Wednesday, March 2, 2011

Not all buy health care as commerce

Politico
By: Stephen Presser
March 2, 2011 04:41 AM EST

For former Solicitor General Charles Fried and Harvard legal scholar Laurence Tribe, President Barack Obama and members of Congress who voted for the health care law, health care ranks as “commerce.” Since Congress can regulate commerce — the Constitution expressly says so — and since the individual mandate contributes to that regulatory scheme, there can be no doubt of its constitutionality.

Indeed, former House Speaker Nancy Pelosi (D-Calif.), when questioned about its constitutionality, responded, “Are you serious?”

Given that Congress has passed Medicare and Social Security, and the courts acquiesced; and given that, since the New Deal, Congress’s commerce power has been used to regulate virtually everything — including home-grown wheat and marijuana — is there a respectable argument that the health care legislation is flawed? Were federal Judges Roger Vinson and Henry Hudson smoking some home-grown product?

There are many of us who don’t think so. And many of us believe that perhaps Fried, Tribe, Obama and Pelosi are misreading the Constitution.

The real question is whether the Constitution sets limits on the powers of the federal government. True, the Constitution permits Congress to regulate commerce, but the 10th Amendment also states that the powers not granted to the federal government are reserved to the states and the people.

This has been understood, for more than two centuries, to mean that the federal government is one of limited and enumerated powers. I cannot understand how Tribe’s and Fried’s arguments could not be invoked to allow Congress to regulate and control virtually any activity. This is the point that Vinson and Hudson were making when they ruled that a line should be drawn between “activity” (like growing wheat or marijuana) and “inactivity” (like deciding not to purchase health insurance).

The law’s critics have a point when they argue that if Congress can compel us to buy health insurance (on the grounds that if we all do, it can decrease costs), there is no reason why the legislature could not compel us, on the same theory, to eat our vegetables and exercise.

Perhaps health care is commerce — though Vinson was not sure on that point. Indeed, Fried, during his recent congressional testimony, quoted sweeping statements from Chief Justice John Marshall — though this was from a case involving navigable waters, not health care.

But the real debate is over whether we have a federal government limited in its powers or not.

For more than two centuries, our Constitution has been understood to mandate that the primary regulators — those who give us our laws on contracts, torts, property, business associations and many other legal doctrines — ought to be the state and local authorities. For those are the lawmakers closest to the people.

This, in essence, is the argument of the state officials who have joined in challenging the health care law.

This Jeffersonian principle still makes a great deal of sense. If there are any constitutional limits to the federal government that remain, then, quite possibly, Vinson and Hudson have gotten it right.

It is telling that advocates of the constitutionality of the health care law have not been able to tell us what limits on the federal government remain. Perhaps they have just accepted that the federal government is now all-powerful.

Some of us still don’t think so.

Stephen Presser is the Raoul Berger professor of legal history at Northwestern University School of Law and has joined in amicus briefs challenging the constitutionality of the Patient Protection and Affordable Care Act.

Monday, April 12, 2010

Why More Immigrants Are an Answer to the Coming Boomer Entitlement Mess

Robert Reich - former Secretary of Labor, Professor at Berkeley
I was born in 1946, just when the boomer wave began. Bill Clinton was born that year too. So was George W. Bush. So was Laura Bush. And Ken Starr (remember him?) And then, the next year, Hillary Clinton. And soon Newt Gingrich (known as "Newty" as a boy). And Cher. Why did so many of us begin getting born in 1946? Simple. My father was in World War II. He came home. My mother was waiting. Ditto for the others.

Sixty years later, we boomers have a lot to be worried about because most of us plan to retire in a few years and Social Security and Medicare are on the way to going bust. I should know because I used to be a trustee of the Social Security and Medicare trust funds. Those of you who are younger than we early boomers have even more to be worried about because if those funds go bust they won't be there when you're ready to retire.

It's already starting to happen. This year Social Security will pay out more in benefits than it receives in payroll taxes. The tipping point came sooner than anyone expected because the recession has kicked so many people off payrolls. But it was coming anyway. And it adds new urgency to reforming Social Security -- a task the president's commission on the nation's debt is focusing on.

So what's the answer?

Fed Chair Ben Bernanke this week listed the choices. "To avoid large and unsustainable budget deficits," he said in a speech on Wednesday, "the nation must choose among higher taxes, modifications to entitlement programs such as Social Security and Medicare, less spending on everything else from education to defense, or some combination of the above."

Bernanke is almost certainly right about "some combination," but he leaves out one other possible remedy that should be included in that combination: Immigration.

You see, the biggest reason Social Security is in trouble, and Medicare as well, is because America is aging so fast. It's not just that so many boomers are retiring. It's also that seniors are living longer. And families are having fewer children.

Add it all up and the number of people who are working relative to the number who are retired keeps shrinking.

