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Sunday, December 26, 2010
Limits on Congressional Power in the General Welfare Clause
Randy Barnett and David Oedel have an article in the Wall Street Journal (subscription, but can circumvent though Google) arguing for a rather radical limit on Congressional spending. According to Barnett and Oedel, a particular item of federal spending must benefit the "welfare of the people of each and every state" in order to count as providing for the General Welfare of the United States. So an earmark specific to Nebraska that relieved the state of Medicaid expenses would be unconstitutional. Although this is not my area, and many people have been recently burned by underestimating Randy's arguments about limits on Congressional power, color me skeptical on the argument.
First, it is not clear why Barnett and Oedel require parity between states but not individuals. After all, why not say that General Welfare means each and every person, rather than each and every state? Where the constitution required parity between each and every state, such as for direct taxes, the provision was made expressly. Of course, to require every particular item of federal spending benefit every person in the United States would lead to obviously ridiculous results, but that doesn't make drawing the line at state-by-state parity any better.This leds to my more serious objection, which is that particular items of federal spending will always benefit specific states. Barnett and Oedel argue that a military base in Nebraska will benefit the entire nation. But it is hard to imagine how, say, a single janitor sweeping the hall in a federal building in Hawaii will benefit North Dakota. And if we start really stretching logic to find some benefit -- e.g. cleaner hallways in Hawaii will improve the overall efficiency of the federal government -- then that defeats Barnett and Oedel's entire purpose. After all, paying for the medical care of Nebraska residents will obviously benefit the rest of the United States, since it will stimulate economic activity as well as improve the health of Nebraska residents, which will reduce communicable diseases that they might carry to other states, which again will make everyone healthier and improve economic welfare. The point is only that the benefit is somewhat attenuated. But by conceding the military base example -- which of course they had to as a bow to reality -- they necessarily concede some degree of attenuation is persmissible.
Finally, it strikes me that Barnett and Oedel base their argument on a textual mistake. The relevant provision of the constitution is not directed to particular items of spending. It is directed to particular items of tax. The constitution authorizes the levying of taxes to provide for the general welfare -- it only implicitly says those taxes may then be spent. The level of generality is therefore not the particular items of federal spending, but the particular tax being levied. And the relevant tax -- the income tax -- does provide for the general welfare. It does so by being carved up into millions or billions of different pieces of spending. Some of those pieces of spending will benefit individual people or states; but the overall scheme gives some benefit to everybody. And it is inherent in the scheme that some people (and some states) will get more than they put in, while others less.
While everyone should be troubled by particular states or constituencies getting disporportionate shares of the pie because they happen to be in a good political position (having the swing senator), it bears repeating that not every bad law is an unconstitutional law.
Posted by Tun-Jen Chiang on December 26, 2010 at 11:54 PM | Permalink
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Comments
TJ,
Dole itself assumed without discussion that the general welfare was being fulfilled by having a uniform drinking age. The general welfare requirement was noted in dicta as a general restriction but was not disputed in that case. (Incidentally, South Dakota does border other states and had no Hawaii-type argument.)
This case is different for a number of reasons.
Recall that there was no uniformity before the federal spending in Dole. Here, by contrast, there is ALREADY national uniformity that the federal government is supposedly willing to jettison. That is pretextual, of course, but it reveals the coerciveness, and shows that the pretextual choice to opt-out, if real and meant seriously, would actually undermine the general welfare, not advance it.
Unlike in Dole, these states do have standing to raise the general welfare argument and are doing so -- and in intimate connection with coercion. South Dakota had an inconsistent drinking age, and so had a hard time being taken serously about coercion. You're quite right that a pure, stand-alone general welfare challenge to imposing a new uniform federal Medicaid baseline like Medicare would not win, because there could be said to be a general interest in having a uniform national baseline for medical care for the poor just as there can be said in having a uniform drinking age. But that's not what is being done in the ACA: we are seeing coercive expansion of an already-uniform and supposedly joint program in which states are ostensibly partners, but in which they have plainly not been included as partners on this change, being cut out of any meaningful conversation about the nature of Medicaid going forward though they are spending on average 18 percent of their own fiscs on this program, and more after the ACA takes full effect. This is pure coercive federal fiat, and picking the pockets of the states at the same time, with the threat that states can opt out anytime, which would undermine the pre-existing uniformity and the general welfare.
