Obama Campaign Spokesman: It’s a Penalty, Not A Tax

Some of us were highly critical of the Roberts decision on health care — finding that the federal government could impose the individual mandate as a tax even if it could not be justified under the Commerce Clause. This followed the Court rejecting the tax status for the purposes of the Anti-Injunction Act and the fact that the Obama Administration — including the President — long denying that it was a tax. The Administration changed its position in court and argued that it was a tax, if the Commerce Clause did not sustain the mandate. That has produced a political backlash after the Court recognized it as a tax all along. However, now Obama campaign spokesman Ben LaBolt said that President Obama denies it is a tax and even denying that the Administration ever said it was.

In an interview with Soledad O’Brien, LaBolt was asked: “The Supreme Court has said it’s a tax. What does he believe?” He responded “That it’s a penalty. You saw our arguments before the Supreme Court…”

O’Brien:”So then he disagrees with the Supreme Court decision that says it’s now a tax?” O’Brien asked.

LaBolt: “That’s right. He said that it’s a penalty. You saw our arguments before the Court.”

When O’Brien correctly noted that Solicitor General, Donald Verrilli, argued before the Court that it is a tax, LaBolt says she is simply wrong: “It never referred to it as a — it never referred to it as a tax,” LaBolt said. “It said that it was a penalty. And that’s under the section of the law that is the tax code, but it said very specifically that it’s a penalty.”

This rhetorical fight is likely to increase with the campaign since the law was saved only by the Administration saying in court what it denied to the public. More importantly, it highlights in my view the problematic aspect of Roberts declaring this to be a tax — and endorsing a “functional” approach to taxation that allows the government to tax people to influence their choices or decisions. Ironically, LaBolt is agreeing with Scalia and the dissenting justices that this is clearly a penalty — a view that would mean the mandate was unconstitutional.

It is a curious position for the President — to take the win but deny the basis for it. It is a lot like winning Wimbledon and following the cup ceremony by noting that your winning shot really was outside the line. Notably, the Solicitor General is supposed to advance the arguments of the Administration — and ultimately the Chief Executive. Here the President is insisting that this is a penalty but his lawyer argued it was a tax. Verrilli would likely respond that the Justice Department is given the authority to frame the legal argument needed to sustain federal law. However, you appear to have both Congress and the President denying that this was ever a tax. In the very least, it will fuel criticism of Roberts who will look a bit foolish if neither the President nor his opponents agree that this was ever a tax.

Source: CNN

64 thoughts on “Obama Campaign Spokesman: It’s a Penalty, Not A Tax”

  1. “Judge Richard Posner was appointed to the bench by former President Ronald Reagan, and has earned a sparkling reputation as a conservative jurist. But Posner, a judge on the 7th U.S. Circuit Court of Appeals in Chicago, says the current incarnation of the Republican Party has driven him away from conservatism.

    In a candid interview with NPR Thursday, Posner opened up about what he sees as a “real deterioration in conservative thinking” over the last decade.

    “I’ve become less conservative since the Republican Party started becoming goofy,” Posner said.

    Posner’s remarks are likely to delight the left, although this isn’t his first liberal embrace. Early in his career, he served under liberal lions such as former Supreme Court Justices William Brennan and Thurgood Marshall, but Posner veered toward the right after he began teaching at Stanford Law School in the late 1960s. Since his 1981 nomination by Reagan, he has become one of the most widely respected conservative judicial thinkers and one of its most prolific writers. He is a lecturer at University of Chicago Law School and has written dozens of books on law and economics. In recent years, however, Posner has grown disillusioned with his erstwhile allies on the right.

    The latest bit of right-wing goofiness to draw Posner’s ire: the speculation over the Affordable Care Act decision. Posner called the conspiracy theories that seek to explain Chief Justice John Roberts’ opinion to uphold the law a “very serious mistake” on the part of conservatives. Roberts, Posner suggested, might also realize that he has no home on the right.

    “I mean, what would you do if you were Roberts?” Posner said. “All the sudden you find out that the people you thought were your friends have turned against you, they despise you, they mistreat you, they leak to the press. What do you do? Do you become more conservative? Or do you say, ‘What am I doing with this crowd of lunatics?’ Right? Maybe you have to re-examine your position.”

    Posner has spoken out recently against other conservatives on the court, namely Justice Antonin Scalia. After Scalia’s fiery dissent in the Arizona immigration case, in which he took aim at President Obama, Posner wondered whether Scalia was becoming a political actor Slate: “It wouldn’t surprise me if Justice Scalia’s opinion were quoted in campaign ads.” TPM

  2. Mike S.:

    I read your message about the laptop cord and the research. I hope I didn’t compel you to a big research project on this. just was interested in your views which are appreciated.

  3. Barkin:

    “Our Tea Party folks would have been fighting with George at Valley Forge. King George, not George Washington.”


    Pun of the day!

  4. We have Tea Baggers here where my dog pack lives that wont go to Piggly Wiggly because it is integrated. Our Tea Party folks would have been fighting with George at Valley Forge. King George, not George Washington. Where would Willard Romney have been at Valley Forge days? With Washington or sitting in Philly with the Redcoats and Bain Captitalists? Ask that about any Tea Bagger out there yelling “Dont Tread On Me!”. Ask Rand Paul (named after Ann Rand) if he frequents the Piggly Wiggly out in KY.

