Tag: tyranny

Yes, Delaying Obamacare’s Employer Mandate Is Illegal

Last week, when most Americans were starting their Fourth of July holiday, the Obama administration announced it will wait until 2015 to implement Obamacare’s penalties against employers who fail to offer “affordable” and “minimum value” coverage to their workers, rather than impose this “employer mandate” in 2014, as the statute requires. The administration’s stated rationale is that, despite nearly four years of lead time, it still won’t have the capacity to collect from employers the information required to determine which employers will be subject to penalties in 2014. As a result, the administration also announced it would not require employers to report that information until 2015, though (again) the statute requires employers to furnish that information in 2014.

Nicholas Bagley, a professor of law at the University of Michigan, suggests that maybe there is a legal rationale for the Obama administration’s delaying these provisions. So let’s take each provision in turn.

1) Has Congress given Treasury the authority to waive the penalties? The answer is no. The employer-mandate penalties unequivocally take effect on January 1, 2014, and the PPACA gives the Treasury secretary no authority to postpone their imposition.

Every element of the employer mandate demonstrates that it takes effect in 2014.

  • If any worker at a firm with more than 50 full-time-equivalent employees receives a tax credit through a health insurance “exchange,” then “there is hereby imposed on the employer an assessable payment.” Those tax credits become available on January 1, 2014. Thus that is also the date on which the penalties take effect.
  • The statute specifies penalty amounts that apply specifically in 2014, and provides that those penalties shall be adjusted for inflation in years after 2014.
  • The section creating the employer mandate even contains an effective date: “The amendments made by this section shall apply to months beginning after December 31, 2013.”

The statute gives the Treasury secretary the authority to collect these penalties “on an annual, monthly, or other periodic basis as the Secretary may prescribe.” It does not allow the secretary to waive the imposition of such penalties, except in one circumstance: Section 1332 authorizes the Treasury secretary to waive the employer mandate, but only as part of a state-specific waiver, and only if the state enacts a law that would provide equally comprehensive health insurance to as many residents, and only if that law would impose no additional cost to the federal government, and only if there is a “meaningful level of public input” over the waiver and its approval, and even then not until 2017. In other words, Congress spoke to the question of whether and when the executive should be able to waive the employer mandate, and Congress clearly did not want the administration to waive it unless certain specified conditions were met.

Nevertheless, Treasury claims it has the authority to waive those penalties without following Congress’ instructions: “[T]he employer shared responsibility payments…will not apply for 2014. Any employer shared responsibility payments will not apply until 2015.”

2) Has Congress given Treasury the authority to waive the reporting requirement? Again, the answer is no.

The PPACA added two sections to the Internal Revenue Code (sections 6055 & 6056) that require employers to report certain information on their health benefits and the workers who enroll in that coverage, in order to help the IRS determine whether those workers are eligible for tax credits and whether the employer is subject to penalties. Again, the statute is clear: those reporting requirements take effect in “calendar years beginning after 2013” and “periods beginning after December 31, 2013.” The statute contains no language authorizing Treasury to waive those requirements.

Bagley argues the statute does contain language that might enable Treasury to delay the imposition of these reporting requirements. Sections 6055 & 6056 state that employers must furnish this information “at such time as the Secretary may prescribe.” He writes, “Delaying the reporting requirements until 2015 is arguably just a specification of the ‘time’ at which the reports must be submitted.”

This theory reflects a misunderstanding of what an effective date is. When Congress imposes an obligation on some party, that obligation becomes effective on the effective date. The secretary’s discretion to prescribe the time at which the affected party must discharge that obligation neither affects the existence of the obligation, nor empowers the secretary to repeal it.

One might argue that Treasury has the authority to say employers need not report the required information regarding their 2014 health benefits offerings until, say, the next year, when they report the same information for their 2015 offerings. Yet that is not what Treasury is doing. Treasury claims it can altogether eliminate the obligation to report the 2014 information: “The Administration…will provide an additional year before the ACA mandatory employer and insurer reporting requirements begin.”

Moreover, if the language Bagley cites were interpreted to permit Treasury to waive the mandate and reporting requirements for 2014, is there any reason why that interpretation would not empower Treasury waive those provisions indefinitely? Could the secretary determine employers need discharge these obligations every 1,000 years? If not, why not?

