How to Avoid Argentine Federalism

James L. Buckley is a former U.S. Senator, federal judge, and real-life saint. The Federalist Society’s 2014 Annual Convention featured a presentation and panel discussion on his most recent book, Saving Congress from Itself. As the title suggests, Jim Buckley—even at age 91—is into tasks that are kind of biggish. His key proposal is to phase out any and all federal transfer payments to state and local governments.

Robert R. Gasaway (Kirkland & Ellis—once upon a time, Judge Buckley’s law clerk) chaired the panel composed of Senator Buckley, John Eastman (Chapman Law School), and yours truly. Pending FedSoc’s posting of the video, my humble remarks appear below. More fodder for my friend Linda Greenhouse, I suppose.

Saving Congress from Itself is a must-buy and must-read. I wish I could write like that.

 

God bless Senator James Buckley.

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D.I.G. King v. Burwell?

GruberThe hubbub over the ACA is getting weirder and weirder. Amidst other revelations, there appears to be an extensive but as-yet undisclosed legislative history bearing on the pending Supreme Court litigation in King v. Burwell. One surprise at a time, though:

Professor Jonathan Gruber has by now well earned the George Washington Cherry Tree Award. Congenitally incapable of telling a lie, he blurts out an inconvenient truth about the act every time he opens his mouth. In today’s Wall Street Journal, Tevi Troy unveils “Another ObamaCare Deception” cheerfully revealed by Professor Gruber, this one having to do with an artfully disguised tax on “Cadillac” health plans that will eventually encompass Chevys.

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More on the Consequences of a Supreme Court Decision in the Obamacare Case

In my last post, I wrote about the consequences if Obamacare loses in the Supreme Court in King v. Burwell.  My basic point is that a Supreme Court decision holding that federal exchanges cannot receive subsidies will create an enormous fight between President Obama and the Republican Congress. Bill Levin, who recently wrote a post on the cert grant at this site, now has a post at Powerline addressing the same issue. I strongly recommend his post.

Bill is more optimistic than I am about the effects of such a Supreme Court decision. One of his main arguments is that the public understands that the Democrats are responsible for Obamacare and that any problems it has will be seen as the fault of the Democrats. Perhaps, but this would have to be true even though the five Republican justices decide that the subsidies are illegal over the votes of the four Democratic justices.

Ultimately, the biggest advantage that the Democrats have is that the media is on their side. They will portray the dispute as having been caused by the five Republican justices and will argue that the Republicans can easily fix the problem by simply returning to the status quo. It may be that the Republicans can prevail, but they will have to do so over the heads of the media.

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What Happens if Obamacare Loses in the Supreme Court?

Let’s say that the Supreme Court holds, in the King v. Burwell case involving federal exchanges, that such exchanges are not legally permitted to receive subsidies. This holding would create an enormous problem for Obamacare, since individuals in a large number of states would not be receiving subsidies. Clearly, a legislative change would be required. What then?

It has generally been assumed that this legislative change would be beneficial to opponents of Obamacare, as compared to the current situation. Under the current situation, once Republicans control both houses in January, they can pass modifications of Obamacare, but it is assumed that Obama will simply veto them.  The default situation—the regmine without a new law—is the continuation of Obamacare, which Obama likes. But if the Supreme Court holds the subsidies for federal exchanges illegal, the default situation changes: no subsidies for federal exchanges. And therefore one might argue that the Republicans are better off in this situation.

Perhaps. But things are more complicated. The default situation, if the Supreme Court holds the subsidies illegal, is similar to (although distinct from) the default under spending bills. If Obama vetoes a spending bill, the government often closes down. While one might believe that this would pressure him into approving Republican measures, it often doesn’t. The press—who often behave, as Glenn Reynolds puts it, as Democratic operatives with bylines—will usually report the shutdown in a biased way and the Republicans will be forced to compromise. If this happens with federal exchange subsidies—a likely possibility, even though Obama is losing support in the press—then the Republicans may be in a more difficult position than many people appear to assume.

Part of the issue turns on what will happen to people who lose the subsidies. If they lose their health insurance, then the Republicans are likely to be blamed by the press. If the Republican Congress does not give Obama what he wants, then states may choose to adopt exchanges in order not to lose the subsidies.  One issue favoring the Republicans is that the employer mandate will not apply to states with federal exchanges. In addition, the people who lose the subsidies are likely not to be covered by the individual mandate.  

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Bill Levin on The Worm Turns: King v. Burwell

My friend and former colleague from the Office of Legal Counsel, Bill Levin, has been following the Halbig case closely.  Here are his thoughts on the Supreme Court’s cert grant.  For his previous thoughts on the case, see here

First, election night and now the highly significant decision by the Supreme Court to grant cert in the Obamacare tax subsidy case, King v. Burwell.

After such a week, it is justifiable to speculate as to why the court accepted King.

The initial item of interest is timing.  The case was considered by the Court in normal course at its October 31 Conference, but relisted to November 7 when cert was granted.  It is utterly plausible, though unprovable, to assume the Court did not want a high profile determination released just days before the mid-term elections.

