Everywhere I turned last week, it seemed someone on the Right was calling the “penalty” enforcing the Affordable Care Act a “tax”, and citing Chief Justice Roberts’ written Ruling as their evidence. George Stephanopoulos of ABC’s “ThisWeek” yesterday appeared to spend the entire show obnoxiously trying to make the case this is “a tax”, repeatedly citing the Roberts decision as “proof” (even laughing at one point at the idea anyone might think otherwise). It’s nonsense of course. The ruling makes no such claim. It DOES compare the penalty to a tax, and cites the AUTHORITY to impose a penalty as coming from the same place as the power of the Federal Government to “tax”, but never outright calls it “a tax”. In fact, Roberts goes out of his way to explain how a “penalty” is NOT a tax.
“So what?” I hear lots of people respond. “What does it matter if you call it ‘a tax’ or not? If it walks like a duck and quacks like a duck…”. I must have heard that metaphor a half dozen times. What does it matter? Plenty. It’s more than just a matter of semantics. As Senate Minority Leader Mitch McConnell pointed out on “Fox news Sunday” yesterday, the power of Congress to REPEAL “ObamaCare” using Reconciliation depends entirely upon whether or not the penalty is indeed “a tax”:
Senate Minority Leader Mitch McConnell, Fox News Sunday (6/30/12)
If Republicans are able to convince enough Democrats that the “penalty” is in fact “a tax”, then Congress can then legally use “Reconciliation” to repeal the entire law. And that’s what this whole “is a tax”/”is not a tax” debate comes down to: the power to repeal ObamaCare.
While the White House… and President Obama specifically… repeatedly denied accusations that the penalty is indeed a tax, lawyers defending the law before the Supreme Court used every argument available to them that the government does indeed have such enforcement powers, including that the argument that the AUTHORITY to levy “a penalty” is derived from “the same place” the government derives its “power to tax” (from page-1: “this penalty…shall be assessed and collected in the same manner” as tax penalties. §§5000A(c),(g)(1)”). And therein lies the rub.
Reading through most (but not yet all as of this writing) of Justice Roberts’ 150 page decision (pdf), the first 12 pages or so is dedicated to rebuking the White House claim that they have the authority to impose penalties under “the Commerce Clause” (a position Liberal justices, Kagan, Breyer and Sotomayor also rebuked), but then the Chief Justice clearly went to great pains to illustrate why the penalty is LIKE a tax, but in fact is NOT one. A few examples:
“Amicus contends that the Internal Revenue Code treats the penalty as a tax, and that the Anti-Injunction Act therefore bars this suit.” – page 12.
Translation: Roberts is noting that the Amacus pointed out that if this WERE a tax, the court didn’t even have the right to HEAR the case because Congress’ power to tax is unquestionable. The fact they even TOOK the case proves it’s not a tax.
“We have thus applied the Anti-Injunction Act [of 1867] to statutorily described [sic] “taxes” even where that label was inaccurate.” – page 13.
This is important, because he’s pointing out that, when they referred to “The Anti-Injunction Act” (the law restricting the Federal government’s power over state proceedings) to see if it applied in this case, the term “tax” was repeatedly used to describe things that were NOT taxes. Roberts is pointing this out for a reason: Not everything called “a tax” is in fact one. And why else point that out if he’s not suggesting the same goes here?
“In 1922, we decided two challenges to the “Child Labor Tax” on the same day. … [in the first] Congress called the child labor tax a tax … In the second case, however, we held that the same exaction, although labeled a tax, was not in fact authorized by Congress’s taxing power.” – Pages 33/34
What Roberts is pointing out here is that what someone “labels” something is irrelevant. What Congress called “a tax” in that second case, the Court decided was in fact not. “Labels” are irrelevant. It’s the Court’s job to rule based upon the ultimate “goal” of an action. This matters because five pages later, Roberts points this out:
“The joint dissenters argue that we cannot uphold §5000A [the "penalty" provision] as a tax because Congress did not “frame” it as such. … they contend that even if the Constitution permits Congress to do exactly what we interpret this statute to do, the law must be struck down because Congress used the wrong labels.“ – Page 39
THAT is why Roberts pointed out the irrelevance of “labels” five pages earlier. He then goes on to give an example of how the government could penalize you for not buying “energy efficient windows” (ibid). Roberts uses several examples throughout his opinion to reinforce his case.