Forty years ago there were five workers for every retiree. Now there are three. Within a couple of decades, there will be only two workers per retiree. There's no way just two workers will be able or willing to pay enough payroll taxes to keep benefits flowing to every retiree.

This is where immigration comes in. Most immigrants are young because the impoverished countries they come from are demographically the opposite of rich countries. Rather than aging populations, their populations are bursting with young people.

Yes, I know: There aren't enough jobs right now even for Americans who want and need them. But once the American economy recovers, there will be. Take a long-term view and most new immigrants to the U.S. will be working for many decades.

Get it? One logical way to deal with the crisis of funding Social Security and Medicare is to have more workers per retiree, and the simplest way to do that is to allow more immigrants into the United States.

Immigration reform and entitlement reform have a lot to do with one another.

Cross-posted from RobertReich.org

Friday, April 9, 2010

CBO chief says debt 'unsustainable'

POLITICO
By: Jonathan Allen
April 8, 2010 12:12 PM EDT

The nation’s fiscal path is “unsustainable,” and the problem “cannot be solved through minor tinkering,” the head of the Congressional Budget Office said Thursday morning.

Doug Elmendorf, best known for arbitrating the costs of various health care proposals, added his voice to a growing chorus of economic experts who predict dire consequences if political leaders don’t scale back spending, increase taxes or both — and soon.

Elmendorf noted a recent CBO report that pegged an increase in the public debt from $7.5 trillion at the end of 2009 to $20.3 trillion at the end of 2020 if President Barack Obama’s fiscal 2011 budget were to be implemented as written. As a percentage of gross domestic product, the debt would rise from 53 percent to 90 percent, CBO forecasted. The last time the percentage was that high was right after World War II.

Elmendorf’s remarks to reporters at a breakfast sponsored by the Christian Science Monitor echo the recent sentiments of a pair of Federal Reserve chiefs — the current head, Ben Bernanke, and former Chairman Paul Volcker.

Volcker said earlier this week that the U.S. should consider adopting a value-added tax, an idea he described as being less toxic than it has been in the past.

“If at the end of the day we need to raise taxes, we should raise taxes,” Volcker said.

On Wednesday, Bernanke said in a speech in Dallas that the government must cut entitlements or raise taxes.

“These choices are difficult, and it always seems easier to put them off — until the day they cannot be put off anymore,” Bernanke said.

There’s little apparent political appetite to do either.

While the president created a fiscal reform commission earlier this year, his budget calls for an extension of most of President George W. Bush’s 2001 and 2003 tax cuts and no major restructuring of the popular entitlement programs that constitute the lion’s share of the federal budget.

Elmendorf also defended his agency’s role in the health care debate, saying the back and forth between CBO and members of Congress over scoring different policy proposals is typical fare.

“I don’t think we were gamed,” Elmendorf said, describing the process on the health care law as “very similar” to that of other major pieces of legislation.

“I’m very comfortable with the numbers we released,” he said.

Saturday, March 27, 2010

An analysis of the constitutional challenges to the health care reform bill

A law school grad and writing colleague, Ryan Witt, just wrote a useful article that has topical importance for students:


Following the signing ceremony today health care reform is now the law of the land.  As Vice President Joe Biden put it this is a "big f**cking deal" as the legislation represents the largest overhaul of the health care system in over 50 years.  However as soon as the ink was dry from the President's signature some 13 states attorneys general filed lawsuits to have the legislation struck down.  All of Democrats efforts will be for naught if the federal court system nullifies the law because it is unconstitutional.


So is the bill unconstitutional?  The most honest answer is no knows for sure.  A law like this has never been passed and therefore no clear precedent applies. Georgetown law professor Randy E. Barnett seems to give credence to the constitutional challenges to reform but others such as Professor Timothy Jost at Washington and Lee University suggest the legislation is clearly constitutional.  So some very knowledgeable people have contrary opinions.

Here is a breakdown of what we do know about the Constitution as it relates to the legislation.

The Individual Mandate and the Powers of Federal Government

First the legislation does present a new case in that it proposes to force individuals to buy insurance from a private companies.  If individuals do not purchase insurance they will be fined approximately $700 or 2.5% of their income whichever is greater.  There are some exceptions granted based on religious objections and financial hardships.

Now there are some similar laws but nothing that goes quite this far.  For example states require individuals to have insurance in order to drive a car but if individuals do not want to obey that law they simply can chose not to drive.  Under health care reform everyone would need to purchase insurance.  People are also automatically taxed for Social Security and Medicare but these taxes are on income and not technically a fine for not engaging in some kind of behavior. 

