Will the healthcare act pass the constitutional test? Ilya Shapiro, senior fellow in constitutional studies at the Cato Institute and editor-in-chief of the Cato Supreme Court Review, is interviewed by Mike Siegel with the Boss Business Hour to discuss the future of the healthcare act and whether it will be overturned.

Who is Ilya Shapiro?

Ilya Shapiro is a senior fellow in constitutional studies at the Cato Institute and editor-in-chief of the Cato Supreme Court Review. Before joining Cato, he was a special assistant/advisor to the Multi-National Force in Iraq on rule of law issues and practiced international, political, commercial, and antitrust litigation at Patton Boggs and Cleary Gottlieb. Shapiro has contributed to a variety of academic, popular, and professional publications, including the Harvard Journal of Law & Public Policy, L.A. Times, Washington Times, Legal Times, Weekly Standard, Roll Call, and National Review Online, and from 2004 to 2007 wrote the "Dispatches from Purple America" column for TCS Daily.com. He also regularly provides commentary on a host of legal and political issues for various TV and radio outlets, including CNN, Fox News, ABC, CBS, NBC, Univision, "The Colbert Report," and American Public Media's "Marketplace." He lectures regularly on behalf of the Federalist Society and other educational and professional groups, is a member of the board of visitors of the Legal Studies Institute at The Fund for American Studies, was an inaugural Washington Fellow at the National Review Institute, and has been an adjunct professor at the George Washington University Law School. Before entering private practice, Shapiro clerked for Judge E. Grady Jolly of the U.S. Court of Appeals for the Fifth Circuit, while living in Mississippi and traveling around the Deep South. He holds an A.B. from Princeton University, an M.Sc. from the London School of Economics, and a J.D. from the University of Chicago Law School (where he became a Tony Patiño Fellow). Shapiro is a member of the bars of New York, the District of Columbia, and the U.S. Supreme Court. He is a native speaker of English and Russian, is fluent in Spanish and French, and is proficient in Italian and Portuguese.

Transcript:

