The decision by the US Supreme Court upholding the Affordable Care Act mandate as a tax was a stunning surprise to many. Probably no one was more surprised that President Obama. He has seemed apprehensive that his signature legislative accomplishment was about to be thrown out.
What was also surprising was that the swing vote in the 5-4 decision was Chief Justice John Roberts. Most speculation had focused on Justice Anthony Kennedy. And equally surprising was the realization that Roberts could have taken then entire health care act down 5-4 had he sided with the conservatives who, in their dissents, said flatly that the mandate was unconstitutional and the rest of the act had to fall with it as an unconstitutionally broad overreach in the commerce clause.
But why did Chief Justice Roberts side with the President in this case?
And did the Chief Justice just pin the target on the President’s chest instead of having it pinned to his own back?
The beauty of this decision is the ruthless efficiency with which the Chief Justice has made the Affordable Care Act the central political issues in the November 2012 election instead of taking the burden on the back of the Court for undermining the President and Congress. The decision protects the Supreme Court from being dragged into the political debate over the wisdom of the law while forcing the proponents of the law to defend it all over again in the court of public opinion.
The decision of the Chief Justice seems to follow the advice from two of the three Appeals Court decisions that were taken on review.
The 6th Circuit Court of Appeals in Cincinnati and the D.C. circuit Court of Appeals said in their decisions that while the law is intrusive it is within Congress’s power to enact. The Washington Post quoted from the opinion of Senior Judge Laurence Silberman, a Ronald Reagan appointee, who said:
“It certainly is an encroachment on individual liberty, but it is no more so than a command that restaurants or hotels are obliged to serve all customers regardless of race, that gravely ill individuals cannot use a substance their doctors described as the only effective palliative for excruciating pain, or that a farmer cannot grow enough wheat to support his own family.”
In deciding the case by upholding the law as a tax and limiting Congress’ power under the commerce clause, Chief Justice Roberts has sidestepped the political debate that will rage and fixed the accountability for the political wisdom of the act where it belongs—on the President and Congress.
- Politico Warns Chief Justice Roberts (rushlimbaugh.com)
- The Supreme Court’s unusual moment in the spotlight (theneteconomy.wordpress.com)
- The Real Affordable Care Act Battle: Constitutionalists vs. Confederates (theatlantic.com)
- Did Justice Roberts Trade Votes with Justice Kennedy? (americanthinker.com)
- Senator Leahy Threatens Justice Roberts In Advance of the Obamacare Decision (independentsentinel.com)
- Supreme Court decision on polarizing health care law looms (cnn.com)
- A Look Back at Court’s Arguments on Health Care, Laugh Count Included (nytimes.com)
I really start to worry when I find myself agreeing with Paul Krugman. I know he has a Nobel Prize but mostly I find his views on spending and the role of government in our society too intrusive. But he said recently that the markets don’t think the US is Greece (yet!). Nor do they think the US will default on its debt. But they do worry that there are too many downward pressures on growth to get much of it and that is our biggest problem.
Krugman is not recommending that we roll back ObamaCare, or some of the EPA regulations that spew daily from its printing presses. But both those things would be a good start. But even that will not be enough.
As Dan Drechsel said in Accurate Reality the debt deal did not do nearly enough to signal the markets that we are serious about reducing our deficit and debt. He’s right, of course. Washington speak for “cut” really means they are reducing the rate of growth not actually cutting anything. So the debt deal peddled as a cut in spending actually adds $7 trillion more to the national debt net over the next ten years.
The S&P downgrade of US credit ratings to AA+ from AAA is another wake-up call. Will we roll over and hit the snooze button one more time or actually wake up and do something constructive?
When the markets are persuaded that the government is serious about growth we will see business start to spend its hoard of cash and create jobs. Private sector spending (not government spending) and its ripple effect across the economy will turn the tide. But the 2012 election is a long time away and our politicians seem unable, unwilling and unresponsive to our real need for growth.
We need action now—the ship of state is going back into recession. The panic that caused this week’s 513 point meltdown in stocks is driven by the fear that our government is feckless—just like Italy in facing up to our realities. The bright spot is that the global search for safety brought many to US Treasuries in a fervent prayer that America will wake up, get up and find a way to grow again—as we have always done before in times of crisis.
- Paul Krugman: The Wrong Worries (economistsview.typepad.com)
- Newt Gingrich Accuses Obama Of Being A Follower Of Paul Krugman, Which Would Be News To Paul Krugman (huffingtonpost.com)
- WATCH: Krugman Slams Obama, George Will Slams Krugman (huffingtonpost.com)
- The Debt-Ceiling Debate is Dead! Long Live the Debt! Or, Will ObamaCare Cover What Krugman’s Smoking? (reason.com)
- Paul Krugman And Ron Paul Agree, Debit Ceiling Offers Nothing But “False Promises” (inquisitr.com)
Did you know ObamaCare Imposes a 3.8% Capital Gain Tax on Home Sales?
I discovered this fact on a great site I highly recommend by the Tax Foundation. On it you will lots of information that will probably turn your face from blue to red by Election Day.
The Tax Foundation blog reports that the recently approved ObamaCare health reform legislation imposes capital gains taxes on some home sales made by married couples making more than $250,000 in adjusted gross income or $200,000 if single. The capital gain must exceed $500,000 if the house is your primary residence and a married couple or $250,000 if singles. Got a vacation house? No exclusion for that one.
There are plenty of people here in California and elsewhere who dream of once again having such equity in their homes—and if you ever get there the Federal Government will want 3.8% capital gains tax if you meet these threshold tests. But just like the alternative minimum tax the “gotcha” in this home capital gains tax is that the provision is NOT indexed for inflation meaning each year more and more people become subject to the tax.
What does this have to do with healthcare, you ask?
Only the chilling reminder that the Government is going to tax everything that walks, quacks and breathes, everything you sell, invest in or play with in order to pay for the aspirations of our politicians. And if you have anything left when you finish your bucket list—and kick that bucket—the Government will want that too.