Monthly Archives: June 2012

Scott St. Clair: The ObamaCare Decision; The Only Surprise is That Anyone is Surprised

Obamacare is constitutional, says the United States Supreme Court – now what?

At the outset, I’m neither shocked nor surprised at the outcome. Like most common-sense people I regard Obamacare as an abomination and a one-way ticket to bloating the federal budget even more than it is. But I also know something about courts and the law, so I never expect a court to do what everyone thinks it will or should do – courts do what they do. Welcome to a hard dose of judicial reality.

But in that reality is a great big club – the right club – that will beat the beast to death: The hatred Americans have for being over taxed, especially to the tune of $1.76 trillion. Obamacare is now the largest tax increase in American history.

From my early days in activism I learned that relying on courts for your 

political salvation is a fools’ errand. Political issues can only be decided where political issues are always decided, and that’s in the streets, at the ballot box and in the Legislature, in this case Congress. Obamacare is a political issue, and it ultimately must be decided politically.

By upholding the individual mandate as a tax, Mitt Romney now has a new campaign tag line that will damage President Obama and the Democrats: The Obamacare tax on the middle class
Tax, tax, tax, tax, tax, tax – say it often enough and it will stick.

So, there’s some comfort to be taken from this statement found at the outset of Chief Justice John Roberts’ majority opinion: “We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders.” And I would add it includes the judgment of the voters. 
The court took pains to emphasize its tradition to bend over backwards, if necessary, to uphold a legislative act rather than strike it down. By calling the Obamacare individual mandate a tax rather than a penalty for not engaging in commerce, the Court found a peg upon which to hang its judicial robes. 

In simple terms, I defer to SCOTUSBlog.com, which said:
“There were not five votes to uphold (Obamacare) on the ground that Congress could use its power to regulate commerce between the states to require everyone to buy health insurance. However, five Justices agreed that the penalty that someone must pay if he refuses to buy insurance is a kind of tax that Congress can impose using its taxing power. That is all that matters. Because the mandate survives, the Court did not need to decide what other parts of the statute were constitutional…” 
I’ve read a lot of court opinions in my time that do pretty much what’s described – it’s just that this time, the stakes were much higher.

What made me nervous during the run up to the decision was the proliferation of pundits and amateurs making cock-sure predictions that the law would be struck down. When the like-minded talk exclusively with each other, they convince themselves that their hopes are facts and that their facts control. Courts don’t work that way, and people need to understand that.

Literally, within seconds of the decision and opinion being made public, the Internet was swamped with what I can only call dopey statements from the know-nothing wing of the conservative movement. “Chief Justice John Roberts is now dead to me.” “Impeach the Supreme Court.” 

Perhaps the worst was this one dumped on one of my Facebook posts on the decision: “Bush screws us AGAIN! This is how Progressives work and to say that people wanted Jeb Bush to run as Pres or VP?!” Even people ostensibly on our side of the political fence blame Bush.

Because we’re now faced with the political reality of the survival of Obamacare, it’s a waste of time, and politically lazy, to blame it on judges, Democrats, Congressional Republicans, George W. Bush or anyone but the person we see every morning in the mirror. In other words, let’s screw our courage to the sticking place, quit worrying about what your boss or your neighbor or your kids think about your beliefs, get out into the streets, organize the socks off everyone you know and fight like hell without rest until Obamacare is repealed.

