Tuesday, December 28, 2010

ObamaCare© and the *Other* Constitutional Problem

We've spent a great deal of time explaining why the (Evil) Individual mandate doesn't pass Constitutional muster, but there's an even more (potentially more damaging) issue: the General Welfare Clause. To fully appreciate its relevance to ObamaCare©'s fate, we'll need to rewind all the way back to the beginning of the year, and the shameful "Cornhustler" deal:

"Under the terms of a deal Nelson cut with Senate leaders to secure his crucial vote for the health care package, Nebraska would be exempted from having to pay for the coverage of its new Medicaid enrollees ..."

And therein lies the kernel of the problem: ObamaCare©'s numbers rest almost entirely on the fact that it increases the Medicaid burden on the states (and definitely see Bob's explication of how this applies in the real world outside the Beltway). The case currently popping in Florida, wherein 20 of the 57 states are challenging ObamaCare©'s legality, rests almost entirely on this issue.

But what, exactly, is the General Welfare Clause? Since I'm not a lawyer (nor do I play one on TV ), I'll defer to the Wall Street Journal's Barnett and Oedel, both professors of constitutional law at prestigious universities:

"Although the constitutional objections to its individual insurance mandate—the requirement that any person who isn't provided insurance by his employer buy it on his own—have gotten all the public attention, the law also has a "general welfare" problem ... But the Court also acknowledged that "in some circumstances, the financial inducement offered by Congress might be so coercive as to pass the point at which 'pressure turns into compulsion'" ... ObamaCare won't alter Medicaid in a relatively small way. It's an "all in or all out" proposition ... but a threat of losing 100% of the single largest federal outlay to the states."

A 100% loss is, in the words of our silver-tongued Vice President, a Big...Deal.

How big, you ask?

How about:

"The annual federal spending on Medicaid is now over $250 billion, more than all federal spending on transportation and education combined, and it is climbing quickly. States on average devote about 18% of their tax revenues to Medicaid, typically funding between 40% and 50% of their state's total Medicaid costs."

Now take that last to 100%, and that initial 18% is, well.

The problem is that, although ObamaCare© does, in fact, have an "escape" (or opt-out) clause for the states, the penalty for exercising it is that aforementioned 100% onus. And it's that burden that lies at the crux of the current Florida case. You see, all that money that would have gone to, for example, Texas, will now flow instead to, for example Michigan. And that's welfare only to the Wolverine State. It's a "heads I win, tails you lose" proposition.

And that, too, is a Big...Deal.

[Hat Tip: Ace of Spades]
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