And Now the Wait Begins ...... Obamacare and the Supreme Court

by Diane Rufino, March 28, 2012
http://forloveofgodandcountry.wordpress.com

On Monday, March 26, the Supreme Court began oral arguments in the highly-anticipated case challenging the constitutionality of the Patient Protection & Affordable Care Act. By Wednesday afternoon, the hearings had concluded. The historic arguments consolidated an appeal from 26 states, a group representing several small businesses, and several individuals who contend that the 2010 health care law, President Obama’s signature legislative achievement, is unconstitutional.

Perhaps significantly, Justice Kennedy, the Court's notorious swing vote, appeared to be very concerned about the status of young people with respect to the healthcare bill. He noted that the government hasn't exactly been honest about its intentions with the bill, which was to offset the burden that uninsured individuals place on healthcare.

If the administration was really interested in preventing young people (many who are uninsured) from being such a burden, the healthcare plan would allow them to buy only catastrophic health insurance (instead of the plan that includes well visits, preventative care). Catastrophic health insurance is all that 20-30 year-olds really need; It's the only product that makes any economic sense for them. But Obamacare doesn't allow that. So, as Kennedy emphasized, we see what the healthcare bill is really all about. It's about using 20-30 year-olds to subsidize the plan, to subsidize insurance for those who can't afford it. It's about using young healthy people to fund the program. It's about a social scheme.

As we all know, the government's plan is to subsidize health insurance for everyone, especially those who are uninsured and sick (approximately 20% of all uninsured). The plan forces insurance companies to cover the sick. But it doesn't want to use the typical means to pay for this - such as tax subsidies. Instead, the government wants to reach OUTSIDE the market and COMPEL a whole bunch of healthy people into that market so they can be used to subsidize the program and help bring healthcare premiums down. In fact, this was the finding by Congress: that bringing young healthy people into the market will bring down the health insurance premium by about 15% for everyone. Unfortunately, though, it will force them to buy something they don't need or want.

The healthcare challenge, on its face, is about the Individual Mandate - the government's belief that it has the power under the Commerce Clause to force Americans to purchase the specific health insurance it dictates, even those who don't need it. It is also about the fundamental scheme in place, established by our Founders and memorialized with the Tenth Amendment, that the federal government is a government of limited powers with the bulk of powers being reserved to the States where they can most effectively regulate for the health, safety, welfare, and morality of their people. It is about the section of the bill which enlarges the Medicaid program and coerces the States to participate in its healthcare scheme by threatening to withhold all Medicaid funding should they decide not to. According to the states, the sheer volume of the federal funding at stake leaves them with no practical capacity to withdraw from Medicaid. By placing all of a state’s federal Medicaid dollars at risk for the failure to adhere to the healthcare bill’s conditions, they claim the Act also amounts to compulsion. And furthermore, they claim that conditions imposed on state governments to implement the scheme constitutes impermissible commandeering of the states and their resources.

But the underlying issue is individual liberty. It is about the right of an individual to be free from government compulsion - not being forced to do something against one's will or spending one's money (that is, what remains after the government takes its cut in the form of income taxes) on things one don't want or need. It's the fundamental right to conduct one's life the way he or she feels fit and to make his or her own personal decisions. It's the basic right "to be left alone" by government.

And the decision, therefore, will speak volumes about how strongly our nation's highest court is committed to this grand notion of individual liberty. We already know that there are several justices who believe in an expansive view of government and use the court to evolve its responsibilities. And there are those justices who believe in the strict interpretation of the Constitution and in limits to federal power. And then there is Justice Kennedy, who can be defined by neither classification. His opinion may turn out to be the deciding factor in this case.

All eyes are usually on Justice Kennedy, the genial justice who sits on the fence, often keeping interested parties nervous as to which side he will side with - the liberal bloc (Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, and Elena Kagan) or the conservative bloc (Justices Antonin Scalia, Clarence Thomas, Samuel Alito, and the Chief Justice John Roberts). Kennedy was appointed to the bench in 1988 by President Reagan, after the Senate failed to confirm his first choice, committed originalist Robert Bork. Reagan also appointed Justice Scalia. At the time of his appointment, he was a judge on the US Court of Appeals for the Ninth Circuit, appointed by President Gerald R. Ford. The Ninth Circuit is known as the most liberal of the circuit courts, and in fact, tried to remove the words "Under God" from the Pledge of Allegiance. Justice Kennedy's crucial swing vote has often been the decisive factor in many of our most important and controversial cases of recent years.

