Judge Motz: NFIB “puts a new light” on the Commerce Clause

Following the Supreme Court’s opinion in NFIB v. Sebelius, to the surprise of some, the Justices remanded the case of Liberty University v. Geithner. This case, which considered not only the individual mandate, but also the contraceptives mandate, was not definitively resolved by NFIB. Yesterday, the Fourth Circuit heard oral arguments, with the same panel that two years ago dismissed the challenge under the AIA.

According to a report from Politico (I haven’t seen the transcripts), Judge Motz had a very distinct view of the commerce clause following NFIB.

Klein argued that Congress has a long history of regulating employer health plans under the Commerce Clause — and that the employer mandate is no different.

But Motz suggested that last year’s health law ruling in the case brought by 26 states and the National Federation of Independent Business — in which the Supreme Court said the individual mandate is not valid under the Commerce Clause but valid under the taxing power — put new restrictions on the Commerce Clause.

“The Supreme Court opinion puts a new light, it seems to me, on the Commerce Clause,” Motz said. “It sounds like we’re in a new regime [post] NFIB.”

I think Judge Motz’s characterization of our “new regime” after NFIB is accurate. Her comment is a different way of describing what Larry Solum has referred to as our shifted “constitutional gestalt.” The gestalt is the notion that although NFIB did not repudiate the New Deal settlement, going forward, the scope of the federal government’s authority will be open to constitutional contestation.

I discuss this theme in my book, Unprecedented, and added this great quotation from Judge Motz:

Perhaps more importantly, beyond constitutional doctrine, NFIB v. Sebelius altered our collective consciousness about the relationship between the federal government and individual liberty. By shifting what Prof. Larry Solum has referred to as the “constitutional gestalt,” NFIB has forced us to rethink our assumptions about what we thought was settled law.  In May 2013 during oral arguments over a followup case about the Affordable Care Act, Judge Diana Gribbon Motz observed that NFIB “puts a new light, it seems to me, on the Commerce Clause.” The Fourth Circuit judge, who two years earlier had dismissed a challenge to the ACA under the Anti-Injunction Act without addressing the commerce clause analysis, added, “it sounds like we’re in a new regime [post] NFIB.” Judge Motz is correct. NFIB has forced us to rethink our assumptions about what we thought was settled law.

H/T Randy Barnett

The Electrical Umpire

As far back as 1939, futurists envisioned replacing the baseball umpire with a machine!

In the summer of 1939, Popular Science peered into the fantastical future of athleticswith a story headlined “New Inventions in the Field of Sports.” In between the “merry-go-round training machine” for rowers, and a proposal for polo on horses in water — a “thrilling new aquatic sport” — there was a futurist gem: the Electrical Umpire.

A quarter-page illustration detailed the intricate system of light beams comprising the guts of the (entirely fictional) machine. “Electric eyes” several feet to the left and right of each batter would determine whether the ball passed through the strike zone, defined as the area from the upper chest down to the knees. A projector strung along a clothesline 10 feet overhead would shoot light straight down at a mirror under home plate and recognize if the ball passed over the plate, if it had broken the vertical beam of light. When a pitch satisfied those two criteria — in the strike zone and over the plate — an indicator light signaled a strike.

Now, if only John Roberts could be digitized.

Pareto Optimality at 30,000 Feet

Recently, I boarded a flight from Seattle to Houston. I was in seat 10C, an aisle seat. The middle seat next to me, 10B was empty. Across the aisle, 10E, the middle seat was also empty.

A mother and father, holding a young infant, were complaining to the flight attendant that they wanted to sit together, but there were no other seats next to each other. I volunteered to move from my aisle seat (10C–which I paid more for, United EconomyPlus) to the middle seat, 10B. Now, I was sandwiched next to a mom holding a crying baby. Lovely.

A few moments later, the mom passed the baby over to the dad, who was now sitting in the other middle seat, 10E. This was going to be the routine. Pass the crying baby across the aisle.

The guy who was sitting in 10F, the other aisle seat, made a smart decision. He offered to switch seats with the mom sitting next to me. Now, the mom and dad were sitting next to each other with baby in 10E and 10F. I’m still in the middle, but minus the crying baby.

These exchanges were Pareto Optimal. Had I remained in my aisle seat, and not volunteered a change, I would’ve had a crying baby next to me. Likewise, if the guy in 10F stayed in his seat, he also would’ve had to sit near a crying baby. Plus, the disruption of passing the crying baby back and forth. Now, both of us, who volunteered to take different seats, are slightly better off than if we had stayed put. The only person who is worse off is 10D, who remains next to the crying baby in the window seat.

