Health Care: If It's a Tax, It Should be Called One

That’s the core issue of challenges to the health care law:

When 21 states and several private groups initiated lawsuits challenging the constitutionality of the Obama health care law earlier this year, critics denounced the suits as frivolous political grandstanding. But it is increasingly clear that the plaintiffs have a serious case with a real chance of victory.

The suits focus primarily on challenges to the new law’s “individual mandate,” which requires most American citizens to purchase a government-approved health insurance plan by 2014 or pay a fine. One of the cases was filed by 20 state governments and the National Federation of Independent Business in a federal court in Florida. Another was initiated by the Commonwealth of Virginia in a federal court in this state, and a third by the Thomas More Law Center in Michigan…

The federal government claims that Congress has the power to impose the mandate under the Commerce Clause, the Necessary and Proper Clause, and the Tax Clause of the Constitution. On the first two claims, Judge Vinson ruled that Supreme Court precedent doesn’t clearly support the government, thereby enabling the plaintiffs’ lawsuit to go forward. He outright rejected the government’s claim that the mandate is constitutional because it is a “tax.” It is instead a financial penalty for refusing to comply with a federal regulation. As Judge Vinson pointed out, congressional leaders consistently emphasized before the law’s enactment that it was not a tax.

In September 2009, President Obama himself noted that “for us to say that you’ve got to take a responsibility to get health insurance is absolutely not a tax increase.” He was right. If the mandate qualifies as a tax merely because it punishes violators with a fine, then Congress could require Americans to do almost anything on pain of having to pay a fine if they refuse. It could, for example, force citizens to buy virtually any product, such as purchasing General Motors cars for the purpose of helping the struggling auto industry.

This is the end result of a political system where transparency is out the window.

It may seem like a semantic difference.  But that semantic difference is what got the health care bill passed.  Had its proponents–Obama and the Democrats in Congress–done the obvious and proposed a tax to pay for those who couldn’t afford health care, not even Nancy Pelosi could have gotten it through.  (We’re already doing that with Medicaid, so that precedent is established).  But instead they went the route of requiring people to purchase a product from a non-governmental source that they may or may not want.  All the while they characterised the requirement as a “non-tax”.  Now they have no right to complain when the courts call their bluff.

I’m not sure that the courts will, in the end, toss this thing out.  Our judiciary has a strange way these days of not discerning where their values end and where the law starts.  For people with substantial incomes, making others pay for anything might not seem much of a requirement.  But how you see that depends upon what end of the economic spectrum you’re at.

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