Overruled

by Damon Root

  It was a subtle nod to judicial restraint—the idea that people should seek relief at the ballot box, not at the courthouse—and there’s no doubt the savvy chief justice-to-be knew exactly what he was saying. For well over a century, prominent legal figures ranging from Oliver Wendell Holmes to Learned Hand to Robert Bork had made that very same argument. Roberts was signaling his own support for the same deferential philosophy.

  To be sure, Roberts has also revealed a willingness to wield judicial power on other occasions. In the Supreme Court’s 2010 ruling in Citizens United v. Federal Election Commission, for instance, Roberts joined the conservative majority in nullifying portions of several campaign finance regulations and overruling one of the Supreme Court’s previous campaign finance decisions. Not exactly a deferential maneuver. Yet even then, Roberts still made a point of reiterating his commitment to modesty, writing a separate concurring opinion in Citizens United “to address the important principles of judicial restraint and stare decisis implicated in this case.”36 Those principles remain core judicial values, Roberts stressed, but “there is a difference between judicial restraint and judicial abdication.”37 For instance, “if adherence to a precedent actually impedes the stable and orderly adjudication of future cases”—when, for example, “the precedent’s validity is so hotly contested that it cannot reliably function as a basis for decision in future cases”38—the Supreme Court is justified in taking action.

  Which version of John Roberts would emerge in the health care case? Would it be the champion of judicial modesty, or the critic of judicial abdication? In an August 2011 column for Reason.com, I offered my own prediction: “Roberts may very well uphold the health care law as an act of judicial restraint.”39

  Day One: “A Carefully Made Representation”

  “We will hear argument this morning in case 11–398, Department of Health and Human Services v. Florida.”40 So declared Chief Justice Roberts on the morning of March 26, 2012. The three-day legal marathon to determine the constitutionality of Obamacare was officially underway.

  The focus of the first day’s arguments was the Anti-Injunction Act, which says one cannot challenge a federal tax in court until that tax has been assessed and paid. If the Supreme Court was looking for a chance to dodge the bullet, this was it. By declaring the ACA to have imposed a tax, the Court could dismiss the entire case on jurisdictional grounds and avoid a bitter constitutional showdown. Yet none of the justices revealed the slightest interest in that approach during their questioning. The Supreme Court was clearly ready to rule on the fate of the individual mandate, the subject of the next day’s oral arguments.

  In that sense, day one was simply a warm-up for day two, the main event. But it was not without its moments of high drama, particularly during two rounds of questioning that previewed the legal fireworks to come. The first such exchange occurred at the one-minute mark of Solicitor General Donald Verrilli’s time at the lectern.

  “General Verrilli, today you’re arguing that the penalty is not a tax,” said Justice Samuel Alito. “Tomorrow you’re gonna be back and you’ll be arguing that the penalty is a tax. Has the Court ever held that something that is a tax for purposes of the taxing power under the Constitution is not a tax under the Anti-Injunction Act?”

  “No, Justice Alito,”41 Verrilli was forced to admit. The Court had never done so. Alito had just honed in on what appeared to be a glaring inconsistency in the government’s posture. In its briefs, the Obama administration had justified the individual mandate under both the Commerce Clause and the so-called taxing power, the constitutional provision authorizing Congress “to lay and collect taxes.” Yet here was the solicitor general telling the Supreme Court that the Anti-Injunction Act did not bar the litigation from proceeding because the individual mandate did not impose a tax. As Alito pointed out, this was indeed a curious position to take. Is it a tax or isn’t it a tax?

  Several minutes later, Justice Sonia Sotomayor returned to that seeming inconsistency in the government’s case. “Could we address, General, the question of whether there are any collateral consequences for the failure to buy—to not buy health insurance? Is the only consequence the payment of the penalty?” According to the National Federation of Independent Business, she went on, if an individual is on probation and “they don’t buy health insurance, they’d be disobeying the law and could be subject to having their supervised release revoked.”

  “That is not a correct reading of the statute,” Verrilli responded. “The only consequence that ensues is the tax penalty. And the—we have made a representation, and it was a carefully made representation, in our brief that it is the interpretation of the agencies charged with interpreting this statute, the Treasury Department, the Department of Health and Human Services, that there is no other consequence apart from the tax penalty.”42 In other words, perhaps the mandate requiring the purchase of health insurance was not a mandate requiring the purchase of health insurance after all. Verrilli would return to this argument on day two.