Nixon and Obama do share one thing in common

Both Presidents tried to enact comprehensive health care reform that would have ensured that all Americans have access to affordable health insurance. Neither succeeded.

Read Nixon’s speech. It is stunning that such words came from a Republican in 1974:

Without adequate health care, no one can make full use of his or her talents and opportunities. It is thus just as important that economic, racial and social barriers not stand in the way of good health care as it is to eliminate those barriers to a good education and a good job.

Three years ago, I proposed a major health insurance program to the Congress, seeking to guarantee adequate financing of health care on a nationwide basis. That proposal generated

…

The plan is organized around seven principles:

First, it offers every American an opportunity to obtain a balanced, comprehensive range of health insurance benefits;

Second, it will cost no American more than he can afford to pay;
Third, it builds on the strength and diversity of our existing public and private systems of health financing and harmonizes them into an overall system;

Fourth, it uses public funds only where needed and requires no new Federal taxes;

Fifth, it would maintain freedom of choice by patients and ensure that doctors work for their patient, not for the Federal Government.

Sixth, it encourages more effective use of our health care resources;

And finally, it is organized so that all parties would have a direct stake in making the system work–consumer, provider, insurer, State governments and the Federal Government.

Alacrity aside, the comparisons between Obama and Nixon are starting to appear more viable. If you’re interested in a different take on Nixon, check out my friends Penny Lane and Brian Frye, who produced this awesome documentary, “Our Nixon,” that involves the home-movies taken inside the Nixon White house.

Update: This piece from John Yoo is too precious:

The Justice Department’s seizure of the AP’s phone records shows that this administration cares far more about power than political and civil liberty.  It has intruded on the freedom of the press in ways that the allegedly power-hungry Bush Administration would never have dreamed.

When the Bush administration was wracked with the leaks of classified information about its counter-terrorism policies, most notably its interrogation and electronic surveillance programs, Democrats in Congress happily took advantage of the information. Nary a peep was heard about protecting national security and preventing the media from publishing classified information.

But now President Obama has to live in the leak-happy world that he and his colleagues created to undermine the last administration. And they don’t like it. Unlike the Bush administration, however, they are willing to go to lengths that threaten the freedom of the press to stop it — this administration has conducted far more investigations and prosecutions for leaking than its predecessors. And, for the most part, this administration has gotten away with it from the press, which has given them a pass on civil liberties compared to how they treated Republicans.

Minnesota Legalizes Mariage Equality, Reverses Baker v. Nelson

How far have we come from Baker v. Nelson (1972), in which the Supreme Court of the United States dismissed an appeal from the Minnesota Supreme Court “For want of a substantial federal question.” Nelson, of course, held that Minnesota law–which was silent as to gender–limited marriage to a man and a woman.

Perhaps most noteworthy, in his brief, the Solicitor General said that Baker v. Nelson was not controlling on the Prop 8 case.

Contrary to petitioners’ contention (Br. 27-28), this Court’s one-line summary dismissal in Baker v. Nelson ,409 U.S. 810 (1972), in which it dismissed an appeal as of right from a state supreme court decision denying mar-riage status to a same-sex couple, neither forecloses theapplication of heightened scrutiny nor dictates the resultin this case. Summary dispositions are “not of the sameprecedential value as would be an opinion of this Courttreating the question on the merits.” Edelman v. Jor-dan , 415 U.S. 651, 670-671 (1974); see Massachusetts Bd. of Ret. v. Murgia , 427 U.S. 307, 309 n.1 (1976) (percuriam). In any event, neither the underlying statesupreme court decision, Baker v. Nelson , 191 N.W.2d185, 187 (Minn. 1971), nor the questions presented in theplaintiffs’ jurisdictional statement, addressed the ap-plicability of heightened scrutiny to classifications basedon sexual orientation, 12-307 J.A. 559; see also id. at 570(describing equal protection challenge as based on the“arbitrary” nature of the state law); id. at 574 (statingthat “[t]he discrimination in this case is one of gender”)

This was most certainly wrong, but it doesn’t matter. Justice Ginsburg concurred during oral arguments:

Cooper: The issues, the constitutional issues that 10 have been presented to the Court, are not of first 11 impression here. In Baker v. Nelson, this Court 12 unanimously dismissed for want of a substantial Federal 13 question.

