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August 03, 2010

Virginia's Challenge to ObamaCare and the History of the New Deal

Grim responds to the White House's (mis)characterization of yesterday's decision to allow Virginia to challenge the constitutionality of the so-called Affordable Care Act

Here is the White House's chosen response to the news that a constitutional challenge to their health care mandate has been permitted by the courts.

We saw this with the Social Security Act, the Civil Rights Act, and the Voting Rights Act – constitutional challenges were brought to all three of these monumental pieces of legislation, and all of those challenges failed. So too will the challenge to health reform.

This, then, is the understanding of our opponents: Constitutional challenges are to be expected, but they will always be overcome. The Constitution isn't so important that it could stop "monumental" legislation; complaining that the Constitution does not permit something is merely a temporary holding action by the rear guard of a defeated army.

Both the White House's latest argument and the process used to pass ObamaCare (a hastily drafted and poorly thought out bill of dubious constitutionality) are eerily similar to the arguments and process that gave us Social Security (another hastily drafted and poorly thought out bill of dubious constitutionality). Thomas H. Elliot, general counsel to the committee that drafted the SSA, remembers:

The Potomac atmosphere in early 1935 was one of importunate enthusiasm--of aggressive confidence, too, with one great exception. That exception, which colored the thinking of even the lowliest contributor to policy making, was grave uncertainty as to the Supreme Court's view of the constitutionality of New Deal legislation. To be sure, the Schechter decision, which invalidated the NRA and provoked President Roosevelt to angry comments about the "horse-and-buggy Court," was not handed down until late May. Long before that, however, all of us working to prepare social insurance legislation were aware of the constitutional difficulties involved. A young lawyer saddled with more responsibility than he should have accepted (I not only accepted it, I clung to it) was unceasingly conscious of the threatening shadow cast by the Constitution or the justices or both.

The bill was introduced on January 17. It was not ready for introduction. The President's committee headed by Miss Perkins had not agreed on its main features until after the new year began; in fact, one member of the committee, Secretary Morgenthau, at the last moment withdrew his agreement to the proposal's financial provisions. But, as everything in the program except old age insurance--unemployment compensation, old age assistance, aid to dependent children, child welfare--depended on complementary state action, speed seemed desirable. Almost all of the state legislatures were in session in 1935. They would not meet again in regular session for two years, so unless Congress acted quickly, state action might be long postponed. It seems odd now that anyone could have imagined that Congress would pass such a long and novel measure in the space of a few weeks. Yet at the time it seemed possible. Perhaps we were still bemused by the unique performance of Congress in the spring of 1933, when measures of great import had been rushed so swiftly to enactment. But those "hundred days" were unique in peacetime legislative history, and are likely to remain so.

...the original bill was certainly not well drafted. It was, in fact, a hodgepodge, not of unrelated subjects but of drafts prepared by various people, drafts which I either accepted in toto (the old age insurance provisions ably but hurriedly prepared in the Treasury Department) or edited far too hastily (the welfare titles written in the Children's Bureau). Inevitably, too, it reflected my heedless failure to resolve many small but significant policy issues which had been discussed little or not at all by the President's committee. Drafting is not just a technical job; it requires foreseeing every possible question that may arise and eliminating every ambiguity.

...The bill became law on August 14, 1935. And still no one could be sure that it would last. Was it constitutional? Certainly its welfare provisions, grants-in-aid to the states, were valid, but what of unemployment compensation and old age insurance? In regard to unemployment compensation I had been tiresomely insistent during the drafting of the bill in proposing a federal tax on employers which would be "forgiven" to the extent that the employers paid contributions into state unemployment compensation funds. I was insistent because there was a judicial precedent for upholding this method of persuading the states to act and because Justice Brandeis had casually mentioned that precedent to his son-in-law, a leader in the unemployment compensation movement in Wisconsin. With respect to old age insurance, the Constitution gives the Congress power to tax and spend for the general welfare. But was a particular tax on employees, who would eventually be paid benefits in amounts measured by the taxes they had paid, a proper exercise of this congressional power? Or was it an attempt to establish a compulsory retirement insurance system, and if so, was it beyond the authority of Congress?

Here, another history lesson is in order. According to the Social Security Administration's own online history pages, the Court's decision not to strike down Social Security was neither free of coercion nor clear cut:

Few Americans now recall that in the months leading up to the Court's review of the Social Security Act, judges had been striking down one New Deal law after another. Even fewer Americans remember FDR's response to this judicial defiance:

Enraged, Roosevelt decided to subdue the Court. His megalomania inflated by his 1936 landslide, on February 5, 1937 he abruptly asked Congress to enact a bill empowering him to appoint one additional Justice for every one who turned 70 and did not retire, for a maximum of six, thus enlarging the Supreme Court from nine Justices to up to fifteen.