• Boy Scouts of America v. Dale (2000; upholding the Boy Scouts of America's organizational right to ban homosexuals from being scoutmasters. He joined the conservative justices in this decision)

• Lawrence v. Texas (2003; finding the right of homosexual men to engage in sodomy in the privacy of their home thereby overturning an earlier Supreme Court decision which banned the practice. He joined the liberal justices on this decision)

• Kelo v. City of New London (2005; holding that local government has the power to take private property for economic development through the use of eminent domain. He joined the liberal justices in this decision)

• United States v. Lopez (2005: holding that possession of a gun in a local school zone is not an economic activity that might, in the aggregate, have a substantial effect on interstate commerce because the conduct at issue has nothing to do with "commerce." He joined the conservative justices in this decision)

• Kennedy v. Louisiana (2008; holding that the 8th Amendment bars Louisiana from imposing the death penalty for the heinous rape of a child where the crime did not result, and was not intended to result, in the victim's death, although the injuries were so extensive, doctors don't know how she survived. Kennedy joined the liberal justices on this decision)

• Boumediene v. Bush (2008; a case challenging the legality of Boumediene’s detention at Guantanamo Bay. Kennedy sided with the four liberal justices in finding that the constitutionally guaranteed right of habeas corpus applies to persons held in Guantanamo Bay and to persons designated as enemy combatants on that territory)

• District of Columbia v. Heller (2008; holding that the 2nd Amendment confers an individual right to keep and bear arms; All four of the liberal justices believe it only applies to state militias and therefore prevents individuals from having the right to possess guns in their homes)

• McDonald v. City of Chicago (2010; holding that Heller applies to the States through the 14th Amendment. holding that the Fourteenth Amendment makes the Second Amendment right to keep and bear arms for the purpose of self-defense applicable to the states. Kennedy sided with the conservative justices in asserting that these rights are "fundamental to the nation's scheme of ordered liberty" and are "deeply rooted in this Nation's history and tradition" and hence are appropriately applied to the states through the 14th Amendment)

• Brown v. Plata (2011; holding that releasing violent criminals from an over-crowded prison is a proper remedy to address the violation of prisoners' 8th Amendment guarantee against 'cruel and unusual punishment' caused by long wait times to see prison doctors and less-than-ideal medical accommodations)

In the 2008–2009 term, there were 16 decisions in which the justices split strictly along ideological lines. Kennedy joined the conservative members of the Court eleven times and the liberals only five.

And so, all eyes were on Justice Kennedy in the case against the Patient Protection & Affordable Care Act (PPACA) and all ears were open to his questions and comments, in the hopes of providing a glimpse into his mindset regarding the administration's huge power grab under the Act.

On the first day of hearings, the justices had to entertain whether the healthcare challenge is even allowable under the Anti Injunction Act (AIA), a federal tax law that says, in essence, that a taxpayer cannot challenge a tax until it comes into effect. The provision at issue is the penalty portion of the Act, which requires that almost every individual purchase health insurance by 2014 or pay a penalty. The questions before the Court were twofold: (1) Can the penalty be classified as a "tax" and therefore implicate the AIA? And (2) If so, is it then premature for the court to consider the present challenge to the individual mandate?

Justice Breyer asked point blank: "Where I see the problem is in the part of the AIA which refers to the 'assessment or collection of any tax.' Now, Congress has nowhere used the word 'tax.' What it says is 'penalty.' Moreover, this is not in the Internal Revenue Code 'but for purposes of collection.' And so why is this a tax?" He further emphasized that lawmakers intentionally did not use the term when they crafted the legislation nor did they intend the penalty as a tax.

Justice Ruth Bader Ginsburg, another liberal member of the Court, also expressed skepticism. "This is not a revenue-raising measure because, if it's successful, nobody will pay the penalty and therefore there will be no revenue to raise."

Judging on the arguments and discussion made the first day, it seems likely the case will be decided and not postponed. Even the administration's lawyer, Solicitor General Donald B. Verrilli urged the justices to decide the merits of the dispute. "This case presents issues of great moment," he said.

On the second day of hearings Verrilli faced a barrage of skeptical questions from four of the court’s more conservative justices, including Justice Kennedy. The questions posed to him went straight to the central issue in the case and that is whether the federal government can compel individuals not engaged in commerce to buy a product - health insurance - and hence become part of that commerce in order to be regulated. “Can you create commerce in order to regulate it?” Justice Kennedy asked. That was his very first question of the day. He later told Mr. Verrilli that the federal government faced “a heavy burden of justification” for the Individual Mandate and pressed him to articulate “some limits on the Commerce Clause."

The court focused on whether the mandate for Americans to have insurance "amounts to an affirmative duty to engage in commerce" and is therefore "an unprecedented step beyond what our cases allow," which is how Justice Kennedy phrased the issue. He then told Verrilli: "With this law, you are changing the relationship of the individual to the government.”

Chief Justice Roberts asked: "So, can the government require you to buy a cell phone because that would facilitate responding when you need emergency services? That way, you can just dial 911 no matter where you are?" Verrilli tried to argue that Roberts' scenario was distinguishable from the health care market. But Roberts fired back: "It seems to me that's the same as in my hypothetical. You don't know when you're going to need police assistance. You can't predict the extent to emergency response that you'll need. But when you do, and the government provides it. I thought that was an important part of your argument, that when you need health care, the government will make sure you get it. Well, when you need police assistance or fire assistance or ambulance assistance, the government is going to make sure to the best of its ability that you get it."

