Some conservative opponents of the Affordable Care Act raise an objection to upholding the Act under the taxing power that goes something like this:
It is unfair that President Obama denied that the mandate was a tax to get the legislation passed, but then the Court allowed the mandate to be labeled a tax for purposes of the tax power. If the Administration had to call the mandate a tax, it never would have passed in the first place. The Administration should have to play by consistent rules, and shouldn’t get to switch position midstream. Plus, requiring Congress to label a tax as a tax bolsters the political accountability of the taxing power, which makes sure that the taxing power is not unlimited.
I’m not so sure. Consider the following counterarguments:
1) My understanding is that at the time the mandate was being debated, whether the law fell within within Congress’s tax power was not thought to be a major issue. At that time, it pretty widely agreed among lawyers and legal commentators that the mandate fell under the Commerce Clause power. There were a relatively small number who disagreed with that, but not that many. The argument that the mandate exceeded the Commerce Clause power mostly developed and took hold later. Given that the tax power argument was just a back-up argument, I don’t think the Administration can be accused of playing some sort of trick. This wasn’t a devilish plan by the Obama Administration, but rather a backup argument responding to the acceptance of a narrower reading of the Commerce Clause than was expected at the time the law was being debated and passed.
2) Some argue that the legislation never would have passed if Congress had to call it a tax. But if you want to raise counterfactuals, it should be done with all the issues in the case, not just the tax issue. We need to imagine that the arguments opposing the mandate had been established law going back ten or twenty years, and there were precedents clearly indicating both that (a) you need to label the tax a tax to count under the tax power and (b) Congress cannot enact economic mandates under the Commerce Clause. In that case, the option of a health care mandate would have looked very different from the beginning of the debate over health care. It’s hard to know how that debate would have unfolded over the years.
3) Some argue that requiring the label of a tax would make a major difference because it would considerably increase the political accountability of Congress, thus ensuring a more limited power. But there are two major reasons to question this. First, I doubt that whether a statute calls a payment a tax makes that much of a difference for most people. If politicians bicker over whether a payment is a tax when it is not labeled a tax, why would they stop arguing when it is?
Second, the political accountability of taxes has and can change over time. It happens to be the case that our current political environment is very sensitive to taxes. Calling an item a tax is a big deal, and raising taxes of any kind is out of the question to many in today’s GOP. But while that’s true today, it often has not been true in the past. And it’s probably not a wise idea to base a constitutional rule on the political implications of a label based on one historical period that won’t necessarily be true in the future. Consider an example. Imagine that in 2030, the public is less sensitive to whether something is a tax increase, but Congress wants to regulate all sorts of things beyond the commerce clause power. If the Court in 2012 says that the key issue is the label, then there would be no limits at all on the scope of federal power in 2030: Congress can just call things “taxes” even if they are not, and the item will fall within the taxing power. In that case, focusing on the label won’t further accountability: Rather, it will allow a limitless federal government.