A firestorm ensued. Critics rightly called Roosevelt’s proposal a plan to pack the Court. Even liberals who deplored the Court’s decisions, including many congressional Democrats, opposed it.

Its arm cruelly twisted by Roosevelt’s threat to its independence, the Supreme Court began surrendering in self-preservation.

An aging Supreme Court, intimidated by Roosevelt's threats, capitulated and refused to declare Social Security unconstitutional. But the important point here is the argument provided by Justice Cardozo in the majority ruling (which, by the way, largely relied upon the administration's case that Social Security was a valid exercise of Congress's spending power):

Regarding whether Titles II and VIII together were an invalid old-age insurance scheme, Cardozo merely noted Davis’s argument that they dovetail so as to justify concluding that Congress would not have passed one without the other, and the government’s opposing position that Congress could spend the revenue as it willed. "We find it unnecessary to make a choice between the arguments, and so leave the question open." So the Court ducked the core issue of whether Social Security is an unconstitutional government insurance program. Why?

...The majority of the Helvering v. Davis majority, Hughes, Roberts, Van Devanter, and Sutherland, were conservatives. Most had bitterly criticized the New Deal. Can anybody really believe that they found Cardozo’s half-baked opinion, mostly lifted from the Administration’s brief, an adequate expression of their views on Social Security’s constitutionality?

Am I the only one to see the similarities in the White House's justification for ObamaCare?

In order to make health care affordable and available for all, the Act regulates how to pay for medical services – services that account for more than 17.5% of the national economy. This law came into being precisely because of the interconnectedness of our health care costs. People who make an economic decision to forego health insurance do not opt out of the health care market, but instead shift their costs to others when they become ill or are involved in an accident and cannot pay.

...many reforms provided by the law – such as the requirement that insurers cover individuals with pre-existing conditions – can only be effective if everyone is part of the system, which is why the minimum coverage, or shared responsibility, requirement is part of the law.

Actually the last sentence in the first excerpted paragraph is demonstrably untrue. While the uninsured may seek care and pass the cost to others, they also have the right to refuse care. Under what legal or equitable doctrine does the federal government force individuals to pay their "fair share" of costs they never incur nor pass on to others? What is a fair share of zero? As for the second paragraph, it seems to assert that unconstitutional provisions of federal laws are justifiable so long as they are required to make the law "work". This is essentially a glorified version of "the end justifies the means" even if those means exceed Congress's constitutionally derived authority.

That said, given the Court's penchant for presuming the constitutionality of congressional legislation, the administration's confidence may not be unwarranted: (CWCID: spd)

Since the New Deal, Supreme Court justices have generally assumed a law is constitutional and overruled it only when it infringes on an individual right that is enumerated in the Constitution (free speech) or not (privacy). "If you're talking about the regulation of economic activity, the presumption of constitutionality is for all practical purposes irrebuttable," Mr. Barnett says.

Instead, Mr. Barnett would have the court adopt a "presumption of liberty," placing the burden on the government to show that a law has a clear basis in Congress's constitutional powers. "The easiest way to explain it is, it would basically apply to all liberty the same basic protection we now apply to speech," he says.

A presumption of liberty - now there's change we can all believe in. Who's against liberty? Well, for starters, anyone who wants to avoid the responsibility that goes along with freedom.

Isn't it remarkable that the administration has chosen to ground its arguments for ObamaCare in FDR's flagrant New Deal arm twisting of a Supreme Court that - if one believes the historical materials posted right on the Social Security Administration's web site - initially struck down most New Deal legislation as unconstitutional and departed from this stance only in response to threats from the Executive branch?

I certainly never learned any of this in my history classes. I'm betting the administration hopes you never did either.

Posted by Cassandra at August 3, 2010 08:29 AM

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Don't you just love how they target the psychological warfare operations using the word "Affordable" given that the most pressing thing they must fight in the war of perception is that healthcare is not affordable and thus not sustainable?

Posted by: Ymarsakar at August 3, 2010 10:51 AM


It amuses me to mock the LSM's tactic of trying to discredit the "so-called Surge" by calling ObamaCare the "so-called Affordable Care Act" :p

Posted by: Cassandra at August 3, 2010 11:02 AM

My understanding of the history of the court packing scheme of FDR's was that Congress was the one who push backed the hardest. They rightfully saw that if FDR was allowed to pack the court it might infringe on their powers.

