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Update: They Got It -- Court Watcher: ACA's Defenders Should Hope for Judicial Activism in King v. Burwell

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EDITOR’S NOTE: This was originally published in April of this year. We’ll have a fresh post later today; but this is a fair, prescient write-up of what just happened. We apparently have psychics on staff.


Earlier this week Harvard ConLaw professor Noah Feldman posited in a Bloomberg View column that Obamacare supporters better hope that liberal Justice Anthony Kennedy (pictured above, right) provides the crucial vote to uphold the Patient Protection and Affordable Care Act’s subsidy provisions as promulgated by the Internal Revenue Service, which would be strong judicial activism on Kennedy’s part:

The uncomfortable truth (for liberals, at least) is that the ACA case arises from a piece of statutory language that on its face explicitly says that tax subsidies are only available for health insurance purchased on an exchange “established by the state.”

Liberals have tried to explain why, correctly interpreted, this language really means “established by the state or the federal government on the state’s behalf.” But their theories seem forced. Congress never went through the usual reconciliation process when it produced the ACA, and a single, contradictory sentence made its way to into the statute. If it were followed literally, it would have the effect of destroying the state exchanges and rendering Obamacare ineffective in the states that haven’t established their own exchanges but rely on exchanges created for them by the federal government.

The simplest way for the liberals to win the Obamacare case, King v. Burwell, is to convince Kennedy that the ACA shouldn’t be read literally, as doing so would produce a disastrous and therefore unjust result. If the law is interpreted flexibly in accordance with equity, the Obama administration wins. If it’s read strictly, the administration loses.

Emphasis added. My former Cato Institute colleagues Michael Cannon, Trevor Burrus, and Caleb Brown explained rather succinctly what’s at stake in King v. Burwell in a recent video:

“This is not a constitutional challenge to Obamacare, this is a straightforward case of statutory interpretation. If it were about anything but Obamacare, the Court would rule for the plaintiffs nine to nothing.”

But Professor Feldman surmises, correctly I think, that it would take strong judicial activism to vote to uphold the government’s reading of the statute in furtherance of the functional argument that the law simply won’t “work,” for lack of a better term, if people in over 30 states lose subsidies they’re currently illegally enjoying.

And here’s a good time to remember exactly how judges think—that they’re somehow a coordinate, co-equal branch of government, and that they play an important role in policy creation. Prior to her confirmation to the bench of the nation’s High Court, here’s a young(er) Second Circuit Judge Sonia Sotomayor on what she thinks is the role of the courts:

How droll. But that’s not even close to the case. To wit, the framers intended for the judiciary to be the weakest branch of the nascent federal republic they were building at the Constitutional Convention. Alexander Hamilton wrote in Federalist No. 78 (emphasis added) that

Whoever attentively considers the different departments of power must perceive, that, in a government in which they are separated from each other, the judiciary, from the nature of its functions, will always be the least dangerous to the political rights of the Constitution; because it will be least in a capacity to annoy or injure them … The judiciary…has no influence over either the sword [Executive] or the purse [Congress]; no direction either of the strength or of the wealth of the society; and can take no active resolution whatever. It may truly be said to have neither FORCE nor WILL, but merely judgment; and must ultimately depend upon the aid of the executive arm even for the efficacy of its judgments.

This simple view of the matter suggests several important consequences. It proves incontestably, that the judiciary is beyond comparison the weakest of the three departments of power*; that it can never attack with success either of the other two; and that all possible care is requisite to enable it to defend itself against their attacks. It equally proves, that though individual oppression may now and then proceed from the courts of justice, the general liberty of the people can never be endangered from that quarter; I mean so long as the judiciary remains truly distinct from both the legislature and the Executive….

* The celebrated Montesquieu, speaking of them, says: “Of the three powers above mentioned, the judiciary is next to nothing.”—“Spirit of Laws,” vol. i., page 186.—PUBLIUS

And later (again, emphasis added) that

It can be of no weight to say that the courts, on the pretence of a repugnancy, may subsitute their own pleasure to the constitutional intentions of the legislature. This might as well happen in the case of two contradictory statutes; or it might as well happen in every adjudication upon any single statute. The courts must declare the sense of the law; and if they should be disposed to exercise WILL instead of JUDGMENT, the consequence would equally be the substitution of their pleasure to that of the legislative body….

In other words, if the court has the power to make or rewrite law according to any individual judge or justice’s belief in what’s fair, or to any preference for a functional outcome of a law, rather than to simply interpret what a law says, or what it means, based upon what we know about legislative intent and the statute’s construction, individual liberty is in grave danger.

As Professor Feldman noted in his column, the government has been advancing arguments in litigation that, when the ACA says “Exchanges created by the State,” they didn’t just mean one of the individual fifty states—they meant any sovereign government, including the government of the United States. And as Professor Feldman further noted in his column, this argument is rather contrived.

