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When is a Tax Not a Tax? When the White House Says So.


So, the Supreme Court ruled yesterday that ObamaCare is constitutional because it is a tax. That settles it, right?

Not so fast.

On Friday, the day after the ObamaCare ruling, White House Press Secretary Jay Carney insisted the fine is still just a “penalty”.

Carney went on to say Friday that the “penalty” will affect only about 1 percent of Americans, those who refuse to get health insurance. He said the penalty was modeled after the one put in place in Massachusetts when Mitt Romney was governor.

“It’s a penalty, because you have a choice. You don’t have a choice to pay your taxes, right?” Carney said.

Carney was initially reluctant to assign a label to the fine when pressed repeatedly by reporters Friday. “Call it what you want,” he said.

and more:

You can call it what you want,” he said. “If you read the opinion, it is not a broad-based tax. It affects one percent, by CBO estimates, of the population. It is not something that you assess like an income tax.”
It was unclear which Congressional Budget Office estimate Carney was referring to. Despite being pressed on the issue, though, the spokesman would not relent.

It didn’t even take 24 hours for the games and backtracking by the White House to begin. Don’t forget, they insisted to the American people — in order to get the bill passed — that it was not a tax. Clearly, they are worried about the tax narrative shaping the rest of the election season rhetoric.

Finding Dissonance in the ObamaCare Ruling

The WSJ editorial this morning, The Roberts Rules, was excellent — as it dissects the inconsistencies within the ObamaCare decision. Read it through, but here are some highlights:

The remarkable decision upholding the Affordable Care Act is shot through with confusion—the mandate that’s really a tax, except when it isn’t, and the government whose powers are limited and enumerated, except when they aren’t.

and this:

The Chief Justice ruled that ObamaCare’s mandate violated the Commerce Clause, joined by the Court’s conservative bloc, but he also said that the mandate fell within Congress’s power to tax, joined by the Court’s liberal bloc. In practice this is a restraint on federal power without real restraint—and, worse, the Chief Justice had to rewrite the statute Congress passed in order to salvage it. The ruling will stand as one of the great what-might-have-beens of American constitutional law.

more:

According to Chief Justice Roberts, the penalty is merely a tax on not owning health insurance, no different from “buying gasoline or earning income,” and it thus complies with the Constitution. This a large loophole.

and this:

But if the mandate is really a tax, why doesn’t the law known as the Anti-Injunction Act apply, which says that taxes can’t be challenged legally until they’ve been collected? The Chief Justice actually rules that the mandate is a tax under the Constitution and a mandate for the purposes of tax law.

Additionally, the WSJ lent some more credence to the assertion that Chief Justice Roberts was actually in agreement with Scalia, Thomas, Kennedy, and Alito (giving a 5-4 strikedown), but at the last minute changed his mind. “One telling note is that the dissent refers repeatedly to “Justice Ginsburg’s dissent” and “the dissent” on the mandate, but of course they should be referring to Ruth Bader Ginsburg’s concurrence. This wording and other sources suggest that there was originally a 5-4 majority striking down at least part of ObamaCare, but then the Chief Justice changed his mind”. This theory was floated yesterday first by Paul Campos and Brad Delong who noticed language confusion and tone changes in the opinion. Their ideas are examined more in depth here.

Now that we have a both a scrutiny of the dissonance and a peek at some silver linings, where do we go from here? It is clear that November must be our top priority — both at the Presidential level and Congress, especially the Senate. And then, we’ll see whether American can be preserved.

Update #1:and the White House (Jay Carney) is already insisting today that it is NOT A TAX