Given that, I find it a little difficult to believe that the court would feel much pressure from FDR. I thought they found most of the New Deal Constitutional, but found only a few parts that weren't.

What I found offensive about the whole thing was the president's rhetoric. It came across as that we were spending too much of our money on healthcare and the government had to do something about it. Really? Since when is it the government's money? Granted, Congress can "bend the spending curve" on Medicare, but we know how well that will go over.

Posted by: Allen at August 3, 2010 11:31 AM

Allen, there was another part of the story regarding the Court. In conjunction with the court-packing scheme, Roosevelt made numerous public statements to the effect that, given that the executive branch controls the armed forces and the federal policing agencies, if the Court continued to displease Roosevelt, then it might have great difficulty finding anyone to enforce its decisions. The message was clear: given that the judiciary does not have its own enforcement arm, it could either acquiesce or become a vestigial organ, a useless appendix. The Justices were faced with a choice between partial breakdown of constitutional government and total breakdown; they chose to live to fight another day.

Of course, this all sounds strange to us now because starting with and since Roosevelt's time, the Left has been very successful in remaking the judiciary in its own image. We now have a judicial branch that is compliant with leftist Executives, and obstinately obstructionist when a non-leftist holds the White House. So the idea that a Marxist President would need to threaten the judiciary strikes us as odd. But it hasn't always been that way.

Posted by: Cousin Dave at August 3, 2010 12:02 PM

I find it a little difficult to believe that the court would feel much pressure from FDR. I thought they found most of the New Deal Constitutional, but found only a few parts that weren't.

You may want to read this:

While the Social Security bill was in Congress, the Court invalidated the Railroad Retirement Act, which resembled Social Security. So the Administration’s allies on the House Ways and Means Committee weeded the insurance language out of the bill and physically separated the tax and benefits titles in the text so they wouldn’t look like an insurance program. Meanwhile, the Supreme Court hammered the New Deal. On May 27, 1935, in a crushing defeat for Roosevelt, it voided the National Industrial Recovery Act and the Frazier-Lemke Farm Bankruptcy Act. It struck down the Agricultural Adjustment Act on January 6, 1936, the Guffey Coal Act on May 18, and the Municipal Bankruptcy Act and a New York state law setting minimum wages for women on May 25. Enraged, Roosevelt decided to subdue the Court. His megalomania inflated by his 1936 landslide, on February 5, 1937 he abruptly asked Congress to enact a bill empowering him to appoint one additional Justice for every one who turned 70 and did not retire, for a maximum of six, thus enlarging the Supreme Court from nine Justices to up to fifteen. A firestorm ensued. Critics rightly called Roosevelt’s proposal a plan to pack the Court. Even liberals who deplored the Court’s decisions, including many congressional Democrats, opposed it. Its arm cruelly twisted by Roosevelt’s threat to its independence, the Supreme Court began surrendering in self-preservation. On March 29, the Court upheld a revised Frazier-Lemke Act; the National Firearms Act; the Railway Labor Act, which promoted collective bargaining; and a Washington state law providing for minimum wages for women.

Link: http://www.lewrockwell.com/orig3/attarian7.html

Posted by: Cassandra at August 3, 2010 12:18 PM

I studied the history of the New Deal under Dr. June Hopkins, who is I believe the granddaughter of Harry Hopkins, one of FDR's closest advisors. She was of course sympathetic to her grandfather's case -- her work on the subject is titled Harry Hopkins: Sudden Hero, Brash Reformer.

However, she also taught the history of the relations with the SCOTUS that way. Basically, until the court packing scheme almost succeeded, SCOTUS held the line and enforced the Constitution. Afterwards, they gave up. The Constitution largely died in the years right after that: our duty will be to restore it, all the way.

Posted by: Grim at August 3, 2010 12:50 PM

When I was in school that period of history seemed to get short shrift.

One of the most enlightening books I ever read was Doris Kearns Godwin's bio of FDR and Eleanor Roosevelt (No Ordinary Time). It really shifted my view on FDR and the New Deal in surprising ways.

Posted by: Cassandra at August 3, 2010 12:57 PM

I always said Bush could ignore the Supreme Court whenever he wanted to. Given that Bush is the Executive arm of enforcement and the Supreme Court cannot enforce whatever decrees it issues on GitMo or terrorism.

But Bush wasn't going to risk the Constitution. He wanted to play it safe.

Some people weren't nice enough to give us that option, however.