Finally, Bagley concludes no one would have standing to challenge these actions in court. Thus even if the administration’s actions are illegal, he writes, “So what?”

Let’s assume for the moment that Bagley is correct on the standing issue. Here’s “what.” The law is a mutual compact between the government and the people. The more the government acts as though it is not bound by that the law, the more widespread will be the belief among the people that they are not bound by the law, either. That would be a very bad situation. There are already enough people out there who believe the government is not bound by the law that President Obama feels it is worth his time to counsel Americans to “reject these voices” – even as his actions lend credence to them, and further diminish respect for the law. That’s a “what” that I figured law professors understood.

Shades of Nixon: ‘IRS Apologizes for Targeting Conservative Groups’

From the Associated Press:

WASHINGTON (AP) — The Internal Revenue Service is apologizing for inappropriately flagging conservative political groups for additional reviews during the 2012 election to see if they were violating their tax-exempt status.

Lois Lerner, who heads the IRS unit that oversees tax-exempt groups, said organizations that included the words “tea party” or “patriot” in their applications for tax-exempt status were singled out for additional reviews.

Lerner said the practice, initiated by low-level workers in Cincinnati, was wrong and she apologized while speaking at a conference in Washington.

Many conservative groups complained during the election that they were being harassed by the IRS. They said the agency asked them an inordinate number of questions to justify their tax-exempt status.

Certain tax-exempt charitable groups can conduct political activities but it cannot be their primary activity.

Let’s all recall what President Obama told Ohio State University graduates just days ago:

Unfortunately, you’ve grown up hearing voices that incessantly warn of government as nothing more than some separate, sinister entity that’s at the root of all our problems. Some of these same voices also do their best to gum up the works. They’ll warn that tyranny [is] always lurking just around the corner. You should reject these voices. Because what they suggest is that our brave, and creative, and unique experiment in self-rule is somehow just a sham with which we can’t be trusted.

We have never been a people who place all our faith in government to solve our problems. We shouldn’t want to. But we don’t think the government is the source of all our problems, either. Because we understand that this democracy is ours. And as citizens, we understand that it’s not about what America can do for us, it’s about what can be done by us, together, through the hard and frustrating but absolutely necessary work of self-government.

“Government is simply the name we give to the things we choose to do together,” says Barney Frank. Like persecute our political enemies.

President Ashcroft

President Obama has drawn some fire for telling Ohio State University graduates, among other things:

Unfortunately, you’ve grown up hearing voices that incessantly warn of government as nothing more than some separate, sinister entity that’s at the root of all our problems; some of these same voices also doing their best to gum up the works. They’ll warn that tyranny is always lurking just around the corner. You should reject these voices.

His critics included my colleagues Roger Pilon in the Wall Street Journal, who deplored Obama’s conflation of the family and the federal government, and Gene Healy in the Washington Examiner, who noted the president’s attempt “to reframe skepticism toward overweening federal power as “cynicism.’”

I was reminded of another political official’s warning back in 2001:

To those who scare peace-loving people with phantoms of lost liberty; my message is this: Your tactics only aid terrorists - for they erode our national unity and diminish our resolve. They give ammunition to America’s enemies.

That was attorney general John Ashcroft testifying before Congress on the Patriot Act and the Bush administration’s exercise of power after 9/11. It’s a standard theme of those in power: If you question our actions, if you protest the expansion of government and the loss of freedom, you’re aiding the enemy. You’re undermining our faith in government.

The Founders of this nation had a different view. James Madison warned us that since men are not angels, we can’t entrust them with unlimited power. And Thomas Jefferson wrote in the Kentucky Resolutions against the Alien and Sedition Acts, 

that it would be a dangerous delusion were a confidence in the men of our choice to silence our fears for the safety of our rights: that confidence is everywhere the parent of despotism–free government is founded in jealousy, and not in confidence; it is jealousy and not confidence which prescribes limited constitutions, to bind down those whom we are obliged to trust with power: that our Constitution has accordingly fixed the limits to which, and no further, our confidence may go….In questions of power, then, let no more be heard of confidence in man, but bind him down from mischief by the chains of the Constitution.

That’s the spirit of freedom and self-government: Jealous of our rights and liberties, confident in our Constitution, and skeptical about power and about the men and women who seek it.