The conventional wisdom was that the Court would deny cert since there is presently no split in the circuits, following the D.C. Circuit grant of en banc review vacating the Halbig decision.  In days to come it will surely be repeated ad nauseam on the left that the Court is indulging in politics by taking King out of normal order.

Professor Rappaport on this site correctly bucked the conventional wisdom in predicting cert acceptance.  His reasoning, that four of the five conservative justices would refuse to let stand the D.C. Circuit end run to vacate Halbig, is appealing from a visceral perspective.  The D.C. Circuit vacated the decision in Halbig, but not the panel’s well-reasoned opinion.  From every practical perspective, a fully litigated split in the circuit currently exists with respect to the correct statutory construction of the ACA.

Regardless, King independently justifies expedient resolution on standard grounds.

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Jonathan Gruber: Airbrushed from History

GruberA flurry of activity surrounding the Affordable Care Act (described below) brings to mind a bitter-cold day in February 1948, when party leader Klement Gottwald stepped out onto a Prague balcony to announce the birth of Communist Czechoslovakia. A solicitous comrade (Clementis) placed his fur cap on Gottwald’s bare head. As Milan Kundera describes it in The Book of Laughter and Forgetting:

Every child knew the photograph from posters, schoolbooks, and museums.

Four years later Clementis was charged with treason and hanged. The propaganda section immediately airbrushed him out of history and, obviously, out of all the photographs as well. Ever since, Gottwald has stood on that balcony alone. Where Clementis once stood, there is only bare palace wall. All that remains of Clementis is the cap on Gottwald’s head.

What remains of Jonathan Gruber?

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Halbig and the Nonchalance of Six Small Words

New legislation

The psychology of legislative draftsmanship involved in the six words at stake in Halbig v. Burwell—“an exchange established by the State”—reflects a short-odds gamble that did not hit. The bettors first wanted the IRS to rescue them from the consequences, and now they want the courts to do it.

The gamble was that states, enticed by subsidies for their citizens or intimidated by the threat of losing Medicaid funds, would establish healthcare exchanges. The Obama administration is surely right that the whole idea of the Affordable Care Act (ACA) was that such subsidies be provided, and that the consequences that have ensued from those six small words were probably unintended.

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Halbig and the Possibility of Supreme Court Cert

Now that the D.C. Circuit has granted rehearing en banc for the Halbig case, there is speculation about whether the case will make it to the Supreme Court.  Halbig, of course, is the case addressing whether federal health care exchanges are allowed to receive federal subsidies.

The defenders of the subsidies for the federal exchanges are hopeful that the case does not reach the Supreme Court.  Before the D.C. Circuit granted rehearing en banc, there was a split between the circuits, with the D.C. Circuit ruling against the legality of the subsidies and the Fourth Circuit ruling in favor of them.  Cert seemed assured.

But the future decision of the en banc court of the D.C. Circuit changes things.  With the three new Democratic appointees to the Court, there is now a Democratic majority and it seems extremely likely that the panel decision will be reversed – in which case, there would no longer be a split.  Of course, there are other cases – a District Court in Oklahoma just held that federal exchanges cannot receive subsidies – but those circuit court decisions may take some time and there is arguably a strong need for this issue to be resolved expeditiously.

I wonder whether the Supreme Court will feel constrained from taking cert if the full D.C. Circuit decides in favor of federal exchange subsidies.  Every circuit court judge who has decided the matter has voted on party lines in these cases.  If the Democratic D.C. Circuit reverses, that trend will continue.  And there is controversy about whether the D.C. Circuit should have taken the case en banc.  In these circumstances, one might wonder whether at least four of the five Republicans on the Supreme Court will decide to hear the case, notwithstanding the lack of a circuit split.

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This Just In: District Court Nixes IRS Obamacare Rule

In a relatively brief, concise Order and Opinion, U.S. District Judge Ronald A. White (Eastern District, Oklahoma) has set aside a notorious IRS rule declaring that subsidies and mandates under the Affordable Care Act apply in states with federal as well as state-run health care “Exchanges.” The Order and Opinion in Pruitt v. Burwell agreed with the D.C. Circuit’s holding in Halbig v. Burwell, currently pending on en banc consideration, that the statutory language—an exchange “established by the State”—could not be read to include exchanges established by the federal government in and on behalf of the state. The District Court disagreed…

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In Sickness and in Health

If Ezekiel Emanuel (age 57)  had just stated his preference for dying at 75 or if he were a citizen uninvolved in public affairs, no attention need be paid. There is no use disagreeing with tastes, and the world is full of eccentrics. But Emanuel was one of the enthusiastic cheerleaders of the President’s health care plan, and he offers a lot of reasons to justify his preference. The considerations he adduces and those he fails to account for provide an unsettling perspective on the world view underlying some progressive support for Obamacare.

Insufficient interest in future innovation. Emanuel is concerned that, even if he lives longer than 75, he is likely to be a shadow of his former self. But Emanuel considers the world as it is today, not one that innovation could create when he is 75.

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