Political Spin and the Constitution

Oral arguments last week suggest an activist decision by the Supreme Court in the challenges to the Affordable Care Act. Indeed, in their response to the taxing power argument, the justices seemed poised to adopt a rather intrusive doctrine of policing political speech by elected officials. While some critics claimed that the mandate could not have qualified as a valid tax however it was characterized, the mandate has failed as a tax primarily because Congress called it a penalty and expressly disclaimed any intent to invoke its taxing power.

Consider, then, the following hypothetical version of the mandate's enactment. Suppose Democratic members of Congress discussed the taxing power as a source of authority and came to the incorrect conclusion that they could not use that power but instead had to use the Commerce Clause power to pass a valid mandate. They therefore called the levy for failing to carry insurance a penalty and disavowed any reliance on the taxing power, even though the levy was pegged at 2.5 percent of income (with minimum and maximum levies).

Should the Court really hold Congress to an inaccurate understanding of constitutional law? What would be the harm if the Court upheld the mandate as a valid exercise of the taxing power?

With the actual mandate, lower court judges were concerned about political accountability if Congress could pretend the mandate was not a tax when passing it and then call the mandate a tax when defending it. But how is political accountability compromised by the mislabeling? The public readily understood what was going on and very much held Democrats accountable in November 2010.

I understand the political reasons why Congress chose to invoke its Commerce Clause power rather than its taxing power, but the Court should not be in the business of rejecting statutes because Congress engaged in a good deal of spin when describing its actions.

[cross-posted at Health Law Profs]

Comments

[BDG]

Yes. One also has to appreciate the irony of Justice Scalia pointing to an interview on 60 Minutes as a source of interpretive guidance. Though I'd quibble (as I explained in the YLJO) with the suggestion that Congress didn't label the mcp a tax. For those interested, the amicus briefs of the Constitutional and Tax Law Professors (really, me & 4 other much smarter people) and of the SEIU make your point at greater length and depth.

[anon]

Is a "tax" paid to a for-profit, private corporation, like an insurance company.
We are speaking of the MANDATE, i.e., whether the Congress can order me to purchase a policy from a for-profit, private insurer, and punish me if I don't.
I suppose one could say that the penalty for speeding is a tax, too, right?

[TJ]

"But how is political accountability compromised by the mislabeling? The public readily understood what was going on and very much held Democrats accountable in November 2010."

That sound a lot like: "yes of course we tried to defraud you, but you saw through it, so don't complain." Not usually a persuasive argument.

And one can add that if there was no mislabeling, the Democrats might have been held even more accountable in November 2010 and beyond.

[anon]

TJ: "That sound a lot like: "yes of course we tried to defraud you, but you saw through it, so don't complain." Not usually a persuasive argument."
But see, the recent decision dismissing a case against a law school for misinforming prospective students.
I agree that the way that different considerations come into play when imposing a tax levy is a valid reason to make sure that a distinction is upheld between a tax and a fine.