Health Care and Federalism: A Response to Professor Charles Fried

I have received a significant number of emails after my earlier stated views on the national health care legislation were raised in the hearings this week before the United States Senate Committee on the Judiciary. Unfortunately, I am plowed under this week in litigation, but I wanted to offer a brief response to Harvard Law Professor and former Reagan Solicitor General Charles Fried who disagreed with my views on the danger to federalism.

Senator Cornyn asked Fried (and later the other witnesses) the same question:

But I just want to ask whether you agree — let me ask Professor Fried this question — Jonathan Turley, a law professor who testifies occasionally here in — before us, said that if the Supreme Court upholds the individual mandate, it’s hard to see what’s left of federalism.

Fried disagreed with my conclusion. His overall position is stated as follows:

I come here not as a partisan for this act. I think there are lots of problems with it. I’m not sure it’s good policy. I’m not sure it’s going to make the country any better. But I am quite sure that the health care mandate is constitutional.

I have my doubts about the part that Senator Grassley mentioned with the Medicare — Medicaid compulsion on the states. That’s something I worry about.

But the health care mandate I think really is — I wouldn’t have said a no-brainer, but I mustn’t with such intelligent brains going the other way.

Clearly, insurance is commerce. It’s — that was held by the Supreme Court in 1944. There was a time when the Supreme Court didn’t think it was commerce. But it has been ever since. And if you look at the mountain of legislation, most noticeably the ERISA legislation, you see that the Congress and the courts obviously think insurance is commerce.

And health care — surely, health care insurance surely is commerce, insuring as it does something like 18 percent of the gross national product.

Now if that’s so — if health care insurance is commerce, then does Congress have the right to regulate health care insurance? Of course it does.

And my authorities are not recent. They go back to John Marshall, who sat in the Virginia legislature at the time they ratified the Constitution, and who in 1824, in Gibbons v. Ogden, said regarding commerce’s — Congress’ commerce power, “What is this power? It is the power to regulate.” That is, to prescribe the rule by which commerce is governed.

To my mind that is the end of the story — the constitutional basis for the mandate. The mandate is a rule. More accurately, part of a system of rules by which commerce is to be governed, to quote Chief Justice Marshall.

And if that weren’t enough for you, though it is enough for me, you go back to Marshall in 1819 in McCulloch and Maryland, where he said, “The powers given to the government imply the ordinary means of execution. The government, which has a right to do an act,” surely to regulate health insurance, “and has imposed on it the duty of performing that act, must according to the dictates of reason be allowed to select the means.”

And that is the necessary and proper clause.

And he ends by saying, “Let the end be legitimate,” — that is to say the regulation of health insurance. “Let it be within the scope of the Constitution,” ERISA, “and all means which are appropriate, which are plainly adapted to that end, which are not prohibited but consistent with the letter and spirit of the Constitution are constitutional.”

Well, that to me is the end of the story. And I think that one thing about Judge Vinson’s opinion where he said, “If we strike down the mandate, everything else goes,” shows as well as anything could that the mandate is necessary to the accomplishment of that — of the regulation of health insurance.

But is it proper?

Well, there is I think an intellectual confusion here. Something is necessary — this is clearly necessary. It is improper only if it bumps up against some specific — some specific prohibition in the Constitution. And the only prohibitions I can think of that this bumps up against — the liberty clauses of the Fifth and Fourteenth Amendment. And if that’s so, then not only is Obamacare unconstitutional, but then so is Romneycare in Massachusetts. And I think that is an example of an argument that proves too much.

First, the reference to Vinson seems a bit forced. The fact that Judge Vinson found the entire statute to be unconstitutional due to the importance of the individual mandate is hardly convincing support on the constitutional question. I have discussed the severability issue in a column this week. Clearly an unconstitutional provision can also be central to a federal scheme. The centrality or the importance of the provision cannot establish its constitutionality or the matter becomes hopelessly circular. The individual mandate was necessary to generate funding for the program as a whole by requiring low-cost young people to pay into the system. The fact that this revenue stream is essential does not mean that the assertion of the federal government over these individuals is constitutional. For example, if Congress required all minorities to pay twice the amount of non-minority, the added revenue might be essential to the sustainability of the program, but it would still be clearly unconstitutional. Professor Fried seems to be arguing that, if a provision is essential to a federal scheme, it strongly suggests that it is constitutional because the federal government needs it to achieve these goals. That would be a rather maddening test since allows the ends to swallow the means for the purpose of constitutional review. The fact that the federal government has a legitimate interest in health care reform does not mean that any means is permissible in achieving that goal — so long as Congress makes it central to its legislative scheme.

