POTUS vs SCOTUS on Affordable Care Act?

Apparently, President Barack Obama did not like how the arguments over his massive health care measure went before the U.S. Supreme Court. On April 2, he not only came out swinging against the Court, but questioned the Supreme Court's role in our system of checks and balances. It was an unprecedented attack from a president of the United States.

For good measure, Mr. Obama, who taught classes in constitutional law, either misled people or proved that he fails to understand what judicial activism is.

On challenging the Court's role, Obama argued that the Court should "not take what would be an unprecedented, extraordinary step of overturning a law that was passed by a strong majority of a democratically elected Congress."

Was the President serious here or is this just a case of playing politics? Either way, it's quite troubling.

Of course, there is nothing "unprecedented" or "extraordinary" about the Supreme Court having to take the step of "overturning a law" when that law flies in the face of the Constitution. After all, the Supreme Court's job is to make sure that laws do not cross the line and violate the Constitution. This was made clear by the Founding Fathers, and in the 1803 Marbury v. Madison decision.

Given that serious responsibility, even if a law were passed by significant majorities, that would not influence or affect the Court's responsibility. But large majorities most certainly were not the case with ObamaCare. The President declared that his health care measure "was passed by a strong majority of a democratically elected Congress." This is another troubling declaration.

Again, is the President misleading for political purposes, or has he talked himself into something that does not align with reality? ObamaCare just got enough votes to avoid a filibuster in the Senate (60 votes), and squeaked by in the House of Representatives by a margin of 219-212, without any Republican support.

So, Mr. Obama got the history of his own health care law wrong, and served up a disturbing assessment of what the proper role of the Supreme Court is.

But there was more distortion when it comes to the Court's role and judicial philosophy. President Obama said, "And I'd just remind conservative commentators that, for years, what we have heard is, the biggest problem on the bench was judicial activism, or a lack of judicial restraint, that an unelected group of people would somehow overturn a duly constituted and passed law."

Well, the President is correct that judicial activism, or a lack of judicial restraint, has been the biggest problem on the bench. But judicial activism is not about the Court overturning a law when that law is unconstitutional. Rather, judicial activism is when the Court decides to take on the role of constitutional author and/or legislator. That is, rather than following and properly applying the Constitution, judicial activists decide to ignore what the Constitution actually says and replace it with their own preferences. They decide to rewrite the Constitution as they see fit. This is where the unelected seek to take on the job of elected lawmakers, which is completely inappropriate.

For example, judicial activism was on full, unsavory display in the Court's 5-4 decision in the Kelo v. City of New London eminent domain case, when the Court redefined "public use," as written in the Constitution, to mean public purpose, and then allowing politicians to define public purpose however they like.

In the end, President Obama did not like the signals that were being sent by justices during the arguments over ObamaCare, in particular, that the individual mandate represents an unprecedented, sweeping and constitutionally groundless expansion of federal government powers. His responses amounted to a political fit, in which he said things that undermined his own reputation. The President seems to be laying the groundwork for accusing the U.S. Supreme Court for playing politics with ObamaCare during his reelection campaign. But if the Court overturns ObamaCare on true constitutional grounds, that is not politics. Instead, it is our government's checks and balances working as they should.

It was bad enough that President Obama pushed a costly, damaging health care measure through Congress that makes no economic sense, but now he is levying unwarranted attacks on the Supreme Court as it considers serious questions about the law as it pertains to the U.S. Constitution. Shame on the President.

_______

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His new book is "Chuck" vs. the Business World: Business Tips on TV.

The Constitution and ObamaCare

If you paid any attention to the news about the arguments before the U.S. Supreme Court over ObamaCare, it's hard to miss a very obvious, fundamental difference that exists between liberals and conservatives when it comes to the U.S. Constitution. What is that difference?

Well, first, let's be clear as to what the court case over ObamaCare is not about. It is not about the economics of ObamaCare, or whether it is smart or dumb law.

For the economist, the bankruptcy of ObamaCare should be obvious. After all, the selling point was that this massive measure would somehow rein in costs, expand coverage, and improve care. Hmmm. Now when was the last time that a vast expansion of government into any arena resulted in lower costs, and more and better service? Quite simply, the answer is: Never.

For example, ObamaCare is about increased government subsidies of health care coverage, which inevitably will result in expanded utilization. That jump in demand, of course, will increase prices, especially when the supply of services are not increased in similar proportion. For good measure, when government spending is increased, waste expands as incentives to spend other people's money with prudence, care and wisdom do not exist in the public sector.

Then add on assorted mandates, regulations and taxes, and costs inevitably get driven even higher. Eventually, as costs careen far beyond anything that government originally estimated - as has been the case in Massachusetts with RomneyCare, with Medicaid, with Medicare, and in every nation with government-run health care - the eventual result is rationing of care via government (i.e., political appointees).

So, the entire ObamaCare law works against its stated objectives of lower costs and improved service. Instead, it's about increased costs for taxpayers, both individuals and businesses; higher costs for businesses due to mandates and regulations; and government deciding what's appropriate health insurance coverage and eventually appropriate care. It's bad economics and a dumb law.

But the Supreme Court does not exist to consider whether such a law makes economic sense, or even if is smart or not. Instead, the Supreme Court is considering whether ObamaCare is constitutional or not. This case before the Court is not about health care per se; instead, it's about the power of the federal government under the Constitution.

We've read and heard about the arguments presented, and the questions and comments offered by the justices on the issues of the individual mandate requiring that each person buy health insurance, and expanded Medicaid costs for the states.