  Day Two: “All Bets Are Off”

  “People say I’m a libertarian,” Justice Anthony Kennedy told the New York Times in 2005. “I don’t really know what that means.”43 Most libertarians would tend to agree with him. In 2004, when the libertarian lawyer Randy Barnett stood before the Supreme Court to explain why his client Angel Raich was not engaged in interstate commerce because her medical marijuana had been cultivated and consumed entirely within the state of California, Kennedy did not buy it. Several months later, Kennedy joined Justice John Paul Stevens’s majority opinion upholding the federal ban on marijuana as a valid exercise of congressional power under the Commerce Clause.44

  But Kennedy seemed to have a different take on the reach of federal power when Solicitor General Verrilli made his case for the individual mandate on the second day of oral arguments over the ACA. Kennedy not only suggested that Verrilli had “a heavy burden of justification” but also described a mandated purchase as so “different from what we have in previous cases” that it “changes the relationship of the federal government to the individual in a very fundamental way.”45

  At another point, however, Kennedy seemed inclined to accept the government’s argument that all of us will at some point receive health care, so it is reasonable to regulate the manner in which we pay for it. In an exchange that occurred toward the end of that day’s oral arguments, he referred to an uninsured young person as “uniquely proximately very close to affecting the rates of insurance and the costs of providing medical care in a way that is not true in other industries.” Then again, Kennedy prefaced that statement with yet another reference to the government’s failure to articulate any limits on its own power. “The government tells us that’s because the insurance market is unique,” he said. “And in the next case, it’ll say the next market is unique.”46

  Would Kennedy’s willingness to accept the government’s description of the health care market outweigh his obvious discomfort with the government’s potentially unlimited assertion of congressional power? The nation would soon learn the answer.

  In the meantime, Verrilli was enduring a grueling attack from Chief Justice Roberts, who wasted no time tearing apart the government’s Commerce Clause argument, which rested on the idea that because we will all require health care at some point, the government may stipulate how we pay for it in order to prevent the uninsured from imposing a burden on others in the marketplace. “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,” Roberts told the solicitor general, “it seems to me that we can’t say there are limitations on what Congress can do under its commerce power.” In fact, Roberts continued, “given the significant deference that we accord to Congress in this area, all bets are off.”47

  Justice Antonin Scalia voiced similar misgivings. “Why do you define the market that broadly?” he asked the solici
tor general. “Everybody has to buy food sooner or later,” Scalia continued, “so you define the market as food. Therefore everybody is in the market; therefore you can make people buy broccoli.”48 It was the same issue that troubled the Eleventh Circuit in 2011, which struck down the mandate because the government had failed to articulate a “generally applicable, judicially enforceable limiting principle.”49

  Nor did liberal Justice Stephen Breyer do the government’s case any favors when he chimed in to say that “yes, of course,” Congress can “create commerce where previously none existed,” which could include forcing all Americans “to buy cell phones”50 to facilitate the provision of emergency services (a hypothetical posed by Roberts). Verrilli hastened to clarify that the government was not in fact endorsing a cell phone mandate, but the damage seemed to have been done.

  To make matters worse for the government, after Verrilli suggested that a ruling against the individual mandate would be tantamount to judicial activism because it would “import Lochner-style substantive due process,”51 Roberts shot forward in his chair to forcefully dismiss the idea. Several minutes later, Roberts circled back and accused the government of inviting judicial activism by asking the Court to decide that a health insurance mandate is acceptable but that a broccoli or cell phone mandate is not. “It would be going back to Lochner if we were put in the position of saying, no, you can use your commerce power to regulate insurance, but you can’t use your commerce power to regulate this market in other ways,” Roberts declared. “I think that would be a very significant intrusion by the Court into Congress’ power.”52

  Lochner, of course, is the 1905 case in which the Supreme Court struck down a state law limiting the working hours of bakers, saying it violated the Fourteenth Amendment right to liberty of contract. In the eyes of most liberal legal thinkers, Lochner stands as a notorious example of conservative judicial activism. But many conservative legal thinkers also dislike Lochner, and for the exact same reason. Among those conservatives is John Roberts. During his Senate confirmation hearings, the future chief justice said, “You go to a case like the Lochner case, you can read that opinion today, and it’s quite clear that they’re not interpreting the law; they’re making the law.”53 So when Roberts told Verrilli that the government’s theory of the Commerce Clause risked unleashing Lochner-style activism by the courts, he was raising a powerful objection, one that allowed him to wear the mantle of conservative judicial restraint. It was a sign of things to come.

  “The President Said It Wasn’t a Tax”

  The solicitor general was given a full hour to make his case that morning. With less than fifteen minutes left on the clock, he finally turned to his fallback position: The individual mandate may also be upheld under Congress’s power to tax. “In terms of the tax power,” Verrilli explained, “I think it’s useful to separate this into two questions. One is a question of characterization. Can this be characterized as a tax; and second, is it a constitutional exercise of the power?”54

  Once again, Verrilli ran into trouble. “The President said it wasn’t a tax, didn’t he?” asked Justice Scalia.

  “The President said it wasn’t a tax increase,” Verrilli carefully responded, “because it ought to be understood as an incentive to get people to have insurance. I don’t think it’s fair to infer from that anything about whether that is an exercise of the tax power or not.”