Or get used to it.
Tell ’em where you saw it. Http://www.victoriataft.com

Pete the Banker: Be Wary of the Rosy Housing Numbers

Be wary of these fluffy mass media headlines, “U.S. single-family home prices picked up for a third month in a row “ and “Annual pending home sales are up 13.3%, while, compared to April 2012, May is up nearly 6%”
Most owner occupied (as distinct from investor)  residential pending sales are subject to financing.  Just because a home purchaser enters an earnest money agreement it doesn’t mean that the purchase will close three months later if it can’t be financed.   Increases in pending sales don’t necessarily translate into actual sales. 
Additionally, investors cash purchases still dominate the residential sales market.  Those markets recently seeing the largest sales increases as reported by both Core Logic and Case Shiller showed a heavy concentration of distressed sales according to Diane Olick of CNBC
Two major problems persist in the housing market.  Distressed sales and potential distressed properties inventory still dominate the market.  The potential home inventory exceeds the stated inventory because of shadow inventory numbers and distressed values of housing.  The National Association of Realtors figures include houses on the market, not potential future inventory.   The estimated shadow inventory is up to 4MM units.   This number is further compounded by underwater borrowers (11 MM by most estimates with Zillow even higher ) who are trapped in existing homes at values less than their mortgage balance as well as by mortgage modifications (some 1MM under HAMP and 4 MM Hope Now) many of which re-default within 12 – 18 months after modification.  Both of these sources will inflate future housing inventory levels. 
The second problem is financing.  Lawrence Yun, NAR chief economist said, “The housing market is clearly superior this year compared with the past four years,”  and  “Actual closings for existing-home sales have been notably higher since the beginning of the year and we’re on track to see a 9 to 10% improvement in total sales for 2012.”  Notice that Yun states that sales will increase 10% this year, yet according to the Mortgage Bankers Association sales are only 20% of total current residential mortgage loan financings.  Refinances, not housing sales, are driving the mortgage financing market.  Even a 10% increase in sales this year belies a healthy housing market.
The Mortgage Bankers Association projects total single family residential financings of $1.2 Trillion this year.  While that is slightly higher than last year’s results and  20% higher than their earlier projection this year, it is still only one half of the total financing volume in 2007.  The financing market is still overly dependent upon Freddie, Fannie and the FHA.  These government entities in the absence of Administration and Congressional reform (the House has passed reform measures, Harry Reid and the Senate seem absent), now provide more than 85% of residential financing.   And with every home refinanced, the archaic GSE model draws additional capital funds from the American taxpayer, a subsidy engineered to perpetuate the government’s failed social engineering.  Until private funds return to the mortgage market (likely requiring higher rates commensurate with risk), financing volume and increasing owner occupied homeownership will languish. 
Washington, DC and this Administration continue to rely upon active Federal interference and artificially low interest rates to magically re-awaken the housing market.  It hasn’t worked over the past 3+ years and it won’t work.  Until the residential housing market is unfettered, hope of a sustained improvement in the housing and housing finance markets will continue to be nothing more than myth!
Pete the Banker is a Portland area banker. And that’s all we’ll say because we know what happens to Portland Businessmen who are more conservative who speak truth to power, er, tyrants.
Tell ’em where you saw it. Http://www.victoriataft.com

Here Come the ObamaCare AtTAX Ads

Within an hour of the US Supreme Court decision on ObamaCare, Romney’s reelection campaign picked up. From New York Magazine,

In less than twelve hours after the Supreme Court delivered its landmark ruling Thursday upholding President Obama’s Affordable Care Act, the Romney campaign raised $3.2 million and counting in donations through its website, according to Romney spokeswoman Andrea Saul. Considering that Romney and the RNC had about $107 million on hand at the end of May, the figure itself may not seem that significant. However, Buzzfeed reports that the donations poured in from more than 30,000 individual donors. By comparison, Romney’s campaign only received 27,661 individual donations during the entire month of May.

And the commercials have hit the web and airwaves:

Tell ’em where you saw it. Http://www.victoriataft.com

Scott St. Clair: The ObamaCare Decision; The Only Surprise is That Anyone is Surprised

Obamacare is constitutional, says the United States Supreme Court – now what?

At the outset, I’m neither shocked nor surprised at the outcome. Like most common-sense people I regard Obamacare as an abomination and a one-way ticket to bloating the federal budget even more than it is. But I also know something about courts and the law, so I never expect a court to do what everyone thinks it will or should do – courts do what they do. Welcome to a hard dose of judicial reality.

But in that reality is a great big club – the right club – that will beat the beast to death: The hatred Americans have for being over taxed, especially to the tune of $1.76 trillion. Obamacare is now the largest tax increase in American history.

From my early days in activism I learned that relying on courts for your 

political salvation is a fools’ errand. Political issues can only be decided where political issues are always decided, and that’s in the streets, at the ballot box and in the Legislature, in this case Congress. Obamacare is a political issue, and it ultimately must be decided politically.

