A Congress of Unlimited Power?

Preamble

In the debates about the passage of the Patient Protection and Affordable Care Act (ACA), there were charges (and denials) that ACA would include “death panels”. In fact, a central feature of ACA was the now-defunct Independent Payment Advisory Board (IPAB), which was

to have the explicit task of achieving specified savings in Medicare without affecting coverage or quality….

Beginning in 2013, the Chief Actuary of the Centers for Medicare and Medicaid Services determined in particular years the projected per capita growth rate for Medicare for a multi-year period ending in the second year thereafter (the “implementation year”). If the projection exceeded a target growth rate, IPAB was to develop a proposal to reduce Medicare spending in the implementation year by a specified amount.

With regard to IPAB’s recommendations, the law said: “The proposal shall not include any recommendation to ration health care, raise revenues or Medicare beneficiary premiums … , increase Medicare beneficiary cost sharing (including deductibles, coinsurance, and co-payments), or otherwise restrict benefits or modify eligibility criteria.”

Defenders of ACA claimed that IPAB wasn’t a “death panel” (or an incipient one) because ACA specifically prohibited it from recommending the rationing of health care. But IPAB didn’t have to ration health care directly. All it had to do was “develop a proposal to reduce Medicare spending … by a specified amount”. Any such proposal, which would go into effect unless Congress overrode it, would have had the effect of forcing rationing of some kind, by some means (e.g., reducing or eliminating Medicare coverage for certain conditions, or reducing the compensation of providers who might treat certain conditions, thus discouraging them from treating those conditions in the first place).

It’s true that IPAB, or something like it, was (and still is) necessary in a government-run systems like Medicare and Medicaid, where the amount of money available to provide health care is limited by Congress. (In fact, some lefties openly admit it.) But that just moves the problem up a level. It means that Medicare and Medicaid, which are essentially mandatory for tens of millions of persons, constitute a system for rationing health care. (All misguided rhetoric to the contrary, free markets are not rationing mechanisms.)

But what if Medicare and Medicaid didn’t exist and many older Americans had to do without many of the health-care products and services that they enjoy because they couldn’t afford those products and services? The existence of Medicare and Medicaid, whatever their benefits, is tantamount to governmental rationing; that is, their existence forces the redistribution of income among citizens (beneficiaries of Medicare and Medicaid vs. those who subsidize it) and the reallocation of resources toward health care and away from other uses.

The bottom line: It’s true that ACA doesn’t mention death panels and prohibits rationing. But ACA in fact established a “death panel” (IPAB) and authorized (even more) rationing of health care than was already the case under Medicare and Medicaid, pre-ACA.

In sum, a thing can exist without being called by a particular name. Reverse discrimination, for example, exists because Affirmative Action and various “diversity” programs, as they are practiced, foster discrimination against straight, white males of European descent. But to say that Affirmative Action and “diversity” programs are discriminatory is verboten in left-speak.

The Issue at Hand: Whether the Powers of Congress Are Specifically Enumerated in the Constitution

The same principle — that a thing can exist without being called by a particular name — applies to the Constitution of the United States. An obvious case is found in the structure of the Constitution, which is characterized as a system of checks and balances. The term “check and balances” is found nowhere in the Constitution, but the Constitution does nevertheless provide checks on the power of the central government and balances between the powers of the central government’s branches and between the powers of the central government and State governments.

Likewise, the Constitution nowhere says that the powers of the central government are enumerated (and therefore limited). But they are, despite Richard Primus’s casuistry in “Herein of ‘Herein Granted’: Why Article I’s Vesting Clause Does Not Support the Doctrine of Enumerated Powers” (U of Michigan Public Law Research Paper No. 681, October 8, 2020).

What is the Vesting Clause? It is Section 1 of Article I, which says this:

All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.

Primus makes much of what he calls the lack of parallelism between that language and the its counterparts in Article II (which defines the executive branch) and Article III (which defines the judicial branch); viz.:

The executive Power shall be vested in a President of the United States of America.

The judicial Power of the United States, shall be vested in one supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish.

Which, as I will show, is akin to making a mountain out of a molehill. To what end?

This: Primus’s attack on the Vesting Clause is really an attack on the doctrine of enumerated (and therefore limited) powers. As he says,

the idea that Article I’s Vesting Clause limits Congress to a set of textually enumerated powers was virtually unknown in the ratification debates of 1787-88. 18 It was also absent from the First Congress, and conspicuously so. The First Congress prominently featured conflict over the question of whether Congress was limited to powers specifically enumerated in the Constitution: think, for example, of the fight over chartering the Bank of the United States. The Representatives arguing for the enumerationist position in those debates had every incentive to point to the Vesting Clauses for support, if they thought the Vesting Clauses supported their view. None of them did, which suggests that none of them thought Article I’s Vesting Clause established the enumeration principle.