JUSTICE GINSBURG: Mr. Cooper, Baker v. 15 Nelson was 1971. The Supreme Court hadn’t even decided 16 that gender-based classifications get any kind of 17 heightened scrutiny.

MR. COOPER: That is –

JUSTICE GINSBURG: And the same-sex intimate 20 conduct was considered criminal in many States in 1971, 21 so I don’t think we can extract much in Baker v. Nelson.

MR. COOPER: Well, Your Honor, certainly I 23 acknowledge the precedential limitations of a summary 24 dismissal. But Baker v. Nelson also came fairly fast on 25 the heels of the Loving decision. And, Your Honor, I 1 simply make the observation that it seems implausible in 2 the extreme, frankly, for nine justices to have — to 3 have seen no substantial Federal question if it is true, 4 as the Respondents maintain, that the traditional 5 definition of marriage insofar as — insofar as it does 6 not include same-sex couples, insofar as it is a gender 7 definition is irrational and can only be explained, can 8 only be explained, as a result of anti-gay malice and a 9 bare desire to harm.

Of course, RBG argued all those gender cases.

Almost forty years later, the Minnesota legislature has enacted a law that would allow same-sex couples to marry. Minnesota is now the 12th state to legalize SSM.

President of AP Blasts Attorney General Ashcroft For “Unprecedented Intrusion” by Monitoring Journalist Telephone Records

Oh did I say Ashcroft? I meant Holder.

 The Justice Department secretly obtained two months of telephone records of reporters and editors for The Associated Press in what the news cooperative’s top executive called a “massive and unprecedented intrusion” into how news organizations gather the news.

The records obtained by the Justice Department listed incoming and outgoing calls, and the duration of each call, for the work and personal phone numbers of individual reporters, general AP office numbers in New York, Washington and Hartford, Conn., and the main number for AP reporters in the House of Representatives press gallery, according to attorneys for the AP.

In all, the government seized those records for more than 20 separate telephone lines assigned to AP and its journalists in April and May of 2012. The exact number of journalists who used the phone lines during that period is unknown but more than 100 journalists work in the offices whose phone records were targeted on a wide array of stories about government and other matters.

They really are hard to tell apart some time.

Don’t Blame The Bean!

Justice Kagan continues to delight with this gem from Bowman v. Monsanto:

Still, Bowman has another seeds-are-special argument: that soybeans naturally “self-replicate or ‘sprout’ unless stored in a controlled manner,” and thus “it was the planted soybean, not Bowman” himself, that made replicas of Monsanto’s patented invention. Brief for Petitioner 42; see Tr. of Oral Arg. 14 (“[F]armers, when they plant seeds, they don’t exercise any control . . . over their crop” or “over the creative process”). But we think that blame-the-bean defense tough to credit. Bowman was not a passive observer of his soybeans’ multiplication; or put another way, the seeds he purchased (miraculous though they might be in other respects) did not spontaneously create eight successive soybean crops.

This pithy ten page opinion took less than two months to complete (it was argued on Feb. 19). That’s fast!

When Prince Harry Visited Arlington Cemetery, I Wonder If He Paid Respects To Those Killed In The War of 1812

Does anyone know how the British view the War of 1812? It didn’t really change anything, but resolved some lingering issues from the Revolution. Wikipedia notes:

The war is scarcely remembered in Britain today, as it regarded the conflict as sideshow to the much larger Napoleonic Wars raging in Europe.

…

By the 21st century it was a forgotten war in Britain and Quebec^{[citation needed]}, although still remembered in the rest of Canada, especially Ontario. In a 2009 poll, 37% of Canadians said the war was a Canadian victory, 9% said the U.S. won, 15% called it a draw, and 39%—mainly younger Canadians—said they knew too little to comment.

And yes, there is actually a memorial at Arlington for fourteen unknown soldiers and sailors who died in the war of 1812 against the British.

In 1905, workers completing some construction projects at the present site of the Washington Navy Yard discovered the remains of fourteen (14) soldiers of the War of 1812. These unknown soldiers were interred in Arlington National Cemetery later that same year. In April 1976, the memorial which appears below was dedicated by the National Society of the United States Daughters of the War of 1812.

It doesn’t look like he did.

Attorney General Ashcroft Delivers Commencement Address At Berkeley Amid Protesters Demanding Closure of Guantanamo Bay

Oh did I say Attorney General Ashcroft? I meant Attorney General Holder.