By upholding the individual mandate as a tax, Mitt Romney now has a new campaign tag line that will damage President Obama and the Democrats: The Obamacare tax on the middle class
Tax, tax, tax, tax, tax, tax – say it often enough and it will stick.

So, there’s some comfort to be taken from this statement found at the outset of Chief Justice John Roberts’ majority opinion: “We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders.” And I would add it includes the judgment of the voters. 
The court took pains to emphasize its tradition to bend over backwards, if necessary, to uphold a legislative act rather than strike it down. By calling the Obamacare individual mandate a tax rather than a penalty for not engaging in commerce, the Court found a peg upon which to hang its judicial robes. 

In simple terms, I defer to SCOTUSBlog.com, which said:
“There were not five votes to uphold (Obamacare) on the ground that Congress could use its power to regulate commerce between the states to require everyone to buy health insurance. However, five Justices agreed that the penalty that someone must pay if he refuses to buy insurance is a kind of tax that Congress can impose using its taxing power. That is all that matters. Because the mandate survives, the Court did not need to decide what other parts of the statute were constitutional…” 
I’ve read a lot of court opinions in my time that do pretty much what’s described – it’s just that this time, the stakes were much higher.

What made me nervous during the run up to the decision was the proliferation of pundits and amateurs making cock-sure predictions that the law would be struck down. When the like-minded talk exclusively with each other, they convince themselves that their hopes are facts and that their facts control. Courts don’t work that way, and people need to understand that.

Literally, within seconds of the decision and opinion being made public, the Internet was swamped with what I can only call dopey statements from the know-nothing wing of the conservative movement. “Chief Justice John Roberts is now dead to me.” “Impeach the Supreme Court.” 

Perhaps the worst was this one dumped on one of my Facebook posts on the decision: “Bush screws us AGAIN! This is how Progressives work and to say that people wanted Jeb Bush to run as Pres or VP?!” Even people ostensibly on our side of the political fence blame Bush.

Because we’re now faced with the political reality of the survival of Obamacare, it’s a waste of time, and politically lazy, to blame it on judges, Democrats, Congressional Republicans, George W. Bush or anyone but the person we see every morning in the mirror. In other words, let’s screw our courage to the sticking place, quit worrying about what your boss or your neighbor or your kids think about your beliefs, get out into the streets, organize the socks off everyone you know and fight like hell without rest until Obamacare is repealed.

Or get used to it.
Tell ’em where you saw it. Http://www.victoriataft.com

Pete the Banker: Be Wary of the Rosy Housing Numbers

Be wary of these fluffy mass media headlines, “U.S. single-family home prices picked up for a third month in a row “ and “Annual pending home sales are up 13.3%, while, compared to April 2012, May is up nearly 6%”
Most owner occupied (as distinct from investor)  residential pending sales are subject to financing.  Just because a home purchaser enters an earnest money agreement it doesn’t mean that the purchase will close three months later if it can’t be financed.   Increases in pending sales don’t necessarily translate into actual sales. 
Additionally, investors cash purchases still dominate the residential sales market.  Those markets recently seeing the largest sales increases as reported by both Core Logic and Case Shiller showed a heavy concentration of distressed sales according to Diane Olick of CNBC
Two major problems persist in the housing market.  Distressed sales and potential distressed properties inventory still dominate the market.  The potential home inventory exceeds the stated inventory because of shadow inventory numbers and distressed values of housing.  The National Association of Realtors figures include houses on the market, not potential future inventory.   The estimated shadow inventory is up to 4MM units.   This number is further compounded by underwater borrowers (11 MM by most estimates with Zillow even higher ) who are trapped in existing homes at values less than their mortgage balance as well as by mortgage modifications (some 1MM under HAMP and 4 MM Hope Now) many of which re-default within 12 – 18 months after modification.  Both of these sources will inflate future housing inventory levels. 
The second problem is financing.  Lawrence Yun, NAR chief economist said, “The housing market is clearly superior this year compared with the past four years,”  and  “Actual closings for existing-home sales have been notably higher since the beginning of the year and we’re on track to see a 9 to 10% improvement in total sales for 2012.”  Notice that Yun states that sales will increase 10% this year, yet according to the Mortgage Bankers Association sales are only 20% of total current residential mortgage loan financings.  Refinances, not housing sales, are driving the mortgage financing market.  Even a 10% increase in sales this year belies a healthy housing market.
The Mortgage Bankers Association projects total single family residential financings of $1.2 Trillion this year.  While that is slightly higher than last year’s results and  20% higher than their earlier projection this year, it is still only one half of the total financing volume in 2007.  The financing market is still overly dependent upon Freddie, Fannie and the FHA.  These government entities in the absence of Administration and Congressional reform (the House has passed reform measures, Harry Reid and the Senate seem absent), now provide more than 85% of residential financing.   And with every home refinanced, the archaic GSE model draws additional capital funds from the American taxpayer, a subsidy engineered to perpetuate the government’s failed social engineering.  Until private funds return to the mortgage market (likely requiring higher rates commensurate with risk), financing volume and increasing owner occupied homeownership will languish. 
Washington, DC and this Administration continue to rely upon active Federal interference and artificially low interest rates to magically re-awaken the housing market.  It hasn’t worked over the past 3+ years and it won’t work.  Until the residential housing market is unfettered, hope of a sustained improvement in the housing and housing finance markets will continue to be nothing more than myth!
Pete the Banker is a Portland area banker. And that’s all we’ll say because we know what happens to Portland Businessmen who are more conservative who speak truth to power, er, tyrants.
Tell ’em where you saw it. Http://www.victoriataft.com

