A surprising number of conservative commentators have come out cheering the ObamaCare decision because it ruled that the Commerce clause in the Constitution – Congress’s power to regulate commerce across the 50 states – doesn’t empower our legislators to force us to buy things (in this case, health insurance).
Of course, Congress can require those who propose to engage in regulated activities to purchase things, as a price of doing business. But ObamaCare forces us to buy insurance just because we woke up one day and were citizens of the United States (and earning a certain income and not covered by insurance our employers have to buy).
The real decision
SCOTUS has said Congress can do that. Focusing on SCOTUS’s repudiation of the Commerce clause justification is pursuing a gigantic red herring. Who cares what the Commerce clause allows, if SCOTUS says Congress can make us buy stuff anyway?
The Commerce clause has been made irrelevant by this ruling. Chief Justice Roberts found another way to justify Congress making us buy stuff. No one will ever have to invoke the Commerce clause again to propose a law that makes us buy stuff. Regardless of what stuff we have to buy today, any Congress in the future can make us buy other stuff. All Congress has to do is impose a monetary penalty if we don’t buy the mandated stuff, and SCOTUS will call it a “tax.”
The victory for the Commerce clause is the Pyrrhic one here. Another such victory, and we are lost.
Tax versus mandate
A purchase mandate and a tax are two different things. It seems silly to have to lay this out, but apparently there are a lot of people who are confused. What distinguishes a tax from all other requirements is that its first-order effect is producing revenue for the government – not because the citizens engage in any particular activity, but because the government needs revenue, and chooses one or another basis for levying a tax to produce it. To gain tax revenue, the government surveys what the citizens do and chooses to tax some of it. A tax is not something that arises from government-mandated activity, nor is it levied because of what people choose to do. You may choose to buy milk and have to pay a sales tax on it (in some states), but the tax isn’t imposed because you buy milk, it’s imposed because the state or local government needs revenue.
There are other ways – non-tax ways – in which we send money to the government for various things. We pay fees, for example, to operate businesses or get driver’s licenses. We pay speeding fines. We buy hunting licenses. We pay fees to register private vehicles and boats. We get fined for particular transgressions, such as littering or polluting. All of these ways of handing money over to the government are contingent on us choosing to do something. If we don’t choose to do it, we don’t fork over money to the government.
Taxes are a different matter. Their existence doesn’t depend on us wanting to “do” things, or doing wrong things, for which a fine is imposed; they exist because government needs revenue. Taxing income, sales, cigarettes, liquor, gasoline, property, etc is intended to produce revenue, on a regular and somewhat predictable basis.
The purpose of the ObamaCare insurance-purchase mandate is not to produce revenue for the government. It is not a tax, by any valid definition of “tax.” It doesn’t tax sales. It doesn’t tax goods. It doesn’t tax income. It doesn’t tax property. It doesn’t tax activity (e.g., federal taxes on commercial airline flights or landline services). It mandates that certain citizens buy something from commercial vendors, and it fines them if they don’t. In that way, its closest analogue is the requirement of the various states that drivers maintain auto insurance. That’s not a tax, and has never been held to be one. And even that analogue is imperfect, since no one who doesn’t own a vehicle has to maintain the insurance.
I really wish Republicans would stop cynically chanting that Obama has broken his pledge on taxes with the ObamaCare legislation. (And for the Republicans doing it foolishly, because they don’t understand or care that there is a significant difference in law and our philosophy of government between a tax and a purchase mandate: you guys stop it too.) This battle can’t be won if we concede that any old way of being ordered to send money somewhere at the government’s direction equals a “tax.”J. E. Dyer
About the Author: J.E. Dyer is a retired US Naval intelligence officer who served around the world, afloat and ashore, from 1983 to 2004.
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