With protesters outside demanding closure of the Guantanamo Bay detention center, U.S. Attorney General Eric Holder on Saturday gave an unambiguous endorsement of the civilian court system to try suspected terrorists, telling UC Berkeley Law School graduates that failing to do so “would weaken our ability … to punish those who target our people.”

…

Before Holder spoke, a handful of demonstrators clustered on the sidewalk with large signs, protesting the federal criminalization of marijuana, the continued detention of alleged terror suspects at Guantanamo Bay and the alleged use of torture on prisoners following the Sept. 11, 2001, terror attacks.

One man in an orange prison-style jumpsuit blasted the federal government for “locking people up and throwing away the key” at Guantanamo Bay.

Mary Ann Thomas of Oakland handed out orange ribbons to denote the orange jumpsuits worn by Guantanamo Bay prisoners. A few steps away, people distributed flyers urging new law graduates to work for a marijuana advocacy group. A plane circled overhead trailing a banner reading: “Holder: End Rx cannabis war.”

I really get them confused sometimes. John Yoo must be laughing his ass off.

Another Last Minute Effort To Stop Construction of Ashby High Rise

Although the long-standing battle against the construction of the Ashby High Rise in Houston seemed to come to a close, as demolition has begun, the neighboring property owners have filed a last-ditch effort to halt the process. What’s their claim? As best as I can tell (I don’t have the complaint), it is based on an air/light nuisance:

A group of residents who live near the site of the high-rise planned for 1717 Bissonnet filed suit against the developer in state district court Wednesday, another attempt to stop construction of the 21-story building.

The seven plaintiffs say if the property is built it will cause harm to them and their homes. They are concerned about physical damage to surrounding structures and safety issues associated with construction.

They say the building would stand 260 feet above grade, “casting an enormous shadow over dozens of surrounding homes and blocking sun and rain from reaching the yards of neighboring properties.” The building would “make it impossible for certain of the plaintiffs to maintain their gardens,” as well as affect the privacy of the homeowners.

In any other city, a zoning board would have shut down this project before it even got started. But, in Houston, that’s not an option. Thus, only organized and well-to-do landowners can kick and scream to stop constructions. Here, after nearly 7 years, they lost.

Stay tuned for the next chapter in this never-ending land-use saga.

Ginsburg Dreamed A Dream

“My expertise to address this topic may not be clear. For truth be told, I am ill-equipped to break out in song. My grade school music teacher labeled me a sparrow, not a robin, and instructed me to just mouth the words. Still, in my dreams I can be a great diva.”

Shame on the teacher who called little (I’m sure she was even more little then!) Ruth Bader a “sparrow.”

Where did the Facebook logo go?

For as long as I can remember, Facebook.com had a Facebook logo in the upper left-hand corner. That was the link to go home. Now, it seems to be gone. The small “F” logo is now inside the graph search box, I suppose to draw attention to search. Clicking the “F” still gets you back to the homepage. Changes are a brewing on the facebooks.

Reading Rand in Cuba

A friend was recently boarding a flight from Toronto to Habana, Cuba, and saw someone reading “The Fountainhead” by Ayn Rand. My friend wisely told the Randian to chuck the book. He asked why. She replied, “that book may be deemed ideologically counter revolutionary. You may get into trouble carrying *that* book.” He chucked the book in the trash can.

I was tempted to slip a copy of Adam Smith’s “The Wealth of Nations” in her bag, but I thought better of it.

I received the proofs of my book!

It is 350 pages, including a Foreword by Randy Barnett. Here is the title page. You can order it today! It will ship on September 3. More details real soon.

Tribe Offers Predictions on Same-Sex Marriage Cases

Larry Tribe–who as I discuss in Unprecedented was the *only* person who accurately and precisely predicted how John Roberts would vote in NFIB–offers some predictions of how the Court will resolve the DOMA and Prop 8 cases.

Regarding the pair of cases currently pending in the Supreme Court, my hunch – and it is only that – is that the Court will narrowly conclude that the DOMA [Defense of Marriage Act] issue is properly before SCOTUS on the merits notwithstanding the solid reasons to doubt that BLAG [Bipartisan Legal Advisory Group of the U.S. House of Representatives] is a proper representative of Congress and that the Court will hold DOMA’s Sec. 3 unconstitutional by a vote of 5-4, with Justice Kennedy relying heavily on the kinds of federalism considerations that Judge Boudin found persuasive in CA1 [U.S. Court of Appeals for the First Circuit] but with the more liberal four justices relying squarely on the equality component of fifth amendment due process.

