The Obama administration (in office from 2009 – 2017) argued that it (and the Congress, working together) had the authority to mandate that Americans buy health insurance and that people can be fined or perhaps jailed for failure to comply.

The Obama administration (in office from 2009 – 2017) argued that it (and the Congress, working together) had the authority to mandate that Americans buy health insurance and that people can be fined or perhaps jailed for failure to comply.

The law was called the Affordable Care Act (i.e., ACA, or more popularly known as “Obamacare”). The Obama administration argued that the authority came from the “Interstate Commerce Clause” (Article 1, Section 8 of the U.S. Constitution), which the federal government nearly always does when it wants a new power. This law was challenged in the federal courts and the case went all the way to the U.S. Supreme Court. The Supreme Court ruled in Obama’s favor and asserted that because the penalties for failure to comply will be collected by the IRS, that made it a “tax,” which the government is authorized to do under the Constitution, even though Barrack Obama argued that it was NOT a tax. That is, by a vote of 5–4 (in National Federation of Independent Business versus Sebelius, 2012), the Supreme Court upheld the individual mandate component (that people must buy health insurance) of the ACA as a valid exercise of Congress’s power to “lay and collect taxes.” The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. The question, though, is whether the Obama administration (and Democrats in Congress) were using the tax argument to get around constitution limits on government power.
The Supreme Court was heavily criticized as just upholding a law the court liked and, in the process, just finding any way it could (even arguably unconstitutional way) of upholding that law. The question now becomes,
what does this ruling suggest about the Constitution providing limits on the federal government?
1.How is it (or is it not) “interstate” and how is it (or not) “commerce”?
2. Would it suggest that the government now had the authority to mandate that all Americans buy savings bonds to finance the nation’s debt and have it collected by the IRS just to argue it is a tax and not a fine?
3. The governments (state level) require car owners to have car insurance…is the health care example different? How so?
4. Should such a mandate to buy health insurance be the exclusive purview of the states (to issue such a mandate)? HINT: The key here is whether the goal was to actually raise government revenue or to modify social behavior. What was the true objective of the “financial penalty” that the court called a tax?