Paul L. Caron

Wednesday, July 11, 2012

Cooter-Siegel Article Foreshadowed Chief Justice Roberts' Taxing Power Decision

Following up on my prior post (Feb. 10, 2012):  Robert D. Cooter (UC-Berkeley) & Neil Siegel (Duke), Not the Power to Destroy: A Theory of the Tax Power for a Court that Limits the Commerce Power, 98 Va. L. Rev. ___ (2012):  SCOTUSblog, A Theory of the Tax Power That Justifies – and May Have Informed – the Chief Justice’s Analysis:

As Randy Barnett and Jeff Rosen have recognized, the Chief Justice’s tax-power analysis in NFIB v. Sebelius closely resembles a theory that we have been developing in conferences and online for two years.  Entitled “Not the Power to Destroy,” the paper was first posted on SSRN on January 23, 2012, and was subsequently discussed on Balkinization.  It is forthcoming in the Virginia Law Review.  The similarities in logic, citations, and rhetoric are striking.  The Chief Justice’s opinion applies two of the three characteristics that we use to distinguish taxes from penalties for constitutional purposes; stresses, as we do, that differences in characteristics cause different effects on individual behavior; and concludes, as we do, that characteristics and effects trump labels and congressional intent.  The Chief Justice cites some of the same sources we do, in the same way and at the same time.  The Chief Justice concludes by invoking the Holmes quote that is our paper’s title.  We offer a substantive, anti-coercion limit on use of the tax power that the Chief Justice adopts and that to our knowledge has not been offered elsewhere. ...

We may be wrong about all this.  The Chief Justice does not cite us.  Perhaps we have independently drawn the same conclusions from the same case law and knowledge of economics.  Regardless, our theory justifies almost all of his analysis of the tax power, as well as the decisive vote that he cast.

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Maybe the individual mandate came within the penumbra (that thing hovering around the 14th Amendment) of the power to tax so that was close enough to call it a tax.

Posted by: TexeEcon | Jul 12, 2012 9:48:57 AM

So, if the penalty is really a tax, how is it that the Court could rule on it before anyone had paid the tax?

Posted by: Woody | Jul 11, 2012 6:50:37 AM

The prolific Neil Siegel has posted a July 5, 2012, draft paper: "Distinguishing the 'Truly National' from the 'Truly Local': Customary Allocation, Commercial Activity, and Collective Action," that addresses the Commerce Clause issue that CJ Roberts challenged. Siegel makes a powerful argument challenging Roberts' challenge. (A link is available at the Legal Theory Blog.)

Posted by: Shag from Brookline | Jul 11, 2012 3:01:34 AM