However just because the federal government has never done something this does not mean that it is unconstitutional.  The Department of Justice is likely to point to many parts of the Constitution in defending the legislation.  Article 1, Section 8 proscribes the powers given to Congress.  The relevant powers in this case could be:



The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises

To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes

To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof"

The government's power to tax is generally interpreted very broadly by the courts so if the Obama administration was able to effectively argue the mandate was in fact a "duty" or "tax" the courts would probably approve the mandate.  Of course the state attorneys generals will argue the legislation does not fall under this power since a "fine" is different in nature than a tax.

The Department of Justice could also argue that the legislation is merely an attempt to "regulate Commerce."  The commerce power is certainly not unlimited but generally Congress can regulate anything which has a substantial relation to interstate commerce.  The Obama administration would have a strong argument here since health care makes up over one-sixth of the economic activity of the entire nation.

A Challenge Based on the Tenth Amendment

Idaho has already passed a law which states their citizens are not bound by the health care laws.  While this is likely a nice political tactic in general states can not simply exempt their citizens from federal law.  For example if Missouri passed a law exempting their citizens from the federal income tax the IRS will still be able to demand my payment next year.  Under the Supremacy Clause (Article VI, Clause 2 of the U.S. Constitution) federal law generally trumps state law.

A reader may have noticed how I emphasized the "generally" part of my last analysis.  There are exceptions to the Supremacy Clause rule.  If a power is considered "reserved" for the States under the Tenth Amendment then theoretically a federal law could be nullified if it conflicted with state law.

The problem for the attorneys general is that once again a regulation of health care seems perfectly within the federal government power either to tax or to regulate interstate commerce.  Given the vast nature of Medicare and Medicaid it will be hard for the states to argue that the regulation of health care is a power reserved solely for them.

A Challenge Based on the Fourteenth Amendment

The Supreme Court has interpreted the 14th Amendment as granting substantive due process rights to American citizens.  Basically what this means is that citizens have certain rights which are not explicitly enumerated in the Bill of Rights.  For example the Supreme Court determined a woman has a limited right to have an abortion based upon a right of "privacy" under the Fourteenth Amendment even though privacy is never explicitly mentioned as a right in the U.S. Constitution.

In order to challenge the health care bill a U.S. citizen would have to allege the bill violates a fundamental right they have as part of the "liberty" interest under the Fourteenth Amendment.  Generally something is determined to be a "fundamental right" if it is "deeply rooted in American history and traditions."  A claimant would have to identify a right such as "the right to make one's own health care decisions" or "the right to abstain from purchasing insurance."  They would then have to show that this right has been deeply rooted in American history and traditions.  The Department of Justice would of course argue to the contrary.

Even if the court agreed that a "fundamental right" was at issue the government could still argue the legislation is constitutional.  Even legislation affecting fundamental rights is constitutional if it is necessary to advance a compelling state interest.  The government would argue the individual mandate is necessary to meet the compelling state interest of providing affordable health care for all or something to that effect.  It would then be up to the court to determine which side was right.

The hardest step in this process would be convincing a court that a "fundamental right" was at stake.  Generally the courts are reluctant to create new fundamental rights since it opens the door to challenges of all sorts of other laws.  For example if a court determined an individual has a "fundamental right" not to purchase insurance it could lead to a challenge of automobile insurance laws among other things.

Conclusion:



Anyone who says they know for certain how the court system will rule on an issue this complicated does not know of what they speak.  Having said that the lawsuits that seek to have health care reform overturned are facing some long odds.  The Department of Justice has a large staff of experienced and qualified lawyers who have many credible legal arguments to make for the bill.  I have just scratched the surface of the legal arguments they are sure to come up with in defending the legislation.  A federal court is unlikely to declare such a bill unconstitutional without a really good basis for doing so.  Faced with such obstacles it is hard to imagine opponents of reform succeeding in getting rid of the law through the court system.

Thursday, March 4, 2010

The Real Problem with Politics is US.

Must Read

http://finance.yahoo.com/expert/article/economist/225007;_ylt=Av7AhADJGnqDIRs2LmDtEmi7YWsA;_ylu=X3oDMTFma2t0NDhnBHBvcwM0BHNlYwNleHBlcnRPcGluaW9uRHluYW1pYwRzbGsDdGhlcmVhbHByb2Js

Tuesday, February 23, 2010

EPA delays greenhouse gas curbs

By: Lisa Lerer
February 22, 2010 11:12 PM EST

Environmental Protection Agency Administrator Lisa Jackson reassured Democrats that the agency would take a cautious approach to regulating greenhouse gases, in a letter sent to coal state representatives on Monday.

An agency plan to regulate greenhouse gases from large, industrial sources has come under fierce criticism from Republicans, coal state Democrats, and industry groups.

Jackson's quick response is an attempt to keep Democrats from voting to veto the agency plan.

In her letter, Jackson said that no industrial facilities will be required to curb greenhouse gas emissions in this year. The agency would phase-in permit requirements starting in 2011. The smallest sources would not be subjected to permitting for emissions until 2016, she wrote.

