CQ WEEKLY – IN FOCUS
Corrected March 26, 2012 – 4:25 p.m.

A Supreme Test of Federal Power

By David Harrison, CQ Staff

The fate of President Obama’s signature domestic accomplishment is not all that’s hanging in the balance this week as the Supreme Court hears oral arguments on the 2010 health care overhaul. The unusual three-day hearing also presents the highest-profile debate in generations over government power.

TRASH THIS: Iowa Rep. Steve King rips a page from the 2010 health law at a March 21 rally of House Republicans to denounce what they term ‘Obamacare’ as the Supreme Court prepares to hear the case. (WIN MCNAMEE / GETTY IMAGES)

It goes beyond the core question of Congress’ power to regulate under the Commerce Clause, too. The case addresses overarching fundamentals about how the federal government wields its power over the states and also how the judiciary wields authority over those elected to govern.

The fact that the arguments come a month before the court hears a case from Arizona, testing the powers of the states to legislate in the field of immigration, gives this court term particular potential for defining the contours of Washington’s authority.

All in all it is a signal year, combining into a series of cases many of the animating issues of the era at the same time they are being fought out in congressional and presidential election campaigns.

The ultimate significance will depend on whether the court can get its own act together. It takes four votes on the court to decide to review a case, but five to form a majority. And the majority must agree on a particular line of reasoning — as opposed to just a result — in order for an opinion to offer lasting direction. The first big affirmative action decision — Regents of the University of California v. Bakke — was fragmented to the point of being indecipherable.

For now, though, no one wants to contemplate anticlimax.

“This could be the watershed case of a generation, depending on how it comes down,” says historian Jeff Shesol, a former speechwriter for President Bill Clinton and author of a book on President Franklin D. Roosevelt’s battle against the Supreme Court.

“This decision could be the undoing of big elements of what’s been called the Constitutional Revolution of 1937. You can’t undo it all in one fell swoop, but [the justices] can do an enormous amount of damage if they so choose.”

It’s time for this discussion, says Utah Republican Sen. Mike Lee, a former law clerk to Justice Samuel A. Alito. Full scrutiny “has occurred far too infrequently and has not been nearly as robust as it should be in recent decades, in part because the court’s standards have been so permissive that Congress has tended to see those standards as a perpetual green light,” he says. “There needs to be some identifiable limit somewhere.”

The breadth of the controversy embodied in the health care cases stems from its three primary parts.

The Commerce Clause question revolves around the provision of the law requiring uninsured people to buy health insurance. The government argues that the mandate is permissible as a regulation of economic activity.

Opponents say the law dramatically expands the government’s reach by regulating inactivity, requiring people to buy a product.

A Supreme Test of Federal Power

Federalism, while permeating the entire case, is most directly invoked by the health care law’s provision that expands Medicaid, a joint federal-state program offering health care to low-income people.

A group of 26 states suing the federal government argues that the law is coercive because it would withhold billions of dollars from any state that defied the expansion.

The court’s decision on the federalism question could dramatically recast the relationship between Congress and the states, observers say, because scores of federal laws — from highway legislation to education — involve such conditional grants of federal funding.

The Supreme Court’s authority is always at issue when it’s being asked to overturn acts of Congress, which are, by the court’s own precedents, presumed to be constitutional.

But another unusual part of the health care case more directly raises the question of the court’s jurisdiction. The justices will consider whether federal tax law bars them from hearing the challenge to the health care mandate until someone actually is penalized for violating it, which would be some time in 2015 at the earliest.

While some have wondered how seriously the court might take this claim, the justices did not really have to consider it but chose to do so anyway.

New Case, Long History

The broad issues reach back to the 18th- century debates over the ratification of the Constitution, and the resistance of the so-called anti-federalists such as Patrick Henry to the creation of a national government with so much power.

The conflict continued as America’s political parties evolved and fought over whether the Constitution included not only explicit powers, but also “implied powers,” such that the government could create a Bank of the United States that the Framers failed to mention.

Roosevelt’s New Deal produced precedents that addressed similar questions about the federal government’s power.

Roosevelt and an overwhelmingly Democratic Congress worked together to pass a series of popular laws expanding the government’s reach in areas that had been off-limits before then. One law allowed the government to regulate working hours and wages. Another used the tax system to control the price of agricultural commodities. A third established a national railroad pension plan.

But in 1935 and 1936, the Supreme Court knocked down those laws, ruling that the Constitution’s narrow listing of powers granted to Congress did not include the authority that Roosevelt was claiming, such as the ability to intervene in wage disputes or to regulate a sector of the economy.