As for the president’s much-quoted attack on “individual ambition,” I addressed that in the Wall Street Journal back in 2008 when he made a similar argument to Wesleyan grads.

Wednesday Links

  • Next up for marriage equality: Perry v. Schwarzenegger. Please join us at 12:00 p.m. Eastern today as co-counsels for the plaintiffs Theodore Olson and John Boies join Center for American Progress president John Podesta and Cato chairman Robert A. Levy for a panel discussion on marriage equality, exploring legal and moral questions dating back to the landmark 1967 Loving v. Virginia decision that ended state bans on interracial marriage. If you cannot join us here at Cato, please tune in to watch a live stream of the event.
  • “Republicans have an opportunity for a much more important debate, which will frame the election campaign next year.”
  • In President Obama’s next speech, Cato director of foreign policy studies Christopher Preble hopes “that the president reaffirms the importance of peaceful regime change from within, not American-sponsored regime change from without.”
  • What will former Massachusetts governor Mitt Romney’s next position on health care be?
  • Like cleanliness next to godliness, so is democracy next to tyranny.
  • The U.S. hit the debt limit–what’s next?


“This time they said, ‘We’re not going.’”

“This time they said, ‘We’re not going.’”

That was the quote that caught my attention in last week’s PBS broadcast of “Stonewall Uprising,” a documentary about the “Stonewall riots” that launched the gay rights movement in 1969. And it made me think of other people who finally said “no” to oppression – like Rosa Parks in Montgomery, Alabama, and Mohammed Bouazizi in Tunisia.

At the Britannica blog I look at the connections among these resisters and movements and ask:

What causes some acts of resistance to succeed? Is it historical inevitability, just the right moment for the dry field of hidden dissatisfaction to be set on fire by a spark? Some libertarian — and other — radicals wonder why Americans don’t revolt against what the radicals see as tyranny.

Good News: 9/11 Didn’t ‘Change Everything’

On the eighth anniversary of the terrorist attacks on New York and D.C., things are going much better than most of us dared hope in the initial aftermath of that horrible day.  We’re still a secure, prosperous, and relatively free country, and the fear-poisoned atmosphere that governed American politics for years after 9/11 has thankfully receded.

Not everyone’s thankful, however.  Boisterous cable gabber Glenn Beck laments the return to normalcy. The website for Beck’s “9/12 Project” waxes nostalgic for the day after the worst terrorist attack in American history, a time when “We were united as Americans, standing together to protect the greatest nation ever created.” Beck’s purpose with the Project?  “We want to get everyone thinking like it is September 12th, 2001 again.”

My God, why in the world would anyone want that?  Yes, 9/12 brought moving displays of patriotism and a comforting sense of national unity, but that hardly made up for the fear, rage and sorrow that dominated the national mood and at times clouded our vision. 

But Beck’s not alone in seeing a bright side to national tragedy.  Less than a month after people jumped from the World Trade Center’s north tower to avoid burning to death, David Brooks asked, “Does anybody but me feel upbeat, and guilty about it?” “I feel upbeat because the country seems to be a better place than it was a month ago,” Brooks explained, “I feel guilty about it because I should be feeling pain and horror and anger about the recent events. But there’s so much to cheer one up.” 

One of the things that got Brooks giddy was liberals’ newfound bellicosity. That same week, liberal hawk George Packer wrote:

What I dread now is a return to the normality we’re all supposed to seek: instead of public memorials, private consumption; instead of lines to give blood, restaurant lines… ”The only thing needed,” William James wrote in ”The Moral Equivalent of War,” ”is to inflame the civic temper as past history has inflamed the military temper.” I’ve lived through this state, and I like it.

There’s something perverse, if not obscene, in “dreading” the idea that Americans might someday get back to enjoying their own lives.  “Private consumption!”  “Restaurant lines!”  The horror!  The horror!

Like Brooks’s National Greatness Conservatives, a good many progressives thought 9/11’s national crisis brought with it the opportunity for a new politics of meaning, a chance to redirect American life in accordance with “the common good.”  Both camps seemed to think American life was purposeless without a warrior president who could bring us together to fulfill our national destiny. 