As to Hollingsworth, however, I doubt that the Court will conclude that Chuck Cooper and the other private proponents of Prop 8, all lacking a fiduciary duty to California, have Art. III standing to defend it on the merits in the Supreme Court (despite what the state’s highest court concluded) and will dismiss that case on standing grounds, leaving in place Judge Walker’s statewide injunction against Prop 8 but setting no nationwide precedent. Alternatively, despite the Rule of Four, I wouldn’t be too surprised to see the Court dismiss cert as improvidently granted, leaving CA9’s [U.S. Court of Appeals for the Ninth Circuit] decision in place but again setting no nationwide precedent.

There you have it.

Here are the current predictions on FantasySCOTUS.

For Prop 8

Hollingsworth v. Perry – Do Petitioners Have Standing?	Affirm	69% Yes	-	-
Hollingsworth v. Perry – Does Prop 8 Violate the Equal Protection Clause?	Affirm	73% Yes	-	-

For DOMA

United States v. Windsor – Does Counsel for House of Representatives have Standing?	Affirm	78%-Yes
United States v. Windsor – Does DOMA violation the Equal Protection Component of the 5th Amendment or Federalism Principles?	Affirm	83%-Yes	-	-
United States v. Windsor – Does SG’s agreement with 2nd Circuit deprive SCOTUS of jurisdiction?	Affirm	78%-No	-	-

Tribe also offers some thoughts on a question that Justice Scalia posed– a question in which Ted Olson struggled to answer: when did a ban on same-sex marriage become unconstitutional.

On the one question of just when a ban on same-sex marriage “became” unconstitutional, however, my answer would be that, from a rather formal perspective, it was unconstitutional from the moment the Fourteenth Amendment was ratified although, from a more evolutionary and thus realistic perspective, it is still in the process of becoming unconstitutional in the sense that the constitutional status of challenged action is a function of an evolving partly political/cultural and partly legal development rather than something akin to the “fact of the matter.” Asking when this kind of ban “became” unconstitutional is like asking when the ban on interracial marriage “became” unconstitutional: the answer might be said to be 1967, when Loving v. Virginia was decided, but it also might be said to be 1868, when the Fourteenth Amendment was ratified. The question isn’t of the same metaphysical character as, e.g., the question of when the oceans of the earth were formed, or when the big bang occurred, or when George W. Bush became President of the United States.

Does the U.S. Constitution Allow Non-Citizens To Vote?

New York City has made some waves by–over the opposition to Mayor Bloomberg–moving forward with a law that would allow non-citizens to vote in local, but not state or federal elections. There are some issues about whether New York City has the authority to enact this law under the New York Constitution, which I don’t have any thoughts on. The more interesting question is whether a city could constitutionally enact a law that would allow a non-citizen to vote in a federal election (put aside for the moment any statutory voting provisions).

Contrary to what many think, the Constitution does not provide an affirmative grant of the right to vote. It appears nowhere in the Constitution. Rather, through a series of Amendments, the Constitution places limitations on who and how the state and federal government can exclude from the franchise–race, gender, poll taxes, and age. Most noteworthy, all of these provisions speak of denying the right to vote of “citizen[s].”

Amendment 15 1. The right of citizens of the United States to vote shall not be denied or abridged by the United States or by any State on account of race, color, or previous condition of servitude.

Amendment 19 The right of citizens of the United States to vote shall not be denied or abridged by the United States or by any State on account of sex.

Amendment 24 1. The right of citizens of the United States to vote in any primary or other election for President or Vice President, for electors for President or Vice President, or for Senator or Representative in Congress, shall not be denied or abridged by the United States or any State by reason of failure to pay any poll tax or other tax.

(For a history of why the 24th Amendment only applies to federal elections, see here).

Amendment 26 1. The right of citizens of the United States, who are eighteen years of age or older, to vote shall not be denied or abridged by the United States or by any State on account of age.

Indeed, other than the voting provisions, the Constitution only uses the term citizen to define the qualifications for the House of Representatives, the Senate, the Presidency, guarantee of Privileges and Immunities (Article IV), the 11th Amendment (“citizens of another state”), and the 14th Amendment (naturalization and “privileges or immunities”). There isn’t much that the Constitution favors Citizens and not persons, but the right to vote is one of them.

