Time to Rethink the Chevron Doctrine


These are interesting times, constitutionally speaking. In the past two weeks, federal courts have ruled both ways on Obamacare. In the D.C. Circuit, a panel ruled that the law allows for subsidized health insurance in exchanges created by state governments, but not in the “backstop” exchange created by the federal government. Meanwhile, the Fourth Circuit says that the statute allows subsidies in both.

Who is right?

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Lawlessness, Small and Large

A reporter for The Nation magazine looking for a partisan “color” story cornered me at the 2014 Conservative Political Action Conference, asking what I thought of Chris Christie. I took the chance to remind his magazine’s audience that both parties in American politics have been adopting similar habits of lawlessness, and that continuing to confirm those habits has dire consequences.

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Taking Down D’Souza and Other Abuses of Power

In 2004 leftwing filmmaker Michael Moore released his film Fahrenheit 9/11, a searing attack on the legitimacy of George Bush’s election to the presidency in 2000, and his handling of events before, during, and after the terrorist attack of September 11, 2011 on the World Trade Center. Moore was unequivocal in his stated hope that the movie would “help unseat a president.”

Fahrenheit 9/11 was produced by Moore’s production company Dog Eat Dog Films, a corporation. At the time – before the Supreme Court decision in Citizens United v. Federal Election Commission—it was illegal for corporations to spend money “in connection with any election to any political office,” and illegal for an officer of a corporation to consent to such an expenditure.

Imagine if fourteen months after the election, Moore had been indicted by a Bush-appointed federal prosecutor for violating the prohibition on corporate spending. Imagine if Moore was arrested, cuffed, criminally charged for his activities, had his passport confiscated, and bail set at $500,000–what would have been the reaction from the America’s liberals? Of the press? Of Senator Barack Obama?

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Live Not by Lies

Being human, politicians lie. Even in the best regimes. The distinguishing feature of totalitarian regimes however, is that they are built on words that the rulers know to be false, and on somehow constraining the people to speak and act as if the lies were true. Thus the people hold up the regime by partnering in its lies. Thus, when we use language that is “politically correct” – when we speak words acceptable to the regime even if unfaithful to reality – or when we don’t call out politicians who lie to our faces, we take part in degrading America.

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Congress Slouches Towards Illegitimacy

America is under one-party rule. That is illegitimate because it is irresponsible. Restoring responsible government will take a revolt from within the ruling coalition, or a new party formed explicitly to represent the people against the ruling class.

The New York Times’ “News Alert” heralded the House of Representatives’ passage (359-67) of a single bill that appropriates money for the US government’s discretionary accounts through fiscal 2014: “The legislation, 1,582 pages in length and unveiled only two nights ago, embodies precisely what many House Republicans have railed against since the Tea Party movement began, a massive bill dropped in the cover of darkness and voted on before lawmakers could possibly have read it.” The same day, a Wall Street Journal headline hailed the event as “Budget Deal Gives Parties Break From Fiscal Combat.” Like the Times, the Journal published a summary list of “who gets what” from the $1.1 trillion deal.

iStock_000001750148SmallThe Party bosses and the lobbyists closest to them who worked out the deal over the previous weekend answered only to themselves.

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District Court Upholds Obamacare Exchanges

Earlier today, Judge Friedman (D.D.C.) sustained an IRS rule to the effect that Obamacare’s subsidies and coverage mandates apply in all states with a health care exchange–not just those with a state-run exchange but also those with a federal or federally “facilitated” exchange. That is so, the judge held, despite statutory language that specifically refers to exchanges established by or ”a state.” The IRS (or for that matter HHS) is not a state but never mind. The opinion is here; news coverage here.

The judge’s opinion is (in my humble estimation) not a “let’s-save-Obamacare” blow-off: it wrestles with a serious problem of statutory interpretation—a Chevron problem. The judge says that the overriding purpose (universal coverage) is so blazingly obvious that in the context of the statute, the plaintiffs’ literal interpretation makes no sense. I think that’s mistaken (and I think I’d say that even if I weren’t affiliated with the Competitive Enterprise Institute, which helped to engineer this case), and I hope that it will be corrected on an already-pending appeal. But I think the real problem lies elsewhere.

