Comments on NFIB v. Sebelius

So AFA (Obamacare) is legal because it's a tax. I've seen lots of opinions on this but nobody has brought up what I find to be the most interesting open question. To get to the question I'm interested in, I'd like to go over the history of the bill as it relates to this decision.

Both Congress and the President insisted at time of passage, and many of them still insist, that what the bill does is make it illegal to not buy healthcare with a fine if you disobey the law.  They did this for several reasons including the fact that they had promised not to raise taxes, that the bill couldn't make it back through the House (where tax bills must start) so it was less Constitutionally suspect starting in the Senate if it didn't contain taxes, and that behavioral economics make it more likely that people will avoid a fine than a tax.

The Supreme Court decided that Congress doesn't have the power to do this. But that's okay, that's not (according to the Supreme Court) what Congress and the President really did. The majority on the Court decided that what the bill really did (in spite of the text of the bill to the contrary) was add a tax on people who didn't buy insurance. This is Constitution because of the taxing power. But wait, where is the taxing power in the Constitution?

Article 1, Section 8 The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States

Congress doesn't have the power to lay and collect taxes as a penalty for something it dislikes.  It can only do it to pay for things.  There's a long established ability to exempt people from taxes for arbitrary reasons (thus the mortgage deduction, credit card interest deduction, charitable deduction...) but to my knowledge there's never been a federal tax raised specifically to discourage behavior the feds don't like.

So clearly Congress could have written a bill that raised everyone's taxes by $1000 and then gave an exemption to those who purchased insurance.  The question is if that's actually what they did.  Congress argues they didn't.  The President argues they didn't.  The minority on the Supreme Court argues they didn't.  The US Attorney who argued for Obamacare argued it was a tax, but not that it was really a deduction.  Even the majority on the Court doesn't actually argue they did, but it's the only Constitutionally consistent way to interpret their decision.

I should note that lots of commentators (like the one above) think the fact that the people who favor the bill still argue that it's not a tax even though the only reason it's Constitutional is that the Court decided it is.  There's good precedent for that.  The Roosevelt administration argued in Helvering v. Davis that Social Security is just a tax, not actual contributions, which is the only reason it was declared constitutional, but there are still very few arguments that the government doesn't have an obligation to pay you back.

Flags

When used on a speaker's platform, the flag, if displayed flat, should be displayed above and behind the speaker. When displayed from a staff in a church or public auditorium, the flag of the United States of America should hold the position of superior prominence, in advance of the audience, and in the position of honor at the clergyman's or speaker's right as he faces the audience. Any other flag so displayed should be placed on the left of the clergyman or speaker or to the right of the audience.


14 USC § 7(k)


It's not that hard.

Student Loans

The student loan debate currently being pushed to the forefront by President Obama is like the rhetorical gift that keeps on giving.  I could write pages on the interesting facets of this, but I'll start with the basics:

In 2008 the Democrat controlled House and Senate passed, and President Bush signed, a law lowering the interest on Federally backed student loans from 6.8% to 3.4% for 5 years.  Those 5 years expire this year and so presently the President is going around talking to college campuses about how he wants to stop the Republicans from raising the interest rates and how he understands the plight of these poor college students having to pay on their student loans because he and the First Lady just paid off their loans 8 years ago.  Romney and the House Republicans (lead by Boehner) also want to extend the lowering, but Boehner wants to "offset" the cost by reducing the expenditures in Obamacare.

There are so many interesting quirks to this it's hard to see where to start, but I think I'll pick the fact that this shows us how invasive a "temporary" program is.  I didn't really follow this particular debate in 2008, but I'm sure there were 10 year budget projections showing what this cost, under the assumption that it only lasted 5 years.  But now, 5 years later, the debate isn't about lowering student loan income, it's about preventing it from going up.  Both politicians and commentators frequently take the sunset clauses on these "temporary" programs seriously.  They shouldn't.  If it was a good idea to lower student loan interest rates, it should have been done in perpetuity (the same is true for the Bush tax cuts).  The only difference between cutting student loan interest rates (or taxes) for 5 years and forever is that you get to debate it again in 5 years with a "temporary" program, and blame the other side for wanting to go back to the status quo ante (even though that's actually what you agreed to do when you created the program).

The second interesting thing is that the President's student loans dragged him down so much that he couldn't pay them off until just 8 years ago.  After he had bought a condo (and a house) and "should have been saving for [his children]".  Obama received a $100,000 advance for the publication of his first autobiography while he was still in law school.  For the last 5 of those years the Obamas were making well over $200,000.  For two of them they were making enough to be the "super rich" that aren't paying their fair-share of taxes.  There are two possibilities here, neither of them very favorable for the President. The first is that despite being "super rich" (by his own definition) he really didn't have enough money to pay off his student loans.  That eviscerates his argument (which he has been continuing to make at these taxpayer funded campaign speechs at Universities) that those over $250,000 are just throwing away money and need to be giving more in taxes.  The other is that, despite having an abundance of discretionary income, he chose not to pay off student loans because the opportunity cost favored keeping them.  I suspect this what really happened.  He had a student loan at around 6% (this is before the rates were lowered in 2008) and he could make more money on that money than he was paying in interest (and he certainly couldn't get a loan that low) so he didn't see any point in aggressively paying it off the way you would, say, a credit card.  This destroys his argument for artificially cutting the rate in half from what was already so cheap he chose to keep it around when he didn't have to.

