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Health Insurance Mandate Now, Forced Loans Tomorrow?

The five and a half hours of oral argument before the Supreme Court this week are probably the most anticipated since the final days of the Watergate scandal. Barring a major unanticipated event, it will utterly dominate this week’s news out of Washington. Indeed people have been camped out since Friday in order to get one of the very few seats available to the public. (For those not inclined to sit on the street for three days to hear it directly, audiotapes of the arguments will be available each afternoon). A good summary of the cases and the players can be found here.

In 1974, as the nation hung on every word, the Court heard arguments in United States v. Nixon on July 8th, 1974, and on July 24th delivered its unanimous verdict (8-0, Justice Rehnquist, later Chief Justice, having recused himself because he had worked in the Nixon Justice Department). The verdict, denying the president’s power to assert executive privilege over tapes relevant to the case, doomed the Nixon presidency and led to Nixon’s resignation on August 9th. For those of us old enough to be around in those days, now nearly forty years ago, it was the great constitutional drama of our lives. (You can hear the oral arguments and the delivery of the decision here.)

The present cases don’t quite rise to that level, but they are crucial nonetheless. The American political landscape will be deeply affected by the Court’s rulings on this issue. Assuming the whole issue doesn’t run afoul of the Anti-Injunction Act, the subject of Monday’s argument, the crux of the matter is whether Congress, pursuant to its power (Article I, section 8)  to regulate commerce “among the several states,” can mandate that individuals enter into a contract with health insurance providers. This will be the argument heard on Tuesday. (Wednesday’s argument will deal with the severability issue, whether a judgment against the mandate would invalidate the whole law, or just that part of it. As a practical matter, the loss of the mandate would probably make the rest of the law unworkable.)

The mandate, forcing individuals to participate in commerce, is a breathtaking enlargement of federal power under the commerce clause. If Congress can mandate this under the commerce clause, what can’t it mandate? Can we be required to buy certain types of automobiles (about the only way the Chevy Volt, it seems, can be a commercial success)?

Or how about this for a scenario. Treasury securities circulate in interstate commerce, being bought and sold by the millions every workday. So, could Congress mandate that individuals purchase treasury bonds, bills, and notes, perhaps requiring that a certain portion of 401(k)s and IRA’s be invested in treasuries? That, of course, would be tantamount to a “forced loan.”  The Romans used that technique to help finance the Punic Wars. But when King Charles I tried it early in his reign it led directly to the Petition of Right of 1628, one of the fundamental documents that make up the British Constitution and deeply influenced our own. Indeed the Third, Fifth, Sixth and Seventh Amendments of the Bill of Rights derive directly from it. The U. S. Constitution does not, however, expressly forbid forced loans.

Argentina did this a couple of years ago, forcing citizens to convert the securities in their retirement accounts into government bonds.  The Chicago way has been bad enough the last three years, the Buenos Aires way would be a lot worse.



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