The subtlety of the argument about the general welfare problem in this context is partly because of the interplay between coerciveness AND the federal government's formal willingness to sacrifice general welfare in the particular scheme being pursued. The seamlessness and perniciousness of the ACA's coercive scheme is further revealed by noting that nowhere in the voluminous text of the ACA is there any mention of a way for states to recognize that they have any choice about accepting the changes to Medicaid, apparently violating Pennhurst -- another of Dole's general restrictions. Furthermore, as mentioned, the whole coercive dimension would result in glaring P or I claims by U.S. citizens in a state that declines to participate. In short, just about every one of the general restrictions of Dole is in play in this case. Rather than foreclosing a ruling like the one we envision, Dole seemed to anticipate a limit to spending being announced and applied one day.
Predicting a result on the constitutional margin is a difficult business and I won't do so here, but I think you're not giving full credit to the way in which the threat of undermining the general welfare in the device chosen to facilitate uniform baselines; the lack of discussion of choice in the act; and the P or I claims that would be generated by any opt-out -- all these weave together in a calculated way to coerce the states. South Dakota was a lone hold-out over 5%, and maintained a 19-year-old drinking age anyway. These 20-plus states are kicking and screaming over the program, and are suing collectively, but still nary a one has opted out. That is a prima facie case of coercion that was utterly lacking in Dole. Your prediction about the ultimate weakness of our argument in this unique context seems to me to be premature. If you go back and look carefully at the general restrictions of Dole, and think about their interplay here with coercion, you may see a little more depth in our position.
In any event, thanks for joining issue and the conversation, TJ.
Dave
Posted by: David Oedel | Dec 31, 2010 10:07:22 AM
Dave,
Dole does put forward this concept of "general welfare," but it defines this in a very different way than you do. It says that having uniform drinking laws will deter drinking and driving across state boundaries. That says nothing about how requiring Hawaii to have a minimum drinking age will benefit every other state such as North Dakota (your definition), since presumably no one thinks that drunk teenagers from Hawaii might drive into North Dakota and kill people there. You are putting a new gloss on "general welfare," resulting in a completely different concept from that in Dole.
Another way of showing this is that the conditional spending condition in Dole has exactly the same type of majority-strips-minority-and-redistributes-to-opt-ins effect that you deem particularly coercive. All spending conditions have this effect. There might be a quantitative degree that Dole says only 5% of highway funding is not enough, but the 5%/100% difference is conceptually unrelated to the majority-minority difference you are hanging your hat on. And the majority-minority coercion argument has a real problem given that is exactly what happened in Dole. I understand the majority-minority coercion argument, though I think you will lose it in light of Dole. But just because of that doesn't mean framing the same argument under a different heading of "general welfare" while twisting its prior meaning is any better.
Posted by: TJ | Dec 30, 2010 4:24:52 PM
TJ,
Dole itself, not Randy or me, puts general welfare as the first general consideration when considering whether conditional spending is constitutional. We are not making up a connection out of thin air.
Our op-ed in the Journal on Monday does begin with the Cornhusker Kickback, but only as an introduction to the general welfare concept in the context of this particular act. We are not claiming that the Cornhusker Kickback is particularly relevant today, as it was rejected. If it had been enacted, it would have been unconstitutional, but there is a closer question in that situation about whether that specie of a general welfare violation (majority funding the minority) is justiciable, or whether it's a political question. The housing subsidy that you raise is another example of a majority choosing to fund a minority, and is not the big target that we are addressing.
This situation, of the majority threatening completely to strip the minority of federal funding while continuing to tax that minority, is an especially pernicious form of a general welfare violation that should be justiciable. It is factually related to the coercion argument because it explains why the federal government's repeated statements about the voluntariness of the states' continuation in Medicaid are untrue. And again, it is legally related to coercive spending because of the plain language of Dole.
