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Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, January 28, 2011

Galle Presents ObamaCare's Insurance Mandate and the Taxing Power at Charleston

Galle Brian Galle (Boston College) presents The Taxing Power, the Affordable Care Act, and the Limits of Constitutional Compromise, 121 Yale L.J. Online __ (2011), today at Charleston School of Law as part of the Federal Courts Law Review Symposium on Healthcare Law in the Federal Courts. Here is the abstract:

This brief essay responds to recent court decisions and scholarly commentary questioning the constitutionality of the Affordable Care Act. Criticism has focused in particular on the provision imposing a $695 penalty on those who fail to purchase qualifying health insurance.

I argue that, contrary to the courts and the commentators, this provision is valid as an exercise of Congress' power to lay and collect taxes. Although much has been made of Congress' use of the word "penalty" rather than tax, the Supreme Court has held since 1866 that Congress can invoke the tax power in litigation without using that term in the challenged statute. I also reject any normative arguments for rejecting that venerable rule as unpersuasive. In any event, the relevant section refers to the penalty it imposes as a "tax" 48 times.

More substantively, I argue that efforts to claim that the section would fall afoul of constitutional limits on "direct" taxes over-read those sections of the Constitution. Limits on direct taxes were the product of a compromise over slavery, and have no other obvious deep meaning. While we must honor the bargain that resulted in their inclusion in the Constitution, honor can be paid with a narrow reading that allows Congress, not courts, to make tax policy.

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The problem is that none of this describes what actually happened in the bill, which is that the Administration was able to get the insurance companies' support only by forcing private citizens to buy private insurance that they didn't want. It is as if the Government, needing the support of Major League Baseball for legislation, decided to require everyone to attend at least one game per year. Calling it a tax or a penalty may be a clever argument, or a good way to advance one's career; but it's unconstitutional just the same.

Posted by: mike livingston | Jan 28, 2011 7:08:27 PM