In particular, those challenging the law point out that forcing citizens to engage in an act of commerce they would not otherwise engage in simply because they are citizens is an unprecedented expansion of federal power. If allowed to go forward, then politicians could justify anything under federal powers.

As Justice Anthony Kennedy asked during the arguments, "Can you create commerce in order to regulate it?" He also observed, "The government is saying that the federal government has a duty to tell the individual citizen that it must act, and that is different from what we have in previous cases, and that changes the relationship of the federal government to the individual in a very fundamental way."

As for Medicaid, the requirement that the states accept and foot part of the bill for a huge expansion of Medicaid, or lose all federal Medicaid funding amounts to extortion by the federal government, and undermines state sovereignty implicit in our constitutional structure. The states, of course, are not forced to be part of Medicaid. But now that all are in so deep, the argument is that this clearly is federal coercion.

Chief Justice John Roberts referred to this relationship as the federal government putting a "gun to the head" of the states. He observed, "You have to give up your wallet. You don't have a choice."

What was perhaps most fascinating was the reaction to these arguments from both sides of the legal/judicial/political aisle. Conservatives noted that these are pertinent and important questions that get to what the Constitution says, allows and limits, which is critical to our system of checks and balances.

In contrast, liberals were simply aghast that these questions were given any kind of hearing. There was minimal recognition of the Constitution serving as a protection of individual liberty against government action, no matter what the intentions of those in power might be.

This case provides another powerful reminder that the Left has little regard for the Constitution itself. They fail to take serious the idea that the Constitution defines and limits the powers of government. Indeed, such a notion serves as anathema to their philosophy. What the Constitution actually says, and what the original intent was of the authors, matter not at all. Instead, in this view, the Constitution should merely conform to whatever it is that the political class would like to accomplish. In effect, there are no limits on federal power, as long as the justices happen to agree with the goals in mind when federal power is executed. That is, quite simply, the ends justify the means.

Finally, it was interesting to note a Wall Street Journal report on March 29 that included the reactions of the business community if the Court overturned the law. The only two businesses included in the article were firms that hitched their wagons to ObamaCare, and their specific business plans would have to be altered if the law was tossed out. Why not include representatives of the millions of business owners who would see increased uncertainties and costs from the law if it is allowed to stand? The bias of the story was painful.

In the end, based on the Constitution, the individual mandate should be struck down. And since that provision is so central to the law, much of the measure would not have passed without it. Therefore, the entire law should be struck down, rather than having justices acting like legislators to deem what should stay and what should go. The entire issue should be returned to elected representatives. That would be the most appropriate action from the perspective of judicial restraint and constitutionality. In this case, it also happens to be best outcome from the perspective of sound economics and getting rid of a dumb law.

_______

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His new book is "Chuck" vs. the Business World: Business Tips on TV.

"Fairness" for Small Business Missing in State of the Union

Small Business & Entrepreneurship Council (SBE Council) President & CEO Karen Kerrigan issued the following response to President Barack Obama's State of the Union address:

"Jobs and the economy are the top concerns for Americans, yet President Obama offered only vague statements about how he proposes to help job creators. For small business owners, the ‘fairness' that President Obama spoke about begins with addressing government costs and obstacles that are impeding their growth and ability to create jobs. Regulatory costs, rising health coverage costs, new burdens associated with ObamaCare, proposed workplace rules in the pipeline, the threat of new taxes, uncertainty regarding expiring tax rates and incentives, tough conditions for accessing capital and credit, and the exploding deficit are all weighing on entrepreneurs and small firms. It seems President Obama spent most of the evening defending the policy status quo rather than laying out a meaningful pro-growth agenda that will encourage investment and job creation.

"Remarkably, the President did not talk about health care. ObamaCare is collapsing, and just because it's unpopular with Americans does mean he should ignore the mess. The tax credits for small businesses are an abysmal failure, costs continue to spike higher, and the uninsured rate has now climbed to 17 percent according to Gallup. Once the new taxes and mandates kick in, costs will move even higher. More small businesses are preparing to drop coverage due to the forthcoming costs, burdens and penalties. ObamaCare is driving uncertainty for small business owners, and it remains a major impediment to job creation. The President has consistently said he is open to improving the new law, but little has been done thus far to make it better. Ignoring the new law's major flaws will not make them go away.

"It was distressing to hear the President talk about subsidizing his favored energy companies using our scarce tax dollars while just last week he rejected a true shovel-ready project that would have created 20,000 immediate jobs and 118,000 spin-off jobs using no tax dollars. Small businesses would have benefitted tremendously from Keystone XL - as vendors and suppliers in the energy industry, and as energy consumers. This remains a critical infrastructure project. Building out broadband also remains important to small businesses and their competitiveness, but his Administration sued to block the AT&T/T-Mobile merger which would have brought broadband to entrepreneurs who currently lack access. The merger would have created jobs, and provided work for small firms that are players in the telecommunications and technology industries. At a time when the U.S. needs to get its fiscal house in order, desperately needs jobs, and needs to promote reliable and affordable energy and broadband access, the blocking of multibillion dollar private-sector investment projects by the President makes no sense.

"Finally, the President is still talking about raising taxes on entrepreneurs and investors. Unfortunately, the economy will continue to limp along given this threat and the President's class warfare rhetoric which looks to be his central reelection theme. Nagging business owners into creating jobs, or badgering them to bring them home is not a reasonable strategy for job creation and sustained growth. Policy matters, and more importantly policies must be business friendly."

Karen Kerrigan, President & CEO