Justice Alito asked Solicitor General Verrilli: "Do you think there is a, a market for burial services?" He answered in the affirmative. Alito then continued: "All right, suppose that you and I walked around downtown Washington at lunch hour and we found a couple of healthy young people and we stopped them and we said, "You know what you're doing? You are financing your burial services right now because eventually you're going to die, and somebody is going to have to pay for it, and if you don't have burial insurance and you haven't saved money for it, you're going to shift the cost to somebody else. Isn't that a very artificial way of talking about what somebody is doing?" Verrilli didn't agree. But Alito pushed further: "And if that's true, why isn't it equally artificial to say that somebody who is doing absolutely nothing about health care is financing health care services? See, I don't see the difference. You can get burial insurance. You can get health insurance. Most people are going to need health care. Almost everybody. Everybody is going to be buried or cremated at some point. What's the difference? If you don't have money then someone has to pay... Whether the State or a family member. And isn't that what the mandate is doing? You can correct me if these figures are wrong, but it appears to me that the CBO (Congressional Budget Office) has estimated that the average premium for a single insurance policy in the non-group market would be roughly $5,800 in — in 2016. The administration estimates that a young, healthy individual targeted by the mandate on average consumes about $854 in health services each year. So the mandate is forcing these people to provide a huge subsidy to the insurance companies for other purposes that the act wishes to serve, but if those figures are right, isn't it the case that what this mandate is really doing is not requiring the people who are subject to it to pay for the services that they are going to consume? It is requiring them to subsidize services that will be received by somebody else." Verrilli acknowledged that this was in fact the case.

Chief Justice Roberts commented: "It's critical how you define the market. If I understand the law, the policies that you're requiring people to purchase involve - must contain provision for maternity and newborn care, pediatric services, and substance use treatment. It seems to me that you cannot say that everybody is going to need substance use treatment, substance use treatment or pediatric services, and yet that is part of what you require them to purchase. Your theory is that there is a market in which everyone participates because everybody might need a certain range of health care services, and yet you're requiring people who are never going to need pediatric or maternity services to participate in that market."

He then asked: "If the government can force people to buy health insurance can it require people to buy certain types of cars? Broccoli?" Justice Scalia hinted that if everyone were forced to buy a new car, it might help lower the costs of new cars for everyone.

Scalia offered his interpretation of the government's case: "I don't agree with you that the relevant market here is health care. You're not regulating health care. You're regulating insurance. It's the insurance market that you're addressing and you're saying that some people who are not in it must be in it. That approach is different from the regulation of any type of commerce that already exists out there."

Solicitor General Verrilli tried to paraphrase the government's position: "Our position is that it's not an illegitimate exercise of the commerce power for some people to subsidize others. You're young and healthy one day, but you don't stay that way. And the system works over time."

Justice Scalia spoke up: "We're not stupid. They're going to buy insurance later. They're young and need the money now. When they think they have a substantial risk of incurring high medical bills, they'll buy insurance, like the rest of us. You seem to suggest that they are never going to buy it. You could solve that problem by simply not requiring the insurance company to sell it to somebody who has a condition that is going to require medical treatment, or at least not require them to sell it to him at a rate that he sells it to healthy people. But you don't want to do that. And to me, that seems like a problem created by the government - a self-created problem."

Chief Justice Roberts added: "You say your argument is limited to health insurance But once you establish that you have a market for health care, would you suppose Congress's power under the Commerce Clause is broad in scope with regard to how they they regulate that market. I don't see how we can accept your argument that 'it's just insurance.' Once we say that there is a market and Congress can require people to participate in it, as some would say - or as you would say, that people are already participating in it - it seems to me that we can't say there are limitations on what Congress can do under its commerce power. It could regulate the market in any rational way. Congress has chosen to regulate the health care market. Everybody's in it, they said, so it can be regulated. This year, they looked at a particular serious problem, which is how people pay for it. And they decided to compel people to purchase insurance. But next year, they can decide to look at something else - a different problem - and decide how they are going to regulate it. And they'll be able to do it because they've already accepted the argument that this is a market in which everybody participates."

Scalia jumped in: "I tell you what the something else is. The something else is everybody has to exercise, because there's no doubt that lack of exercise cause — causes illness, and that causes health care costs to go up. So the Federal government says everybody has to join an exercise club. That's the something else."

Mr. Verrilli tried to explain: "What matters here is whether Congress is choosing a tool that's reasonably adapted to the problem that Congress is confronting. And that may mean that the tool is different from a tool that Congress has chosen to use in the past."

Justice Scalia responded: "Well, that's both "Necessary and Proper." What you just said addresses what's necessary. Yes, has to be reasonably adapted. Necessary does not mean essential, just reasonably adapted. But in addition to being necessary, it has to be proper. And we've held in two cases that something that was reasonably adapted was not proper because it violated the sovereignty of the States, which was implicit in the constitutional structure. The argument here is that this also may be necessary, but it's not proper because it violates an equally evident principle in the Constitution, which is that the Federal Government is not supposed to be a government that has all powers; that it's supposed to be a government of limited powers. And that's what all this questioning has been about. What is left? If the government can do this, what, what else can it not do? But that's not the only constitutional principle at stake in this case. An equally evident constitutional principle is the principle that the Federal Government is a government of enumerated powers and that the vast majority of powers remain in the States and do not belong to the Federal Government. Do you acknowledge that that's a principle?" Verrilli so acknowledged.

Scalia continued: "I mean, the Tenth Amendment says the powers not given to the Federal Government are reserved, not just to the States, but to the States and the people. And the argument here is that the people were left to decide whether they want to buy insurance or not."

