Wednesday, July 06, 2011

Should It Matter What Powers Congress Invokes?

By Mike Dorf

Judge Sutton's concurrence in last week's 6th Circuit ruling upholding the individual mandate of the Affordable Care Act is so effective because, more than any academic or judicial writing concluding that the mandate is constitutional, Sutton's analysis credits the claimants as raising a real objection. He feels the full force of the argument for an activity/inactivity line but finds the argument lacking nonetheless. His reasoning will have credibility with conservatives on the Supreme Court--even though he couches his conclusion with qualifiers about his limited role as a circuit judge.

That said, I do want to take issue with one smallish point Judge Sutton makes en route to his final conclusion. In addition to voting to uphold the mandate under the Commerce Clause, he writes separately to explain why he thinks that it cannot be sustained as an exercise of the power to tax. Congress could have structured a mandate as a tax, but here it did not, Judge Sutton concludes. One factor he cites en route to that conclusion is the fact that Congress, in the Act, invoked the Commerce power but not the Taxation power. It's not clear how much weight Judge Sutton gives this factor, but I think it ought to be given no weight.

We could have had a jurisprudence in which, in order for a law to be a valid exercise of some power of Congress, the law would have to include a provision stating that Congress is exercising that power. But in fact we have no such jurisprudence. Let me give three examples, starting with the Uber-Case on enumerated powers.

(1) I start with McCulloch v. Maryland, in which Chief Justice John Marshall upholds the power of Congress to charter the Second Bank of the United States by invoking what he calls the "great powers," including:
to lay and collect taxes; to borrow money; to regulate commerce; to declare and conduct a war; and to raise and support armies and navies. The sword and the purse, all the external relations, and no inconsiderable portion of the industry of the nation are intrusted to its Government. 
Now notice that the Act of Congress creating the Second Bank does not invoke any affirmative powers. To be sure, the Second Bank was modeled on the First Bank, and the Congressional Charter of the First Bank did list reasons for granting the charter that can be tied to the powers that Marshall invoked in McCulloch. The First Bank charter recites that having a bank will be:
very conducive to the successful conducting of the national finances; will tend to give facility to the obtaining of loans for the use of the government, in sudden emergencies; and will be productive of considerable advantages to trade and industry in general . . . .
But even if we can map the First Bank charter's reasons onto the powers Marshall invoked in McCulloch, there is nothing whatsoever in the McCulloch opinion to indicate that Marshall thought formal invocation of a power by Congress was a prerequisite for sustaining an Act of Congress as falling within that power.

(2) The point is even more arresting in a much more recent case, Gonzales v. O Centro Espirita, in which the Supreme Court unanimously applied the Religious Freedom Restoration Act (RFRA) to the federal government less than a decade after having held that RFRA was invalid as applied to the states. What power did Congress exercise in passing RFRA as applicable to the federal government? The short answer, as Sarah Palin might say, is "you know, all of 'em."  That is, because RFRA requires certain religious exceptions to federal statutes, the authority for RFRA (as applied to the federal government) is whatever power justifies whatever  statute is yielding to RFRA in any particular case. Did Congress mention all of its powers in RFRA?  Certainly not. Yet that didn't bother the Court in O Centro one bit.

(3) To be sure, in O Centro the Court assumed but did not directly decide the constitutionality of RFRA as applied to the federal government. So consider last year's decision in United States v. Comstock, upholding a federal statute authorizing civil detention of certain federal prisoners after they have completed their sentences. The Court found the law necessary and proper to running its prisons, which in turn is necessary and proper to enforcing the criminal law, which in turn is necessary and proper to effectuating the powers that Congress exercised in enacting those criminal laws in the first place--like the power to create a Post Office (in the case of mail fraud), the power to regulate interstate commerce (in the case of bank robbery), and the power to establish intellectual property (in the case of criminal IP piracy).  Did the civil commitment statute in Comstock list "all of em" in a section of the law listing the powers Congress was exercising? Nope.  The statute didn't list any powers. Did the Court nonetheless uphold the Act? You betcha.

