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On Friday, I was a guest on Houston Matters–a local public radio show–to discuss prayer in the public square. It was an extended discussion that touches on Establishment Clause jurisprudence over the last five decades.

The Seventh Circuit continues to troll everyone who thinks appellate judges should stick to the record. Construction and General Labor v. Town of Grand Chute considers a local ordinance that restricts the placement of one inflatable rats, that unions use to shame employers. Judge Easterbrook wrote the majority opinion:

This case is about rats. Giant, inflatable rats, which unions use to demonstrate their unhappiness with employers that do not pay union‐scale wages. Cats too—inflatable fat cats, wearing business suits and pinkie rings, strangling workers.

Judge Posner’s concurring opinion, to demonstrate that the rats are not nuisances, explains that he often passes a similar rat on his commute from Hyde Park.

I’ll scandalize some readers, who think it improper for a judge to stray outside the official trial record, by sharing with them my experience with a roadside union rat. I some‐ times drive to work on a major divided highway called Mar‐ tin Luther King Drive, which runs north from Hyde Park, where I live, south of downtown Chicago, to downtown. As one nears the downtown on MLK Drive one sees (or rather saw, because during the long gestation of this case the rat— alas!—was removed, whether because the labor dispute be‐ tween union and employer was resolved or for some other reason), on the east side of the street, a large inflated rubber rat named Drape (short for Draper and Kramer, the employ‐ er with whom the union that put up that rat was fighting). Every time I drove past the rat I glanced at it, as it was the only noteworthy sight on my route. This glance never caused me to swerve, crash, crouch in my seat, avert my eyes, hit a pedestrian, or cause other mayhem. Nor did I ever observe an accident, even a swerve, in the vicinity of the rat. I saw no driver, or pedestrian, upon glimpsing the rat flee in terror. And yet this rat, like its Grand Chute cousin, was close to a major street—in fact much closer than the Grand Chute rat was to a major street; for while the Grand Chute rat was 70 feet from the highway, my Chicago rat was only about three feet from MLK Drive.

He even took pictures (hopefully not while driving):

I took a close‐up photo of the rat, and another photo of it from across the street. Here are the two photos:

Posner concludes:

I can’t imagine that any driver seeing Drape either close up or from across the street would have been distracted to the point of endangerment.

 

Only Judge Posner would first cite WIkipedia, and then cite a State Department Human Rights Report to “confirm” Wikipedia. His dissent in Fuller v. Lynch considered a removal case where the alien asserted he would be subject to persecution in his native Jamaica because he was bisexual. To show that in fact Jamaica has a hostile culture towards the LGBT community, Posner cites (what else?) Wikipedia.

Fuller testified before the immigration judge at length and in detail about his being bisexual and having had nu‐ merous sexual relationships with both men and women be‐ ginning when he was a pre‐teen, and about the hatred directed against LGBT persons in Jamaica, including by members of his own family. He testified that in college he was stoned by other students on several occasions and a few years later taunted as gay by a group of men who sliced his face with a knife. On another occasion he was robbed at gunpoint by a man who called him a “batty man,” which is a Jamaican slur for a homosexual. And he didn’t make that up: see “Batty boy,” Wikipedia, https://en.wikipedia.org/wiki/Batty_boy (last visited Aug. 17, 2016, as were the other web‐ sites in this opinion), where we learn that “in 2006 Time Magazine claimed that Jamaica was the worst place in the Americas for LGBT people and one of the most homophobic places in the world.

Later in the paragraph, we learn that our State Department agrees with Wikipedia.

Our State Department’s Human Rights Reports for 2012 and 2013 confirm the Wik‐ ipedia entry, as do a report by Amnesty International and a decision by another federal court of appeals: Bromfield v. Mukasey, 543 F.3d 1071, 1076–77 (9th Cir. 2008). The immi‐ gration judge’s opinion is oblivious to these facts.

Priorities.

Judge O’Scannlain, writing for a 9th Circuit panel in U.S. v. McIntosh, concluded that a appropriations rider prohibited DOJ from spending any money to enforce the Controlled Substances Act “to prevent [various] States from implementing their own State laws that authorize the use, distribution, possession, or cultivation of medical marijuana.” As a result, the court dismissed prosecutions as violations of the appropriations clause.

I don’t have any thoughts on the construction of the omnibus budget, but there is one dictum in Judge O’Scannlain’s opinion that is not exactly correct. Footnote 5 on the final page of the opinion states:

Nor does any state law “legalize” possession, distribution, or manufacture of marijuana. Under the Supremacy Clause of the Constitution, state laws cannot permit what federal law prohibits. U.S. Const. art VI, cl. 2. Thus, while the CSA remains in effect, states cannot actually authorize the manufacture, distribution, or possession of marijuana. Such activity remains prohibited by federal law.

The final quoted sentence is absolutely correct. Under Gonzales v. Raich, possession of a controlled remains prohibited by federal law, regardless of what the state law enacts. Justice Stevens explained in Raich:

The Supremacy Clause unambiguously provides that if there is any conflict between federal and state law, federal law shall prevail.

