Topic: Law and Civil Liberties

Are Democratic-Appointed Judges a Sure Thing for ACA?

Jason Millman of the Washington Post’s Wonkblog casually assumes that Democratic-appointed judges can be counted on to uphold the Affordable Care Act and its implementation against any legal challenge:

The Obama administration and supporters of the president’s health-care law are probably breathing a little easier this morning after some pretty big news from the U.S. Court of Appeals for the District of Columbia.

A few months after a three-member panel of the court ruled the federal government can’t provide insurance subsidies through federal-run exchanges in 36 states, the court on Thursday granted the Obama administration’s request for the entire panel to re-hear the case. The en banc hearing, as it’s known, wasn’t entirely unexpected—and with a heavy makeup of Democratic-appointed judges on the panel, it seems likely the administration will get a more favorable ruling when the entire court reconsiders the case later this year.

I don’t know. I know that Obamacare passed in both the House and Senate on straight party-line votes, over unanimous Republican opposition. But judges aren’t politicians. With a slew of Reagan- and Bush-appointed judges striking down gay marriage bans, I hope and expect that Democratic-appointed judges will show similar nonpartisan judiciousness when they consider the challenge to the IRS’s illegal implementation of insurance subsidies.

The D.C. Circuit Vacates Its Panel’s Halbig Decision

A quick note on unfortunate happenings at the U.S. Court of Appeals for the D.C. Circuit this morning: The court vacated its excellent July 22 decision in Halbig v. Burwell, which had held that Obamacare’s plain language precluded the federal government from subsidizing the health insurance premiums of policies people obtain through exchanges established by the federal government. Just hours after that July 22 decision came down, the Fourth Circuit Court of Appeals ruled the other way on the question in King v. Burwell, setting up a circuit split and a reason for the Supreme Court to promptly decide the question, especially given the scope and magnitude of the issues at stake (36 states have declined to establish state exchanges, for which Obamacare does provided subsidies).

Thus, with the D.C. Circuit now having vacated its three-judge panel’s decision and having agreed to rehear the case en banc (by the entire court), there is no longer a circuit split and less urgency for the Supreme Court to take up the issue. Other cases challenging the federal subsidies are coming along, but for the moment, this is where things are. For more on these issues, see Ilya’s latest post and a WSJ op-ed by Adam White, both written before this morning’s decision. It’s rare for any circuit, but especially for the D.C. Circuit, to grant en banc rehearings. But then nothing has been normal about Obamacare, which is what you should expect when so politicized a program is thrust upon the nation.

Supreme Court Must Resolve Obamacare Chaos

When the Affordable Care Act was being debated in Congress, former House Speaker Nancy Pelosi infamously insisted that “we have to pass the bill to find out what’s in it.”  It turns out, however, that the Obama administration—which has been making it up as it goes along with regard to ACA enforcement—doesn’t care “what’s in it.”

The IRS in particular has been implementing Obamacare as it thinks the law should be, not as it is. The ACA encourages states to establish health insurance exchanges by offering people who get their health coverage “through an Exchange established by the State” a tax credit—a subsidy to help them pay their premium. In the event a state declines to establish an exchange, Section 1321 further empowers the Department of Health and Human Services to establish federal exchange in states that decline to establish their own exchanges (without providing for the premium subsidy).

When, contrary to the expectations of the law’s achitects, 34 states declined to establish an exchange—two more have since failed—the IRS decided that those getting their insurance on federally established exchanges should qualify for tax credits regardless of the statutory text. In conflict with the U.S. Court of Appeals for the D.C. Circuit in a similar case called Halbig v. Burwell, the Fourth Circuit in King v. Burwell found the legal text to be ambiguous and thus deferred to the IRS interpretation.

The so-called Chevron doctrine counsels that statutory text controls when Congress has spoken clearly on an issue. But where Congress is ambiguous or silent, the agency can fill the regulatory gap with its own rules and policies. The problem here is that the ACA’s text was not ambiguous and there is no evidence that Congress intended to delegate to the IRS the power to determine whether billions of taxpayer dollars should annually be dispersed to those purchasing health care coverage on federal exchanges. That the Fourth Circuit has bent over backwards to accommodate the administration’s latest Obamacare “fix shows that it, too, is not so concerned with “what’s in” the law. 