Of course, nothing in the text of the Constitution would *stop* a state from giving noncitizens the right to vote. But what are the cultural or philosophical issues about extending the franchise in this manner?

This seems to be part of a broader trend, as evidenced by California’s decision to allow noncitizens to serve on a jury, to break down the divisions between citizens and noncitizens–except for campaign donations. They can’t do that. Too dangerous. Wouldn’t that be a bitch? Benny Bluman could vote for local candidate in New York, speak about him, but not donate to his campaign.

Update: My friend Derek Muller addresses this issue in his article in the Arizona State Law Journal, titled, “Invisible Federalism and the Electoral College.”

“Alien suffrage was quite common during the nineteenth century, coming to a peak in 1875 when twenty-two states and territories granted aliens the right to vote.”237 That ended in the 1920s, at which point all states required citizenship as a condition to voter eligibility.238 Today, every state prohibits noncitizens from voting in federal elections.239 Federal law, too, prohibits aliens from voting in federal elections.240 There are, however, jurisdictions that allow,241 or seek to allow,242 noncitizens to vote in local elections. And as resident aliens have a significant interest in the locales where they reside, and are subject to other political obligations like taxation, there have been particularly strong arguments in favor of extending suffrage to at least a set of them.243

Reversing The Final Play Of The Game

It seems that there has been another blown call in baseball. This time, what would have been a game-tying home run in the 9th inning was ruled by the Crew Chief as not a home-run. Even after reviewing a video replay, the Umpires let the call stand.

With two outs, Rosales sent a drive to left that appeared to clear the 19-foot-high outfield wall and strike a railing. Melvin asked Hernandez and his crew to review the hit, and three umpires left the field to view replays in a designated area near their dressing room.

After a lengthy delay, the umpires returned to the field and instructed Rosales to stay at second, a decision that shocked the A’s, the Indians, 14,000 fans in attendance at Progressive Field and people watching on television.

Justice Joe Torre denied certiorari on the Oakland A’s appeal. Well, pretty much.

“By rule, the decision to reverse a call by use of instant replay is at the sole discretion of the crew chief,” Torre said in a statement released during Thursday’s series finale. “In the opinion of Angel Hernandez, who was last night’s crew chief, there was not clear and convincing evidence to overturn the decision on the field. It was a judgment call, and as such, it stands as final.

I ‘ve previously blogged about the importance of calls at the end of the game–perhaps most famously the blown call that cost Armanda Gallaraga a perfect game. Should the umps just let ‘em play, and err on the side of an exciting conclusion?

For more on judging and umpiring in sports, see here, here, here, and here.

The Structure of Sebelius

In Paul Clement’s merits brief on behalf of in Bond II, there are a number of citations to NFIB v. Sebelius, all for the proposition that the structural protections of our Constitution are fundamental to the protection of individual liberty. Here are the cites:

That is why “the Framers considered structural protections of freedom the most important ones,” and why “they alone were embodied in the original Constitution and not left to later amendment.” NFIB, 132 S. Ct. at 2676–77 (joint dissent) (emphasis added); see also id. at 2577– 78 (Roberts, C.J.) (“the Constitution did not initially include a Bill of Rights at least partly because the Framers felt the enumeration of powers sufficed to restrain the Government”).

The statutory provisions addressed in cases such as Lopez, New York, Printz, Morrison, and NFIB were unconstitutional because they were “inconsistent with the federal structure of our Government.” New York, 505 U.S. at 177; see also, e.g., Lopez, 514 U.S. at 567 (rejecting theory of federal power that “would require us to conclude that the Constitution’s enumeration of powers does not presuppose something not enumerated”); Printz, 521 U.S. at 935 (rejecting theory of federal power as “fundamentally incompatible with our constitutional system of dual sovereignty”). As these and other cases make clear, the cardinal canon that “[i]mpermissible interference with state sovereignty is not within the enumerated powers of the National Government” informs the scope of all federal powers. Bond, 131 S. Ct. at 2364

To the contrary, the Necessary and Proper Clause does not empower Congress to enact laws that “undermine the structure of government established by the Constitution.” NFIB, 132 S. Ct. at 2592 (Roberts, C.J.); see also Printz, 521 U.S. at 923–24 (a law that “violates the principle of state sovereignty reflected in the various constitutional provisions … is not a ‘La[w] … proper for carrying into Execution’” that power).