Siegel: Folks, welcome back in. Good to have you with us right here at the BOSS Business Hour. My name is Mike Siegel. As we get started on our conversation, BOSS Business is the small business advocate for all of you out there and you ought to get involved. It is a very, very valuable organization. What is also very valuable is talking with Ilya Shapiro at the KATO Institute. He is the senior fellow for constitutional studies. By the way, he is also editor in chief for the KATO Supreme Court Review, which is perfect to talk about this legal case now in Florida where Judge Vincent, as we heard in the last segment, basically said that he wants to move forward with this case from the 20 attorneys general and the National Federation of Independent Business, because he believes there is merit to the argument that there has been in effect a violation of the constitution by the healthcare bill mandate for individuals to buy health insurance. Mr. Shapiro, thanks for being with us. How are you today?
Shapiro: Good to be here.
Siegel: Tell us your take on this judge's decision about the way he wrote the decision and what your sense is about it.
Shapiro: Well, I still haven't fully read it. It is 65 pages and I just landed, coming in from the west coast. I kind of skimmed it and put out a brief statement. I think it is correct. It goes into a lot of depth. It treats every argument by both sides seriously and goes into a lot of deep, into the weeds, unlike the decision by the Michigan judge last week, which essentially spent maybe three pages on the commerce clause argument. But I think it is right. I mean, this is an unprecedented assertion of federal authority to require everybody to go into the private market place and buy a particular good or service. Under existing law, there is just no precedent for that. There is no constitutional warrant for congress to require that. Now, the Supreme Court eventually might expand its doctrine and take us to that point. That would be unfortunate in my view, but I think a district court is certainly in no position to let congress do something like that. It would be hard to see how, in followup briefing and arguments, that the court would reverse itself. So, I think this is going to go up on appeal. Similar to the Virginia case that we had a similar ruling in August.
Siegel: Very true. The Virginia Attorney General actually went on his own and did that, but this one involves 20 attorneys general, as well as NFIB. Now, it seems to me that with the judge making this decision that he has basically drawn the line in the sand and said that the commerce clause does not apply, because inaction, meaning that people who do not do an act, in other words not buy health insurance, are not having any commerce happen to begin with. By mandating them to do this as though your trying to mandate to fall within the commerce clause, and even then we have to buy health insurance these days intrastate, within the state, so it doesn't even apply in terms of the commerce clause. Right or wrong?
Shapiro: Yeah. That is when the rubber of this hits the road. I mean, this is unlike the greatest assertions of federal power that the court has ratified. For example, the New Deal, the courts said that congress can tell farmers that they need to grow more to meet their quota and not just consume their wheat for themselves. But, congress wasn't requiring people to become farmers. Similarly, if you run a hotel or restaurant, you can't discriminate based on race and other classifications based on who you serve, but nobody has to become a hotel owner or restaurant operator. So, here it is mandating that you do something. You know, you can just be doing nothing, just existing, and this is telling you to act. It is unprecedented in the economic real and the commerce clause realm.
Siegel: I don't want to make this facetious or Saturday Night Live, but if they can do that, why couldn't they say that every American has to eat one chocolate candy bar every day?
Shapiro: Well, that is exactly right, and indeed statistics show that whether you exercise and eat right has much greater affect on health care costs and lowering government spending on health care than just owning a health insurance policy. So, if anything, a requirement to say join a gym or buy spinach or not buy chocolate bars until you have eaten your broccoli or what have you, is more closely tied to congressional power than the requirement to buy health insurance. And, indeed, if you follow the reasoning that the government asserts, which the Michigan judge last week caught, he called it an economic decision not to buy health insurance, which has an affect on interstate commerce. Well, there are lots of things. Any decision is economic. My decision right now to be on your program rather having a cup of coffee or sitting at a bar getting a beer, that is an economic decision. Or, my decision to have gone to law school rather than to go into construction, that is an economic decision. All of a sudden, congress is going to say, well, we have too many lawyers, we don't have enough people building houses, so all of you students who are planning to enter law school this year, tough luck, you are now going to work for construction. I mean, there is really no limiting principal on federal power, if the government's argument here wins.
Siegel: Now, we are talking with Ilya Shapiro at the KATO Institute. He is a senior fellow in constitutional studies and, as you have heard, he is an attorney. Let me turn to the 10th amendment. There have been some arguments about that as well in terms of Medicaid and unfunded mandates coming down to the states with Medicaid requirements for more people to get on Medicaid and yet the funding not being there. What about the 10th amendment application here that I think many of the attorneys general were concerned about?
Shapiro: Sure. The judge let those arguments continue as well. You know, ruling against the federal government's position on those claims, which basically say that the, as you said, expansion of Medicaid and other ways in which state health care insurance and other bureaucracies have to change and expand under ObamaCare, that that is a plausible claim to say that that is coercive. The federal government under Supreme Court precedent cannot commandeer (that is a technical term), commandeer state officials to do its bidding, to impose its regulations. As well, the federal government cannot attach coercive or unconstitutional conditions onto federal monies. So, the court didn't definitive rule that the states win on those points, but it did say that those claims are serious ones and both this court and on appeal they will have to grapple with these areas, which again are unprecedented. This health care legislation, I want to underline… it is not just a matter of whether it increases costs or decreases them, whether it is the best idea for reforming health care or not, but it really implicates so many different types of federal power that courts have never had to deal with. I mean, it is breathtaking what congress is trying to do here.
Siegel: And, by the way, if this were ultimately to be defeated in the United States Supreme Court, that that section of the health care bill would be excised because it is unconstitutional, wouldn't it then be a house of cards? Because the whole bill is predicated on every body participating and all of the other elements would go away. We have about one minute. What is your take on that?
Shapiro: That is right. I mean, the government keeps arguing that the individual mandate is key and necessary to the whole thing. That is important to another type of argument that it is making, but the more that it makes that argument, that the individual mandate is essential, then indeed there is no separability and there is no separability clause in all that legislation. So, I think that knocking it out really becomes the whole ball game.
Siegel: Well, it is a fascinating conversation, a fascinating discussion. Any bets on how the Supreme Court might decide? Is it going to be, do you think, an ideological decision, liberal versus conservative?
Shapiro: I think so. I think it will come down to Justice Kennedy as the swing vote. You know, a lot of people would go poor if the Supreme Court were on the betting lines in Vegas. So, I am not going to go out on a limb there, but I will say that the Supreme Court will take this. It will get up there and we can probably expect a ruling maybe June 2012 or later that year.
Siegel: I thank you very much, Mr. Shapiro, great to talk to you. We will certainly have you back again as this thing unfolds. Good to have you with us.
Shapiro: Thanks for having me.
Siegel: Have a great day, too. Thanks for taking the time after landing from your flight. We appreciate it. Mike Siegel here. Good to have you with us. We are at the BOSS Business Hour with lots more coming. We are the advocates for small business. Stay with us.