To that end, Cato joined four other organizations to support the plaintiffs’ petition for review by the Supreme Court. Our brief argues that the Court should hear the case because it offers the opportunity to reverse potentially grave harm to the separation of powers, to correct a misapplication of the Chevron doctrine, and to restore the idea that drastically altering the operation of a major legislative act belongs to the political process and not in a back rooms of an administrative agency. Just because those who voted for the ACA didn’t care what it said doesn’t mean that the executive and judicial branches should also turn a blind eye.  

To see the legal machinations now at play in these cases regarding the Obamacare-IRS-tax-credit, see my recent op-ed in the National Law Journal. Since that was published this past Monday, the government received a 30-day extension in which it has to file its response to the King cert petition. That means that the Supreme Court will be considering at some point next month whether to take the case.

For Cato’s previous briefs in Halbig and King, respectively, see here and here.

Police Unions and Excessive Force

[cross-posted from Overlawyered]

The need for police forces isn’t going away, so what practical suggestions do libertarians have in the here and now for discouraging police resort to excessive force? Thanks to Ed Krayewski at Reason for quoting me on the subject of tackling the power of police unions, which not only protect bad actors from removal but tie the hands of well-intentioned administrators in a dozen other ways and exert political pressure against effective reform. (Other suggestions in the piece: increase use of body- and dash-cams, extend the role of civilian oversight boards, and end the Drug War; relatedly, curtail SWAT tactics and the use of other paramilitary force.)

On a perhaps not unrelated note, the Washington Post reports today on the police shooting of an unarmed suburban Washington, D.C. man in his front doorway after he refused to let police into his home following a domestic call. The fact that jumped out at me was that, a year after it happened, the Fairfax County police department is still releasing no information about the incident, not even the name of the officer who pulled the trigger. According to the Post’s account (related lawsuit), police shot kitchen contractor John Geer once but first aid did not arrive until an hour later — he bled to death — and his body remained unmoved for hours, like that of Michael Brown on the street in Ferguson, Mo. The Fairfax chief says his department is just following its own policy by not releasing the officer’s name or other information while an investigation is pending (and pending and pending) — but how that policy came to be adopted, and for whose benefit, are questions worth asking.

Anti-School Choice Activists Demand Judge’s Recusal Because She’s Catholic

It’s bad enough that a Florida teachers union, the Florida School Boards Association, and the PTA filed a lawsuit to deprive low-income students of scholarships citing the state constitution’s historically anti-Catholic, Know-Nothing inspired “Blaine amendment.” But now anti-school choice activists are demanding that a judge recuse herself from another lawsuit against the state’s choice laws because she’s Catholic.

Kathleen Oropeza, president of the ironically-named Fund Education Now (given that they want to deny tax-credit scholarship funds to low-income students), filed a motion demanding that the circuit court judge recuse herself for the following reasons:

2. On August 26 and 27, 2014, I discovered facts concerning Judge Angela C. Dempsey that cause me to believe that she is biased against the Plaintiff’s position that the Florida Tax Credit Program and the McKay Scholarship Programs are violations of Article IX of the Florida Constitution.

3. The facts are as follows:

a. Judge Dempsey is a member of the Board of Directors of Catholic Charities, and a contributor to same.

b. Judge Dempsey has been a speaker at Trinity Catholic School in Leon County, which is a recipient of funds from the Florida Tax Credit Scholarship Program and the McKay Scholarship Program as well as Step Up for Students which provides vouchers to Trinity Catholic School. (See Ex. A.)

c. The Florida Catholic Conference was an amicus curiae in Bush v. Holmes, 919 So. 2d 392, 404 (Fla. 2006), and supported Opportunity Scholarship vouchers which were struck down by the Florida Supreme Court.

d. Plaintiff’s research has led her to discover a Catholic strategy for saving Catholic education through Florida-style Opportunity Scholarships. A 2011 report, From Aspirations to Action, provides the strategy for this Catholic position complete with “Opportunity Scholarship” model legislation and with getting rid of the Blaine/No Child language through-out the nation, which Plaintiff believes has made Judge Dempsey unable to be impartial in this case. Also, Rev. Larry Snyder, president of Catholic Charities USA, is listed as a Council Member of the National Leadership Roundtable on Church Management, the organization which produced the position statement. (Ex. B, at 77.)