An unchecked power to implement treaties would amount to exactly the sort of “great substantive and independent power” that the Necessary and Proper Clause cannot supply. McCulloch v. Maryland, 17 U.S. 316, 411 (1819); see also NFIB, 132 S. Ct. at 2591–92 (Roberts, C.J.).

I was recently talking with a conlaw prof at another school, who asked whether South Texas separates constitutional law into separate classes on structure and rights. This dichotomy never made sense to me. Indeed, at GMU, the two bled into each other. Justice Kennedy made this point emphatically in his dissent, as read from the bench.

From Chapter 8 of Unprecedented, where I explore “Judgment Day”:

Everyone in the courtroom remained stunned. Totally oblivious to the commotion brewing outside the Court, the justice continued.

Kennedy paused for emphasis, then continued to read, very slowly. “Structure means liberty, for without structure, there are insufficient means to hold to account a central government that exceeds its powers in controlling the lives of its citizens. Today’s decisions should have vindicated, not ignored, these precepts. For these reasons, we would find the act invalid in its entirety.”

Kennedy was done.

Let’s see if the Court expands the intricate relationship between structure and liberty in Bond II.

CFTC seeks to expand regulation of Bitcoin

In the past, I have blogged about the Commodity Future Trading Commission’s broadening scope of their own enforcement jurisdiction, as empowered by Dodd Frank. The CFTC has deemed politicla prediction markets, which involve only opinions and no actual items, as if they were contracts on physicla commoditie (such as gold or silver or oil). Now, the CFTC is looking to get involved wtih Bitcoin.

The Commodities Futures Trading Commission is reportedly ‘seriously’ exploring whether volatile cyber currency Bitcoin may fall under the U.S. regulator’s purview.

The potential regulatory oversight from the CFTC poses a serious threat to Bitcoin, which has enjoyed a surge of new attention and an explosion in value in recent months amid concerns about traditional bank deposits and currencies.

Bitcoin “is for sure something we need to explore,” Bart Chilton, one of the five commissioners at the CFTC, told the Financial Times. A source told the paper that the regulator, which gained new powers thanks to the Dodd-Frank legislation, is “seriously” examining the issue.

“It’s not monopoly money we’re talking about here — real people can have real risk in these instruments, and we need to ensure that we protect markets and consumers, even in what at first blush appear to be ‘out there’ transactions,” Chilton told the FT.

By regulate, the CFTC means ban. The prohibitory costs of registering with the CFTC would likely render Bitcoin impossible to run in the United States, similar to the rules imposed on InTrade. Stay tuned.

Obamacare Nudges Young And Healthy Away From Buying Insurance

Rahm Emanuel, who was instrumental in President Obama’s decision to enact the Affordable Care Act when many told him not to, famously said that a crisis is a terrible thing to waste. Pass it now, and worry about it later. Now Rahm’s brother, Zeke, is helping to pick up the mess left behind by the rushed and unpopular law now known as Obamacare. In the WSJ, Zeke addresses some of the eventual problems with Obamacare–namely, that young, healthy people still won’t buy insurance. These are the very people the ACA sought to bring into the insurance market.

Here is the specific problem: Insurance companies worry that young people, especially young men, already think they are invincible, and they are bewildered about the health-care reform in general and exchanges in particular. They may tune out, forego purchasing health insurance and opt to pay a penalty instead when their taxes come due.

The consequence would be a disproportionate number of older and sicker people purchasing insurance, which will raise insurance premiums and, in turn, discourage more people from enrolling. This reluctance to enroll would damage a key aspect of reform.

Insurance companies are spooked by this possibility, so they are already raising premiums to protect themselves from potential losses. Yet this step can help create the very problem that they are trying to avoid. If premiums are high—or even just perceived to be high—young people will be more likely to avoid buying insurance, which could start the negative, downward spiral of exchanges full of the sick and elderly with not enough healthy people paying premiums.

Emanuel lays out the problem perfectly. But he has three solutions (none of which will work):

Fortunately, there are solutions [to this ACA-induced adverse selection problem]. First, young people believe in President Obama. They overwhelmingly voted for him. He won by a 23% margin among voters 18-29—just the people who need to enroll. The president connects with young people, too, so he needs to use that bond and get out there to convince them to sign up for health insurance to help this central part of his legacy. Every commencement address by an administration official should encourage young graduates to get health insurance.

Yeah, this won’t work. Voters–especially young men–are extremely prone to voter ignorance. And, to be frank, if the President’s charisma was enough to encourage people to have health insurance, we wouldn’t have needed an individual mandate which, for the first time ever, coerced people into buying insurance (it wasn’t a tax on failing to have insurance when it was initially enacted).

