Supreme Court upholds the Individual Mandate…but enforces Commerce Clause limits

June 28, 2012 | By TIMOTHY SANDEFUR

The Supreme Court this morning upheld the constitutionality of the Individual Mandate and other provisions of the Affordable Care Act, in a decision that declared, 5-4, that the Mandate does violate the Commerce Clause, but is still constitutional because it is a kind of tax. This last argument recevied relatively little attention in the past year, and was not addressed at all during the oral argument, if memory serves. But the Court ruled that citizens can be forced to pay taxes, and that taxes can take the form of requiring people to buy insurance instead of paying the government directly. More on that issue in a bit.

Although the Court upholds the Mandate’s constitutionality in the end, it declared that the Mandate exceeds Congress’s Commerce Clause powers, which is a major victory for defenders of limited government. The question of whether the power to “regulate commerce” includes the power to force you to buy a product or service is an extremely important matter; if Congress had such power, it would indeed be the case that the federal government could force people to buy products or services that politicians think they ought to have. Chief Justice Roberts, in his separate opinion, declares the Mandate unconstitutional under the Commerce Clause–a point on which the four dissenters agree. It is therefore the majority opinion of the Court that the Mandate violates the Commerce Clause.

The Court does, however, find that the Mandate “merely imposes a tax citizens may lawfully choose to pay in lieu of buying health insurance.” But this does not mean that Congress has limitless power under the Taxing Clause, the justices say, because a tax that is too “penalizing” will “lose[] its character as [a tax] and become[] a mere penalty with the characteristics of regulation and punishment.” This is not the case here, the Court says, because

“Congress’s authority under the taxing power is limited to requiring an individual to pay money into the Federal Treasury, no more. If a tax is properly paid, the Government has no power to compel or punish individuals subject to it. We do not make light of the severe burden that taxation—especially taxation motivated by a regulatory purpose—can impose. But imposition of a tax nonetheless leaves an individual with a lawful choice to do or not do a certain act, so long as he is willing to pay a tax levied on that choice.”

More to come.