e. On April 20, 2014, Face the Nation reported that Cardinals and Bishops of the Catholic Church are pushing vouchers as a solution to a public school report. […]

4. These facts make me believe there is a continuing association between Judge Dempsey and the interests in my case through her relationship with the Catholic doctrine and position on vouchers for Catholic schools; Catholic Charities; Trinity Catholic School; and as a contributor to Catholic causes. Had I been aware of this relationship, I would have moved to disqualify her before she ruled in my case.

The judge belongs to a Catholic charity and has spoken at a Catholic school, the local Catholic Conference took a position in the original lawsuit, and a cardinal in another state said nice things about school choice on TV, therefore the anti-school choice activists want her to recuse herself. In other words, they want her to recuse herself because she’s Catholic.

The defendants’ response to the motion of recusal firmly rejects Oropeza’s arguments as “legally insufficient” and not “objectively reasonable”: 

10. Plaintiffs’ claim, as articulated in Ms. Oropeza’s affidavit, is legally insufficient. Of the five reasons articulated by Ms. Oropeza, only two—Judge Dempsey’s membership in and board service for Catholic Charities of Northwest Florida, and her role as a speaker at a Leon County parochial school—actually relate to the judge’s own activities. But neither of these affiliations indicate that Judge Dempsey is biased on the question of so-called voucher programs. According to its website, Catholic Charities of Northwest Florida focuses its charitable efforts on immigration, crisis pregnancy and adoption, and emergency assistance—not vouchers or other education issues. And a speaking engagement by Judge Dempsey at a parochial school that receives voucher funds—at an unspecified time, on an unspecified topic and in an unspecified capacity—provides no basis to impute any bias to Judge Dempsey on the question of vouchers or any other topic at issue in this lawsuit.

11. The remaining three “facts” alleged in Ms. Oropeza’s affidavit show nothing more than some individuals and organizations, with some degree of affiliation to the Catholic Church, support the enrollment of students at parochial schools through voucher programs. Unless Plaintiffs were to assert that all Catholics, by reason of their faith, support voucher programs to such a degree that they are unable to render an unbiased opinion on the issue—a position that Ms. Oropeza expressly disclaims—there is nothing about these third party positions that could shed any light on Judge Dempsey’s own ability to fairly and impartially preside over this case.

The defendants also note that there “are no judges in this state who have no involvement with the schools of this state,” since they “either have or had children in school, studied in Florida schools themselves, or have close relatives involved in Florida’s schools,” yet it would be ludicrous to demand that a judge recuse herself for such reasons. It would be equally absurd to demand that female judges not preside over cases involving abortion or sexual harassment or that black judges recuse themselves from cases involving racial discrimination.

Hilariously, Oropeza claimed in her motion, “I do not base this motion on Judge Dempsey’s religious beliefs, but rather on the positions of the organizations with which she is affiliated.” Yes of course, organizations like… the Catholic church and affiliated Catholic charities. But this has nothing to do with the judge’s religious beliefs, she claims, it’s just an attempt to protect citizens from the nefarious “Catholic strategy” that she “discovered” in her “research.” That sounds awfully familiar…

Thomas Nast's anti-Catholic "American River Ganges" cartoon, 1875 

Image: Thomas Nast’s infamous 1875 “American River Ganges” cartoon depicts a noble white Protestant male protecting his family from the bishops’ “Catholic strategy.”

Last year, plaintiffs demanded that a federal judge recuse himself from a case involving the Catholic church because he is Catholic. Sadly, the demand that Catholic judges recuse themselves from certain cases is increasingly common, even from seemingly respectable sources. The imposition of a religious test for judges should be vigorously resisted.

Why Tax Credits Survive Legal Challenges But Vouchers Often Don’t

Yesterday, on the same day that the New Hampshire Supreme Court rejected a challenge to the state’s scholarship tax credit law, a district court judge struck down Oklahoma’s special-needs voucher law.

