The Shutdown and the Rollout

Judge Andrew P. Napolitano*

Here is a quick pop quiz. Which presented more harm to human life and personal freedom: the four-week partial shutdown of the federal government last month or the rollout of Obamacare this month?

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Obamacare is the greatest single expansion of federal regulatory authority in American history. In one stroke, it puts 16 percent of American economic activity -- virtually all of health care and health insurance -- under the thumb of federal bureaucrats. It dictates the minimum insurance coverage that everyone in the United States must have.

It punishes severely, without a hearing, anyone who deviates below the prescribed minimum. It forces nearly all Americans to acquire coverage in a one-size-fits-all policy, including coverage for events that cannot occur.

Obamacare was passed by both houses of Congress with support from Democrats only, using parliamentary tricks, rather than straight up or down votes. And all the Democrats voted for it after President Obama promised them and the American people ad nauseam that if they like their current doctor and if they like their current health insurance, they would be able to keep them under Obamacare.

The law was found constitutional by the Supreme Court only after the chief justice -- who acknowledged in his opinion in the case that Congress lacks the authority to compel people to engage in interstate commerce by forcing them to purchase a good they don’t want -- changed his mind on the ultimate outcome of the challenge. In order to save the law from imminent constitutional extinction, he created a novel legal theory, and he persuaded the four progressives on the court to join him.

They ruled that the punishment for the failure to obtain the level of health care coverage that the law requires is actually a tax. Then the court ruled that because Congress can constitutionally tax any event, it can tax nonevents (like the failure to purchase health insurance), and so the entire scheme is constitutional because it is really just a tax law.

The Supreme Court, lawyers sometimes say, is infallible because it is final; it is not final because it is infallible. I am a student of the court, and I revere it. It can change the laws of the land, but it can’t change the laws of economics. And so, when Obamacare ordered all insurance carriers in the land to cease offering health care plans that provide insurance coverage below the federally mandated minimum, they naturally began to cancel those plans. And when the new health care exchanges that Obamacare established failed to find coverage for those formerly insured by the substandard plans, those who had these plans and liked them suddenly were told that on Jan. 1, 2014, when Obamacare becomes effective, they will have no health insurance. The old insurance coverage will be illegal, and there is no new coverage for them.

Why were these substandard plans canceled when the president repeatedly promised that they could be kept? Didn’t the president know that he was not being truthful when he signed a bill into law that mandated minimum coverage, yet promised that plans that failed to meet that minimum coverage could survive the law? How is it that emails from the West Wing to the White House and legal briefs filed by the Department of Justice defending Obamacare in various federal courts acknowledged that millions would lose the doctors and the coverage that they liked?

One of the reasons many Americans had their policies canceled this month is the failure of those policies to conform to the new federal minimum requirements. At the heart and soul of Obamacare is the power of bureaucrats to tell everyone what coverage to have. At the core of Obamacare is the removal of individual choice from the decision to purchase health care coverage. The goal of Obamacare is high-end coverage for everyone -- brought about by Soviet-style central planning, not in response to free market forces.

From the perspective of the central planners who concocted Obamacare, minimum insurance coverage is the sine qua non of the statute. They want you to pay for coverage you will not need or ever use, so that the insurance carriers will have extra cash on hand to fund coverage for those who cannot afford high-end policies. This is where the laws of economics enter. By forcing all carriers to offer only high-end policies, the statute forced the carriers to raise their rates. By raising rates, the substandard policies -- with their lower rates -- could no longer be offered. If the government forced everyone to buy a Mercedes, when most are perfectly happy with an Acura, soon the Acuras would disappear from the market and most of us would be walking to work.

Now back to our pop quiz. When Congress was unable to agree on a budget for this present fiscal year because tea party Republicans saw this mess coming and wanted to dull its sting and congressional Democrats refused to negotiate with them, the federal government partially shut down. The Democrats and the mainstream media went wild. They claimed the government would default on its obligations and millions would suffer without the conveniences normally offered by the federal government. Yet, the only inconvenience we really heard about was the inability of a few hundred folks to visit federal parks and monuments. All federal services -- defense, the courts, the airports, the TSA (ugh), customs, and meat inspectors -- continued to operate as before the shutdown.

Yet, when Obamacare was rolled out earlier this month, more than 5,500,000 innocent Americans lost their health insurance, and the president knew of this in advance and lied about it repeatedly, and caused it with the one-size-fits-all mentality of his signature piece of legislation. Last week he caved and said that folks who have the old substandard policies could keep them for another year. This was too little and too late. He can no more change federal law than he can change the laws of economics. And he knows that.

In modern times, we have endured great lies told in the White House. One great lie was about a third-rate burglary, and it ended in a presidential resignation. Another great lie was about a private sexual affair, and it ended in a presidential impeachment. The present great lies are about the health and freedom of 5,500,000 Americans. How will this mess end?

*Andrew P. Napolitano, a former judge of the Superior Court of New Jersey, is the senior judicial analyst at Fox News Channel. Judge Napolitano has written seven books on the U.S. Constitution. The most recent is "Theodore and Woodrow: How Two American Presidents Destroyed Constitutional Freedom."

Hunter's Point: An Overlooked Benefit of the Debt Limit

Isaiah Hunter* 

The debt limit is a universally maligned policy that artificially creates funding crisis. Instead of allowing markets to restrain government borrowing by charging higher interest rates, the debt limit restricts the principal government can borrow. This creates occasional shutdowns, including the current shut down. There is one overlooked positive aspect of the debt limit: it constrains the dead hand control of prior Congresses on new Congresses. This is demonstrated by the current impasse.