  But the point of a tax is to raise revenue, objected Justice Ruth Bader Ginsburg, “and the purpose of this exaction is to get people into the health care risk—risk pool before they need medical care. . . . That’s what the penalty is designed to do, not to raise revenue.”55

  “You’re telling me they thought of it as a tax, they defended it on the tax power,” added the chief justice. “Why didn’t they say it was a tax?”56

  As Verrilli continued fielding those objections, Scalia suddenly spoke back up. “You’re saying that all the discussion we had earlier about how this is one big uniform scheme and the Commerce Clause blah, blah, blah, blah, it really doesn’t matter,” he told Verrilli. “This is a tax and the Federal Government could simply have said, without all the rest of this legislation, could simply have said, everybody who doesn’t buy health insurance at a certain age will be taxed so much money, right?”

  But Verrilli dodged the question. The government “used its powers together to solve the problem of the market not providing affordable coverage,” he told Scalia.

  “Yes, but you didn’t need that,” Scalia immediately shot back, his voice getting louder. “If it’s a tax, it’s only—raising money is enough.”

  Verrilli held his ground. “It is justifiable under its tax power,” he insisted.

  “Okay,” Scalia responded. “Extraordinary,”57 he added a few seconds later, the disbelief evident in his voice. Would the tax power end up deciding the outcome of this case, even after two years of courtroom battles over the scope of the Commerce Clause? Scalia appeared to be astounded at the thought.

  “The Democratically Accountable Branches of Government”

  The next hour belonged to the legal challengers. Former Solicitor General Paul Clement, attorney for the twenty-six states, and conservative lawyer Michael Carvin, attorney for the National Federation of Independent Business, each had thirty minutes to lay siege to the individual mandate. Both came out with guns blazing. “The Commerce Clause gives Congress the power to regulate existing commerce,” Clement declared. “It does not give Congress the far greater power to compel people to enter commerce, to create commerce essentially in the first place.”58

  Carvin amplified the point. “I’d like to begin with the Solicitor General’s main premise,” he told the Court, “which is that they can compel the purchase of health insurance in order to promote commerce in the health care market because it will reduce uncompensated care. If you accept that argument,” he continued, “you have to fundamentally alter the text of the Constitution and give Congress plenary power.”59

  Things were not looking good for the government’s Commerce Clause theory, as one conservative justice after another signaled varying degrees of sympathy for the legal challengers. Ironically, however, neither Clement nor Carvin spent any significant time rebutting Verrilli’s second justification for the mandate, the tax power. In retrospect, it is a striking omission.

  As day two began winding down, the solicitor general returned to the lectern to deliver a final, four-minute rebuttal. He made wise use of that time. “Congress confronted a grave problem when it enacted the Affordable Care Act: the 40 million Americans who can’t get health insurance and suffered often very terrible consequences,” Verrilli began. And to solve this grave national problem, he continued, Congress used its powers under the Commerce Clause to craft a comprehensive national solution. “That is the kind of choice,”60 Verrilli emphasized, that must remain in the hands of elected lawmakers.

  Turning next to the taxing power, Verrilli made perhaps the single most important argument of the entire three-day saga. “But if there is any doubt about that under the Commerce Clause, then I urge this Court to uphold the minimum coverage provision as an exercise of the taxing power,” he said. According to the Court’s own precedents, Verrilli stressed, the Supreme Court “has a solemn obligation to respect the judgments of the democratically accountable branches of government, and because this statute can be construed in a manner that allows it to be upheld that way, I respectfully submit that it is this Court’s duty to do so.”61

  “Thank you, General,” the chief justice responded, bringing the day’s arguments to a close. “Counsel, we’ll see you tomorrow.”62

  Day Three: “I Would Urge This Court to Respect That Judgment”

  The third and final day of arguments featured two separate sessions. First came the matter of severability. Did the entire ACA have to fall if the mandate was ruled unconstitutional? The justices appeared closely di
vided on the question. Then, after a short lunch break, came the Medicaid expansion. Was Congress coercing the states with a so-called gun to the head or merely spending money for the general welfare? A majority of the Court appeared hostile to Congress’s tactics in this area and seemed willing to rule against the Medicaid expansion. Indeed, the government ultimately lost on this issue by a vote of seven to two. Once again, things were not looking good for the federal government.

  In his final minutes at the lectern that afternoon, Solicitor General Verrilli took one last shot at saving the ACA. And once again, he made wise use of his time. “I’d like to take half a step back here,”63 he told the Court. “The Medicaid expansion that we’re talking about this afternoon and the provisions we talked about yesterday, we’ve been talking about them in terms of their effect as measures that solve problems, problems in the economic marketplace.”64 But there is one more element to consider, he said. And that element is democracy. Health care reform “is something about which the people of the United States can deliberate and they can vote,” Verrilli maintained, “and if they think it needs to be changed, they can change it.” The Supreme Court should not usurp that power and displace the people’s basic right to chart their own course. “This was a judgment of policy that democratically accountable branches of this government made by their best lights,” he concluded. “And I would urge this Court to respect that judgment and ask that the Affordable Care Act, in its entirety, be upheld.”65