July 29, 2010

Spending, choice, and coercion

By Spending, choice, and coercion

Author: Timothy Sandefur

A reader commenting on yesterday’s post about our lawsuit challenging the constitutionality of ObamaCare asked an interesting question, the answer to which can help illuminate the limits of federal power under the Constitution. “Since the federal government can mandate that hospitals receiving federal monies (e.g. Medicare/Medicaid) must treat everyone who presents in the emergency room, regardless of ability to pay,” writes the commenter, “why can’t Congress mandate that individuals must pay their fair share of that burden by buying a minimally satisfactory health insurance or pay an in-lieu amount of money?”

The requirement that hospitals receiving federal money comply with certain conditions is an exercise of federal power under the Constitution’s Spending Clause, not the Commerce Clause, which is involved in our lawsuit. Under the Spending Clause, Congress may offer money to states or to private parties, and then to attach strings to that money. For instance, the Federal Government subsidizes many colleges and universities, and imposes a great many conditions on the schools that accept such funds. Likewise, in the case of South Dakota v. Dole, the Supreme Court upheld Congress’ authority to require states to change their legal drinking age as a condition of receiving funds to support and maintain highways.

The idea behind the Dole decision is that if states don’t like the conditions, they don’t have to accept the money. Congress had simply offered a “relatively mild encouragement to the States to enact higher minimum drinking ages,” which left the states free to refuse the money if they wanted. Still, the Court did recognize that there were limits to “Congress’ broad spending power.” Congress could not use this power “to induce the States to engage in activities that would themselves be unconstitutional.” Also, “in some circumstances, the financial inducement offered by Congress might be so coercive as to pass the point at which pressure turns into compulsion,” and in such a case, Congress’ action would be unconstitutional.

ObamaCare, however, is different. It’s enacted under the Commerce Clause—the Congress’ authority to “regulate commerce…among the several states.” That power is different, because it doesn’t involve Congress giving anything away, like the Spending Clause does. Instead, under the Commerce Clause, Congress simply dictates what you may and may not do. You cannot refuse to participate in the program, the way South Dakota could in the Dole case. It’s a mandate, not a bargain, and it’s imposed under a different constitutional provision.

But there’s a second problem here. Very frequently, government offers to subsidize certain activities, and then follows up that subsidies by ever increasing amounts of government control. Each control seems sensible in light of the subsidy—and yet the ultimate result is that government calls the shots on everything. First, government provides people with free hospital care. And then, when that turns out to be very expensive, the government follows up by limiting what you’re allowed to do, in order to keep costs down. Everything from seat belt and motorcycle helmet laws, to government agencies determining what kind of operations you may and may not have, are all justified under this theory. People in government housing are even forced to give up their fourth and second amendment rights in many cases.

In the end, whenever you accept government money—often given under some philanthropic cover—there is going to be a hook beneath it. This is all the more reason to say no to big government, no matter how compassionate it might seem at the time.

What to read next