Here Come the ObamaCare AtTAX Ads

Within an hour of the US Supreme Court decision on ObamaCare, Romney’s reelection campaign picked up. From New York Magazine,

In less than twelve hours after the Supreme Court delivered its landmark ruling Thursday upholding President Obama’s Affordable Care Act, the Romney campaign raised $3.2 million and counting in donations through its website, according to Romney spokeswoman Andrea Saul. Considering that Romney and the RNC had about $107 million on hand at the end of May, the figure itself may not seem that significant. However, Buzzfeed reports that the donations poured in from more than 30,000 individual donors. By comparison, Romney’s campaign only received 27,661 individual donations during the entire month of May.

And the commercials have hit the web and airwaves:

Tell ’em where you saw it. Http://www.victoriataft.com

HOLDER FOUND IN CONTEMPT OF CONGRESS FOR FAST & FURIOUS DOCUMENTS

Washington (CNN) — The House of Representatives voted Thursday to hold Attorney General Eric Holder in criminal contempt for refusing to turn over documents tied to the botched Fast and Furious gun-running sting — a discredited operation that has become a sharp point of contention between Democrats and Republicans in Washington.
The 255-67 vote marked the first time in American history that the head of the Justice Department has been held in contempt by Congress. Almost every House Republican backed the measure, along with 17 Democrats.
A large number of Democrats — including members of the Congressional Black Caucus and House Minority Leader Nancy Pelosi — walked off the House floor in protest and refused to participate in the vote. Speaking in New Orleans immediately after the vote, Holder dismissed it as “the regrettable culmination of what became a misguided — and politically motivated — investigation during an election year.”

Tell ’em where you saw it. Http://www.victoriataft.com

Individual Mandate Survives the Health Care Decision

Money quote from opinion via SCOTUSBlog:  

“Our precedent demonstrates that Congress had the power to impose the exaction in Section 5000A under the taxing power, and that Section 5000A need not be read to do more than impose a tax. This is sufficient to sustain it.” 

Roberts’ rationale is on pages 31 & 32 of the decision which is here.  The discussion is about the past precendent always assumes the benefit of doubt to Congress; to find the authority with which they can implement statute; not find a way in which they thorw it out. 


