholding it; partisan supporters were just as quick to note that this is the first substantial ruling on the act.

After a brief reading of the opinion, here are a few quotes from it and a couple of thoughts:

The Obama Administration‘s arguments in support the Act fall can be boiled down to this: Congress was within its powers to pass the Act because it acted under its power to regulate interstate commerce. To pick that apart, the Administration is arguing that Congress has the right to regulate activities that in the aggregate “substantially affect” interstate commerce. The Administration is relying upon aggregation theory, says Judge Hudson:

“…which is conceptually based on hypothesis that the sum of individual decisions to participate or not in the health insurance market has a critical collective effect on interstate commerce.”

In other words, each of us make enough decisions on health care that all taken together it is enough to affect interstate commerce. Under the Commerce Clause argument, the Minimum Essential Coverage Provision–what is more commonly known as the “individual mandate“– is necessary to make sure that the program of reforms in other areas work. In essence, if not everyone is paying into the system, then there won’t be enough people paying in to support the sick and poor that cannot pay for the benefits of health care. The dysfunctional system cannot be reformed if every person does not participate because, well, to put it simply–it’ll cost too much. So, to sum up the argument, since Congress has the power to regulate healthcare under the Commerce Clause, it also has the power under the Necessary and Proper Clause to make the regulations necessary.

Judge Hudson notes that although the Necessary and Proper Clause “vests Congress with broad authority to exercise means […] to implement legislation, it is not without limitation.” This is an interesting, and perhaps understated commentary, on what many, including Speaker Pelosi, see as the definition of the Necessary and Proper Clause. It is an unenumerated power, but there are still limits. The means to accomplish the end must be “rationally related to the implementation of a constitutionallyenumerated power, but it must not violate an independent constitutional prohibition.” And here is the crux of the Virginia assault on the Act; it is a violation that “offends a fundamental restriction” on the Commerce Clause powers.

Central to the Commerce Clause is that it relates to economic activity. Can the government compel an unwilling person to perform an involuntary activity? Previous cases that the Administration cited dealt with individuals who grew wheat or cannabis and thereby voluntarily inserted themselves in the stream of interstate commerce. Here, however, the individual mandate compels a person to do an involuntary act, buy health insurance, and thereby become subject to the Commerce Clause. Because this goes beyond the bounds of the Commerce Clause, Congress is outside of its ability to use the Necessary and Proper powers to force the purchase. Congress can use its authority to pass constitutional laws; outside those bounds its powers are “bridled.” Quoting Chief Justice Marshall,

[l]et the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consistent with the letter and spirit of the constitution, are constitutional.

And thereby is why Judge Hudson ruled the individual mandate of the Act unconstitutional. As laudable as were the intentions of Congress in passing the Act, “the legislative process must still operate within constitutional bounds. Salutatory goals and creative drafting have never been sufficient to offset an absence of enumerated powers. And, my favorite quote: “Congressional findings, no matter how extensive, are insufficient to enlarge the Commerce Clause powers of Congress.”

What are those boundaries? Judge Hudson cites case law that limits Congressional powers under the Commerce Clause to subject matter that is economic in nature and voluntary activity. However, despite arguments by the Administration that everyone will at some point in their life need healthcare of some sort, this was the bridge too far for the Judge.

Neither the Supreme Court nor any federal circuit court of appeals has extended Commerce Clause powers to compel an individuals to involuntarily enter the stream of commerce by purchasing a commodity in the private market.

Because it is not voluntary, the government cannot require individuals to make a purchase, to participate in the market.  Ironically, this seems to be the very lynch pin upon which the entire scheme relies–without participation, voluntary or otherwise, of healthy individuals paying into healthcare, the government will be unable to pay for the costs of covering the poor and sick.

Interestingly, critics are attacking Judge Hudson’s interpretation of the Necessary and Proper Clause powers. See their discussion here. Others suggest that Judge Hudson is writing for Justice Scalia, and that it is a better opinion than the critics are giving him credit for. “Nonetheless, once read in light of Scalia’s concurring opinion in Raich, Judge Hudson’s analysis is considerably more coherent that his critics allow.”

There are other arguments in the case, including a tax argument that Judge Hudson calls “simplistic.” (He also refers to the precedent it cites as “dicta,” a slap at the value of the authority the Administration cites).  I thought the Commerce Clause argument, however, was the most interesting, not to mention the most important.

A last and important element of the opinion is that of the severability of the individual mandate clause from the rest of the Act. In other words: can the rest of the Act survive even though the individual mandate is unconstitutional? In this case, because it is difficult for the court to determine whether Congress intended that the rest of the Act to survive the invalidity of any single clause, the Judge ruled only on the section (1501 in this case, if you were wondering) is invalid and the rest of the Act, as it is currently unchallenged, survives.

Read the opinion here.


9 responses to “The Commerce Clause argument in Virginia v. Sebelius, among others

  1. The talking points memo article confuses tautology with if/then. Tautology is A is A. Transitional is A then B. A being the enumerated power and B being necessary and proper, Hudson says that with no A you cannot get to B. Big larf at the professor who said that.

    • Well put. I included that it is out there for the purpose of at least nodding to the fact that the opinion is not without detractors (as if it was not obvious enough, I suppose).

  2. Shout out. I was here. Looking at your blog.

  3. Hey, nice summary of the ruling. I’m not convinced by the good judge’s opinion, as I’ve stated elsewhere, but I appreciate all the work that goes into a thoughtful summary like this, complete with links :)

    I’ll also admit to being a little confused by the Necessary and Proper Clause argument. Conceptually, I’ve always considered the Necessary and Proper Clause as more of an interpretive rule than a separate substantive provision capable, in and of itself, and serving as the basis for Congressional action. But maybe that’s ultimately a meaningless distinction — whether you give more leeway under the Commerce Clause or uphold something under the Necessary and Proper Clause, I suppose the end effect is the same.

    Ultimately, I would be shocked if the mandate is struck down. If I were the Supreme Court, I’d want to stay well away of invalidating the most significant Congressional legislation (for good or ill) of the last 40 years. But they’ll be forced to confront it, and stranger (and more controversial) things have undoubtedly happened . . . .

    • SO all Congress has to do to avoid getting overturned is pass highly significant legislation? I’ll be honest–that makes no sense whatsoever.

      Last I checked, the Supreme Court holds legislation valid or not based on whether it complies with the constitution, not on how significant it is. My two bits…

      • SO all Congress has to do to avoid getting overturned is pass highly significant legislation?

        No, but as a practical matter, the Court is often careful with its institutional capital in situations like this, especially in cases where there are good arguments on both sides (I’m speaking practically, not normatively). However it turns out, it will be very interesting to watch.

  4. Pingback: Next battle in the Affordable Healthcare Act drama? Administrative Rulemaking. | After the Bar

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