An outraged Roosevelt threatened to enlarge the court with at least six new members to tilt the balance in favor of his enacted legislation. Soon, Justice Owen J. Roberts abandoned the court’s conservative majority and joined the liberal wing in arguing in favor of broad new federal powers to regulate the economy.

A Supreme Test of Federal Power

With Roberts’ backing, the court handed down a series of cases on March 29, 1937, upholding minimum-wage laws, collective bargaining rights and government aid to farmers. The cases dramatically increased Congress’ power under the Commerce Clause and effectively killed the earlier doctrine limiting congressional authority.

By the time the Supreme Court took up civil rights cases in 1964, a more liberal group of justices repeatedly found that Congress had the right under the Commerce Clause to forbid race-based discrimination in the private sector.

Since then, the New Deal decisions have come to seem more routine than revolutionary. For almost 60 years, the court did not strike down a single law for going beyond the scope of the government’s interstate commerce power, says Erwin Chemerinsky, a constitutional law scholar and the dean of the law school at University of California, Irvine.

After a while, Washington politicians stopped asking where their power ended. And the courts, still under Roosevelt’s influence, deferred to Congress.

The 20th-century expansion of federal power did not come overnight, says J. Mitchell Pickerill, a political science professor at Northern Illinois University who has studied the interaction between Congress and the courts.

“But the ultimate consequence is that Congress really did stop thinking about it. It’s hard to find evidence that Congress was interested in debating the scope of its own power.”

The Supreme Court under Chief Justice William H. Rehnquist attempted to revive that interest by chipping away at Congress’ power. In 1995, for instance, justices struck down a federal law banning guns near schools, declaring that only the states — not Congress — had the power to regulate the carrying of guns in school areas. That case, U.S. v. Lopez, was the first case since 1935 in which the court struck down a major law based on Congress’ power to regulate commerce.

Five years later, in U.S. v. Morrison, the court invalidated parts of the Violence Against Women Act, saying Congress had “exceeded its constitutional bounds” by making gender-based violence a federal crime. “The Supreme Court has really over the last decade started knocking Congress down a peg or two when it comes to exercises of federal power,” says Charles Geyh, a law professor at Indiana University.

The current conflict has in many respects been forced by the tea party movement, which ushered into Congress a wave of rookie lawmakers intent on rolling back the power of the very institution to which they had been elected.

All of a sudden, the debate over the scope and extent of the federal government’s power — which had largely been relegated to legal seminars and think tanks – became the most pressing political question around.

A law professor working with tea party groups on constitutional issues, Georgetown University Law School’s Randy Barnett, is considered the intellectual father of the challenge to the individual mandate, which many other scholars dismissed as frivolous.

With the health care suit, the new small-government advocates in Congress are hoping to lay down a marker for future generations that will set a firm boundary on the government’s power in all aspects of the economy.

“If the individual mandate is upheld, then one could argue that the concept of limited enumerated powers has evolved into something of a fiction,” says Lee, one of the new conservative lawmakers.

A Supreme Test of Federal Power

“If the court decides in this case that Congress acted legitimately within its power under the Commerce Clause, then it’s difficult to imagine almost any regulatory scheme that would not be under Congress’ power as long as it utters the magic words,” Lee says.

Ilya Somin, a George Mason University law professor and co-author of an amicus brief against the law, says a ruling upholding it would give Congress “a nearly unconstrained” power to set new mandates. “It’s easy to imagine that there are lots of industries out there that have considerable political clout that would love to lobby Congress to have people buy their products,” he says.

The government scoffs at these claims in its court briefs. “There is no reason to think that a democratically accountable Congress would ever exercise a power to compel” such purchases, Solicitor General Donald B. Verrilli Jr. argued in a response to the challengers. “Quite the contrary,” he wrote, noting that although the challengers agree that the states have the power to enact mandates, there are no examples of “any state ever having compelled its citizens to buy cars, agricultural products, gym memberships or any other consumer product.”

“I would guess that it wouldn’t have significant implications in other policy areas immediately, but I would anticipate it would be used by opportunistic policy makers and lawmakers down the road,” Pickerill says.

If, on the other hand, the Supreme Court sides with the plaintiffs and strikes down all or part of the law, it could have a dampening effect on ambitious government programs in the future.

In particular, striking down the Medicaid provision could lead to challenges of such major pieces of legislation as the 2002 education law known as No Child Left Behind.

But striking down the individual mandate on “very narrow” grounds “will have much less in the way of a longer-term impact,” says Chemerinsky.

The states argue that the expansion in Medicaid goes beyond the federal government’s usual conditional grant programs that send money to states provided state governments fulfill certain requirements. Because the loss of federal Medicaid grants would be devastating to state budgets, the states argue that the federal government is coercing them to expand their Medicaid programs. That, they say, violates the Constitution’s clause allowing the federal government to tax and spend.