The Government relies primarily on our decision in Gonzales v. Raich. In Raich, we considered “comprehensive legislation to regulate the interstate market” in marijuana. 545 U. S., at 22. Certain individuals sought anexemption from that regulation on the ground that theyengaged in only intrastate possession and consumption.We denied any exemption, on the ground that marijuanais a fungible commodity, so that any marijuana couldbe readily diverted into the interstate market. Congress’sattempt to regulate the interstate market for marijuanawould therefore have been substantially undercut if it could not also regulate intrastate possession and consumption. Id., at 19. Accordingly, we recognized that“Congress was acting well within its authority” under the Necessary and Proper Clause even though its “regulationensnare[d] some purely intrastate activity.” Id., at 22; see also Perez, 402 U. S., at 154. Raich thus did not involve the exercise of any “great substantive and independentpower,” McCulloch, supra, at 411, of the sort at issue here. Instead, it concerned only the constitutionality of “individual applications of a concededly valid statutory scheme.” Raich, supra, at 23 (emphasis added).
Just as the individual mandate cannot be sustained as a law regulating the substantial effects of the failure to purchase health insurance, neither can it be upheld asa “necessary and proper” component of the insurance reforms. The commerce power thus does not authorize the mandate. Accord, post, at 4–16 (joint opinion of SCALIA, KENNEDY, THOMAS, and ALITO, JJ., dissenting).
31 Cite as: 567 U. S. ____ (2012)
Opinion of ROBERTS, C. J.
B That is not the end of the matter. Because the Commerce Clause does not support the individual mandate, itis necessary to turn to the Government’s second argument: that the mandate may be upheld as within Congress’senumerated power to “lay and collect Taxes.” Art. I, §8,
cl. 1.
The Government’s tax power argument asks us to view the statute differently than we did in considering its commerce power theory. In making its Commerce Clauseargument, the Government defended the mandate as aregulation requiring individuals to purchase health insurance. The Government does not claim that the taxingpower allows Congress to issue such a command. Instead, the Government asks us to read the mandate not as ordering individuals to buy insurance, but rather as imposing a tax on those who do not buy that product.
The text of a statute can sometimes have more than one possible meaning. To take a familiar example, a law that reads “no vehicles in the park” might, or might not, ban bicycles in the park. And it is well established that if a statute has two possible meanings, one of which violates the Constitution, courts should adopt the meaning thatdoes not do so. Justice Story said that 180 years ago: “No court ought, unless the terms of an act rendered it unavoidable, to give a construction to it which should involve a violation, however unintentional, of the constitution.” Parsons v. Bedford, 3 Pet. 433, 448–449 (1830). Justice Holmes made the same point a century later: “[T]he rule issettled that as between two possible interpretations of a statute, by one of which it would be unconstitutional and by the other valid, our plain duty is to adopt that whichwill save the Act.” Blodgett v. Holden, 275 U. S. 142, 148 (1927) (concurring opinion).
The most straightforward reading of the mandate isthat it commands individuals to purchase insurance.
32
NATIONAL FEDERATION OF INDEPENDENT
BUSINESS v. SEBELIUS
Opinion of ROBERTS, C. J.
After all, it states that individuals “shall” maintain health insurance. 26 U. S. C. §5000A(a). Congress thought itcould enact such a command under the Commerce Clause, and the Government primarily defended the law on thatbasis. But, for the reasons explained above, the Commerce Clause does not give Congress that power. Under our precedent, it is therefore necessary to ask whether theGovernment’s alternative reading of the statute—that itonly imposes a tax on those without insurance—is a reasonable one.
Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes. See §5000A(b). That, according to the Government,means the mandate can be regarded as establishing acondition—not owning health insurance—that triggers atax—the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance.Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earning income. And if the mandate is in effect just a tax hike on certain taxpayers who do not have health insurance, itmay be within Congress’s constitutional power to tax.
The question is not whether that is the most naturalinterpretation of the mandate, but only whether it is a “fairly possible” one. Crowell v. Benson, 285 U. S. 22, 62 (1932). As we have explained, “every reasonable construction must be resorted to, in order to save a statute from unconstitutionality.” Hooper v. California, 155 U. S. 648, 657 (1895). The Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution. Granting the Act the full measure of deference owed to federal statutes, it can be so read, for the reasons set forth below.
Opinion of ROBERTS, C. J.
33 Cite as: 567 U. S. ____ (2012)
Opinion of the Court
C The exaction the Affordable Care Act imposes on those without health insurance looks like a tax in many respects. The “[s]hared responsibility payment,” as thestatute entitles it, is paid into the Treasury by “taxpayer[s]” when they file their tax returns. 26 U. S. C. §5000A(b). It does not apply to individuals who do not pay federal income taxes because their household income is less than the filing threshold in the Internal Revenue Code. §5000A(e)(2). For taxpayers who do owe the payment, its amount is determined by such familiar factors astaxable income, number of dependents, and joint filing status. §§5000A(b)(3), (c)(2), (c)(4). The requirement topay is found in the Internal Revenue Code and enforced by the IRS, which—as we previously explained—must assessand collect it “in the same manner as taxes.” Supra, at 13–14. This process yields the essential feature of any tax:it produces at least some revenue for the Government. United States v. Kahriger, 345 U. S. 22, 28, n. 4 (1953). Indeed, the payment is expected to raise about $4 billionper year by 2017. Congressional Budget Office, Paymentsof Penalties for Being Uninsured Under the Patient Protection and Affordable Care Act (Apr. 30, 2010), in SelectedCBO Publications Related to Health Care Legislation,2009–2010, p. 71 (rev. 2010). It is of course true that the Act describes the payment asa “penalty,” not a “tax.” But while that label is fatal to the application of the Anti-Injunction Act, supra, at 12–13, it does not determine whether the payment may be viewedas an exercise of Congress’s taxing power. It is up to Congress whether to apply the Anti-Injunction Act to anyparticular statute, so it makes sense to be guided by Congress’s choice of label on that question. That choice does not, however, control whether an exaction is within Congress’s constitutional power to tax.Our precedent reflects this: In 1922, we decided two