President Obama argues that Congress’ job is to fund programs it enacted, including Obamacare. Implied in this argument is that if Congress agreed to create a program and appropriated funds for that program, then it is a duty for a new Congress to secure the funds even if they need to raise the debt limit. However, Obama obfuscates the issue by equivocating on Congress. The Congress that passed Obamacare is not the Congress attempting to defund Obamacare. Therefore, under Obama’s logic prior Congress’ funding plans (but not laws) obligate future Congresses to raise the debt limit to pay for prior Congresses promises. Obama’s failure to differentiate between the two Congresses embraces a weak ethos of: one vote, one person, one time. This is because institutionally old Congresses already exhibit substantial sway over current congresses.

The way Congressional default rules are set up and because of public choice, it is very difficult to invalidate laws once enacted – even if the law is bad policy. The debt limit provides a procedural mechanism whereby the current Congress can regain some of its authority against the older Congresses. This is good because while we want stability, older in time does not necessarily mean superior in wisdom nor should it mean in the policy context as first in right.

Now, the debt limit is per se a dead hand control. Moreover, it is a blunt tool for dealing with a problem that requires precision. Finally, Congress rarely uses this tool. Therefore, I do not support the debt limit even without considering the pecuniary costs associated with the debt limit policy. Nevertheless, there is a benefit to the debt limit. That anti-dead hand benefit frames the issues surrounding the debt limit. Namely, just because one Congress enacted a law does not – contrary to President Obama’s claim – obligate morally or legally a future Congress to fund that law. Further, the anti-dead hand benefit should serve as a normative goal: how can new Congresses assert their policies goals while still maintaining some degree of settled expectations.


*Isaiah Hunter is a J.D. Candidate at New York University School of Law, class of 2014, and is Senior Articles Editor of the Journal of Law & Liberty. Mr. Hunter is the author of the Column "Hunter's Point." 

Consider This a Warning: Is Our Republic in the Emergency Room?

Thomas Warns*

It is no secret that the current healthcare debate taking place in Congress may end up temporarily shutting down the government. As Republicans and Democrats battle over a spending bill and the debate surrounding the future funding of Obamacare intensifies, The New York Times set the stage for a possible government shutdown:

“Without a complete capitulation by House Republicans, large sections of the government would close, hundreds of thousands of workers would be furloughed without pay, and millions more would be asked to work for no pay.
Polls show that the public is already deeply unhappy with its leaders in Congress, and the prospect of the first government shutdown in 17 years would be the latest dispiriting development. With a temporary shutdown appearing inevitable without a last-ditch compromise, the battle on Sunday became as much about blaming the other side as searching for a solution.”
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Ignoring the merits of the Obamacare legislation itself, what does this legislative impasse reveal about how Americans perceive democracy in a Republic? And what should we see as the result of this debate?

Many Americans are frustrated that partisan gridlock seems to have prevented Congress from doing much of anything recently besides passing the Affordable Care Act in 2010. For many this budget debate seems to represent the worst of Congress’ partisan politics, but this sort of all-or-nothing showdown could be exactly what the doctor ordered for stopping future gridlock. If the government does shut down, one party is likely to come out a big winner while the other comes out a big loser.

Midterm elections are a year away, and this debate will significantly shape the outcome. With both parties trying their best to achieve their partisan goals while blaming the other party for a potential shutdown, it seems like the “winning” side could stand to take a larger share of seats in Congress. Democrats largely believe that the 2012 elections were an unconditional victory, however, the Republicans still control the House of Representatives – if Congress unites wholly under one party, it would be much easier for legislation to make it to the President’s desk.

Both parties claim that they are speaking for the majority of Americans; clearly at least one of them is wrong, but perhaps they both are. Only 57.5% of Americans eligible to vote actually did so in 2012. Since the election was close to a 50-50 split (roughly speaking) of those who voted, neither side can plausibly say that they represent a majority of the country’s citizens.

America’s political system is obsessed with the idea of majority rule, but the fact is that no such majority political consensus exists nationally. The Tea Party members behind the defund Obamacare movement constantly take flak for allegedly hijacking the nation’s political system by trying to wield influence that exceeds its base of support. But the Tea Party is merely just one minority group among many trying to exert its influence to the maximum extent possible.

Should we be concerned or surprised when a small but dedicated movement is able to score legislative victories at a greater pace than a larger but apathetic plurality? Certainly not. We expect and receive more input on legislation from the people who are most affected by it and who care about it the most. That is normal, just as it is normal for the EPA to receive more feedback from the automobile and trucking industry than from the general public about newly proposed improved emissions standards for cars and trucks.

John McCain recently said that he would not defund Obamacare because the American people “spoke” and Congressmen need to “respect the outcomes of elections because they reflect the will of the people.” But his view of democracy doesn’t make sense in a Republic. Nationally President Obama was re-elected running in support of Obamacare, but the House of Representatives has 232 Republicans and the Senate has 46. Should Ted Cruz vote in favor of Obamacare after being elected on a platform staunchly opposed to it because voters in states he doesn’t represent support it? Absolutely not.

So what does this all mean? It means that a government shutdown followed by a political “win” for one party is not necessarily a sign of dysfunction in Washington, but could actually demonstrate that our Republic is operating just fine and that Congress might start working more smoothly after the midterm elections.


*Thomas Warns is a J.D. Candidate at New York University School of Law, class of 2015, and is Staff Editor of the Journal of Law & Liberty. Mr. Warns is author of the weekly column "Consider This a Warning".