In all of the Federalist Papers, for example, thirty or so of which specifically addressed questions about the extent of congressional power, Publius invoked the Vesting Clause exactly zero times.

This is nothing but argumentative sleight of hand. The Vesting Clause may not have been invoked, but the Constitution was ratified on the clear understanding that the powers of the central government were limited because they were specifically enumerated (mainly in Section 8 of Article I). The proponents and opponents of specific legislation wouldn’t have argued about the broad language of the Vesting Clause. Rather, they would have argued about the specific inclusion or exclusion of the subject matter in text of the Constitution. The main repository of specific language is Section 1 of Article I.

Enumerated and Limited Powers: The Lynch-Pin of the Constitution

Under the Articles of Confederation (Articles) that preceded the Constitution, the central government — such as it was — depended on the whims of member States to finance its operations. It therefore proved difficult to provide for such things as the defense of the United States, the conduct of foreign affairs on behalf of all of the States, and the free flow of trade among the States. Further, every State was equal to every other State — one State, one vote — which made it possible for regional coalitions and even individual States to wield disproportionate power. (Among the compromises that underlay the adoption and ratification of the Constitution was the creation of the Senate, which wields some amount of disproportionate power but not as completely as did the States of the confederation.)

The Constitution doesn’t specifically say that the powers of the central government are enumerated and limited, but they are, as a legacy of the Articles:

Article II. Each state retains its sovereignty, freedom, and independence, and every Power, Jurisdiction, and right, which is not by this confederation expressly delegated to the United States, in Congress assembled.

(Aside: Whereas the Articles of Confederation refer specifically to a “perpetual Union” of the member States, the Constitution nowhere says or implies that the resulting union was meant to be perpetual.)

During the debates about the ratification of the Constitution, a great many speeches were given and great amounts of ink and paper were devoted to the issue of constraints on the central government. Alexander Hamilton, James Madison, and John Jay — leading advocates of ratification — issued their arguments in the series of essays that became known as The Federalist Papers. Among Madison’s contributions are Federalist Nos. 41, 42, 43, 44, and  45. Those five papers constitute a defense of the specific powers granted to the central government by the Constitution. Madison nowhere adverts to unmentioned, free-floating power because the Constitution doesn’t grant any such power to the central government.

As Madison puts it in Federalist No. 45:

The powers delegated by the proposed Constitution to the federal government, are few and defined [emphasis added]. Those which are to remain in the State governments are numerous and indefinite.


Related posts:

The Slippery Slope of Constitutional Revisionism
The Constitution: Original Meaning, Corruption, and Restoration
Does the Power to Tax Give Congress Unlimited Power?
Does Congress Have the Power to Regulate Inactivity?
Our Perfect, Perfect Constitution
Does the Power to Tax Give Congress Unlimited Power? (II)
The Constitution: Myths and Realities

Constitutional Confusion

Will Wilkinson’s “The individual mandate: A taxing distinction” is rife with confusion about the Constitution:

…Suppose I sell a novel to a publisher. If the publisher cuts a check to my agent, and my agent cuts a check to me, did I really not do business with the publisher? Of course I did. The middle man is irrelevant to whether or not business has been done between the publisher and I. Likewise, if I cut a check to the government and the government cuts a check to Raytheon, I did business with Raytheon.

…If forcing me to hand a dollar to Raytheon and taking a dollar by force and handing it Raytheon are two materially equivalent ways of making me do business with Raytheon, and they are, then the undisputed power of Congress to tax and spend was a power to force me to do business with private companies all along.

One principled libertarian line on this question is that government has the power to tax only for the purpose of spending on the provision of those public goods, such as the common defence, which voluntary exchange on the free market cannot be relied on to provide…. A ruling to the effect that government may not force citizens to do business with private entities could be useful to a libertarian legal activist precisely because there really is no sound distinction between mediated and unmediated transactions….

The “libertarian line,” principled or not, is irrelevant to the meaning of the Constitution, which is not a libertarian document but a political one. The issue at hand — the constitutionality of the individual mandate — cannot be resolved by invoking libertarian principles; it must be resolved by invoking constitutional principles.

The Constitution gives the federal government the power to raise and employ armed forces in the defense of the nation. The taxing power is used legitimately (in constitutional terms) when it enables the exercise of that power. When Wilkinson is taxed to help defray the cost of national defense, he is not being forced to do business with Raytheon. He is being forced (legitimately, under the Constitution) to support the national defense, which happens to involve purchases from Raytheon (among many things).