Fried’s use of precedent on the inherent power of Congress to regulate health care is certainly a compelling and may ultimately prevail in the Supreme Court. However, for those concerned over the implications for federalism, it proves too much. “Let the end be legitimate . . . Let it be within the scope of the Constitution . . . and all means which are appropriate, which are plainly adapted to that end, which are not prohibited but consistent with the letter and spirit of the Constitution are constitutional.” That is precisely the concern raised as to the health care legislation: whether this is an appropriate mean “consistent with the letter and spirit of the Constitution.”

To say that cases like Gibbons allows Congress “to prescribe the rule by which commerce is governed” would remove anything to federal jurisdiction so long as it could be linked to commerce. That is certainly the message of Wickard, which we have previously discussed. However, many of us have long been troubled by the sweep of Wickard.

While Fried was asked about about any remaining limits on federal authority if this passes muster, he fails to offer any such limits. Instead, he suggests that any regulations of a matter touching commerce is within Congress’ limited and enumerated powers. That would leave no limits. Some of us simply do not believe that the Framers would have created a system of such limited powers and then allowed unlimited power on any decision that can be defined as affecting commerce. The power “to regulate commerce . . . . among the several states” was meant to prevent states from creating barriers to other states by leaving interstate commerce to the federal government. However, this interpretation would allow the government to sweep within its purview even acts of omission that frustrate its national goals. To say that this is a “no brainer” is to ignore the facially different type of claim raised in this case.

I have stated before that I believe that the cases favor Congress in the lower courts, but that there is strong precedent on both sides. Obviously, both challenging the law are emphasizing United States v. Lopez, 514 U.S. 549, 115 S. Ct. 1624, 131 L. Ed. 2d 626 (1995) and United States v. Morrison, 529 U.S. 598, 120 S. Ct. 1740, 146 L. Ed. 2d 658 (2000). The Court stated in Morrison that it would not accept “the argument that Congress may regulate noneconomic, violent criminal conduct based solely on the conduct’s aggregate effect on interstate commerce.” Id. at 617. In Lopez, the Court required more than what Professor Fried appears to demand in the nexus to support federal authority. In striking down the Gun-Free School Zones Act, the Court found that the claim could not be sustained “under our cases upholding regulations of activities that arise out of or are connected with a commercial transaction, which viewed in [*37] the aggregate, substantially affects interstate commerce.” Lopez, 514 U.S. at 561. Again, the question as stated by Chief Justice Marshall is whether this claim conforms with “the letter and spirit of the constitution.”

As I have stated, people of good faith can disagree on these points and the matter cannot be fully resolved until put before the Supreme Court. Most people anticipate that Justice Kennedy will be the swing vote on a close decision. In both Lopez and Morrison, Kennedy voted to strike down the laws. However, in his concurrence, Kennedy did note that the history and language of the Constitution “counsels great restraint before the Court determines that the Clause is insufficient to support an exercise of the national power.” Moreover, Kennedy did vote to uphold the Controlled Substances Act in Gonzalez v. Raich, 545 U.S. 1 (2005). He agreed that, absent the authority, Congress could not regulate drugs. I am frankly not convinced that the same nexus can be established here.

There is also some question over Justice Scalia’s view since he also concurred in Raich. In that decision, Scalia noted that “[u]nlike the power to regulate activities that have a substantial effect on interstate commerce, the power to enact laws enabling effective regulation of interstate commerce can only be exercised in conjunction with congressional regulation of an interstate market, and it extends only to those measures necessary to make the interstate regulation effective. . . . Congress may regulate noneconomic intrastate activities only where the failure to do so “could … undercut” its regulation of interstate commerce.” However, he also found that “[t]his is not a power that threatens to obliterate the line between “what is truly national and what is truly local emphasis added.”

I view the health care legislation as presenting a new type of federal claim and one that could leave few things as protected by federalism by expanding Congress’ enumerated powers to an unprecedented scope. I respect Professor Fried’s views (and those of many of my friends on the other side of this debate) but I find this a much closer question — the answer of which could leave little left for those who believe in strong federalism guarantees in the Constitution.

Jonathan Turley

93 thoughts on “Health Care and Federalism: A Response to Professor Charles Fried”

  1. 2T, Bob is wrong. A social security mandate has been imposed for over 70 years, on individuals, constitutionally, and so can a health mandate, as a tax and a regulation of commerce.

    If his idiosyncratic constitutional theories go into effect, watch your Social Security, Medicare and Medicaid go down the drain, too.

    Bob says “Health care reform can only be achieved via reform of medicare and funding through the general tax rolls,” but that is just him, not the Constitution, the Courts, or recognized legal scholars.