However, the Supremacy Clause does not require California, or any other state, to enact laws criminalizing marijuana. In fact, such a mandate would amount to unlawful commandeering. California remains free to either not criminalize marijuana, or in fact authorize its possession. Utilizing its own resources, it can direct its state officers not to prosecute anyone for possession. If the federal government doesn’t like that, it can DOJ agents into California to arrest people for possession of marijuana that is legal under state law. This is precisely what happened to Angel Raich.

So this sentence, “Under the Supremacy Clause of the Constitution, state laws cannot permit what federal law prohibits,” is not complete. This sentiment only becomes relevant if a defendant raises the state law as a defense to a federal marijuana prosecution. At that point, the federal court would cite the Supremacy Clause, and hold that the state law is preempted. Or DOJ could sue to block the enforcement of the law (like in Arizona v. United States), arguing that it is interfering with federal priorities. But a state is well within its own power to have a law on the books legalizing marijuana, not expend its own resources to criminalize marijuana, and hope the federal government doesn’t waste its time doing the same.

I’ve blogged about this misconception concerning the supremacy clause in the context of a Colorado employee who was fired for marijuana use, even though it was legal under state law. (The opinion was authored by one of the Trump short-listers, Justice Eid).

 

Just as soon as Unraveled is completed, the next chapter in this Obamacare trilogy opens up. By now, you should have read that Aetna is pulling out of virtually 11 out of the 15 ACA exchanges. Humana is also dropping from 15 states to 11 states. UnitedHealth will offer policies on “three or fewer exchanges.” In one county in Arizona, there will not be any ACA policies on the exchange. A number of states will have only one policy available. Alaska came close to having none, but the legislature bailed out the remaining provider.

What caused Aetna’s withdrawal? Jonathan Cohn and Jeffrey Young obtained through FOIA a letter Aetna’s CEO sent to DOJ Antitrust Division. (The Obama administration finally found a FOIA request that it quickly turned around, huh?) In short, the letter states that if Aetna’s merger with Humana goes forward, the “anticipated synergies” will allow the company to expand coverage on the exchanges. However, if the merger is blocked, due to the lack of such “synergies,” the company would have to scale back its exchange coverage. Aetna wrote:

Specifically, if the DOJ sues to enjoin the transaction, we will immediately take action to reduce our 2017 exchange footprint. We currently plan, as part of our strategy following the acquisition, to expand from 15 states in 2016 to 20 states in 2017. However, if we are in the midst of litigation over the Humana transaction, given the risks described above, we will not be able to expand to the five additional states. In addition, we would also withdraw from at least five additional states where generating a market return would take too long for us to justify, given the costs associated with a potential break- up of the transaction. In other words, instead of expanding to 20 states next year, we would reduce our presence to no more than 10 states.

Cohn and Young call it a “threat.” Nick Bagley writes that, “’there’s something disquieting about its thinly veiled suggestion that the Justice Department should bless anti-competitive conduct for short-term political advantage.” My perspective? Aetna made their Faustian pact–now they have to deal with it.

Aetna and their ilk wholeheartedly supported a law they thought would make them lots of money–can you imagine a government mandate to buy your product! They severely miscalculated. Everyone from Jonathan Gruber on down all suffered from the same fatal conceit: if we tinker with subsidies like this, and risk adjustment like that, and structure these risk corridors, then presto, we can erect a magical, dynamic marketplace. When I wrote Unprecedented, I expected the law to chug along for at least a decade before it seriously started to show signs of failing. Boy was I wrong. Now Aetna is in the position that without expanding the size of their risk pools–necessarily through mergers, because enrollments are flat–they can’t afford the law’s onerous mandates and community rating provisions. So now they’re stuck.

Seth Chandler wrote a painstakingly detailed post on whether the ACA is collapsing. Towards the end of the post, Seth uses an image I created in Unraveled about how the ACA is creeping up on the death spiral’s event horizon.

When you see the rapid contraction of the marketplace, when you see gross premiums increasing by more than 20%, and when you yourself are calling for the federal government to spend considerably more on Obamacare, it is time to admit that the existing Obamacare spaceship is passing the event horizon of the adverse selection black hole. Another quest for the unicorn of community rated health insurance has failed.

At some point in the future, I will complete the Obamacare trilogy  (likely publication date in the fall of 2020, around the next election, assuming the Republic is still standing). To keep with the theme, my working titles are #Unbreakable or #Undone. That is, over the next four years, the long-term viability of Obamacare (HillaryCare II?) will become well known. Either the law will survive, against all odds, or it will have to be completely reworked to prevent its implosion. You can probably guess what my prediction is, but I’ll leave my options open.

Update: The WSJ has a fitting take on the release of the letter:

This is some gall. Aetna was answering a June 28 “civil investigative demand,” in which Justice’s antitrust division specifically asked how blocking the merger would “affect Aetna’s business strategy and operations, including Aetna’s participation of the public exchanges related to the Affordable Care Act.”

Soliciting sensitive internal information that Aetna is legally compelled to provide—and then making it public to sandbag the company—is the behavior of political plumbers, not allegedly impartial technocrats. If police tried this, it’d be entrapment