One need not get into the messy business of defining public goods to find fault with the individual mandate, as a constitutional matter.  The mandate is constitutionally wrong because there is no constitutional writ for such a thing. Obamacare, of which the mandate is an integral element, is nothing less than an attempt on the part of the federal government to commandeer and direct all economic activity that is conceivably related to a fictional entity called the “market for health care.” The mandate is an attempt to further that scheme by forcing individuals to engage in commerce — a power that can be read into the Constitution only by those who would prefer to have a federal government of unlimited power.

Finally, it is hogwash to say that “there really is no sound distinction between mediated and unmediated transactions.” I am not “doing business with Raytheon” because some of my tax dollars go to Raytheon. I am doing business with the federal government as a (constitutionally legitimate) provider of national defense. But if the federal government forces me to buy health insurance (or pay a hefty penalty), I am doing business with an insurance company, not with the federal government.

Related posts:
Unintended Irony from a Few Framers
Freedom of Contract and the Rise of Judicial Tyranny
Social Security Is Unconstitutional
The Constitution in Exile
What Is the Living Constitution?
Blame It on the Commerce Clause
The Slippery Slope of Constitutional Revisionism
The Real Constitution and Civil Disobedience
The Constitution: Original Meaning, Corruption, and Restoration
The Unconstitutionality of the Individual Mandate
Does the Power to Tax Give Congress Unlimited Power?
Does Congress Have the Power to Regulate Inactivity?
Obamacare: Neither Necessary Nor Proper

A Balanced-Budget Amendment and the Constitution

This post is in two parts. Part I rebuts a fatuous attack on proposals for a balanced-budget amendment to the U.S. Constitution. Part II offers an amendment that would result not only in a balanced budget (with appropriate exceptions) but also would limit the federal government’s ability to spend for purposes not contemplated by the Framers of the Constitution.

I. REBUTTING A FATUOUS ATTACK ON PROPOSALS FOR A BALANCED-BUDGET AMENDMENT

The blogger known as Patterico points approvingly to Carson Holloway’s “The Balanced Budget Amendment: What Would Hamilton Say?” at Public Discourse. I am less enthusiastic, to say the least, about Holloway’s arguments against a balanced-budget amendment. Here are key quotations (in italics) from Holloway’s article, followed by my comments (in bold):

[T]he Constitution, as it stands and as the Founders crafted it, empowers the Congress to “borrow money on the credit of the United States.” The Founders, evidently, intended that the government be capable of incurring debt.

Holloway begins by framing the problem incorrectly; it is spending, not borrowing. A balanced-budget amendment need not keep the federal government from borrowing, and could easily be framed to allow borrowing under specified conditions and for specified purposes.

It is possible that circumstances have changed and that a balanced budget amendment is now necessary to realize those basic principles, such as limited government, to which the Founders were committed.

It is obviously true that circumstances have changed. Look at the massive future outlays implied in “entitlement” programs, and consider the effects of those outlays on the productive sectors of the economy. A balanced-budget amendment is as necessary today as Amendment XIII (abolishing slavery) was deemed in 1865.

[F]or those who respect the Founding and seek to be guided by it, the fact that such an amendment would take away or restrict a federal power that the Founders thought necessary should be a cause for hesitation and further reflection. Before deciding to support a balanced budget amendment, we ought to ask: why did the Founders empower the government to borrow?

I respect the Founding and am guided by it. Article V of the original Constitution provides for amendments, and does not restrict the character of amendments. (There was one restriction, which lapsed in 1808.) When the citizens of the United States are confronted with crippling economic policies perpetrated by the government of the United States, amending the Constitution to rectify those policies is among the least drastic of means available to the citizenry.

Here we might turn with particular profit to that Founder most associated with the establishment of America’s public finances, the first Secretary of the Treasury, Alexander Hamilton. Upon taking office, Hamilton was confronted with an infant republic, saddled with considerable debt from the revolution and far behind in its repayment obligations. In late 1789, the House of Representatives charged him with devising a plan to put the nation’s finances back on a sound footing, and he responded with his masterly and much-admired Report on Public Credit; Congress subsequently adopted its recommendations. While the Report’s primary purpose was to provide a financial plan, Hamilton, seeking perhaps to educate public opinion and influence the views of legislators, opened the Report with some general reflections on the importance of public credit. It is here that we might gain some insights to enlighten the contemporary debate on the balanced budget amendment.

It is ironic that Holloway should turn to Hamilton, whose  expansive view of the powers of the federal government.has been openly praised and emulated by legislators, executives, and judges. If any one person can be blamed for the runaway spending that threatens Americans’ prosperity, it is Hamilton.