    The Constitution does not use the term “general tax roll,” just Bob.

  2. Mr. Turley writes:

    “Some of us simply do not believe that the Framers would have created a system of such limited powers and then allowed unlimited power on any decision that can be defined as affecting commerce. The power “to regulate commerce . . . . among the several states” was meant to prevent states from creating barriers to other states by leaving interstate commerce to the federal government. However, this interpretation would allow the government to sweep within its purview even acts of omission that frustrate its national goals.”

    Correct. Brilliant.

  3. “It is of the essence of regulation that it lays a restraining hand on the self interest of the regulated and that advantages from the regulation commonly fall to others.”

    Wow….so does this apply to services as well as goods?

  4. Fried absolutely missed it. He has begged the question of the extend of regulation. No doubt there is interstate commerce, but the question is whether or not the individual mandate is within the constitutional bounds of regulation. I don’t think its a close question.

  5. Vince always makes good arguments, Smom.

    Plus he gets style points for mentioning the Elder Gods, Cthulhu, and the Great Old Ones.

  6. The tea party ran on a platform that was anti-government sponsored health care. They labeled it Obamacare They won the house but they still don’t have the senate and the presidency so they are hoping republican appointed judges will give them what they want. Vince Treacy is correct in his assessment.

  7. JT writes “For example, if Congress required all minorities to pay twice the amount of non-minority, the added revenue might be essential to the sustainability of the program, but it would still be clearly unconstitutional.”

    But then he writes: “Some of us simply do not believe that the Framers would have created a system of such limited powers and then allowed unlimited power on any decision that can be defined as affecting commerce.”

    Well, it is a matter of historical fact that the Framers DID indeed allow Congress “unlimited power” to discriminate against minorities in the regulation of commerce, and in all other matters within its purview. Their Constitution had no Equal Protection Clause. It was only the later Amendments that prevent Congress from doubling the premiums of minorities.

    There was absolutely nothing in the Framers Constitution making it unconstitutional to discriminate against minorities of any kind. Under their Constitution, there was nothing banning slavery, so there was clearly nothing to stop them from doubling the premiums of minorities.

    Under the Framers Constitution, Congress could have discriminated to its heart’s content on the basis of race, previous (and present!) condition of servitude, sex, religion, national origin, sexual preference, and any other basis, in its exercise of the Commerce Power and any other power.

    It is the Constitution, as later amended, that limits the powers of Congress. So how about analyzing the Constitution as amended, instead of continually harping back to the sacred, sainted founders?

    I just don’t like this contradiction, arguing that the Framers did not create unlimited power, and then ignoring the limits that were later added. It is high time to stop this rote invocation of the Elder Gods, Cthulhu, and the Great Old Ones. Mental telepathy is as mythical as astrology, notwithstanding the Calcutta Supreme Court, so one can read the minds of the Framers to discern their intent or innermost desires. The Framers wrote some broad and far-reaching words and we are by necessity bound by the meaning of those words, not by some imagined silent understanding. They left behind some writings that are deeply embedded in their 18th Century worldview, but it is the 21st Century now, and their writings are often ambiguous and only remotely related to present issues.

    Congress has enumerated powers to tax to pay for the common welfare, to regulate commerce, and to make necessary and proper laws for executing those powers. Of course, this power is not unlimited. There must be a rational basis for the laws that are enacted. The rational basis test means that unelected judges may not substitute their own policy predilections for the judgment of the people, as voted by their elected representatives.

    To those of you who want judges to make these calls, be warned that you may disagree with their personal views. If so, you will wait a long, long time to change the law, since the federal judges all have lifetime tenure (unless they take bribes).

    Congress has an election every two years. There is more than ample constitutional authority for the health care law. If you don’t like the law, then vote for new representatives.

  8. A few quick thoughts:

    The government has the power to tax you. The government has the power to provide benefits. The government can, and does, pay or contract with private parties to provide benefits. Sometimes, the government will even give individuals a choice as to which private provider to use when getting these benefits.

    The only real difference I can see between the situation I sketched out above and the mandate is a fig leaf of the government acting as a middleman. It may be that the fig leaf is constitutionally required, but to me it doesn’t necessarily make a lot of sense. The Constitution has been bent to pieces into the form it is now and the nation somehow still survives.