The third, and most disturbing, interesting thing is the games the Republicans are playing here. When the Democrats created Obamacare they took some of the easier-to-cut sections of Medicare and slashed them to make the budget work.  I made the argument at the time that this was like renegotiating a mortgage that was going to bankrupt me and then turning around and spending the "savings" on credit cards.  This is exactly what Boehner wants to do here.  The Republicans have been arguing since it passed that we can't afford Obamacare.  And we can't.  Now we have a Republican Presidential candidate who has committed to dropping Obamacare completely, a Supreme Court case that many people consider likely to throw the entire bid out as unconstitutional, and a Republican Congress that says it's still unconstitutional and we can't afford it, but we can cut some of the money we don't have out of Obamacare and use it to pay for another bad idea.  Obamacare is a bad idea, and we ought to throw it out, but "saving" money by not funding certain care items while keeping the rest of the restrictions and regulations and then spending the "savings" on another bad idea is an even worse idea.

There are a bunch of other issues particular to the way student loans are subsidized and how this contributes to the rapid inflation of education costs, the fact that through this program a 25 year-old plumber gets to pay the bank 6% for the loan on his truck and tools and subsidize the 3.4% (higher risk profile) loan for the education of a 25 year-old lawyer, or the question of why the Federal government is involved in education funding at all, but I'm honestly not as interested in the standard issues with student loans as the politics of the rhetoric itself.

Laws

The internal effects of a mutable policy are still more calamitous. It poisons the blessing of liberty itself. It will be of little avail to the people, that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood; if they be repealed or revised before they are promulgated, or undergo such incessant changes that no man, who knows what the law is to-day, can guess what it will be to-morrow. Law is defined to be a rule of action; but how can that be a rule, which is little known, and less fixed?

Another effect of public instability is the unreasonable advantage it gives to the sagacious, the enterprising, and the moneyed few over the industrious and uniformed mass of the people. Every new regulation concerning commerce or revenue, or in any way affecting the value of the different species of property, presents a new harvest to those who watch the change, and can trace its consequences; a harvest, reared not by themselves, but by the toils and cares of the great body of their fellow-citizens. This is a state of things in which it may be said with some truth that laws are made for the few, not for the many.

In another point of view, great injury results from an unstable government. The want of confidence in the public councils damps every useful undertaking, the success and profit of which may depend on a continuance of existing arrangements. What prudent merchant will hazard his fortunes in any new branch of commerce when he knows not but that his plans may be rendered unlawful before they can be executed? What farmer or manufacturer will lay himself out for the encouragement given to any particular cultivation or establishment, when he can have no assurance that his preparatory labors and advances will not render him a victim to an inconstant government? In a word, no great improvement or laudable enterprise can go forward which requires the auspices of a steady system of national policy.

But the most deplorable effect of all is that diminution of attachment and reverence which steals into the hearts of the people, towards a political system which betrays so many marks of infirmity, and disappoints so many of their flattering hopes. No government, any more than an individual, will long be respected without being truly respectable; nor be truly respectable, without possessing a certain portion of order and stability.

-- Federalist 62 (emphasis added)

Nominating process

There's all sorts of talk right now about whether the slowed-down nominating process the Republicans put in place in 2008 was a good idea. I don't care. I'm more interested in the brokenness of the process in general. I'm pro electoral college (and, in fact, think we ought to have some of the electors sent there by state legislatures like we used to do with Senators) so it may come as a surprise that the non-representative nature of the nominating process really bothers me. The problem is that the electoral college was designed to give some relief to the less populace states in our federation on the choosing of the President. That makes sense. The nominating process doesn't seem designed at all.

At present nearly 10% of Romney's delegates are from territories that don't get to vote for President. I'm actually opposed to our permanently retaining territories that are never going to become states, but if the purpose of the nominating convention is to win the Presidency, do we really care what people who can't vote for President think? I'd be okay with in if they got some nominal vote, but the people of the Virgin Islands and the Northern Mariana Islands together get as many votes as New Hampshire (which, admittedly, has an oversized influence because of when it votes).

Only fourteen of the 60 States or districts who have primaries or caucuses are closed. In the rest either Democrats can help select the Republican representative (I'm sure they will have only the best interests of Republicans in mind) or you have to at least not be party affiliated. Though if you're in a semi-closed state the chance you're going to register with a party is pretty much zero. I would not only have closed primaries, I would require that you have been registered with the party for at least two 30 months.