(jumping ahead past those examples…)
“And the nail in the coffin is that the mandate and penalty are located in Title I of the Act, its operative core, rather than where a tax would be found—in Title IX, containing the Act’s “Revenue Provisions.”
For all these reasons, to say that the Individual Mandate merely imposes a tax is not to interpret the statute but to rewrite it. – PDF page 150.
Translation: Roberts is pointing out that if the penalty WERE a tax, the government would have included it in the section under “taxes”. They didn’t, thus supporting the governments good-faith argument that this isn’t… nor was it ever… intended to be a tax. And to claim otherwise you’d have to physically rewrite the bill to make it say that.
As I just illustrated, any claim that the Roberts Ruling declares the penalty “a tax” is… in his words… rewriting the bill. It doesn’t say that. President Obama didn’t lie (Chris Wallace, I’m looking at you) when he denied the penalty was a tax. And Roberts clearly went to great pains to make the distinction… as well as point out that even in those instances where he referred to it as “a tax”, it shouldn’t be taken literally.
On at least three occasions on ABC’s “ThisWeek”, Steph-O and panelist George Will cited use of the phrase “a tax, not a penalty” in Roberts’ decision as their proof the penalty is indeed a tax. And indeed, that phrase does appear on page 35 of the report. But (surprise, surprise), they took the quote completely out of context. Here’s what it ACTUALLY says:
payment may for constitutional purposes be considered a tax, not a penalty.”
It’s that word “considered” that makes all the difference. Roberts is not saying the penalty IS a tax, simply that for matters of juris pudence, it’s enforced the same way. Roberts uses the term “capitation” (fee for services) early on to make the distinction between a “tax” we pay on things we OWN like capital or property, vs “penalties” the IRS may put on certain behavior (like not paying our taxes. We don’t “tax” someone for not paying their taxes. We fine them. And unlike a tax that applies to everyone, the only people that pay a fine are those in violation of the law.)
And it’s a critically important distinction. Because if they can get enough members of Congress to “admit” it’s “a tax”, then Republicans have added incentive to get to the polls this November and vote in a Republican controlled Senate to begin the “Reconciliation” process to repeal “ObamaCare”. It’s all about the election and regaining control of the Senate. So if you weren’t particularly concerned about the Senate before, you damned well better be concerned now. You thought “contempt hearings against the Attorney General” by a Republican House were nonsense, just wait until they seize the Senate too. Not only would they waste the next four years trying to undo every piece of legislation of the last four (a coup by any other name). but remember what happened the last time we had a GOP controlled Congress and Democratic president? Years of multi-million dollar witch hunts (from Whitewater, to Postage-Gate, to eventually impeaching President Clinton for a dalliance that didn’t even start until LONG after the GOP investigations began.) Investigations that lead to the likes of Newt Gingrich in the House and
Henry Hyde (correction, “John McCain”. Hyde was also a hypocrite, but not a Senator) in the Senate (both cheating on their wives at the time) impeaching the president for lying about having an affair.
Do we REALLY want to go down that road again?
(POSTSCRIPT: Something I’ve been pondering ever since the verdict that I’d love some feedback on: Several states, such as Vermont, obtained waivers from The ACA [the Affordable Care Act] in order to establish Single-Payer programs in their own state. I’m wondering… while the Federal government agreed as part of The ACA not to establish its own competing Public Option in the National Exchange, what’s to stop Vermont from offering its own program in the Exchange of another state… eg: Texas… to compete with the private insurance companies, effectively creating a backdoor Public Option? The more people paying in, the more stable a state’s “Public Option” would become, so they have a financial incentive to attempt it.)
PPS: Uh oh! It looks like ROMNEY also believes the penalty is NOT a “tax”.
PPPS: Hmm, correction. Now Romney “agrees” with the Supreme Court that what President Obama did IS a tax, just not when he did it in Massachusetts (even though he called it one).
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