I’m on twitter @VictoriaTaft right now. Please follow me there. That’s where the action is at the moment. 

Tell ’em where you saw it. Http://www.victoriataft.com

HOLDER FOUND IN CONTEMPT OF CONGRESS FOR FAST & FURIOUS DOCUMENTS

Washington (CNN) — The House of Representatives voted Thursday to hold Attorney General Eric Holder in criminal contempt for refusing to turn over documents tied to the botched Fast and Furious gun-running sting — a discredited operation that has become a sharp point of contention between Democrats and Republicans in Washington.
The 255-67 vote marked the first time in American history that the head of the Justice Department has been held in contempt by Congress. Almost every House Republican backed the measure, along with 17 Democrats.
A large number of Democrats — including members of the Congressional Black Caucus and House Minority Leader Nancy Pelosi — walked off the House floor in protest and refused to participate in the vote. Speaking in New Orleans immediately after the vote, Holder dismissed it as “the regrettable culmination of what became a misguided — and politically motivated — investigation during an election year.”

Tell ’em where you saw it. Http://www.victoriataft.com

Individual Mandate Survives the Health Care Decision

Money quote from opinion via SCOTUSBlog:  

“Our precedent demonstrates that Congress had the power to impose the exaction in Section 5000A under the taxing power, and that Section 5000A need not be read to do more than impose a tax. This is sufficient to sustain it.” 

Roberts’ rationale is on pages 31 & 32 of the decision which is here.  The discussion is about the past precendent always assumes the benefit of doubt to Congress; to find the authority with which they can implement statute; not find a way in which they thorw it out. 