Justice Kennedy added: "The reason this Mandate is concerning is because it requires the individual to do an affirmative act. In the law of torts our tradition, our law, has been that you don't have the duty to rescue someone if that person is in danger. The blind man is walking in front of a car and you do not have a duty to stop him absent some relation between you. And there is some severe moral criticisms of that rule, but that's generally the rule. And here the government is saying that the Federal Government has a duty to tell the individual citizen that it must act, and that is different from what we have in previous cases and that changes the relationship of the Federal Government to the individual in the very fundamental way."

Chief Justice inserted: "The States are not limited to enumerated powers, but the Federal Government is. And it seems to me it's an entirely different question when you ask yourself whether or not there are going to be limits in the Federal power, as opposed to limits on the States."

Another issue that came up was whether the penalty could be classified as a tax (returning to some degree to the topic touched on the day before). If the penalty could be classified as a tax, then the thought is that the Individual Mandate could be supported, in the alternative, under Congress' "Tax and Spend" powers. Justice Scalia quickly noted that "the President has said it isn't a tax." Then Justice Ginsberg added: " A tax is to raise revenue, tax is a revenue-raising device, and the purpose of this exaction is to get people into the health care risk pool before they need medical care, and so it will be successful. If it doesn't raise any revenue, if it gets people to buy the insurance, that's what this penalty is designed to do - to affect conduct. The conduct is buy health protection, buy health insurance before you have a need for medical care. That's what the penalty is designed to do, not to raise revenue."

At that point, the Solicitor General stepped down and the respondents' attorney (that is, for the states), Mr. Clement was given time before the Court. He immediately struck down the administration's position that the Individual Mandate (the penalty, in particular) could be legally supported under the Taxing power. As he told the Court: "I think it might raise some issues about whether or not that would be a valid exercise of the taxing power. My constitutional concern is that it would be a disguised impermissible direct tax. And we all know that Congress is limited in its ability to impose direct taxes. The one thing I think the framers would have clearly identified as a direct tax is a tax on not having something. I mean, the framing generation was divided over whether a tax on carriages was a direct tax or not. Hamilton thought that was a indirect tax; Madison thought it was a direct tax. I have little doubt that both of them would have agreed that a tax on not having a carriage would have clearly been a direct tax. I also think they would have thought it clearly wasn't a valid regulation of the market in carriages."

Attorney Clement then moved on to the market that the government is trying to dominate: "What health insurance does and what all insurance does is it allows you to diversify risk. And so it's not just a matter of I'm paying now instead I'm paying later. That's credit. Insurance is different than credit. Insurance guarantees you an upfront, locked-in payment, and you won't have to pay any more than that even if you incur much great expenses. And in every other market that I know of for insurance, we let people basically make the decision whether they are relatively risk averse, whether they are relatively non-risk averse, and they can make the judgment based on..."

Justice Sotomayor interrupted: "But we don't in car insurance, I mean the states don't. Let me ask you a question: Do you think that if some states decided not to impose an insurance requirement, that the Federal Government would be without power to legislate and require every individual to buy car insurance?"

Clement answered: "Let me say this, you're right in the first point to say that it's the states that do it, which makes it different right there."

Justice Kennedy asked: "Isn't everyone in the market in the sense that they are creating a risk that the market must account for?" Similarly, Justice Kagan asked: "If the effect of all the uninsured people is to raise everybody's premiums, not just when they get sick, if they get sick, but right now in the aggregate, and Wickard and Raich tell us we should look at the aggregate, and the aggregate of all these uninsured people are increasing the normal family premium, Congress says, by a thousand dollars a year. Those people are in commerce. They are making decisions that are affecting the price that everybody pays for this service.

[Wickard v. Filburn (wheat case; 1924, holding that Farmer Filburn couldn't grow wheat for his own use because, if other were to do the same, then in the aggregate, all these farmers would have no need to buy wheat on the open market and would therefore affect commerce) and Gonzalez v. Raich (medical marijuana case; 2005; holding that California's Compassionate Use Act, which legalized marijuana for medical use, conflicted with the federal government's Controlled Substances Act, which is a valid exercise of Congress' commerce powers)].

Mr. Clement disagreed. He answered: "Let's be careful about what they were regulating in Wickard. What they were regulating was the supply of wheat. It didn't in any way imply that they could require every American to go out and buy wheat. And yes, one of the consequences of regulating local market participants is it'll affect the supply and the demand for the product. That's why you can regulate them, because those local market participants have the same effect on the interstate market that a black market has on a legal market.

That aside, I don't think the point you make distinguishes the healthcare market from other markets. When I'm sitting in my house deciding I'm not to buy a car, I am causing the labor market in Detroit to go south. I am causing maybe somebody to lose their job, and for everybody to have to pay for it under welfare. So the cost shifting that the government tries to uniquely to associate with this market, it is everywhere. And even more to the point, the rationale that they think ultimately supports this legislation, that look, it's an economic decision, once you make the economic decision, we aggregate the decision, there is a substantial effect on commerce. That argument works here. It works in every single industry. There are other markets that affect every one: transportation, food, burial services, though we don't like to talk about that either. There also are situations where there are many economic effects from somebody's failure to purchase a product. My unwillingness to buy an electric car is forcing up the price of an electric car. If only more people demanded an electric car there would be economies of scale, and the price would go down.