“The court really hasn’t found conditions under the spending clause that it finds coercive enough,” Pickerill says. “If they did in this case, that could have more profound implications for Congress than striking down the individual mandate.”

The What-Ifs

State governments will soon have another opportunity to challenge federal power, when the Supreme Court takes up Arizona’s immigration law. The Justice Department says the federal government’s authority over immigration matters pre-empts the state law, while the states argue that they are merely enforcing an existing statute.

The Arizona case, which the court will hear in April, rests squarely on this question of state versus federal power.

Arizona’s statute requires that state and local law enforcement check the immigration status of people they suspect of being in the country illegally if they stop them for another reason. Critics say it encourages racial profiling and empowers state officials to take over a responsibility that currently belongs to the federal government.

A Supreme Test of Federal Power

The state says that since the federal government has not been carrying out its responsibility to enforce federal immigration law, it has no choice but to take matters into its own hands.

Since the Arizona law was passed, five other states have enacted similar laws, and several more are considering them. All have been challenged in federal courts. Advocates on both sides say they are waiting for the Supreme Court to draw the line between state and federal responsibility.

As both sides gear up for the political battle that will be waged around the court’s decision, it’s clear that not everyone has come to grips with the idea that members of Congress — in this case the conservatives — could actively try to diminish their own power.

“It’s counterintuitive. You assume that everybody wants more power,” Geyh says. But tea party adherents “are on a mission to reduce the role of the federal government in American life.”

Politicians “stand up and say, ‘I will cut government no matter what,’ and everybody goes, ‘hurray’ until [something] happens and the Social Security checks don’t go out, the clinics close down and the post offices can’t function, and then people say, ‘what are you doing?’” says Democratic Sen. Dianne Feinstein of California. “It’s really a situation of great conflict out there right now.”

But Lee says he sees no conflict with his efforts to shrink government at a time when Washington is groping for ways to kick the economy into gear.

“There’s nothing to be reconciled,” he says. “Once you understand the fact that your duty as a member of Congress is to legislate on matters of federal concern and you look at the document that created Congress to begin with and that gave Congress its power, it’s pretty clear, it’s unambiguous, that our power is in fact limited.”

Some Democrats continue to refuse to acknowledge the possibility that their health care law could be invalidated.

“I’m going to suppose that they’re going to uphold the individual mandate,” says Sen. Tom Harkin of Iowa.

But if Harkin is wrong, how will Congress react?

Roosevelt was fortunate to have huge Democratic majorities in Congress and broad popular support. Obama, however, does not have that luxury.

In the past, when the court has gotten in the way of Congress’ major legislative priorities, lawmakers have gone back to the drawing board to recast the law so that it meets constitutional muster.

Pickerill has studied all the statutes struck down by the Supreme Court since 1954. In most cases, Congress did not consider the legislation significant enough to challenge the court’s decision. But in those cases where the court rejected a major new piece of legislation, or a law that enjoyed both congressional and popular support, lawmakers have found a way to reintroduce the legislation.

A Supreme Test of Federal Power

“History tells us that when Congress is deeply committed to a policy, even when the court strikes it down, Congress will find a way to pass it and keep the policy alive,” Pickerill says.
But this case could represent an anomaly. This could be one of those rare cases where the court strikes down a major new law and Congress doesn’t respond. With House Republicans vowing to repeal the law and with many Senate Democrats locked in tight re-election campaigns, there won’t be enough support on Capitol Hill to revisit the issue.

Retiring Sen. Ben Nelson, a Nebraska Democrat, says he expects there would be some effort in Congress to find a way to address the court’s concerns. “The question is whether there would be the will and sufficient voters to pass anything to replace it,” he says.

He doesn’t think so. The administration struggled for more than a year to get the measure through a Democratic Congress. Today, with a split Congress bogging down legislation and a recent ABC News/Washington Post poll showing that two-thirds of respondents want the court to overturn either the individual mandate or the law in its entirety, it would be almost impossible for Obama to pull off a similar legislative accomplishment.

There are enough people on Capitol Hill who want the law to fail that it would be next to impossible to modify it in a way that doesn’t gut it completely, says Nelson. The idea that the law can be tweaked is nothing more than a “red herring,” he says.

For Further Reading: Health law arguments and precedents, CQ Weekly, p. 544; Medicaid programs, 2011 CQ Weekly, p. 1362; legal challenges, p. 292; enactment, 2010 Almanac, p. 9-3. The 2010 law is PL 111-148 and PL 111-152.