The Congress in 2009 intended to use several mechanisms within the ACA to coerce state legislatures into taking charge of and responsibility for certain aspects of health policy (at least one set of which, ACA’s Medicaid clawback provisions, the U.S. Supreme Court already ruled unconstitutional under the Tenth Amendment—that ruling has unfortunately not stopped the Obama administration from trying to coerce Florida or Tennessee into expanding Medicaid, but I digress). The subsidy provision at the center of King v. Burwell was also designed to handcuff state legislatures, too. But don’t take my word for it—ask Jonathan Gruber, an MIT economist who helped Democrats write the law:

(If the video doesn’t immediately play from the 31:25 mark, click here.)

Did you catch that? Well, here’s Michael Cannon again (again, emphasis added) if you didn’t:

Gruber doesn’t just acknowledge the conditional feature of the PPACA’s tax credits. He also supplies a plausible purpose for that feature (there were people in Washington who either wanted to “squeeze the states to do it,” or saw the law as directing them to do so). He describes the mechanism by which this provision achieves that purpose (taxpayers will pressure their state officials to create Exchanges so they can receive tax credits). He acknowledges that the conditional nature of the tax credits sits perfectly well alongside the law’s requirement that the federal government establish an Exchange within states that do not (providing another refutation of the argument offered by Yale law professor Abbe Gluck that these provisions are somehow in tension). He even explains why the Obama administration might try to ignore this part of the law (the politics of the PPACA “can get ugly,” and the lure of tax credits might not be enough to induce states to cooperate).

And later (again, emphasis added) that

A reader notes that Gruber also acknowledged that the PPACA gives states a powerful role in deciding the law’s ultimate fate. While discussing “threats” to the law, the third and final threat he listed was (28:57): “The third threat, and the one that’s least well-known, is state implementation. This legislation puts enormous power in the hands of states to implement health care reform. Once again, another myth about health care reform: this is not a federal takeover. There’s a huge role for states to actually run these Exchanges, and decide how people get health insurance in the states. But states have to take up  that challenge. It’s a challenge. It’s a lot of work. And states need to be willing to take up that challenge, and really fairly implement this law. So that’s really the third threat, is that states won’t do that. So really you have these three threats to the system, and so how they get resolved will determine, you know, where health care reform ultimately goes.”

So if the Medicaid clawback provisions that were designed to coerce state governments into playing ball with the Obama administration were unconstitutional under the Tenth Amendment, presumably so would be a subsidy withholding provision designed to do the same. But that’s not what the plaintiffs in King contend. Rather, they’re simply asking the Supreme Court to enforce the Affordable Care Act as it’s written. If the law was poorly written, and it seems to have been, then the people who drafted, passed, and enacted it should suffer the political consequences of its ineptitude or malfeasance.

In King, the government is now neatly trying to avoid the political consequences of its own ineptitute or malfeasance by positing an argument in federal court that the law doesn’t mean exactly what it says, or exactly what its chief architect says it means. And Obamacare’s defenders will be counting on Justice Anthony Kennedy to take it upon himself to rewrite the ACA for ideological reasons and preconceived notions of fairness and justice, which falls far outside the purview of the Court’s legitimate functions in the eyes and words of the very people who established it in the first place.

Lest anyone think I’m picking on Justice Kennedy, who is decidedly left-leaning, the ostensibly right-leaning Chief Justice John Roberts (pictured above, left) rewrote the ACA’s “shared responsibility payment” as a tax in 2012 in the opinion that upheld the individual mandate as constitutional:

Right of center commentators lambasted the ruling — most notably lawyer commentators Ann Coulter and Mark Levin, neither of whom are ever shy about what they think. And I’m somewhat sympathetic to the line of argument these folks are championing: that a Bush-appointed justice sided with the liberal side of the Court to uphold the individual mandate based on an interpretation of statutory language that wasn’t even in the bill. Justices Alito, Kennedy, Scalia, and Thomas wrote in their dissent to the Roberts ruling that the majority’s ruling has dangerous implications for the separation of powers enshrined in the Constitution; that Roberts effectively rewrote the shared responsibility provision as a tax to find it constitutional; that revenue bills are the sole dominion of the House of Representatives, and not the bench of the Supreme Court.

Put another way, “The Supreme Court upheld a law Congress did not pass, and would not have passed,” because of the political consequences that would surely ensue from the largest middle-class tax hike in history. Here’s Cannon and Burrus again, with other former Cato colleagues Ilya Shapiro, Roger Pilon, and Michael Tanner, on the 2012 ruling on the constitutional challenges to Obamacare:

Hey, at least the Roberts opinion said Congress can’t force you to buy an HD television for your neighbor for Christmas if it argues reasonably well enough that there’ll be an impact on insterstate commerce if it doesn’t. But judicial activism is a tendency that transcends ideological divides, and it’s bad for liberty when it happens. Here’s hoping that the nation’s court of last resort will come to its senses and not unilaterally grant either itself or the Internal Revenue Service the power to rewrite laws as either body sees fit. If it fails to do so, the founders’ vision of a federal republic deliberately divided in furtherance of the protection of individual liberty will become further eroded if not lost altogether.


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