That’s why prominent figures on the Right and the Left condemned George W. Bush’s post-9/11 advice to “Enjoy America’s great destination spots.  Get down to Disney World in Florida.  Take your families and enjoy life, the way we want it to be enjoyed.”  As Jeremy Lott notes, “in his laugh riot of a presidential bid,” Joe Biden repeatedly condemned Bush for telling people to “fly and go to the mall!”  A little over a year ago, asked to identify “the greatest moral failure of America” John McCain referenced Bush’s comments when he answered that it was our failure sufficiently to devote ourselves “to causes greater than our self interest.”   

True, Bush’s term “destination spots” is a little redundant; but otherwise, for once, he said exactly the right thing.  And of all the many things to condemn in his post-9/11 leadership, it’s beyond bizarre to lament Bush’s failure to demand more sacrifices from Americans at home: taxes, national service, perhaps scrap-metal drives and War on Terror bond rallies?

National unity has a dark side.  What unity we enjoyed after 9/11 gave rise to unhealthy levels of trust in government, which in turn enabled a radical expansion of executive power and facilitated our entry into a disastrous, unnecessary war. 

In his Inaugural Address, Barack Obama condemned those “who question the scale of our ambitions, who suggest that our system cannot tolerate too many big plans.” “Their memories are short,” he said, “for they have forgotten what this country has already done, what free men and women can achieve when imagination is joined to common purpose and necessity to courage.”

Riffing off of Obama’s remarks, Will Wilkinson wrote:

Can you recall the scale of our recent ambitions? The United States would invade Iraq, refashion it as a democracy and forever transform the Middle East. Remember when President Bush committed the United States to “the ultimate goal of ending tyranny in our world”? That is ambitious scale.

Not only have some of us forgotten “what this country has already done … when imagination is joined to a common purpose,” it’s as if some of us are trying to erase the memory of our complicity in the last eight years — to forget that in the face of a crisis we did transcend our stale differences and cut the president a blank check that paid for disaster. How can we not question the scale of our leaders’ ambitions? How short would our memories have to be?

Oddly, even Glenn Beck seems to agree, after a fashion.  The 9/12 Project credo celebrates the fact that ”the day after America was attacked, we were not obsessed with Red States, Blue States, or political parties.”  And yet Beck has called on “9/12’ers” to participate in tomorrow’s anti-Obama “tea party” in D.C. 

On the anniversary of 9/11, what’s clear is that, despite the cliche, September 11th didn’t “change everything.”  In the wake of the attacks, various pundits proclaimed “the end of the age of irony” and the dawning of a new era of national unity in the service of government crusades at home and abroad.  Eight years later, Americans go about their lives, waiting in restaurant lines, visiting our ”great destination spots,” enjoying themselves free from fear — with our patriotism undiminished for all that.  And when we turn to politics, we’re still contentious, fractious, wonderfully irreverent toward politicians, and increasingly skeptical toward their grand plans.   In other words,  post-9/11 America looks a lot like pre-9/11 America.  That’s something to be thankful for on the anniversary of a grim day.

Obama Says 20 Percent for Government Is Too Much!

While perusing Instapundit, I came across a post suggesting that President Obama thinks investment will suffer if government takes 20 percent of a company’s income. At first I thought this was a form of satire, but there is a real link to a speech that the President gave to the Parliament of Ghana. Indeed, the speech has several good comments:

Development depends on good governance. …Repression can take many forms, and too many nations, even those that have elections, are plagued by problems that condemn their people to poverty. No country is going to create wealth if its leaders exploit the economy to enrich themselves… No business wants to invest in a place where the government skims 20 percent off the top… No person wants to live in a society where the rule of law gives way to the rule of brutality and bribery. That is not democracy, that is tyranny, even if occasionally you sprinkle an election in there. And now is the time for that style of governance to end. 

My initial reaction, focusing on the passage about 20 percent being too much for government, is to ask why Obama wants higher tax rates in America? After all, he wants American small businesses to pay 40 percent, which is twice the burden he thinks is excessive for Ghanians. Upon further reflection, though, I wonder if the President is referring to corrupt bureaucrats asking for bribes. But, even if that is the case, why does that matter? Investors and entrepreneurs care about the amount of disposable income that is generated by an investment. Losing 20 percent to the tax collector has a negative impact on incentives, regardless of whether the money winds up in Treasury coffers or a bureaucrat’s pocket. In any event, it is good to see that the President recognizes that the economy suffers when government becomes too much of a burden. We just need to figure out how to convince him that the laws of economics work the same way in America as they do in Ghana.