Posted by: David Oedel | Dec 30, 2010 1:22:23 PM
Dave,
Your argument seems to be departing significantly from the argument being presented in your op-ed. With the 14th amendment issue, this departure from your original premise is obvious. Same with the coercion issue. I fully understand the coercion issue, but it has nothing to do with your general welfare argument in your op-ed. To make this clear, your general welfare argument in the op-ed was directed primarily to showing that the Cornhusker kickback was unconstitutional. Nothing in your comments here would support finding the Cornhusker kickback is unconstitutional. So you are making a new and different argument.
Again, I fully understand the coercion argument, but it has nothing to do with you general welfare argument. Congress just offered $8,000 to any person who buys a house. In some sense, this "coerces" me to buy a house, since if I don't then I lose the opportunity of getting $8,000 and my taxes are redistributed to all the other citizens who do buy a house. But it doesn't mean that the homebuyer credit does not serve the general welfare--except if "general welfare" is defined to mean that spending must directly benefit every single person in the United States, the radical rule I understood you to be advocating, at which point pretty much all federal spending is unconstitutional.
If you want to argue that the Medicaid mandate is coercive, go ahead. Just don't argue that it doesn't serve the general welfare because the spending will not benefit the states that opt-out. Saying that the taxes are redistributed from opt-out states to opt-in states is not a general welfare argument, it is simply repeating the coercion argument. The only reason that the spending condition is coercive is that the taxes are redistributed to opt-ins (like people who buy a house). It adds nothing to the coercion argument to cloak this in the rhetoric of "General Welfare."
Posted by: TJ | Dec 29, 2010 7:32:57 PM
BDG, conditional spending is fine usually, just not when the alternative is to lose a huge slug of federal spending because a state disagrees with the changes to a longstanding joint program. The all-in-or-all-out character of the changes to Medicaid is problematic in this special iteration of conditional spending because it makes the condition an offer that no state can responsibly refuse.
You'll have to refer me to your earlier work for edification about your views, as I don't know who you are and you offer no cite.
TJ, the latent problem with Dole and Steward Machine is this: where do you draw the line between coercive and merely conditional spending? The general welfare problem with healthcare reform reveals the extreme degree of the coercion problem with the changes to Medicaid under healthcare reform: it is so extreme a form of conditional spending as to amount to a violation of the general welfare clause as well as coercion. If you will go to Dole and review the general considerations that it lists, the first is the general welfare issue, and the last is whether there are other constitutional issues.
I haven't yet mentioned this publicly, but there is also a serious 14th amendment Privileges or Immunities clause problem with this arrangement, as U.S. citizens would be deprived of their ability to benefit from federal funding simply by virtue of their state citizenship should their states opt out of the Medicaid changes.
Incidentally, on justiciability, it is one thing to argue that the courts should refrain from refereeing the typical conditions imposed by the federal spenders and the general rough justice of spending among the states and individuals. It is quite another thing to say that the courts should look the other way when any one state is threatened with being singled out for utter banishment from federal funding -- and when all 50 states therefore go along despite the fact that at least 21 (and more soon) are suing over the whole thing. This is truly a remarkable situation.
I could go on to write a brief and/or law review article, but I'll stop here for now. Thanks for your responses. I hope this helps explain the argument and its context a little better.
Posted by: David Oedel | Dec 29, 2010 6:53:51 PM
I agree with TJ's remarks; on the issue of coercion I'd recommend interested readers to my earlier work (and, of course, the work of folks like Lynn Baker, which I admire but disagree with). More generally, the Barnett/Oedel argument is terrible economics. For one thing, to the extent that federal spending is stimulative, and there are economic ties between states, even spending to dig a hole in South Dakota and fill it again can benefit the national economy. For another, the whole point of having federal spending (from a fiscal federalism perspective) is to carry out redistribution and social insurance, which states can't generally do. Any system of social insurance, viewed from the perspective of a state that does not collect insurance in a given year, will look like it doesn't serve the "general welfare," but the point is that it is the existence of the system that serves everyone. (I'll throw in a cf. here to Rawls' point that it is only over time that a representative government provides benefits to everyone.)
To be sure, some states get more from the federal government than others (Georgia, like most poorer states, is usually a net winner). But presumably the richer states get things from this bargain, as well, such as the ability to see their preferred degree of social insurance and redistribution put into effect (or, at a minimum, they can ensure that the standard of living in poorer states is high enough that there is not a mass influx of migrants).