Thus, I think Judge Sutton is wrong to the extent that he suggests (and he only barely suggests) that Congress must invoke a power in order for that power to be available to sustain an Act. Perhaps if Congress specifically disclaims a power in the Act, then it cannot later come back and defend the Act in Court on the basis of that power, but if there is such a rule, I don't think the Court has clearly articulated it. (The closest the Court has come to doing so is in the somewhat different context of rational basis scrutiny of state laws, in the Nordlinger v. Hahn case, where the Court said that a legislative ruling out of a possible purpose for a law makes that purpose unavailable in future litigation.) In any event, despite language making clear that Congress did not want to call the penalties under the ACA a "tax," the ACA does not clearly disclaim the taxing power as a basis for sustaining it.


Crispian said...

I agree with you that there should be no principle that Congress must invoke a particular constitutional grant of power in order to defend it on that basis. And I recognize your point that the courts should be wary of going in that direction.

But I also don't think anyone is seriously proposing that principle. You appear agree on that point: Sutton "only barely suggests." I don't think Sutton suggests it at all, but uses it as one of many indicators of whether the mandate can be considered a tax. I can see the argument that this could be a distinction without a difference - but only by taking 'barely a suggestion' to an extreme conclusion.

But we could similarly bring your argument to its extreme conclusion and say the court should ignore expressions of congressional intent, especially the more passive ones.

In terms of analyzing the form and function of the mandate there are many reasons to not classify it as a tax. And no court has upheld the mandate under Congress's power to tax. I took Sutton's discussion of congressional intent as reinforcing the more substantive argument.

I have read elsewhere that Sutton's opinion could be particularly persuasive for conservatives on the Court, especially regarding the activity/non-activity argument. But there is seldom a mention of Judge Graham's dissent which also dismisses such a distinction while finding the mandate unconstitutional. Thus is seems to me that nature of activity need not be in any way dispositive.

Neil H. Buchanan said...

The individual mandate collects revenue for the government, and it deliberately changes the effective price of a person's decision about whether to buy a product. From the perspective of an economist, either of those things makes it a tax. Even as a formal matter, the mandate is collected by the IRS, through the income tax system. The only judges who have held that the mandate cannot be justified under the taxing power have said nothing more than "but Congress didn't call it a tax." To channel Justice Kagan's comments (from yesterday's DoL post): "Only one thing is missing from the Court’s response: any reasoning to support this conclusion."

BDG said...

Some of the district courts have gone further in saying that Congress expressly disclaimed reliance on the taxing power (the Florida and D.C. district cases, IIRC), so I think the express waiver question is worth thinking about some more.

I ducked this issue when I wrote about the district court opinions (since the Court holds in the License Cases that Congress doesn't have to invoke the taxing power to rely on it in litigation) but giving it some more reflection, I don't think that a Court that agrees with Boerne would buy the waiver argument. Waiver, I think, allows Congress in some respects to dictate to courts what the constitution means. It's also contrary to the principles of the avoidance canon: it can be a tool for forcing the court to decide a statute on a particular constitutional ground of Congress' choosing.

The due process/rational basis review setting doesn't seem analogous to me. The issue there is that the court is largely hunting for hidden discrimination. If a legislative body has already disclaimed a potential non-discriminatory purpose, it seems like as an evidentiary matter one can take them at their word. But that isn't what's happening with the taxing power.

Crispian said...

There was discussion of whether the penalty's purpose was the raising of revenue or merely served a regulatory purpose, Prof. Buchanan. See Judge Hudson's decision, p. 32-33.

Judge Kessler probably went the furthest in stressing the importance of Congress's invocation of Commerce Clause power, rather than taxation power. But she based her reasoning not on a bare invocation but the conscious decision of Congress to treat the penalty differently from taxes in the law.

Certainly one can take issue with these other elements of the legal analysis, but it is incorrect to say that they "'have said nothing more than "but Congress didn't call it a tax.'"

Michael C. Dorf said...

Crispian is right that Judge Kessler, Judge Hudson, and other judges who have rejected the taxing power have included some analysis about what Congress's intent was. But it's not at all clear why that should matter. When Congress passed the public accommodations provisions of the 1964 Civil Rights Act, its intent was to address a moral wrong--but it took the form of a regulation of commerce, and that was enough (as it had been, in principle, since the Lottery Case). Why should the taxing power be different? Neil's point--with which I agree--is that the effort to figure out whether Congress MEANT the mandate's enforcement provision as a tax should not be relevant. What should matter is whether it FUNCTIONS as a tax, in any substantial part. Otherwise, the analysis boils down to nomenclature.