If I could talk about the difference between the health insurance market and the health care market...... If some private company comes up with a great new wonder drug that would have huge benefits for everybody's health and if everybody had to buy it, it would facilitate economies of scale, and the production would be efficient, and the price would be cheaper and force everybody in the health care market, the actual health care market to buy the wonder drug, and if the government wanted to compel people to take this drug, I'd be up here making the same argument. I would be saying that there is no such authority within the commerce power of the federal government. In Federalist 45, Madison says the commerce power is a new power, but it's not one anyone has any apprehension about. And the reason they didn't have any apprehension about it is because it's a power that only operated once people were already in commerce. You see that from the text of the clause. The first kind of commerce Congress gets to regulate is commerce with foreign nations. Did anybody think the fledgling Republic had the power to compel some other nation into commerce with us? Of course not. And in the same way, I certainly don't think the framers had understood the commerce power to include the power to compel people to engage in commerce."

At that point, Attorney Clement stepped down and Michael Carvin, the attorney representing several small businesses (National Federation of Independent Businesses, NFIB), addressed the Court to argue the unconstitutionality of the PPACA. "I'd like to begin with the Solicitor General's main premise, which is that they can compel the purchase of health insurance in order to promote commerce in the health market because it will reduce uncompensated care. If you accept that argument, you have to fundamentally alter the text of the Constitution and give Congress plenary power. It simply doesn't matter whether or not this regulation will promote health care commerce by reducing uncompensated care; all that matters is whether the activity actually being regulated by the act negatively affects Congress or negatively affects commerce regulation, so that it's within the commerce power. If you agree with us that this is — exceeds commerce power, the law doesn't somehow become redeemed because it has beneficial policy effects in the health care market. In other words, Congress does not have the power to promote commerce. Congress has — Congress has the power to regulate commerce. And if the power exceeds their permissible regulatory authority, then the law is invalid... Think about it this way... when you've entered the marketplace they can impose all sorts of restrictions on you. But what can't they do? I think everyone intuitively understands that regulating participants after A and B have entered into a contract is fundamentally less intrusive than requiring the contract in the first place."

Justice Ginsberg asked: "Isn't the only way to prevent people from paying for the cost-free healthcare of those who are sick and uninsured to have people pay sooner rather than later?"

Carvin answered: "The real problem are those who default on their health care payments. That is an entirely different group of people, an entirely different activity than being uninsured. The people who impose the costs on the rest of us are people who engage in a different activity at a different time, which is defaulting on their health care payments. It's not the uninsured. Under Justice Kagan's theory, you could regulate anybody if they have got a statistical connection to a problem. You could say, since we could regulate people who enter into the mortgage market and impose mortgage insurance on them, we can simply impose the requirement to buy private mortgage insurance on everybody before they have entered the market because we are doing it in this prophylactic way before it develops." [Chief Justice Roberts interrupted to note that not everyone enters the housing market while everyone eventually enters the healthcare market] Carvin continued: "And my basic point to you is this: the Constitution only gives Congress the power to regulate things that negatively affect commerce or commerce regulation. It doesn't give them the power to regulate things that are statistically connected to things that negatively affect the commerce. If they have that power, then they obviously have the power to regulate everything because everything in the aggregate is statistically connected to something that negatively affects commerce, and every compelled purchase promotes commerce." (I admit, I initially had a hard time following that).

Finally, Mr. Carvin ended with these words: "We turn you to the Commerce Clause jurisprudence that bedeviled the Court before the 1930s, where they were drawing all these kinds of distinctions among industries; whereas our test is really very simple. Are you buying the product or is Congress compelling you to buy the product? I can't think of a brighter line. And again, if Congress has the power to compel you to buy this product, then obviously, they have got the power to provide you - to compel you to buy any product, because any purchase is going to benefit commerce, and this Court is never going to second-guess Congress's policy judgments on how important it is this product versus that product. The words "inactivity" and "activity" are not in the Constitution. But the words "commerce" and "noncommerce" are. It's a distinction that comes directly from the text of the Constitution.

The Framers consciously gave Congress the ability to regulate commerce, because that's not a particularly threatening activity that deprives you of individual freedom. If you were required, if you were authorized to require A to transfer property to B, you have, as the early cases put it, a monster in legislation which is against all reason in justice, because everyone intuitively understands that regulating people who voluntarily enter into contracts in setting changing conditions does not create the possibility of Congress compelling wealth transfers among the citizenry. And that is precisely why the Framers denied them the power to compel commerce, and precisely why they didn't give them plenary power."

On the third day of oral arguments, the Court engaged in a discussion of severability - whether the healthcare bill could survive if the Individual Mandate was struck down and whether other provisions could still survive. It was a tortuous line of questioning. Justice Scalia suggested many members of Congress might not have voted for the bill without the central provisions, and so perhaps it wouldn't be fair to allow remaining portions of the bill to survive. He also was emphatic that it was not the province of the Court to go through each and every page to sort out which provision should remain and which should go. He even joked that being required to read the 2,700-page bill should fall under the 8th Amendment's concept of "Cruel and Unusual Punishment." Justice Sotomayor argued that it was Congress' job to fix or scrap the bill, should the mandate be found unconstitutional. Opponents of the bill argued against severability, suggesting that simply striking the mandate while leaving in place corresponding new insurance regulations could result in a spike in premiums that Congress did not intend.

