Home / General / Another Problem With <i>Halbig</i> Trooferism

Another Problem With Halbig Trooferism

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Ian Milhiser explains why Scott Walker’s acknowledgement that there’s no substantive difference between a state and federal exchange established by the ACA should be considered to be far more important than those of President, Speaker of the House, Senate Majority Leader, Secretary of State, Chief Justice of the United States, and longtime don of the Gambino crime family Jonathan Gruber:

Normally, courts would treat both Walker and Gruber’s statements even more dismissively because neither man was in the legislature during Obamacare’s enactment. Walker’s statement, however, falls into an exception to this rule that makes it highly relevant to the outcome of King. To understand why, it’s important to understand fully how the King plaintiffs characterize the Affordable Care Act.

The essence of the King plaintiffs’ reading of the law is that Congress viewed the question of whether state or federal bureaucrats operate each exchange as a matter of such overarching importance that they were willing to deny health care to millions of people — in order to ensure that the people running the exchanges all drew a state paycheck. The plaintiffs argue that the tax credits are part of “a variety of ‘carrots’ and ‘sticks’ to induce states to establish Exchanges voluntarily.” In essence, they claim, Congress used the threat that a state’s citizens could lose access to billions of dollars worth of subsidies in order to coerce the states into setting up their own exchange.

The Constitution places limits on states’ power to do this sort of thing, however. When the federal government conditions payment of federal money upon states taking a particular action, those conditions are unconstitutional “if a State is unaware of the conditions or is unable to ascertain what is expected of it.” Moreover, the question or whether a state is able to ascertain what strings come attached to the funds is evaluated “from the perspective of a state official who is engaged in the process of deciding whether the State should accept . . . the obligations that go with those funds.”

This is why Walker’s views hold special significance. Walker, in his own words, “spent nearly two years” studying the differences between state and federal exchanges, and he learned that “there’s no real substantive difference between a federal exchange [and] a state exchange.” Indeed, as Cannon points out, Walker set up an entire state program premised on the idea that federally-run exchanges are permitted to provide tax credits just like state-run exchanges. Walker’s views, in other words, demonstrate that “a state official who is engaged in the process of deciding whether” Wisconsin should set up its own exchange was unable to ascertain the alleged consequences of this decision. Thus, even if the King plaintiffs are correct that Obamacare conditions tax credits on a state setting up its own exchange, that condition is unconstitutional.

Walker, it should be noted, is hardly alone among Republican governors in his belief that “there’s no real substantive difference between a federal exchange [and] a state exchange.” Nebraska Gov. Dave Heineman (R) said that “[o]n the key issues, there is no real operational difference between a federal exchange and a state exchange.” Former Virginia Gov. Bob McDonnell (R) explained that his state would opt for a federally-run exchange because there was no evidence of any “clear benefits of a state run exchange to our citizens.” A Supreme Court brief filed by the governors or attorneys general of 24 states explained that the Obamacare “can only operate in the manner that Congress intended” if the tax credits are “intact.”

The law’s staunchest opponents in the states, in other words, including two dozen officials who were actively trying to destroy the Affordable Care Act, were “unable to ascertain” that they could thwart one of the law’s central provisions if they refused to set up a state-run exchange. The King plaintiffs’ reading of the law is unconstitutional.

If only this case were being heard by a legal tribunal, or if any American conservative actually cared about federalism…

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