    Other than a brief mention by Prof. Turley, I haven’t seen much discussion about Wickard v. Filburn in this thread, and I think that might be useful to illustrate to the non-lawyers just how far the commerce clause can go. In that case, the Supreme Court held that the commerce clause can be used to regulate a farmer growing wheat, not to sell, but to use as feed for his own animals. In other words, his choice of whether or not to participate in commerce was pretty much shot to pieces. His choice not to buy wheat was irrelevant. The court wrote:

    “It is said, however, that this Act, forcing some farmers into the market to buy what they could provide for themselves, is an unfair promotion of the markets and prices of specializing wheat growers. It is of the essence of regulation that it lays a restraining hand on the self interest of the regulated and that advantages from the regulation commonly fall to others. The conflicts of economic interest between the regulated and those who advantage by it are wisely left under our system to resolution by the Congress under its more flexible and responsible legislative process.”

    One can disagree on whether Wickard was well-reasoned, but it is still the law of the land.

    Additionally, IMHO, the concern about lost Federalism is a largely a dead issue. Federalism has pretty much been dead for a while now, and I say good riddance. The states have whatever power the Feds let them have, and no more. I think history largely shows that this is a good thing. The Southern states abused the powers that they used to have, and the Senate is problematic in part because Wyoming has as much power as California. I think our country has moved past a point where Federalism is very useful.

  9. FWIW, I agree with Prof. Turley. Health insurers/insurance is and always has been regulated by the states. Citing ERISA is bogus. Saying that Romeycare is the constitutional equivalent of the Obamacare mandate is also bogus as Romneycare is state administered.

    We have to draw a line in the sand somewhere re the limits of the commerce clause and I agree with the Prof. that federalism means nothing when you use the commerce clause as a basis for upholding legislation which really has nothing to do with commerce per se but may affect commerce. What in this world doesn’t affect commerce?

  10. As I understand it Fried’s comments came in response to a question from Sen. Cronyn (R-TX). Fried’s statement that the HCR law is clearly Constitutional COULDN’T have been the answer Cronyn was looking for.

  11. raff:

    From your link”There are, of course, at least 39 other errors in Vinson’s opinion, but it really tells you all you need to know about the quality of his reasoning that he saw no problem with fabricating a facially absurd claim about American history that any minimally competent lawyer could debunk in less time than it takes to brew a cup of tea.”

  12. SwM,

    Finally got the link to work … my computer has been acting up, or out

    I wonder what the Judge was trying to say at the end of the article … he confused me

  13. J. Brian Harris, Ph.D., P.E.

    That was Bob,Esq’s quote … I’d like to take credit but am honor bound to give the author his due.

  14. Swarthmore Mom and eniobob, Thanks for the link to the case that was dismissed in Mississippi due to standing questions. The judge was appointed by George W. Bush. It will be interesting to see what happens when/if Plaintiffs refile.

  15. Blouise: “Truth be told, I can’t do it anymore … age plays havoc with the vocal cords but … I wonder if a recording would do ….”

    **** It will if it’s Memorex:

    [youtube=http://www.youtube.com/watch?v=Bkt8Dwzl6Sg&w=480&h=390]

    🙂

  16. RE: Blouise, February 3, 2011 at 12:20 pm

    [begin quote]
    A health insurance mandate is PREDICATED ON the mere existence of a living citizen. The mandate REMOVES ALL CHOICE from the individual per whether to engage in a particular form of commerce.
    [end quote]

    ################################

    I find, in every situation, I have a four way choice, I may approach the situation, may withdraw from the situation, may stay where I am, or may withdraw from all situations.

    For those who believe in fighting, the four choices become the classic fight, fight, freeze, and finish.

    Finish is always available, and so choice can never be taken away from a living person.

    In a world of cruel reciprocal retaliation, to finish is to embrace ultimate mercy.

    Every living person inescapably retains the choice of escape.

    There is more than one way to escape.

    One may escape by dying.

    Or else.

    I always escape the world of cruel reciprocal retaliation by choosing to never retaliate.

    I live in a world those who believe in cruel reciprocal retaliation evidently are incapable of believing really exists.

    Whether such a world really exists is now moot. I am here, and that world therefore exists here, because I am here.

  17. Health insurance is a completely different regulatory issue than auto insurance. If auto insurers refused to pay claims it would be known right away.

    With medical insurers there are many opportunities to imply that you are offering long term insurance but then get out of it. One way is simply to pull out of a state after a group ages.

    I think state insurance commissioners are totally incapable of regulating insurance companies. As an example of this, I followed a company in Colorado called TIC Insurance because they were itemized on some $29 K of attorney fee shifting bills I was ordered to pay on the basis that they insured attorneys and that attorneys have immunity in their role as advocates. I found that the State of Colorado listed them as active and approved to sell health insurance in Colorado. I google mapped the address and found that it was a single family home in Texas. Their only listed phone number was a residential cell phone.

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