Finally, to get to TJ's justiciability / institutional competence point, it may be true that I'm wrong and not all spending is stimulative, or that federal spending does not overall enhance national welfare. But I'd be pretty nervous about asking courts to decide those questions.
Posted by: BDG | Dec 27, 2010 4:53:47 PM
Dave,
I can see the coercion argument, but that argument already exists under S.D. v. Dole, and I am not sure what your General Welfare argument adds to it. I took your General Welfare Clause argument to stand for a more general rule -- that all items spending must benefit each and every state. And I think that rule cannot stand in its absolute form.
You can try and cut back on that rather radical rule in a few ways, but none of which courts are very good at administering and thus are, I think, unlikely to accept. First, you can say that the rule only applies when the spending is on a large enough scale. But drawing the line on what counts as a large enough federal program (as well as drawing the boundary on what constitutes a discrete federal program) is probably impossible to do coherently. Second, you can argue that it only applies when it is unduly coercive of states that want to opt out. But then it goes back to the Dole question of what is unduly coercive.
I can understand the coercion argument, but here I tend to agree with BDG's point (even if not his phrasing) that all conditional spending is, to some degree, coercive. The problem is again one of line drawing, and since courts are terrible at this type of line drawing, the practical answer on when a spending condition is unduly coercive has seemed to be "never." More importantly, I'm not sure that adding a "General Welfare" requirement on top of Dole gets you anything extra.
Posted by: TJ | Dec 27, 2010 3:31:13 PM
Maybe I'm missing Oedel's argument here, but the entire content seems to be that conditional spending is "bullying." I don't understand the normative content of that claim. I mean, is prohibiting recipients of federal funds from discriminating invidiously based on race "bullying" the racists? Or is "bullying" just a term for policy outcomes Barnett & Oedel don't like?
Posted by: BDG | Dec 27, 2010 3:11:00 PM
Professor Chiang,
I'm probably suggesting nothing new to most folks familiar with this blog, but as a newcomer, my impression is that you're a quick, smart and thoughtful critic of Professor Barnett's and my op-ed about whether the healthcare reform act's Medicaid changes were done constitutionally.
If I might make a couple of responses:
You offer a solid point that the Cornhusker Kickback might not be any different from one or another spending item benefiting a single state more than others, except on grounds of proportionality and scale. I tend to agree that, even if there's symmetrical constitutional trouble in both situations, there does seem to be reason to treat the Cornhusker Kickback situation, in which a majority agrees to fund a minority, differently from a situation like the ACA's, where a majority threatens to strip a minority of funding and use that funding for itself, much like a bully. In the latter situation, the representation-reinforcement role for the courts becomes especially important; justiciability issues are minimized; and the power of McCulloch is enlisted as a powerful defender against such radically differential treatment that is little more than piracy.
You also question why states should be treated differently than individuals for general welfare purposes. In this case, Congress has carefully chosen its so-called partners -- and they are identified as states. The Tenth Amendment suggests that residual powers are enjoyed both by states and individuals. Individuals theoretically could make complaints about general welfare violations, but the states have special standing in the case of the ACA's expansion of Medicaid.
You additionally make a point about whether the Spending Clause is textually less susceptible to particularized application than the taxing clause, presumably based on the Preamble language. I think that the particularized language of Article I that puts the "general welfare" language closest to the word "provide," however, should win out under classic and still-conventional principles of contruction.
Thank you for your thoughtful reactions in this national conversation about the meaning of our Constitution in this setting of healthcare reform. Please understand that my personal interests in this matter are those of a constitutional scholar, and that I have nothing against healthcare reform in theory, or against President Obama as a leader. After all, I happened to vote for him in 2008. Also please understand that the views I express here are my own, and are not endorsed by any parties to the 20-state litigation despite my role as a deputy special attorney general for Georgia. Nor do my views bind the thoughtful Professor Barnett, who can and does speak eloquently for himself.
Professor Dave Oedel, Mercer University
Posted by: David Oedel | Dec 27, 2010 2:41:03 PM
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