Commentaries

Tax Reform

Savings, Retirement and Social Security Reform

Contributing Members Commentaries

Investor's Business Daily
July 3, 2012
By Ernest S. Christian

What is with Chief Justice John Roberts? Has he all along been a closet lefty finally forced to show his hand to save ObamaCare?

If so, why didn't he join with the four openly liberal justices on the court in what would have been a 5-4 decision upholding President Obama's buy-insurance-or-else mandate under the ever-elastic Commerce Clause, thereby infinitely expanding Washington's power to make us do whatever it wants?

Instead, he and the four conservative justices in a 5-4 decision refused to expand the reach of the Commerce Clause to accommodate Obama's mandate. Hooray! If the government can force people to buy a product, in this case insurance, there would then be no discernible limit on what else it might require in the name of regulating interstate commerce.

For one brief shining moment, Roberts stood tall, protecting Americans' liberties from the ultimate regulatory coup de grace advocated by Obama.

But then, in a maneuver that left the four conservative justices astounded and sputtering, Roberts turned around and joined the four liberals in a second 5-4 decision (opinion by Roberts) that upheld enforcement of the unconstitutional insurance mandate as a tax.

He thereby infinitely expanded Washington's power to control a broad range of behavior not involving interstate commerce and that would otherwise be beyond government's reach. Odd? Very! Also scary. The bottom line is simple: Do what the government says or pay a special tax until you do! What could be more straightforward (and frightening) than that?

Roberts did not cut back on the government's broad powers under the Commerce Clause; he merely refused to expand them, and, instead, concentrated on expanding Washington's power to discipline us with taxes. At his instigation, government now has two hugely powerful court-blessed weapons in its behavior-control arsenal.

Roberts extended himself greatly to save ObamaCare with a tax-based opinion that, while electrifying in its conclusion, is uncertain in language and lacking in the compelling legal analytics normally expected. It can fairly be characterized as a bit of a curiosity, almost as contrived and offbeat as ObamaCare itself.
Only to Roberts and the liberals is the regulatory penalty under ObamaCare a tax and, in their minds, apparently only for the purpose of upholding the mandate.

It is not a "tax" under the Anti-Injunction Act (the court unanimously so held.) Although the IRS is to receive and account for the money, the normal rules for the enforcement of taxes due do not apply. What the chief justice chooses to call a tax was written and passed by the Congress as a regulatory penalty, and signed into law by a president who consistently insisted that it was not a tax.

For the purposes of the World Trade Organization treaty and decades of international learning and litigation related to taxes, if the regulatory penalty can be recast as a tax at all, it is a "direct" tax because it is imposed on persons, as distinguished from an "indirect" tax imposed on goods or services.

If a direct tax, and because it is not apportioned among the states, it should be barred by Article I, sections 2 and 9 of the Constitution, unless further recast as an "income tax" allowed by the 16th Amendment.

Even if, arguendo, the regulatory penalty is an otherwise permissible tax (indirect or direct), that does not necessarily mean that it is constitutional. Roberts seems to be saying that imposing a special tax on people until they give in (and do what they are told) is constitutionally innocuous because any tax, once injected into the private economy, tends to have some influence on behavior.

One of the more disturbing aspects of his opinion is the failure adequately to distinguish between a free-market economy's built-in dynamic reactions to changes in tax rates and, on the other hand, a deliberate decision by government to impose a special tax on nonconforming people until they buy insurance, lose weight, start buying and using birth control pills or do other things that the government has no constitutional authority to require.

The question is why did Roberts climb so far out on such a shaky limb. The opinion he wrote on the status of ObamaCare under the Commerce Clause is profound and sure-footed. In contrast, his opinion on the tax issues seems to have been written by a different person who is far from a master of the subject, and himself not fully convinced, but feels compelled to uphold ObamaCare.

It is hard to think of Roberts as an unctuous and anxious Uriah Heep, concerned about his status among the left-wing arbiters of intellectual correctness, and yearning for approval by the New York Times and Washington Post. Possible, but not likely.

Perhaps the chief justice thought that if he deserted the conservative wing of the court and adopted what he mistakenly thought was a middle-ground approach, he might shake up - and eventually end - the liberal versus conservative split that has long plagued the court.

If so, it is too bad that he chose to do so by producing a result that is so profoundly disturbing in its implications, and backed it up with an unimpressive opinion. It is unlikely that he has enhanced his reputation (and leadership capacity) among his colleagues on the court or with the public.

It is not necessary for the chief justice to be a reliable conservative, but it is necessary for him to be a reliable jurist who reaches decisions well-grounded in the immutable principles of logic and precedent. Highly flexible "situational logic" is bad enough in the White House and the Congress. It has no proper place on the Supreme Court.

The ObamaCare saga may signal a new kind of "activist" judicial philosophy that, given Roberts' young age and the advanced years of many of the other justices, may in time develop into the "Roberts Court." The chief justice says it is the duty of the court to uphold what Congress and the president do if it possibly can, and, in this case, he actively sought to do so, going well beyond what the dissenting justices and many others seem to think is reasonable.

In the future, instead of the court going to great lengths to protect individuals from government, as many liberals and conservatives have done in the past, and instead of trying to preserve the rightful role of the states in a federal system, as many conservatives have so often tried to do, the court under Roberts' leadership may primarily seek to protect the growing power of the federal government from court challenges by those who disagree with its decisions.

If that is the course taken by the Roberts court, and if it refuses to protect people from the excesses of presidents and members of Congress who by hook or crook have managed to get themselves elected, liberty will suffer.

It is already clear that Americans are on this Fourth of July less free than they were on Independence Day last year. If Roberts' decision in the ObamaCare case is a true harbinger of what is to come, it is also clear that we will all be far less free 10 years from now - and, ultimately, not free at all.

Christian has been a lawyer in Washington, D.C., since the 1960s, was deputy assistant secretary of the Treasury for tax policy in the Ford administration, served on President Reagan's transition team in 1980 and helped draft the original Reagan tax reforms enacted in 1981.