California and New York, states where the Republican nominee is guaranteed zero electoral votes, are two of the three largest delegations to the convention (Texas is number 2). On top of that nearly half of the California and New York delegates (123 out of 261) come from districts that are 60% or more Democrat. According to Sean Trende at Real Clear Politics, 8 districts from Los Angeles County cast just barely more votes in the 2002 Gubernatorial primary as a single majority-republican district. Yet they would get 8 times as much influence in the nominating process. To make matters worse, California is an open primary, so nobody is checking whether the delegates from Nancy Pelosi's district even reflect the desire of the Republican who lives there. I'm not saying we shouldn't care about these people's voice in the primary, but we shouldn't care a lot more about Republican's in Nancy Pelosi's district than those in Paul Ryan's.

On the flip side, the current procedures give extra bonus delegates to majority Republican states. Unlike the issues with allocating delegates based on general-population district lines that in lots of cases were intentionally drawn to polarize towards one party or the other, I can see why this makes sense. The nominee is supposed to be somebody who represents the will of the Republican electorate, so it makes sense to give bonuses to majority Republican states. But the nominee is also supposed to be somebody who can actually win the Presidency. Given that the important thing is winning the electoral college in the fall, wouldn't it make sense to give similar (or even greater) bonus delegates to the states with the closest elections in the past Presidential election? Hugh Hewitt has recommended at least once having the nominee determined only by the closest states. That seems like a recipe for a splintered party to me. It's one thing to give extra credit to electorally important states, it's another entirely to say to Texas or Georgia that the party doesn't care what you think, we're going to find a moderate who does well in Ohio and Pennsylvania.

We also have a bunch of unbound delegates who got their position through some previous party position. I actually don't have a problem with these. The "super delegates" bring some of the horse trading in order to get the desires of various factions of the party fulfilled while finding the most likely candidate to actually secure the election into the convention. If it's a close call, that's a role I don't mind seeing.

If I were head of the primary process, I would allocate votes among the states based on the number of popular votes they cast for the Republican in the prior election. Then I would give a bunch of extra votes to the 4 closest states. The national convention needs some way of allocating votes within states other than congressional districts which are drawn based on general population and frequently drawn to intentionally skew towards one party or the other. I would suggest something like forcing proportional distribution based on the entire states' returns. I would love to draw districts, but you would need special districts established for the purpose if you wanted to fairly district among just one party, and that doesn't seem practical.

Obama is right

In a post on PowerLine, John Hinderaker started a firestorm on conservative blogs this morning by pointing to (and dismantling) Obama's claim that he "would put our legislative and foreign policy accomplishments in our first two years against any president — with the possible exceptions of Johnson, F.D.R., and Lincoln".

I must say, Obama is right. The standard consistently used to judge Presidents in rankings is something along the lines of how much lasting change they have made to the structure of the Union. This is completely consistent with Obama's worldview (which you would expect, because those rankings are put together by progressive intellectuals). So the economy may have been much worse when Reagan took office and much better at this point in his Presidency, but that's immaterial. Harding took a deflationary depression and turned it completely around within 3 years but consistently appears in the bottom of Presidential rankings. FDR managed to keep the Great Depression going for a decade, but always appears at the top. If you listen to a progressive academic, and Obama has spent his life listening to progressive academics, Presidents aren't measured by how well the economy does.

A much bigger deal than is being reported

Last night, in order to avoid voting on Obama's jobs bill, Harry Ried changed the rules of the Senate to disallow the introduction of amendments after cloture is invoked. This is an arcane bit of Senate procedure, but the important point to take away from this is that the rules have been changed by a simple majority to prevent the minority from exercising a power they usually possess. This is exactly what I urged the Republican senate to do to allow votes on circuit court judges to pass with a majority, but they were unwilling to do because once Pandora's box is opened the procedure could be used by Democrats in a future Senate. I argued at the time, we now know correctly, that this was irrelevant and Democrats would change the rules as soon as it became convenient.

In light of this, I'd like to propose two changes to the Senate rules for the new Republican majority in 2012:

1) Allow appointments to pass by simple majority. First off, this is extremely politically advantageous, because Republicans tend to accept any judge who is qualified as a matter of training and experience, even if they dislike the positions they take, while Democrats reject any judge whose philosophy they disagree with, so Republican presidents have much more difficulty getting their nominees through the Senate. But secondly, I think the current position is unconstitutional. The Senate can do whatever it wants to its procedures for introducing new legislation, but appointments are an executive power that merely requires Senate "consent". The Senate should not allow itself to withhold consent if the majority of its members agree.

2) Allow any repeal bill to pass with a simple majority. As I stated on my post on Heinlein, giving a power to the government necessarily entails a restriction on personal freedom, and we shouldn't need a super majority to give that freedom back. (This also has convenient side effect that it makes repeal of Obamacare almost guaranteed)