Why, then, do Hamilton’s principles seem to condemn a balanced budget amendment to the Constitution? Though Hamilton claims that public borrowing should be undertaken in response to unforeseeable “exigencies” or “emergencies,” he nevertheless claims that public borrowing is a “necessity.” This is the case because, while the exact nature of such exigencies cannot be known in advance, we can know, with great confidence, that they will arise, in one shape or another, and that they will overtax the ordinary revenues of the government.

Holloway, again, shifts the focus from spending to borrowing. Borrowing is not the problem, nor is borrowing out of the question under a balanced-budget amendment.

[T]he proponents of the balanced budget amendment might respond that it can be crafted in such a way as to allow for public borrowing in cases of war or crisis…. [I]t would surely be foolhardy to write the amendment in such a way as to allow public borrowing only in cases of war, because it does not take too much imagination to summon to mind many potential crises short of war that might be addressed best through public borrowing….

Holloway assumes that “crises” short of war are any of the federal government’s business, and that — if they are — they could not be addressed simply by re-prioritizing the federal budget. The “crisis” of the Great Depression elicited many unconstitutional schemes. Social Security is the most notable of them and, until the advent of Medicare, perhaps the most disastrous.

[A]n inability to borrow would not only hamstring the government in responding to grave public evils; it might also prevent the government from seizing positive opportunities that could produce public benefits for generations. America might, at some point, have a chance to purchase some valuable new territory, perhaps rich in natural resources, that will enhance the nation’s prosperity. Such a purchase, however, might require an immediate transfer of money that would be impossible without the ability to borrow.

Here, Holloway resorts to fantasy and appeals to mercantilism. If there is “some valuable new territory, … rich in natural resources” to be acquired, let it be “exploited” by the most efficient producer (of whatever nationality). Americans will benefit by being able to purchase more, newer, and better things at better prices from the “exploiter.” There is no particular advantage if the “exploiter” is American, for even in that case its products will not be given away to other Americans. If the “exploiter” chooses — for some insane reason — not to offer products to Americans, that would be the exploiter’s loss. If the “exploiter” is a foreign nation with evil designs, a peaceful acquisition is unlikely and the evil designs are best met through federal government’s constitutional authority to provide for the common defense.

One could, of course, try to avoid all of these problems by framing the necessary exception broadly enough in the language of a balanced budget amendment. The amendment might, for example, allow public borrowing not only in cases of war but also in cases of public crisis. But if a narrowly drawn exception accomplishes too much by preventing borrowing when it is really needed, a broadly drawn exception would accomplish too little and would, in fact, make the amendment useless for all practical purposes.

What about an exception that is drawn in a way that accomplishes what is needed? (I’ll come to that.) Holloway’s generalities are uninformative, and clearly designed to support his prejudice against a balanced-budget amendment.

The proponents of a balanced budget amendment might instead try to discipline borrowing by establishing a serious procedural obstacle to incurring debt. For example, the amendment might require a two-thirds majority of each House to authorize borrowing on behalf of the public. Based on the American experience, it is not clear that such a requirement would seriously deter the government from incurring new debt. In the Senate, the filibuster already creates a supermajority requirement (of three-fifths) for increasing the nation’s debt, yet debt-ceiling increases have routinely passed the Senate. Indeed, debt-ceiling increases have been routinely enacted with overwhelming support in both Houses of Congress. In the most recent, and most hotly contested, debt-ceiling debate ever, 62% of the House of Representatives and 74% of the Senate voted to issue more debt. One might try for an even more stringent requirement—calling for, say, a three-fourths vote in each House of Congress—but this would only exacerbate an already serious failing in any supermajority requirement: namely, any supermajority requirement is anti-majoritarian, and the higher the bar is set, the more anti-majoritarian it is. A balanced budget amendment framed in this way thus strikes at one of the vital principles of American republicanism: majority rule. It would be a step backwards in the direction of the Articles of Confederation, which required supermajorities for important actions of the Federal government.

Holloway once again deploys shifty logic and dubious facts in the service of big government. As for the recent debt-ceiling debate, it resulted not only in a higher debt ceiling but also in the reduction of planned spending — a precedent, as far as I know. As for the use of rules that require approval of certain actions by supermajorities, Holloway’s earlier appeal to the Founders (Framers, really*) should put him on the side of such rules. (That he appeals only to one such Framer, big-spending Alexander Hamilton, gives him away.)  For one thing, the Constitution specifically states that “Each House may determine the Rules of its Proceedings” (Article I, Section 5).