All of AdLaw rests on the premise of Congress as a deliberative assembly that wants reasonable ends, reasonably pursued. Sometimes (Chevron says) Congress speaks with precision, and we courts follow; at other times, it delegates, and then we ask whether the agency acted within the statutory bounds, and reasonably.

That may make sense in the context of statutes that Congress actually thought about, like (say) the Clean Air Act at issue in Chevron (and now that I wrote that sentence, I want to shoot myself). But the ACA?? The basic design question—state or federal exchanges—has proved kind of important, don’t you think? But the harsh fact is that the Congress that enacted this statute had very specific intentions with respect to interest groups pay-offs (that’s why the ACA runs over 1,000 pages) but no discernible intent with respect to anything beyond that—except to cram it down our throats. The text could have committed the exchanges to Evita Peron or Mylie Cyrus: it still would have passed. Everyone knows that. The litigants and judges know it better than most; but none of them can say that.

The deep challenge here, and in an increasing number of cases, is to improvise public law rules for a nihilistic Congress and political process.

Obamacare: The Impending Collapse

Obamacare is on the ropes. As everyone is beginning to understand, the malfunctioning website is the least of it. There’s the millions of canceled individual policies, skyrocketing Medicaid enrollments … and much more trouble ahead.

As previously reported, four pending lawsuits challenge an IRS rule that would extend the ACA’s coverage mandates and subsidies into states that have declined to establish a state exchange and are now operating under healthcare.gov. Sean Trende has a tremendous piece on the four cases here.

Two of the cases were brought by states (Oklahoma and Indiana). The other two were cobbled together by the Competitive Enterprise Institute; Michael Carvin of Jones, Day represents the plaintiffs in both cases. (Disclosure: I serve on CEI’s Board.)

The two cases are on an extremely fast track. District Judge Judge Paul Friedman (D.C. Circuit) has denied the government’s motion to dismiss the case, ordered expedited briefing, and promised a ruling by February 15, 2014. The other case, filed in September in a U.S. District Court in Richmond, is on an even faster schedule: briefing will conclude in early December, and there may be a ruling before the end of the year. The filings in both cases are available at www.cei.org/obamacare.

More and more, the Rolls Royce of progressive politics looks like a tricycle. And the wheels are coming off.

The War On Us

Increasingly, the US government’s many police forces (often state and local ones as well) operate militarily and are trained to treat ordinary citizens as enemies. At the same time, the people from whom the government personnel take their cues routinely describe those who differ from them socially and politically as illegitimate, criminal, even terrorists. Though these developments have separate roots, the post-9/11 state of no-win war against anonymous enemies has given them momentum. The longer it goes on, the more they converge and set in motion a spiral of civil strife all too well known in history, a spiral ever more difficult to stop short of civil war.

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NSA Data Fuels the Administrative State

The past week’s events show what little use the US government’s massive electronic interceptions are for protecting the American people, and the credulity of Establishment Republicans. Most of all they show the real role that these programs will play in our lives: an enforcement mechanism for the modern Administrative state, politicized and partisan.

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Friday Roundup, August 9th

  • Brian Domitrovic reviews The Battle of Bretton Woods in our Books section this week, and alerts us to a side of Keynes you may not have seen before. Domitrovic notes as well that the strength of the IMF only grows with each international financial crisis. The IMF never lets a crisis go to waste.
  • Scrooge and Ropke collide over the limits of economics. Ropke, the Austrian economist, whose policies we’ve explored at some length at Liberty Law Talk, believed that economics emerged from a nation’s character, culture, and political philosophy. Economics was one of several goods within a free society that had to be balanced and weighed with various other commitments. This was common sense born from his experience in watching Germany go to war in World War I and his flight from Germany with the fall of the Weimar Republic. In both instances, Ropke believed, the economy had not reinforced the overall sense of independence of the people. Political economy would need better thinking to sustain it within representative democracy. Later, he returned to helped build the postwar West German miracle.