In the afternoon session, the justices considered a challenge by the 26 states to the expansion of the Medicaid program for low-income Americans, an important feature in the effort extending health insurance to an additional 30 million people. The court's liberal justices made it fairly clear they will vote to uphold the Medicaid expansion, which would take in 15 million people with the federal government paying almost all the costs. They did not seem to agree with the challengers that expansion of the program is unconstitutionally coercive. Justice Kagan asked: "Why is a big gift from the federal government a matter of coercion?"

Attorney Clement defended the states' position: "Let me focus on what I think are the three hallmarks of this statute that make it uniquely coercive. One of them is the fact that this statute is tied to the nonvoluntary individual mandate. The second factor, of course, is the fact that Congress here made a distinct and conscious decision to tie the state's willingness to accept these new funds, not just to the new funds but to their entire participation in the statute, even though the coverage for these newly eligible individuals is segregated from the rest of the program. In other words, if a state doesn't want to cover the newly eligible individuals, it not only doesn't get the new money, it also doesn't get any of the money under the original contact, agreement (old money). What's coercive is not the absolute guarantee that the secretary could cut off every penny, but the fact that she could. And the third factor is the sheer size and scope of Medicaid. The expansion of Medicaid since 1984 is really breathtaking. In 1984 the Federal spending to the States was a shade over $21 billion for Medicaid. Right now it's $250 billion, and that's before the expansion under this statute. If the Secretary should withhold all funding for a state's poor population, that state would have an impossible time coming up with the funds on its own to cover those people."

Hopefully, we know where Justice Kennedy stands on matters that threaten to upset the balance of power created under our federalist system. In short, he has never been one to want to enlarge the government's status with regard to its relationship to the States.

The arguments and answers given on day two of course represent the meat of the case. I believe it is the closing remark by Attorney Carvin which holds the key to how Justice Kennedy will ultimately view the Individual Mandate. He emphasized that the ability to regulate commerce was not the same as compelling commerce for the latter would deprive individuals of individual liberty. I believe in his final analysis, Justice Kennedy will look at the implications the Individual Mandate has on individual liberty - the very precious intangible that our Founders so judiciously and ambitiously sought to protect and promote.

I point to two fairly recent cases to highlight Justice Kennedy's views on Liberty and Federalism - United States v. Lopez (1995) and Bond v. United States (2011). His words make his intentions clear. I believe his firm belief in the concept of federalism and the liberty interests it serves is an important insight as to how he may come down on the healthcare question, and especially the Individual Mandate.

In Lopez, the Court was asked to decide the constitutionality of a federal statute - the Gun-Free School Zones Act of 1990, which made it a crime for any individual to "knowingly possess a firearm at a place that [he] knows...is a school zone." Alfonzo Lopez, a high school senior, carried a concealed weapon into his San Antonio, Texas high school and was arrested and charged under Texas law with firearm possession on school premises. The next day, the state charges were dismissed after federal agents charged Lopez with violating a federal criminal statute, the Gun-Free School Zones Act. Lopez challenged the federal statute on the grounds that it exceeded the power of Congress to legislate conduct in the states under the Commerce Clause. Justice Kennedy agreed with the majority that the conduct the federal statue sought to regulate was not in fact "commerce" and therefore was an unconstitutional exercise of authority. He wrote a concurring opinion:

The history of our Commerce Clause decisions contains at least two lessons of relevance to this case. The first, as stated at the outset, is the imprecision of content-based boundaries used without more to define the limits of the Commerce Clause. The second, related to the first but of even greater consequence, is that the Court as an institution and the legal system as a whole have an immense stake in the stability of our Commerce Clause jurisprudence as it has evolved to this point. Stare decisis operates with great force in counseling us not to call in question the essential principles now in place respecting the congressional power to regulate transactions of a commercial nature. That fundamental restraint on our power forecloses us from reverting to an understanding of commerce that would serve only an 18th-century economy, dependent then upon production and trading practices that had changed but little over the preceding centuries; it also mandates against returning to the time when congressional authority to regulate undoubted commercial activities was limited by a judicial determination that those matters had an insufficient connection to an interstate system. Congress can regulate in the commercial sphere on the assumption that we have a single market and a unified purpose to build a stable national economy.

In referring to the whole subject of the federal and state balance, we said this just three Terms ago: 'This framework has been sufficiently flexible over the past two centuries to allow for enormous changes in the nature of government. The Federal Government undertakes activities today that would have been unimaginable to the Framers in two senses: first, because the Framers would not have conceived that any government would conduct such activities; and second, because the Framers would not have believed that the Federal Government, rather than the States, would assume such responsibilities. Yet the powers conferred upon the Federal Government by the Constitution were phrased in language broad enough to allow for the expansion of the Federal Government's role.' It does not follow, however, that in every instance the Court lacks the authority and responsibility to review congressional attempts to alter the federal balance. This case requires us to consider our place in the design of the Government and to appreciate the significance of federalism in the whole structure of the Constitution.