More generally, the Constitution was meant to thwart majorities and, therefore, to ensure that the federal government remained limited in its power and scope. The need for supermajorities in certain matters is merely an entirely constitutional effort to restore checks that have been eroded by unconstitutional actions: leglistative, executive, and judicial. Majority rule is not a vital principle of American republicanism, as Holloway asserts. Indeed, for reasons advanced eloquently by James Madison in Federalist No. 10,  majority rule is to be feared and circumscribed. If supermajorities are required for important actions of the federal government, it is only because the federal government has slipped its constitutional bounds.

Holloway would admit such things were he an honest advocate of the Constitution, and not just of Alexander Hamilton’s successful but unconstitutional scheme to enlarge the federal government. But if Holloway were an honest advocate of the Constitution, he would admit, also, that the Constitution has been “amended” by stealth, to allow the federal government to run up huge bills and huge debts, instead of having been amended properly, as provided in Article V.

In summary, contrary to Holloway’s assertion a balanced-budget amendment would not be a step backward. Such an amendment is badly needed to restore the Framers’ original scheme: a government of limited, enumerated scope, as opposed to a government of unlimited scope, financed by the blank check of unlimited borrowing that Holloway seems so devoutly to wish.

II. AMENDMENT TO BALANCE THE FEDERAL BUDGET AND LIMIT THE SCOPE AND SPENDING OF THE FEDERAL GOVERNMENT

Amendment XXVIII

Section 1.

The entire text of Sections 8 and 9 of Article I of the Constitution is replaced by the following:

Section 8.

Congress may, by a majority of three-fifths of the members of each House present, when there is a quorum consisting of three-fourths of the number of persons then holding office in each House:

a. collect revenues in order to pay the debts and expenses of the United States, so long as

• the debts and expenses are incurred through constitutional actions,

• the revenues are not collected through taxes or levies on income or assets,

• all taxes and levies are uniform throughout the united States, and

• there is published a regular statement and account of the receipts and expenditures of all public money;

b. borrow money on the credit of the United States in order to pay its legitimate debts,

(1) so long as the indebtedness of the United States does not increase over any ten-year period, as determined by comparing the amount of indebtedness at the end of the preceding fiscal year with the amount of indebtedness at the end of the tenth preceding fiscal year;

(2) except that, for the purpose of determining the change in indebtedness over any ten-year period. the amount of indebtedness at the end of the preceding fiscal year shall not include the sums spent during the ten-year period for any purpose contemplated in this Constitution, if said expenditures were made pursuant to appropriations approved by at least three-fourths of the members of each House present when there is a quorum of at least three-fourths of the number of persons then holding office in each House;

(3) if the indebtedness of the United States increases, as determined in accordance with the two preceding clauses, then no person who served as a member of Congress or as president or vice president of the United States during the ten-year period in which the amount of indebtedness increased shall thereafter be eligible for election or appointment to Congress or an executive or judicial office of the United States;

(4) further, if indebtedness shall have increased, as determined in accordance with clauses (1) and (2) above, outlays by the government of the United States for all purposes but national defense shall be reduced pro-rata — and without recourse to legislative, executive, or judicial action — in the amounts required to offset the increase in indebtedness within two fiscal years.

[This is adapted from Article V, Section B (Specific Powers of Congress), of “A New, New Constitution.” Go there for a complete listing of Congress’s powers and lack thereof.]

Section 2.

The following article is added to the main text of the Constitution:

Article VIII.

Section 1.

Each word, phrase, clause, sentence, section, and article of this Constitution, as amended, shall be construed in accordance with the meanings of the aforesaid at the time of their ratification.

Section 2.

Where there is ambiguity about the meaning of any portion of this Constitution listed in the foregoing section of this Article VIII, its meaning shall be determined by reference to the speeches and writings of the proponents of the language adopted through ratification.

Section 3.

The meaning of any portion of this Constitution may not be altered to include subjects or powers not specifically contemplated in the language of this Constitution, as determined in accordance with the foregoing sections of this Article VIII.

Section 4.

Despite exigencies, real or proclaimed, the subjects of this Constitution and the powers herein granted or denied may be changed only by amendment, in accordance with Article V.

[This is adapted from Article X, Section C (Construction), of “A New, New Constitution.”]

_________
* “Founders” encompasses the entire founding generation of political leaders who led the Revolution, signed the Declaration of Independence, and crafted the Constitution. “Framers” refers strictly to the makers of the Constitution. Hamilton was one of them, and the assurances that he gave in his numbers of the Federalist about his belief in limited government proved to be deceptive.

See also “The Constitution: Myths and Realities“.