I am not an attorney (much to my mother’s chagrin), yet longtime readers of HA know that when it comes to analyzing legal issues I’ve proven extraordinarily insightful, dating back to my first year of blogging, when I completely pegged the court decision in the BIAW/Rossi challenge of the 2004 gubernatorial election, months before the trial. And I didn’t just predict the result; I explained the legal grounds behind Judge Bridges’ ultimate decision.
So with that and other subsequent legal feathers in my cap, I’d like to take a moment to present a layman’s refutation of Attorney General Rob McKenna’s politically motivated lawsuit, that concisely explains just some of the reasons why his arguments are total bullshit, but without a lot of legal mumbo jumbo. It’s not complicated, so I’m sure even the Seattle Times editorial board can follow along.
And speaking of uncomplicated, let’s start with a recent comment from an HA regular, the aptly named Troll:
If a Republican President signed a bill requiring all U.S. citizens to purchase a handgun, and the Washington State AG filed a lawsuit saying that was unconstitutional, would Goldy say his lawsuit was absurd?
I guess the quick answer would be “No,” depending on the specifics of the law, and the legal arguments within, I would not find such a lawsuit absurd. Which gets to the heart of the absurdity of McKenna’s lawsuit, because this is not an apt legal analogy at all.
See, the recently passed health care reform legislation does not require that all U.S. citizens purchase insurance, it merely provides a tax incentive to those of us who do. If you are not covered by an employer, and if you have not purchased your own individual policy, and if your income is above certain levels, and if you don’t hail from a state that has opted out of this mandate by implementing its own qualified health insurance system, you will be required to pay an additional federal tax, starting at the greater of $95 or 1% of income in 2014, and rising to $695 or 2.5% of income in 2016, up to a cap of the national average premium on a bronze plan. Both the minimum tax and the cap will increase by the annual cost of living adjustment.
Now, some might argue that this is still a mandate to engage in some sort of economic activity because it targets a tax at those who refuse, but one could easily flip this perception around. What it really is, is a flat, 2.5% federal income tax — much along the lines of what is already imposed to fund Social Security and Medicare — but for which the law provides a substantial exemption to those who choose to purchase private health insurance.
And don’t attempt to bog down this discussion in jibberish over whether this is a “tax” or a “fee” or a “penalty” or a “mandate” or whatever. The courts have long been consistent that lawmakers need not jump through such semantic hoops; if a law is constitutional worded one way, it is constitutional worded another, as long as the practical application is the same. And clearly, our tax laws are filled with provisions intended to encourage some economic activities and discourage others.
Along these lines, a better analogy than Troll’s theoretical handgun mandate would be our current home mortgage interest deduction. The federal government does not actually mandate that we all take out big mortgages to buy homes and condos, but it grants huge tax advantages to those who do, essentially penalizing renters. Think about it: with the extra tax revenue from eliminating the home mortgage interest deduction, the federal government could lower the base tax rate on all of us.
So, if the health insurance mandate-cum-exemption is unconstitutional based on the contention that it compels individuals to engage in an economic activity, then so too would be the home mortgage interest deduction, and any number of other federal tax incentives. And I sincerely doubt that McKenna would choose to join a lawsuit seeking to deny Washington homeowners this very popular deduction.
Not to worry though, because the federal government clearly has the constitutional authority to impose a tax to pay for health care (it does so now with Medicare), and it clearly has the constitutional authority to grant deductions, exemptions and other tax incentives in order to encourage or discourage certain forms of economic activity. And from a practical standpoint, that’s all the health care reform bill really does.
Nothing radical there.
As for the other main legal contention in McKenna’s lawsuit, that the new law amounts to an unprecedented encroachment on state sovereignty by requiring states to dramatically expand their Medicaid programs and the inherent costs therein, well, that’s just a load of crap. No state is required to participate in Medicaid, but since the federal government picks up over the half the cost, all states choose to do so, and the courts have long established that Congress has the right to attach conditions to the money it provides.
Likewise, there is no requirement that states set up an insurance exchange. If a state fails to set up an exchange, the federal government will merely step in and do so on behalf of its citizens. Not sure how that meets the definition of “mandate.”
So there you have it. From a layman’s perspective, McKenna’s legal arguments amount to much ado about nothing. And while I don’t put anything past the machinations of the highly partisan and activist Roberts Court, I’m pretty damn confident that this layman is going to prove to have a better grasp of the law than our state’s attorney general.
Which, honestly, is kinda sad.