Both vouchers and scholarship tax credit laws are constitutional under the U.S. Constitution, but vouchers laws have often run afoul of states’ historically anti-Catholic Blaine Amendments, which prohibit public funds from being expended at religiously affiliated schools. By contrast, scholarship tax credit laws have a perfect record at both the federal and state courts because they rely on voluntary, private donations. Donors to nonprofit scholarship organizations receive tax credits worth 50 percent to 100 percent of their donation, depending on the state. In ACSTO v. Winn, the U.S. Supreme Court held tax credit funds did not constitute public money because they had not “come into the tax collector’s hands.” These credits are constitutionally no different than tax deductions for charitable donations to nonprofits (including religious organizations) or the 100 percent property tax exemption granted to houses of worship. In none of those cases do we say that the nonprofit or religious institution is “publicly funded.” 

Yesterday’s decision is heartbreaking for the hundreds of Okie children with special needs who use the vouchers to attend the schools of their parents’ choice. If Oklahoma policymakers want to help those children, they will follow the legal advice of the Institute for Justice and enact a special-needs scholarship tax credit or expand their existing tax credit law.

For more on the the New Hampshire decision, listen to this Cato Daily Podcast with the Institute for Justice’s Dick Komer, who argued the case before the state Supreme Court.

Live Free and Learn: NH Supreme Court Upholds School Choice

Low- and middle-income children in New Hampshire will now be able to use tax-credit scholarships at any school they choose, whether secular or religious.

This morning, the New Hampshire Supreme Court (NHSC) followed the precedent of the U.S. Supreme Court in unanimously ruling that the petitioners challenging the “Live Free or Die” state’s scholarship tax credit law lack standing because they could not demonstrate any harm. The law grants tax credits to corporations worth 85 percent of their donations to nonprofit scholarship organizations that help low- and middle-income parents send their children to the schools of their choice.

When two anti-school choice organizations challenged the law, the Institute for Justice intervened, representing several low-income families who had applied for the scholarships. The Cato Institute filed an amicus brief defending the law’s constitutionality.

The NHSC overturned a lower court’s flawed and unprecedented decision, which had forbidden scholarship recipients from using the funds at religiously-affiliated private schools. The lower court held that the scholarship funds constituted “money raised by taxation” and therefore violated the state’s historically anti-Catholic Blaine Amendment, which states:

[No] money raised by taxation shall ever be granted or applied for the use of the schools of institutions of any religious sect or denomination. (New Hampshire Constitution, Part II, Article 83)

The NHSC did not address the merits of the lower court’s decision because it held the petitioners were unable to demonstrate that “their personal rights have been impaired or prejudiced.” Similarly, the U.S. Supreme Court, in rejecting the petitioners’ standing in ACSTO v. Winn, held that the tax-credit funds did not constitute public money because they had not “come into the tax collector’s hands.”

This is great news for the tens of thousands of students who qualify for tax-credit scholarships—parents like Melissa Cogan, who used the program to cover homeschooling expenses for her two children, Hope and Hunter.

“Without the scholarship from (the Network for Educational Opportunity), homeschool would not have been an option for us,” Melissa said. “We are a large family with very limited resources for supplies, books, workbooks, and electronic technology. The generosity of the Network for Educational Opportunity has made it possible for us to purchase everything we needed to become a successful homeschooling family.”

Such stories should make it unsurprising then that, last year, nearly 97 percent of scholarship families reported being satisfied with the learning environments they chose for their children.

NH tax-credit scholarship, parental satisfaction.

The decision’s import reaches far beyond New Hampshire’s borders. The NHSC’s ruling today takes some wind out of the sails of the Florida School Boards Association (FSBA), which is inexplicably suing the Sunshine State over its more-than-decade-old scholarship tax credit law, in a complaint that mirrors the legal reasoning of the NH petitioners.  It is likely that the Florida Supreme Court’s reasoning will mirror that of the New Hampshire Supreme Court and U.S. Supreme Court.

Certainly there are families in Florida, and elsewhere nationwide, similar to the Cogans who are craving an educational environment that works best for them. Today, the New Hampshire Supreme Court handed them a much-needed victory and, thus, the ability to live free and learn.