Sunday, March 25, 2012

ObamaCare's Constitutionality ... Does It Really Matter?

The Supreme Court will hear arguments about the constitutionality of the Affordable Care Act, aka ObamaCare, beginning tomorrow.

If you'd like to read about the legal arguments supporting a ruling on its unconstitutionality, please see The Supreme Court Weighs ObamaCare, an editorial written by the lawyers representing the 26 states challenging the legislation.

The critical part of the editorial is the following:

"ObamaCare mandates that every American, with a few narrow exceptions, have a congressionally defined minimum level of health-insurance coverage. Noncompliance brings a substantial monetary penalty. The ultimate purpose of this "individual mandate" is to force young and healthy middle-class workers to subsidize those who need more coverage.

Congress could have achieved this wealth transfer in perfectly constitutional ways. It could simply have imposed new taxes to pay for a national health system. But that would have come with a huge political price tag that neither Congress nor the President was prepared to pay.

Instead, Congress adopted the individual mandate, invoking its power to regulate interstate commerce. The uninsured, it reasoned, still use health services (for which some do not pay) and therefore have an impact on commerce, which Congress can regulate.

Congress's reliance on the Commerce Clause to support the individual mandate was politically expedient but constitutionally deficient. Congress's power to regulate interstate commerce is broad but not limitless."

In simple terms, had the Congress chosen to tax us in order to pass national health care legislation, it could have done so. But its members didn't do that, because they feared the reaction of We the People to new taxes. So they set out to achieve indirectly that which they couldn't accomplish directly. Now We the People have ObamaCare, and the Supreme Court has a most important issue to decide.

Simply because Congress elected not to use the taxing power of the government when passing ObamaCare, there's a serious constitutional question for the Court to decide. My point herein isn't to make a legal argument for or against ObamaCare.

Instead it's to call attention to the fact that although higher taxes are always unpopular, in the end We the People have to pay for the legislation enacted by Congress. There's no free lunch.

Congress knows that, so members chose to use a legalistic maneuver to get a national health care program passed. In other words, they opted to do indirectly that which wouldn't pass muster directly with We the People. And they sold it as one more free lunch. Nonsense.

Here's another related question. Since most people like Medicare, and it's supported by taxation, why wouldn't we be willing to pay a direct tax to get national health care? Here's my guesstimate about a possible answer.

Although it wasn't initially advertised as such, Medicare has turned out to be pretty much a 3-fer free lunch. For every three dollars in benefits received, seniors pay about one dollar. Hence, the tax to individuals is far below the program's cost.

So what should Congress have done when legislating ObamaCare? First, they should have asked working people to agree to triple Medicare "contributions." Second, they should have told us that we'd need to pay a sufficient amount in "contributions" to pay for the full costs of a new national health care program. {Government likes to call taxes contributions, as in "contributions" for our Social Security "insurance."} Back to the story.

Since members of Congress knew that higher taxes wouldn't fly, they decided that ObamaCare would be about regulating interstate commerce and not taxation. At the same time, they also made up a whopper about the ObamaCare program being self supporting financially. Of course, it's not.

An editorial by Republican Senator Johnson of Wisconsin makes the point about government's cost estimating ability with respect to ObamaCare's probable costs compared to projections in Obama Care's Costs Are Soaring:

"This would not be the first time a government program exceeded its projected cost. When Medicare was passed in 1965, for example, the federal government estimated it would cost $12 billion in 1990. Medicare actually cost $110 billion in 1990."

Yes, within 25 years Medicare's actual costs were almost ten times higher than predicted originally. And we haven't tackled them yet.

Who knows what ObamaCare will cost 25 years from now? Ten times its projected amount? And what will we then to do about it. Based on Medicare's history, not much.

Summing Up

And that's the main idea of this post. Whether ObamaCare is found to be constitutional or not, we have to face our very big problems with the cost of health care and other government entitlement programs. And we must address the runaway costs of Medicare and Medicaid as well.

Congress and the President are often seriously off base when predicting the costs and benefits associated with new legislation. They always miss to the downside. Are they lying? You decide.

Are We the People effectively monitoring the situation to make sure we're getting our money's worth and not burdening future generations with our mistakes? Not based on our Medicare experience.

Sadly, the following scenario has been the all too common experience of entitlement legislation.

(1) Even though costs may explode to the high side after a law's passage, by then the damage has been done and there's little chance of a reversal at the legislative level.

(2) So we hope the Supreme Court will bail us out, but generally they defer to the legislature and leave the issue of the legislation's repeal up to us.

(3) They reason that if We the People don't like the law or the legislators, we have the power to make the necessary changes to both.

(4) People don't like to have their taxes increased, so Congress tries to avoid tax hikes whenever possible.

(5) Debt and deficits grow.

Article I, Section 8 of the Constitution gives Congress the express power both to tax people and to regulate commerce between the states. A truth telling straight shooting Congress could have used its taxing power to enact ObamaCare. Then taxpayers could have decided whether it was a good idea or not.

Meanwhile, we know that taxpayers like Medicare when it costs us one third of its true costs. What we don't know is how much we'd like it if we had to pay for it in its entirety.

What happens to ObamaCare at the Supreme Court won't be nearly as important as what We the People do about facing up to these after-the fact huge and unplanned costs associated with government entitlement programs.

Thanks. Bob.

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