-Submitted by David Drumm (Nal), Guest Blogger

Harvard Law School professor Einer Elhauge writes that the very first Congress, in 1790, passed a law that included a mandate that ship owners buy medical insurance, but not hospital insurance, for their seamen. That Congress included 20 framers and was signed by another framer: President George Washington. In 1792, Washington signed another bill, passed by a Congress with 17 framers, requiring that all able-bodied men buy firearms. In 1798, Congress, with 5 framers, passed a federal law that required seamen to buy hospital insurance for themselves.

Why weren’t these examples cited by the Solicitor General during his oral argument?

Randy Barnett, looks at the example of ship owners required to provide health insurance for their seamen. Barnett sees no substantive difference between the purchase of insurance and a regulation requiring the purchase of life preservers or life boats. Ship owners are in the business of commerce and this law regulates how that commerce is conducted.

However, ship owners are not in the business of shipping seamen. Ship owners are in the business of shipping cargo, which sometimes includes passengers. Life preservers and life boats are directly concerned with the shipping business. A regulation requiring that seamen be able to perform their duties would be tied directly to the shipping business. A regulation benefiting those seamen unable to do their work, is not.

Barnett also looks at the Militia Act that required persons to provide their own firearms and notes that this is not a “purchase mandate” since the guns could be gifts or borrowed or inherited.

However, the insurance mandate doesn’t exclude insurance that comes as a benefit from a employer, or insurance that is provided under a parent’s policy.

Two years ago, David Kopel points out that the 1798 law imposed a 20 cents per month withholding tax on a seaman’s wages. This revenue was to be turned over to the Treasury Department and used to support sick and injured seamen. Kopel notes that the 1798 law is a good precedent for programs such as Medicare.

Although Elhauge’s examples are not without problems, the arguments against the first two examples also have their problems.

While a single-payer system would have circumvented the constitutional issues, it would have never made it through Congress.

UPDATE:

Einer Elhauge Replies

Professor Randy Barnett is a good friend who deserves enormous credit for coming up with a creative constitutional argument that has commanded such attention.  But I don’t ultimately find his distinctions persuasive, and it isn’t because I like the health insurance mandate.  I am on public record calling it bad policy.  But that of course does not make it unconstitutional.

Although Barnett acknowledges that the early medical insurance mandates were exercises of Congress’ commerce clause power, he distinguishes them on the ground that they were imposed on actors who were in commerce, namely on shipowners and (in a third example he omits) seamen.  His distinction thus means that he admits that these precedents show that if one is engaged in commerce in market A – here the shipping market or the seamen labor market – then Congress has the power to impose a mandate to purchase in market B – here the medical insurance market – even though markets A and B are totally unrelated.  This concession conflicts with the argument of the challengers, which claimed that widespread activity in the health care market did not permit a purchase mandate even in the highly related health insurance market.  Indeed, this concession seems to make the whole action/inaction distinction collapse because the fact that no relation between the markets is required means that commercial activity in any market – say, the market for employment or food or housing – would permit the Obamacare mandate.  Because the Obamacare mandate applies only to those who have income that subjects them to income tax, it is necessarily limited to people who are active in some commercial market and thus his test would be satisfied.

On the gun mandate, Barnett offers two arguments.  First, he says it was different because it did not require individuals to buy guns if they got them from someone else.  But the Obamacare mandate similarly just requires you to have health insurance; you don’t have to buy it if someone else provides it for you, which is true for many who get their health insurance from the government or their employer, spouse, or parent.  Plus, the gun mandate required the self-provision of consumables like ammunition and gunpowder that required purchasing more than one was already going to use.

Second, Barnett says the gun mandate was different because it was an exercise of the militia power rather than the commerce clause power.  But I still think this misses the point.  As Judge Silberman held, the text giving Congress the power to “regulate commerce” on its face includes a power to mandate purchases given 1780s dictionary definitions of “regulate.”  To rebut this, the challengers have relied heavily on the notion that the unprecedented nature of purchase mandates allows us to infer the framers were against them.  This example shows there was no such unspoken understanding.  Nor does the text of the militia clause give much basis for a greater power to mandate purchases.  To the contrary, the relevant portion of the militia clause gives Congress the power “To provide for… arming ….the Militia,” that is the power to provide the militia with arms, which seems the opposite of forcing individuals to self-provide those arms.  If that text can be flexibly read to allow a purchase mandate, then such a reading is even more plausible under the Commerce Clause.

Moreover, even if the challengers do win on the Commerce Clause, the mandate must still be sustained if it is authorized under the necessary and proper clause.  Given that the challengers admit the constitutionality of the provisions that ban insurer discrimination against the sick and argue that those provisions cannot be severed from the mandate, it seems undisputed that the mandate was necessary to exercise Congress’ commerce clause power to ban such discrimination.  The challengers’ argument on the necessary and proper clause thus boils down to their assertion that purchase mandates are not “proper” – and these historic examples refute the notion that the framers thought there was anything improper about purchase mandates.

Finally, Barnett asserts that these are the only examples of federal purchase mandates.   Even if that were the case, they seem pretty telling given their framer involvement and they rebut the claim such mandates were unprecedented.  But in fact there are many other examples of federal purchase mandates. One federal mandate requires corporations to hire independent auditors. Another requires that unions buy bonds to insure against officer fraud.  Such mandates fit the mold of allowing activity in one market to trigger a mandate in a totally different market, and as noted above, if that is constitutional, then so is Obamacare’s individual mandate.

H/T: LGF, Eugene Volokh.