Of the various structural elements in the Constitution, separation of powers, checks and balances, judicial review, and federalism, only concerning the last does there seem to be much uncertainty respecting the existence, and the content, of standards that allow the judiciary to play a significant role in maintaining the design contemplated by the Framers. Although the resolution of specific cases has proved difficult, we have derived from the Constitution workable standards to assist in preserving separation of powers and checks and balances. These standards are by now well accepted and judicial review is also established beyond question, Our role in preserving the federal balance seems more tenuous.

There is irony in this, because of the four structural elements in the Constitution just mentioned, federalism was the unique contribution of the Framers to political science and political theory. Though on the surface the idea may seem counterintuitive, it was the insight of the Framers that freedom was enhanced by the creation of two governments, not one.

"In the compound republic of America, the power surrendered by the people is first divided between two distinct governments, and then the portion allotted to each subdivided among distinct and separate departments. Hence a double security arises to the rights of the people. The different governments will control each other at the same time that each will be controlled by itself." James Madison, Federalist No. 51

Just as the separation and independence of the coordinate branches of the Federal Government serve to prevent the accumulation of excessive power in any one branch, a healthy balance of power between the States and the Federal Government will reduce the risk of tyranny and abuse from either front. . . . In the tension between federal and state power lies the promise of liberty. The Constitution divides authority between federal and state governments for the protection of individuals. State sovereignty is not just an end in itself. Rather, federalism secures to citizens the liberties that derive from the diffusion of sovereign power.

The theory that two governments accord more liberty than one requires for its realization two distinct and discernible lines of political accountability: one between the citizens and the Federal Government; the second between the citizens and the States. If, as Madison expected, the federal and state governments are to control each other, see Federalist No. 51, and hold each other in check by competing for the affections of the people, see Federalist No. 46, those citizens must have some means of knowing which of the two governments to hold accountable for the failure to perform a given function. Federalism serves to assign political responsibility, not to obscure it. Were the Federal Government to take over the regulation of entire areas of traditional state concern, areas having nothing to do with the regulation of commercial activities, the boundaries between the spheres of federal and state authority would blur and political responsibility would become illusory. The resultant inability to hold either branch of the government answerable to the citizens is more dangerous even than devolving too much authority to the remote central power.

To be sure, one conclusion that could be drawn from The Federalist Papers is that the balance between national and state power is entrusted in its entirety to the political process. Madison's observation that "the people ought not surely to be precluded from giving most of their confidence where they may discover it to be most due," (Federalist No. 46) can be interpreted to say that the essence of responsibility for a shift in power from the State to the Federal Government rests upon a political judgment, though he added assurance that "the State governments could have little to apprehend, because it is only within a certain sphere that the federal power can, in the nature of things, be advantageously administered, Whatever the judicial role, it is axiomatic that Congress does have substantial discretion and control over the federal balance.

For these reasons, it would be mistaken and mischievous for the political branches to forget that the sworn obligation to preserve and protect the Constitution in maintaining the federal balance is their own in the first and primary instance. In the Webster-Hayne Debates and the debates over the Civil Rights Acts before the Senate Committee on Commerce (88th Congress; 1963), some Congresses have accepted responsibility to confront the great questions of the proper federal balance in terms of lasting consequences for the constitutional design. The political branches of the Government must fulfill this grave constitutional obligation if democratic liberty and the federalism that secures it are to endure.

Although it is the obligation of all officers of the Government to respect the constitutional design, the federal balance is too essential a part of our constitutional structure and plays too vital a role in securing freedom for us to admit inability to intervene when one or the other level of Government has tipped the scales too far.

Our ability to preserve this principle under the Commerce Clause has presented a much greater challenge. This clause has throughout the Court's history been the chief source of its adjudications regarding federalism no other body of opinions affords a fairer or more revealing test of judicial qualities. But as the branch whose distinctive duty it is to declare what the law is, are often called upon to resolve questions of constitutional law not susceptible to the mechanical application of bright and clear lines. The substantial element of political judgment in Commerce Clause matters leaves our institutional capacity to intervene more in doubt than when we decide cases, for instance, under the Bill of Rights even though clear and bright lines are often absent in the latter class of disputes. But our cases do not teach that we have no role at all in determining the meaning of the Commerce Clause.

The statute before us upsets the federal balance to a degree that renders it an unconstitutional assertion of the commerce power, and our intervention is required. As the Chief Justice explains, unlike the earlier cases to come before the Court here neither the actors nor their conduct have a commercial character, and neither the purposes nor the design of the statute have an evident commercial nexus. The statute makes the simple possession of a gun within 1,000 feet of the grounds of the school a criminal offense. In a sense, any conduct in this interdependent world of ours has an ultimate commercial origin or consequence, but we have not yet said the commerce power may reach so far. If Congress attempts that extension, then at the least we must inquire whether the exercise of national power seeks to intrude upon an area of traditional state concern.

If a State or municipality determines that harsh criminal sanctions are necessary and wise to deter students from carrying guns on school premises, the reserved powers of the States are sufficient to enact those measures. Indeed, over 40 States already have criminal laws outlawing the possession of firearms on or near school grounds."