Posted by: Ymarsakar at August 3, 2010 01:22 PM

our duty will be to restore it, all the way.

Could be some bodies in the way.

Posted by: Ymarsakar at August 3, 2010 01:23 PM

My Great-Grandfather called FDR "That Communist Bastard In The White House". He had numerous run-ins with FDR and they butted heads over timber for the war effort. What my GG called "government stealing". It got to the point where FDR actually sent military representatives to the mill to make sure my GG complied. I have an entirely different take on FDR from my family history. I know from my Grandfather as well what a prick FDR was. Rule of Law and property rights meant nothing to the man. He anointed himself "King of All He Surveyed". My Grandfather told the story of my GG accusing FDR of doing anything he could to draw us into war to cover his socialistic policies. To the man's face! Gotta' luv those pacifist Quakers!

Who was right?

It never ceases to amaze me how this Country can continue repeat the same mistakes over and over. I firmly believe it is based in public education. Or lack thereof. Government creates crisis and takes over on the grounds of benefit to all citizens. Like their takeover of public education. Healthcare. Private business. Financial markets. It is all based in the lack of education our people receive though. 50 years is a lot of indoctrination.

My darling daughter is working on her Masters in History and she didn't have a clue about how intrusive FDR's policies were. She was never taught Constitutionalism when she was studying FDR and the era. Even at the post graduate level. She knows it now! ;-)

I have to say I'm not surprised though. Governments do not educate. They indoctrinate.

Yeah I know, I'm a blasphemer! FDR was the Greatest Man Of All Time. How dare I think he was an asshat. He saved Amurica! I'm Suthin' too. The man saved the South with the TVA and putting people to work. It's just so simple even my pea brain ought to be able to wrap around it. Sometimes you have to destroy something to build it better. Right? For Da Peeps! That Living, Breathing Document be damned!

Posted by: JHD at August 3, 2010 02:20 PM

FDR also messed up on relaying information from FBI and other intel agencies to the commander at Pearl Harbor. Then one of the guys FDR replaced him with, ditched the Marines at Wake Island. Course, Hollywood covered that one up by saying the Marines fought valiant and died to the last man. That was obviously a lie.

FDR also let government bureaucracy delay crucial torpedo faults. Probably cause some favorite company of his was making the dud impact warheads. It took forever and constant reports before the Fed Bureaus would even conduct a test on the warheads. Then they found that a 90 degree angle on the magnetic torpedo warheads would smash the impact and prevent it from exploding.

You know how the Left say that government and FDr saved America? Bull. Individual Americans were the ones that fought to save their own nation.

They're saying the same stuff today. Hoping the con that worked before, will work not. Last time that con worked, half the world fell to the Soviet Iron Curtain. That great progressive "Beacon of Darkness".

Posted by: Ymarsakar at August 3, 2010 03:05 PM

It was funny how they talked about how Bush was the one using war powers to destroy the Constitution. They obviously thought of that because their boy FDR had perfected it through 16 years of Executive Power.

Posted by: Ymarsakar at August 3, 2010 03:09 PM

My Grandfather told the story of my GG accusing FDR of doing anything he could to draw us into war to cover his socialistic policies.

He almost got us into war on the wrong side. He appointed Joe Kennedy (Senior) ambassador to the Court of St. James -- and he did *not* play well with the Brits, in any sense of the term...

Posted by: BillT at August 4, 2010 08:10 AM

"When I was in school that period of history seemed to get short shrift."

I never thought about it before, but you're right. I experienced the same thing... American history was taught up through the Civil War, there was a brief mention of the Great Depression and WWII, and then it skipped to the 1960s. Most of what I know about everything between the Industrial Revolution and JFK, I learned on my own. (And I know now that a lot of what they taught about JFK and the '60s was wildly inaccurate.)

Posted by: Cousin Dave at August 4, 2010 10:00 AM

I am constantly reminded of how the Democrats whined about the "Imperial George Bush", and are now acting, not as he did, but as they accused him of.

Posted by: htom at August 4, 2010 01:55 PM

Propaganda is more powerful than nukes when it is properly entrenched and allowed to grow.

Posted by: Ymarsakar at August 4, 2010 10:53 PM

Don't forget that Byrd and Kennedy was keeping up the old Democrat traditions of wealth and caste systems. Power for life. That's their game. It hasn't changed.

Posted by: Ymarsakar at August 4, 2010 10:57 PM

I like to call it the "Affordable" "Care" Act.

Posted by: Texan99 at August 5, 2010 10:00 AM

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