The Government relies primarily on our decision in Gonzales v. Raich. In Raich, we considered “comprehensive legislation to regulate the interstate market” in marijuana. 545 U. S., at 22. Certain individuals sought anexemption from that regulation on the ground that theyengaged in only intrastate possession and consumption.We denied any exemption, on the ground that marijuanais a fungible commodity, so that any marijuana couldbe readily diverted into the interstate market. Congress’sattempt to regulate the interstate market for marijuanawould therefore have been substantially undercut if it could not also regulate intrastate possession and consumption. Id., at 19. Accordingly, we recognized that“Congress was acting well within its authority” under the Necessary and Proper Clause even though its “regulationensnare[d] some purely intrastate activity.” Id., at 22; see also Perez, 402 U. S., at 154. Raich thus did not involve the exercise of any “great substantive and independentpower,” McCulloch, supra, at 411, of the sort at issue here. Instead, it concerned only the constitutionality of “individual applications of a concededly valid statutory scheme.” Raich, supra, at 23 (emphasis added).
Just as the individual mandate cannot be sustained as a law regulating the substantial effects of the failure to purchase health insurance, neither can it be upheld asa “necessary and proper” component of the insurance reforms. The commerce power thus does not authorize the mandate. Accord, post, at 4–16 (joint opinion of SCALIA, KENNEDY, THOMAS, and ALITO, JJ., dissenting).
31 Cite as: 567 U. S. ____ (2012)
Opinion of ROBERTS, C. J.
B That is not the end of the matter. Because the Commerce Clause does not support the individual mandate, itis necessary to turn to the Government’s second argument: that the mandate may be upheld as within Congress’senumerated power to “lay and collect Taxes.” Art. I, §8,
cl. 1.
The Government’s tax power argument asks us to view the statute differently than we did in considering its commerce power theory. In making its Commerce Clauseargument, the Government defended the mandate as aregulation requiring individuals to purchase health insurance. The Government does not claim that the taxingpower allows Congress to issue such a command. Instead, the Government asks us to read the mandate not as ordering individuals to buy insurance, but rather as imposing a tax on those who do not buy that product.
The text of a statute can sometimes have more than one possible meaning. To take a familiar example, a law that reads “no vehicles in the park” might, or might not, ban bicycles in the park. And it is well established that if a statute has two possible meanings, one of which violates the Constitution, courts should adopt the meaning thatdoes not do so. Justice Story said that 180 years ago: “No court ought, unless the terms of an act rendered it unavoidable, to give a construction to it which should involve a violation, however unintentional, of the constitution.” Parsons v. Bedford, 3 Pet. 433, 448–449 (1830). Justice Holmes made the same point a century later: “[T]he rule issettled that as between two possible interpretations of a statute, by one of which it would be unconstitutional and by the other valid, our plain duty is to adopt that whichwill save the Act.” Blodgett v. Holden, 275 U. S. 142, 148 (1927) (concurring opinion).
The most straightforward reading of the mandate isthat it commands individuals to purchase insurance.
32
NATIONAL FEDERATION OF INDEPENDENT
BUSINESS v. SEBELIUS
Opinion of ROBERTS, C. J.
After all, it states that individuals “shall” maintain health insurance. 26 U. S. C. §5000A(a). Congress thought itcould enact such a command under the Commerce Clause, and the Government primarily defended the law on thatbasis. But, for the reasons explained above, the Commerce Clause does not give Congress that power. Under our precedent, it is therefore necessary to ask whether theGovernment’s alternative reading of the statute—that itonly imposes a tax on those without insurance—is a reasonable one.
Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes. See §5000A(b). That, according to the Government,means the mandate can be regarded as establishing acondition—not owning health insurance—that triggers atax—the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance.Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earning income. And if the mandate is in effect just a tax hike on certain taxpayers who do not have health insurance, itmay be within Congress’s constitutional power to tax.
The question is not whether that is the most naturalinterpretation of the mandate, but only whether it is a “fairly possible” one. Crowell v. Benson, 285 U. S. 22, 62 (1932). As we have explained, “every reasonable construction must be resorted to, in order to save a statute from unconstitutionality.” Hooper v. California, 155 U. S. 648, 657 (1895). The Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution. Granting the Act the full measure of deference owed to federal statutes, it can be so read, for the reasons set forth below.
Opinion of ROBERTS, C. J.
33 Cite as: 567 U. S. ____ (2012)
Opinion of the Court
C The exaction the Affordable Care Act imposes on those without health insurance looks like a tax in many respects. The “[s]hared responsibility payment,” as thestatute entitles it, is paid into the Treasury by “taxpayer[s]” when they file their tax returns. 26 U. S. C. §5000A(b). It does not apply to individuals who do not pay federal income taxes because their household income is less than the filing threshold in the Internal Revenue Code. §5000A(e)(2). For taxpayers who do owe the payment, its amount is determined by such familiar factors astaxable income, number of dependents, and joint filing status. §§5000A(b)(3), (c)(2), (c)(4). The requirement topay is found in the Internal Revenue Code and enforced by the IRS, which—as we previously explained—must assessand collect it “in the same manner as taxes.” Supra, at 13–14. This process yields the essential feature of any tax:it produces at least some revenue for the Government. United States v. Kahriger, 345 U. S. 22, 28, n. 4 (1953). Indeed, the payment is expected to raise about $4 billionper year by 2017. Congressional Budget Office, Paymentsof Penalties for Being Uninsured Under the Patient Protection and Affordable Care Act (Apr. 30, 2010), in SelectedCBO Publications Related to Health Care Legislation,2009–2010, p. 71 (rev. 2010). It is of course true that the Act describes the payment asa “penalty,” not a “tax.” But while that label is fatal to the application of the Anti-Injunction Act, supra, at 12–13, it does not determine whether the payment may be viewedas an exercise of Congress’s taxing power. It is up to Congress whether to apply the Anti-Injunction Act to anyparticular statute, so it makes sense to be guided by Congress’s choice of label on that question. That choice does not, however, control whether an exaction is within Congress’s constitutional power to tax.Our precedent reflects this: In 1922, we decided two