  5. BarkinDog here. My pal (one never calls a human pal and owner) says that if Romney wins he will abolish Obamacare and that he is moving back to Massachusetts. I aint going because I dont believe in vets and vets are not covered by RomneyCare anyway. I am stickin with the Pig (worm pills from the Piggly Wiggly).

  6. BettyKath and Rafflaw, et al.

    I thought the purpose of the penalty/tax was to defray cost of comverage to those who pay a tax. Aren’t taxes supposed to in principal be used for a program for the benefit of the general public, even a given segment of the public, ie road users, students, etc.

    My conception is perhaps completely wrong. The size of the penalty7tax would be an indicator—-ie does it match the expected costs over the lifetime of the insuree, or is it just an incentive to buy insurance, being instead an extra burden but not sufficient as a cost defrayer

    Can you two help me there?

    It depends on the laws formulation and the use of the tzx/penalty as defined there. And since like Scali, I haven’t read the law…….

  7. SnuggleDog is a guy in our dog pack. He works with a blind pal who lost his eyesight in the left eye when the retina detached and he was in need of some small surgery procedure done in the doctor’s office. But they wanted $20,000 up front to do the operation and he had no insurance. So he went blind in one eye. He works part time pruning bushes for a landscaper and essentially has one client who owns this huge estate on the waterfront. By irony or choice not an echo it turns out the owner of the three million dollar house with bushes is a surgeon. The dog pack started poopin in there when we found out the story.

  8. bettykath,
    that is why I was suggesting that the ACA and the state exchanges could be a good start towards a single payer system.

  9. my understanding is that the Canadian system came about province by province. One put it in place (can’t remember which one), then another. At some point, it was adopted at the federal level. I think the only way we’ll get single payer is the same way, one state at a time. I think that VT might be the first.

  10. BB,
    I will repeat myself. Most people would prefer a single payer system, but there was no way that a single payer system would have made it through the Congress.

  11. Barking dog “ObamaCare is a choice of the Dems not an echo of RomneyCare.”


    “Romney is struggling to distance himself from the health-care law he passed while governor of Massachusetts, and no wonder—the state and federal plans are virtually identical. ”

    Just 2 I found quickly (and can;t give more then 2 links here I understand)

  12. Swarthmore mom 1, July 5, 2012 at 11:53 am

    Romney’s problem is that he pays so few taxes…….way too many off shore investments.
    And way too many loopholes.

  13. 707
    “Do we want a single payer system?

    Game this system so it becomes one.”
    “Government will do it like they now do with Medicare and Medicaid. Only instead of the current millions covered, we ALL can be covered by the penalty/tax alternative.”

    The penalty/tax provides insurance for those who don’t buy it?

  14. The Canadian system started like this o maybe we can get to the single payer dwn the road.

    That would be nice, Rafflaw, but I wouldn’t hold my breath (though if intentions counted, I believe yours would go a long way in getting us there). Meanwhile, at least in terms of accuracy, it is simply embarrassing to compare the ACA with what they have in Switzerland. They have no more similarity than the New Deal does to the Cat Food C omission.

    Note that my biggest point is that it all really comes down to how you start out and Switzerland started out from day one with a bona fide health care system. We are starting out from day one with a way to save the insurance industry since they can no longer find enough people willing to buy their product at those prices with out coercion.

  15. No one would disagree that a public option would be preferable, but there was no way that was going to pass. The Canadian system started like this o maybe we can get to the single payer dwn the road.

  16. Healthcare in Switzerland is similar to Obamacare the way night is similar to day. In Switzerland, it is under strict government control and has been since it started in 1994. Insurance companies are not allowed to make a profit for normal policies.

    A simple Google search will turn up myriad results outlining the same basic difference between government encouraged profligacy for corporate entities and a health insurance system for people. As with the New Deal, the way you start out is pretty much the way you end up. The health care system we are embarking on started out in a Republican think tank. One may accurately remark we are not starting out with ANY kind of public option, not even a weak watered down one:

    The following description of the Swiss health care system from Wikipedia should suffice to discriminate between the two:

    To compete in the market for compulsory health insurance, a Swiss health insurer must be registered with the Swiss Federal Office of Public Health, which regulates health insurance under the 1994 statute. The insurers were not allowed to earn profits from the mandated benefit package, although they have always been able to profit from the sale of actuarially priced supplementary benefits (mainly superior amenities).
    Regulations require “a 25-year-old and an 80-year-old individual pay a given insurer the same premium for the same type of policy..Overall, then, the Swiss health system is a variant of the highly government-regulated social insurance systems of Europe..that rely on ostensibly private, nonprofit health insurers that also are subject to uniform fee schedules and myriad government regulations.


  17. “Twenty years ago, Switzerland had a system very similar to America’s–private insurers, private providers–with very similar problems. People didn’t buy insurance but ended up in emergency rooms, insurers screened out people with pre-existing conditions, and costs were rising fast. The country came to the conclusion that to make health care work, everyone had to buy insurance. So the Swiss passed an individual mandate and reformed their system along lines very similar to Obamacare. The reform law passed by referendum, narrowly. The result two decades later: quality of care remains very high, everyone has access, and costs have moderated. Switzerland spends 11% of its GDP on health care, compared with 17% in the U.S. Its 8 million people have health care that is not tied to their employers, they can choose among many plans, and they can switch plans every year. Overall satisfaction with the system is high.” Fareed Zakaria

    Read more: http://www.time.com/time/magazine/article/0,9171,2109128,00.html#ixzz1znALWIal

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