Advancing a Free Society

The Sixth Circuit’s Ruling on the Individual Mandate

Friday, July 1, 2011

The first of three courts of appeals decisions on the constitutionality of the Patient Protection and Affordable Care Act (Obamacare) was announced last week. In Thomas More Law Center v. Obama, the Sixth Circuit Court of Appeals upheld the lower court’s decision that the law is constitutional.

The three judge circuit court panel was split 2-1. Already much has been made of the fact that Judge Jeffrey Sutton, a George W. Bush appointee, joined Judge Boyce Martin, a Carter appointee, in upholding the law. As Simon Lazarus of the National Senior Citizens Law Center told the National Law Journal, "[b]efore argument occurred, if a proponent of ACA could pick a single appellate judge they would not want to have ruling on this case, it would be Judge Jeffrey Sutton."

If nothing else, Judge Sutton’s conclusion that Obamacare is constitutional belies the widely held view that federal judges can be counted on to put politics above an honest effort to decipher the law. Sutton engages in a careful analysis of the relevant precedent and its application to the facts of Obamacare’s individual mandate. Taking a very restrained view of the judiciary’s role, he concludes that, although the law might be unconstitutional in some applications, it is not unconstitutional in all applications and therefore must be upheld against a facial challenge.

Given the Supreme Court’s commerce clause precedent, Judge Sutton’s conclusion is not unreasonable. If Congress can restrict the amount of wheat grown exclusively for consumption on the farm (Wickard v. Filburn) and can regulate marijuana grown exclusively for personal (medicinal) use (United States v. Morrison), then why can’t it mandate the purchase of health insurance? Judge Sutton finds no basis to distinguish the latter from the former.

But there is something about the individual mandate’s unprecedented intrusion into personal choice that troubles a majority of Americans and some federal judges as well. They might be inclined to suggest that if, under existing commerce clause doctrine, there is not a constitutional problem with the individual mandate (Judge Martin prefers to call it the “minimum coverage provision”), then perhaps there is a problem with the precedent that leads Judges Sutton and Martin to conclude that the law is constitutional. Indeed, it could be argued that the most cogent thing to be learned from Judge Sutton’s thoughtful opinion is that the Supreme Court’s commerce clause jurisprudence has failed to secure a core purpose of our federal system of government.

That is a central point of Judge James Graham’s dissenting opinion in the case. He notes that Justice Clarence Thomas has questioned the viability of the “substantial effects” test on which Judges Martin and Sutton rely, and he predicts that “the [Supreme] Court remains committed to the path laid down by Chief Justice Rehnquist and Justices O’Connor, Scalia, Kennedy, and Thomas to establish a framework of meaningful limitations on congressional power under the Commerce Clause.” “The current case,” concludes Graham, “is an opportunity to prove it so.”

The substantial effects test was a New Deal era innovation designed to accommodate Congressional regulations that relate neither to “the use of the channels of interstate commerce” or “the instrumentalities of interstate commerce, or persons or things in interstate commerce.” It allowed the Court to legitimize the rapidly expanding federal intervention in the national economy by upholding regulations like that of wheat grown exclusively for consumption on the farm. Most recently the test was applied in upholding federal regulation of home grown and consumed marijuana (Gonzales v. Raich).

The problem with the substantial effects test, as Justice Thomas pointed out in Morrison, is that it is “rootless and malleable.” Everything is connected to everything else, so what human activity or inactivity does not affect interstate commerce?

After more than half a century of invalidating not a single federal regulation enacted in the name of the commerce clause, the Supreme Court finally found limits in United States v. Lopez (invalidating a federal prohibition on guns near school yards) and Morrison (invalidating a federal regulation of violence against women). Reliance on the fact that interstate commerce is affected by the costs of hand gun related crime, and by national productivity losses resulting from violence against women, extended commerce clause based regulation a step too far. Judge Graham concludes that the government failed to “show why a view of cost-shifting caused by risky conduct [not buying health insurance] should fare any better.”

To those who say that a federal government that can mandate the purchase of health insurance can also mandate the purchase of other products and services in the interest of positively affecting interstate commerce, Judge Sutton and the government respond that health care is different because, whether or not an individual buys insurance, the provision of health care is mandated by federal law. “But,” as Judge Graham observes, “Congress cannot be tolerated to justify its exercise of power by creating its own substantial effects.” If Congress has authority to regulate anything and anybody that affects interstate commerce, and it can mandate the existence of those effects, there is no limit on the commerce regulation power.

When the case reaches the Supreme Court, which it is almost certain to do, particularly if one or both of the other appellate courts reaches an opposite conclusion, chances are that the Court will take the cautious approach of trying to fit the case into the existing precedent. That would be a mistake. What the Court should do is take up Judge Graham’s (and Justice Thomas’s) invitation to reconsider the substantial effects test.

At least every now and then the Supreme Court should have reference to fundamental principles – it should test existing jurisprudence and its consequences against the Constitution’s enduring values. As Judge Sutton, himself, asks, how much longer can the Court continue to insist that federal powers are indeed limited, by enumeration and the express language of the 10th Amendment, while finding virtually no limits in its case by case interpretation of the Constitution’s provisions? When will it undertake the “hard work,” as Justice O’Connor put it in Raich, of giving meaning and effect to a federal system in which “[t]he powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” (10th Amendment).

Judge Sutton states in his opinion that “[n]ot every intrusive law is an unconstitutionally intrusive law.” No doubt he is correct. But it is equally true that not every popular law is a constitutionally popular law. Not everything a majority of Congress wants to do, even because they believe it good for the nation, is within Congress’ constitutionally enumerated powers. And those powers are enumerated not just in the interest of reserving legislative authority in the states, but also, and more importantly, to protect the liberties of individuals.

Consistent with the custom in commerce clause cases, the focus in this and the several lower court opinions on the constitutionality of Obamacare is on the separation between federal and state power. But as the focus on the individual mandate underscores, and as Judge Sutton recognizes, “a critical guarantee of individual liberty is [the] vertical separation of powers between the National Government and the States.” In light of the Supreme Court’s recent decision in Bond v. United States (holding that an individual has standing to challenge infringements on state power because the federal structure is a protection of liberty), some attention to the liberty constraining aspects of Obamacare would give the Court a pathway out of the morass of old commerce clause jurisprudence and into a new approach that gets back to fundamental constitutional principles of individual liberty and federalism.

(photo credit: Wikipedia)