What is Zeke’s second solution?

Second, we need to make clear as a society that buying insurance is part of individual responsibility. If you don’t have insurance and you need to go to the emergency room or unexpectedly get diagnosed with cancer, you are free- riding on others. Insured Americans will have to pay more to hospitals and doctors to make up for your nonpayment. The social norm of individual responsibility must be equated with purchasing health insurance.

Again, the very reason why the mandate was imposed was because people didn’t give a damn about cost-shifting and free-riding. Free-riding is rational. If a person has a choice between paying a penalty of a few hundred dollars each year, or paying for insurance of a thousand dollars a year, it is rational for young and healthy people to stick with the penalty. This may be a foolish decision, but it makes dollars and sense.

Finally, and most important, we should adopt some of Massachusetts’ practices. When state officials in 2006-2007 were rolling out their exchange—called the Massachusetts Connector—they mounted a sustained campaign to encourage enrollment by young people. One aspect of the campaign focused in particular on young men, even heavily promoting the new exchange on TV during Red Sox games and hosting an annual “Health Connector Day” at Fenway Park.

A sizeable number of Americans think that the ACA is not even law. Whatever PR campaign the federal government is running has failed miserably.

I had dinner with a friend last night who has authored a number of books, and he asked me what will be the news hook for my book which comes in September. I told him the imminent role-out of the ACA on January 1, 2014 will indeed b a trainwreck. I will have the unenviable task of watching this collission happen in slow motion. I predict, firmly, that those like Emanuel will watch the failure of this law, and blame conservatives for opposing it, and making its implementation more difficulty. That will absolutely be correct. But the forseeable errors of this law, grounded in the most basic notions of behavioral economics, are unavoidable.

And lest we forget that the ACA bans catastrophic insurance–the very kind of insurance best-suited for young and healthy people. In a recent piece, the National Journal looks at how the law will likely do the exact opposite of what it was intended to do: raise premiums, and decreasea the number of people covered:

In both examples, the presidential sales pitch ended up being overhyped, with promises made that couldn’t realistically be achieved. At its heart, the mission to oust Saddam Hussein was about preventing a dangerous tyrant from using weapons of mass destruction – but administration officials advocated everything from democracy promotion to preventing an alliance between Iraq and al-Qaida as part of its overall argument. When events turned south, failure to achieve many of the items on the checklist proved politically embarrassing.

Obama’s health care law was designed to expand access to the uninsured. It’s a noble goal, if not necessarily a smart political priority. (It’s more popular to advocate for improved health care, not expanded access.) But to win support for the law, Obama claimed it would lower costs, improve the quality of care and not force anyone off their current health care plan. That’s not shaping up to be the case. Premiums are rising, employer uncertainty is growing and voters aren’t viewing the law favorably – with many not even aware of the frontloaded benefits already in place. And even on the access side, the law of unintended consequences is kicking in: Some large retail companies are cutting back employee hours so they won’t have to offer health insurance. That’s not good for the economy or health care access.

Tom Lambert has many more good points here.

Of course, Emanuel leaves out an important part of the story: the fact that the ACA itself encourages young, healthy people (the “young invincibles,” he calls them) to forego buying health insurance.  The statute does so by mandating that health insurance be sold on a “guaranteed issue” basis (meaning that insurance companies can’t deny coverage to people who waited to buy it until they became sick) and at prices based on “community rating” (meaning that those who are sick or susceptible to sickness can’t be charged more than the healthy).  Taken together, these provisions largely eliminate the adverse personal consequences of waiting to buy health insurance until you need medical treatment.  (You can’t be denied coverage or charged a higher premium reflecting your illness.)  They thereby decimate the incentive for young, healthy people to buy health insurance until they need it.  And since the law doesn’t (and can’t, according to the Supreme Court) require young, healthy people to carry insurance, many are likely to forego buying coverage in favor of paying a small “tax” — $95 in 2014, as opposed to the $2,480 out-of-pocket cost for an individual policy bought on a subsidized exchange by a 26 year-old earning $30,000.  As I have argued on this blog and elsewhere, the ACA is likely to generate a devastating spiral of adverse selection as the “young invincibles” drop out of the pool of insureds, causing premiums for the covered population to rise, encouraging even more of the marginally healthy to exit the risk pool, causing premiums to rise even further, etc., etc