In the case of Bond v. United States, a woman was convicted of trying to poison her husband's mistress. (24 times over several months). He had had a child with the mistress while still married to Bond. The government tried to convict her under a federal statute designed to go after terrorists and so she sued, claiming that she should have been convicted under an applicable state criminal statute. The Court of Appeals for the Third Circuit held that Bond lacked standing to challenge the statute. The Supreme Court, in a unanimous decision, held that a criminal defendant who has been convicted under a federal statute can challenge that conviction on grounds that the statute is unconstitutional. In this particular case, the Court held that the statute exceeded the federal government's powers with respect to the Tenth Amendment. Justice Kennedy wrote the majority opinion:

"The federal system rests on what might at first seem a counter-intuitive insight, that “freedom is enhanced by the creation of two governments, not one.” Alden v. Maine, 527 U. S. 706, 758 (1999). The Framers concluded that allocation of powers between the National Government and the States enhances freedom, first by protecting the integrity of the governments themselves, and second by protecting the people, from whom all governmental powers are derived.

The principles of limited national powers and state sovereignty are intertwined. While neither originates in the Tenth Amendment, both are expressed by it. Impermissible interference with state sovereignty is not within the enumerated powers of the National Government, see New York v. United States, 505 U. S. 144 (1992), at 155–159, and action that exceeds the National Government’s enumerated powers undermines the sovereign interests of States. See United States v. Lopez, 514 U. S. 549, 564 (1995). The unconstitutional action can cause concomitant injury to persons in individual cases.

Federalism has more than one dynamic. It is true that the federal structure serves to grant and delimit the prerogatives and responsibilities of the States and the National Government vis-à-vis one another. The allocation of powers in our federal system preserves the integrity, dignity, and residual sovereignty of the States. The federal balance is, in part, an end in itself, to ensure that States function as political entities in their own right.

But that is not its exclusive sphere of operation. Federalism is more than an exercise in setting the boundary between different institutions of government for their own integrity. “State sovereignty is not just an end in itself: Rather, federalism secures to citizens the liberties that derive from the diffusion of sovereign power.

Some of these liberties are of a political character. The federal structure allows local policies 'more sensitive to the diverse needs of a heterogeneous society,' permits 'innovation and experimentation,' enables greater citizen 'involvement in democratic processes,' and makes government 'more responsive by putting the States in competition for a mobile citizenry.' [All of these would protect and enlarge individual liberty and protect against an oppressive "one-size-fits-all" approach].

Federalism secures the freedom of the individual. It allows States to respond, through the enactment of positive law, to the initiative of those who seek a voice in shaping the destiny of their own times without having to rely solely upon the political processes that control a remote central power. True, of course, these objects cannot be vindicated by the Judiciary in the absence of a proper case or controversy; but the individual liberty secured by federalism is not simply derivative of the rights of the States.

Federalism also protects the liberty of all persons within a State by ensuring that laws enacted in excess of delegated governmental power cannot direct or control their actions. [See ibid]. By denying any one government complete jurisdiction over all the concerns of public life, federalism protects the liberty of the individual from arbitrary power. When government acts in excess of its lawful powers, that liberty is at stake.

The limitations that federalism entails are not therefore a matter of rights belonging only to the States. States are not the sole intended beneficiaries of federalism. An individual has a direct interest in objecting to laws that upset the constitutional balance between the National Government and the States when the enforcement of those laws causes injury that is concrete, particular, and redressable. Fidelity to principles of federalism is not for the States alone to vindicate."

The outcome of this historic case against the massively oppressive healthcare reform bill will no doubt shape the legacy of the Roberts’ Court, influence President Obama's re-election prospects, and potentially deepen the ideological rift that is already dividing the country. But most importantly, the outcome will determine what impact the US Constitution still has on protecting the individual from the pernicious reaches of government.

References:

United States v. Lopez, 514 U.S. 549 (1995). Referenced at: http://www.law.cornell.edu/supct/html/93-1260.ZO.html

Bond v. United States, 564 U.S. ___ (2010).

"Anthony A. Kennedy," NY Times, March 29, 2012. Referenced at: http://topics.nytimes.com/top/reference/timestopics/people/k/anthony_m_kennedy/index.html

Transcript and Audio for Monday's Arguments: http://www.politico.com/news/stories/0312/74477.html

Transcript and Audio for Tuesday's Arguments: http://www.npr.org/2012/03/27/149465820/transcript-supreme-court-the-health-care-law-and-the-individual-mandate

Transcript and Audio for Wednesday's Arguments: http://www.npr.org/2012/03/28/149548299/transcript-audio-supreme-court-the-health-care-law-and-medicaid-expansion

Audio for Tuesday's arguments: http://apne.ws/Hft6z3

Audio for Wednesday's arguments: http://apne.ws/GX1p23
(morning) and http://apne.ws/GXdZOP (afternoon).

"The Supreme Court Arguments Are Over - What Happens Now?," Kaiser Health News, March 29, 2012. Referenced at: http://www.kaiserhealthnews.org/Daily-Reports/2012/March/29/supreme-court-big-picture-wrap-up.aspx