But Jackson's statement didn't go far enough for some critics.

"While the delay in implementation is a small forced step in the right direction, the Clean Air Act continues to be the wrong tool for the job," Alaska Republican Lisa Murkowski said. "And [the] EPA's timeline continues to create significant and ongoing uncertainty for a business community."

Murkowski and three Democratic co-sponsors hope to bring a resolution to the Senate floor in the next month that would veto the EPA rule altogether.

West Virginia Sen. Jay Rockefeller is also currently drafting legislation that would suspend EPA action in order to give more time for Congress to act on a climate and energy bill.

"EPA actions in this area would have enormous implications and these issues need to be handled carefully and appropriately dealt with by the Congress, not in isolation by a federal environmental agency," he wrote in a recent letter to Jackson.

And last week, eight coal state Democrats signed a letter asking the agency to clarify its timetable and suspend regulations for industrial facilities until Congress can pass climate or energy legislation.

In December, the EPA officially declared greenhouse gases a danger to public health and welfare under the Clean Air Act. The decision, mandated by a 2007 Supreme Court ruling, forces to agency to begin regulating emissions across the economy.

The White House has repeatedly said that the administration would prefer to regulate the emissions through congressional legislation — but also notes that with no legislation in sight, the agency has no choice but to move forward with the new rules.

That decision has sent a broad group of actors across the political spectrum running to file petitions, lawsuits and legislation asking to suspend the regulations.

Mississippi Governor Haley Barbour, a Republican, lobbied his fellow governors to sign on to a letter to Congress asking lawmakers to pass a resolution stopping the agency from enacting "costly" regulations, at the National Governors meeting last weekend.

"While [the] EPA should offer input, complex energy and environmental policy initiatives, like greenhouse gas regulation, should be vetted and considered by Congress and States, not a single federal agency," wrote Barbour in a draft of his letter.


© 2010 Capitol News Company, LLC

Tuesday, February 16, 2010

The paper trail that lobbyists leave

How to read the government form that all lobbyists must file.
By Matthew Murray
Fewer players in Washington, D.C., during the past decade have inspired the collective public outrage than the registered lobbyist.

Former Rep. Duke Cunningham (R-Calif.) is now serving eight years in a federal prison related to his shady dealings with a defense industry lobbyist. The exploits of now-incarcerated GOP influence peddler Jack Abramoff are the stuff of K Street legend and the subject of new movie featuring Kevin Spacey.

And while all lobbyists certainly are not created equal — there are plenty of good and bad actors — a single government document unites them all: the lobbying registration form.

Created by President Bill Clinton and a GOP-dominated House 15 years ago, the document is filed by individuals representing the legislative interests of companies, trade associations, universities, nonprofit organizations, states and local governments.

On the form, which is filed with the Secretary of the Senate and searchable online, lobbyists are required to provide contact information for their firms and clients, as well the policy issues they will be discussing with lawmakers.

Lobbyists are also required to disclose whether they've previously worked on Capitol Hill or the White House and indicate if their clients are foreign owned entities.

Ethics lawyer Robert Kelner says that prior to passage of the Lobbying Disclosure Act of 1995, lobbying registration "had been not very effective and not very widely complied with."

The law also requires lobbyists to file reports every three months stating how much money they have been paid by their clients. Registered lobbyists are also required to file a third form, which, too, is searchable on the Secretary of the Senate's Web site, that lists their campaign and charitable contributions.

Kelner says the real intrigue about lobbying records is not about the forms themselves, but about who does and does not file them – and why.

The Covington & Burling lawyer says there is a complicated legal formula to test if an individual is required to register with the Senate. But its policing is largely self-regulated and some lobbyists are perhaps creative with the math.

"There are some obvious loopholes that have been around for a long time and are pretty widely used," Kelner said.

The first loophole entails lobbyists avoiding the reporting threshold altogether by arranging their calendar so that they don't spend more than 20 percent of their time for any one particular client involved in " lobbying activity", a vague classification of tasks that includes preparing for meetings and making phone calls.

"There are a number of people around Washington, D.C., who spend quite a lot of time overall doing lobbying but ensure that they don't spend more than 20 percent of their time for any one client for lobbying, they don't have to register," Kelner said.

Another common way lobbyists avoid registration requirements, Kelner says, is to simply give themselves a new job title and avoid reaching out directly to their former colleagues in the White House and on Capitol Hill.

Typically called "strategic advisors," this new breed of lobbyist – usually former Members of Congress or their senior staff – provide expensive advice to companies and trade associations about how to best make their pitch to the federal government.

"There are certainly a number of prominent people around Washington, D.C., who portray themselves as strategic advisors rather than lobbyists, claiming that they never make a lobbying contact," Kelner said. "In a lot of those cases, there's a very real question as to whether lobbying contacts are actually being made."

Matt Murray writes for Roll Call.