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LIVE BLOGGING OF SCOTUS HEALTH CARE DECISION HERE. WATCH THIS SPACE.

See the live blog here starting in the am.  

This is what Attorney David Rivkin told me is likely to happen in court Thursday morning. Please hear our conversation from Wednesday’s show here. Rivkin is a court watcher, inside the beltway big shot lawyer, arguer of the case for the 28 states in a lower court. He writes for the Wall Street Journal op ed page on constitutional issues and is a frequent guest on The Victoria Taft Show.

He believes Justice Kagan will start things off and read the opinion on the Stolen Valor case. Rivkin believes the Stolen Valor Act will go down because you can’t criminalize speech-ha! hate crimes anyone?–but we’ll see. He’s as sharp as they come and he’s probably right.

Justice Thomas is likely to take on an important decision about who has standing before the court. This is a biggie but inside baseball stuff. Something this important would not likely be given to the newbies on the court.

Then Chief Justice John Roberts will read the ObamaCare decision. He has written nothing this term and has taken on responsibility for writing the majority opinion in a case that legal scholars will parse and teach and learn from for decades to come. The ObamaCare decision is as important to individual liberty and the relationship of an individual to his government as Brown or Roe. It will determine if Americans are mere subjects or if they are Citizens.

My hope is that all of ObamaCare goes down because of the impossibility of determining congressional intent and the lack of a severability clause, but I know it’s too much to hope for. That said, I think we’re possibly looking at a 5-4 or 6-3 decision (hopefully with Sotomayor coming over–don’t ask me why, I’m just hoping) throwing out the mandate but keeping some of the superstructure of the bill. Like a black dwarf, it’s big but meaningless.

What’s your prediction?

Tell ’em where you saw it. Http://www.victoriataft.com

LIVE BLOGGING OF SCOTUS HEALTH CARE DECISION HERE. WATCH THIS SPACE.

See the live blog here starting in the am.  

This is what Attorney David Rivkin told me is likely to happen in court Thursday morning. Please hear our conversation from Wednesday’s show here. Rivkin is a court watcher, inside the beltway big shot lawyer, arguer of the case for the 28 states in a lower court. He writes for the Wall Street Journal op ed page on constitutional issues and is a frequent guest on The Victoria Taft Show.

He believes Justice Kagan will start things off and read the opinion on the Stolen Valor case. Rivkin believes the Stolen Valor Act will go down because you can’t criminalize speech-ha! hate crimes anyone?–but we’ll see. He’s as sharp as they come and he’s probably right.

Justice Thomas is likely to take on an important decision about who has standing before the court. This is a biggie but inside baseball stuff. Something this important would not likely be given to the newbies on the court.

Then Chief Justice John Roberts will read the ObamaCare decision. He has written nothing this term and has taken on responsibility for writing the majority opinion in a case that legal scholars will parse and teach and learn from for decades to come. The ObamaCare decision is as important to individual liberty and the relationship of an individual to his government as Brown or Roe. It will determine if Americans are mere subjects or if they are Citizens.

My hope is that all of ObamaCare goes down because of the impossibility of determining congressional intent and the lack of a severability clause, but I know it’s too much to hope for. That said, I think we’re possibly looking at a 5-4 or 6-3 decision (hopefully with Sotomayor coming over–don’t ask me why, I’m just hoping) throwing out the mandate but keeping some of the superstructure of the bill. Like a black dwarf, it’s big but meaningless.

What’s your prediction?

Tell ’em where you saw it. Http://www.victoriataft.com