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How the Commerce Clause Can Be Used Against Obamacare - Part III

Updated on May 25, 2012

This essay was written by Andrew Herzog, Dominic Dougherty, and Nicholas Caluda for the University of Dallas 'Legal Environment' class. It was compiled back in December, 2011. Part III of III

Commerce Clause
Commerce Clause | Source

Supreme Court Precedent

However, some do not accept the Framers’ argument that was just put forth, but instead insist that the Constitution is a living document and must change with the progressive and fast pace life of the modern era. Indeed, since 1937, the Supreme Court has supported this view and continued to interpret the Commerce Clause in much more broad and expansive view. This has given Congress the power to regulate many things that the Framers would have seen as intrastate commerce that should be regulated by the states. The government argues that the individual mandate is within the sphere of commerce that has been defined by Supreme Court precedent, and as such, it should be upheld. However, a history of the relevant Commerce Clause cases and the standards used to judge interstate commerce will show that this is not the case, and in fact, the individual mandate far exceeds any previous notion of interstate commerce.

Filburn
Filburn | Source

Wickard v. Filburn

The first case of relevance to the present inquiry is Wickard v. Filburn . This case involved the Agricultural Adjustment of 1938 and represents the peak of congressional power under the commerce power. The act gave the Secretary of Agriculture, Claude Wickard, the authority to tell individuals farmers how much wheat they could sell in order to stabilize the national economy. One of these farmers was Filburn, and he was told he could only grow 11 acres of wheat. However, he grew 22, and the government fined him for the extra acres. Filburn refused to pay and went to court seeking an injunction against the government. The case went all the way to the Supreme Court, and the Court upheld the governments actions by expanding the interstate commerce clause. The Court replaced the direct and indirect test that it had previously used and adopted the substantial effects test. This test effectively said that even though Filburn’s activity is “local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce” (Wickard v. Filburn ). To prove substantial effects, the Court used the aggregation principle, which states that a bunch of little independent things can be added up to show that the little thing does have an effect on interstate commerce. This represents the height of Congress’s power under the interstate commerce clause. It gives them the authority to regulate purely local activity simply because if all the local farmers are added up they would substantially affect interstate commerce.

Economic Vs. Non-Economic Activity

For the next 60 years the Court continued to expand the Commerce Clause based on the substantial effect test put forth in Wickard, and they allowed Congress to regulate everything from minimum wage laws to laws concerning discrimination in hotels and restaurants. However, in the 1990’s Congress went too far, and the Court was forced to say Congress had exceeded its commerce powers. In United States v Lopez , the Court dealt with a law that made it illegal to carry guns in school zones. The Court upheld the substantial effects test but made a distinction between economic and non-economic activity. They said all the cases before them had dealt with economic activity, and that this case does not fall into the category. Since the activity is non-economic in nature, the substantial effects test does not apply for two reasons. First, this regulation of criminal activity interferes with the policing power that is reserved for the states, and as such, disrupts the federalist system of government that this county has. Second, the Court pointed out that Congress did not apply any limiting principle to the bill. If they were to uphold this law, there would be no reason why Congress could not regulate any non-economic activity that they believed could substantially affect interstate commerce such as: marriage, child custody, divorce, etc. The new standards put forth by the Court were affirmed again in United States v. Morrison where the Court struck down a law dealing with violence against women. Thus, it seems that the Court has prescribed the outer limits of the Commerce Clause.

Source

Is the Mandate an Economic Activity?

It is with these three cases in mind that the examination of the constitutionality of the individual mandate must be examined. The first order of business is to decide if the individual mandate is economic or non-economic in nature so the proper standard may be applied. There can be no doubt that the health insurance industry can be regulated by Congress, for the system is almost universal and involves all the states of the union. People buy health insurance in one state and then move to the next state very often. This puts it in the realm of interstate commerce; however, this is not the final answer to the question. While the insurance industry may be interstate commerce, it remains to be seen if the individual mandate is in fact a legal regulation of commerce. The mandate requires that all Americans buy health insurance—meaning the activity that it is regulating is the decision to buy insurance. In all previous Supreme Court cases, Congress had only attempted to regulate ongoing and already existing activities. There is no ongoing activity taking place here. In fact, there is no activity. The person is choosing not to act, and thus, not exercising any economic activity that could be regulated by Congress. Therefore, it cannot be considered to be regulating economic activity as the Supreme Court has previously defined it. However, strictly speaking it is not non-economic either. The decision not to buy insurance is most certainly a financial one, and therefore, could be considered to affect the national economy and be economic in nature. Simply put, it seems that the individual mandate cannot be put under the non-economic or the economic category but lies in some sort of grey area in between. With this is mind, the constitutionality of the mandate is left to be decided by other Commerce Clause standards that have been developed by the Supreme Court—namely the Limiting Principle.

The Limiting Principle & the Mandate

In order to see if the mandate has a sufficient limiting principle that can be enforced by the Judicial branch, it is first necessary to discuses the nature of the mandate itself. In effect, the mandate is requiring that all Americans use their hard earned money to buy health insurance for the entirety of their lives. This type of mandate is unprecedented, and never before has Congress attempted to use its commerce power for such a broad and universal manner. The government is in effect saying that by the mere fact Americans have money that they could choose or not choose to spend substantially affects interstate commerce. If the Court were to uphold this logic, then there would be no limit to what Congress could tell you to buy. It would expand its commerce power to the point where it could direct all of the income of all American citizens to the things that it thinks they should spend on—whether this be health insurance or a new pair of tennis shoes. In Lopez, the Court refused to apply the aggregation principle because there was no limiting principle in the bill. If they would have upheld it, then Congress could have regulated any criminal activity, which is not a normal or proper object of interstate commerce. The same principles should apply here. There is no limiting principle in the bill, and the object that the mandate is attempting to regulate is an object that is outside the normal objects of interstate commerce; therefore, based on the Supreme Court’s passed interpretations of the Commerce Clause power, the mandate should be declared unconstitutional. Now, it is the Court’s prerogative to examine its past decisions and to build upon them or even change them if they think changing them would better reflect the Constitution. However, if the Court upholds its own case precedent, then the individual mandate should not be allowed to stand.

Obamacare
Obamacare | Source

In conclusion, regardless of whether Obamacare is examined from the Founder’s perspective or the progressive living constitution view, the individual mandate cannot be declared constitutional, and therefore, all of Obamacare must be ruled unconstitutional. The surrounding opinions support this view and it would be against the general will of the people to uphold it.

Sources

Hamilton, Alexander, James Madison, and John Jay. The Federalist Papers. Ed. Clinton Rossiter and Charles R. Kesler. New York, NY: Signet Class

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