Topic: General

A Startling Development on the ObamaCare Front

The U.S. Court of Appeals for the 5th Circuit — the court that would hear any appeal of the Texas v. Azar decision overturning the entire Patient Protection and Affordable Care Act (ACA) — has just issued a request that does not bode well for ObamaCare.

In NFIB v. Sebelius, Chief Justice John Roberts reasoned the Supreme Court could view the ACA’s otherwise-unconstitutional individual mandate as a constitutional use of the Taxing Power. See my criticisms of Roberts’ reasoning here. In Texas v. Azar, a district-court judge ruled that since Congress zeroed-out the individual-mandate penalty, the courts could no longer uphold the mandate as a use of the Taxing Power, ergo the ACA must fall.

I oppose the ACA but disagree strongly with Texas v. Azar. At the time, I wrote, “federal judge Reed O’Connor did exactly what Chief Justice John Roberts did at the high court: jettison the rule of law to achieve a politically desired outcome.”

In an interesting twist, President Trump decided not to defend the ACA but instead to embrace the district court’s ruling, thereby depriving the overturned statute of its most obviously legally cognizable appellant — the government. Fortunately for the ACA, several states and the House of Representatives appealed the lower-court ruling to the 5th Circuit. Which brings us to yesterday’s development.

Yesterday, the 5th Circuit asked the states and the House (1) to justify why they have standing to appeal the lower-court ruling, (2) to explain, if they do not, whether the court can even hear an appeal of that ruling, and if not (3) what they think should happen then. See the court’s language below.

The request could mean the ACA and its would-be intervenors could have a harder slog than anyone thought. It means at least one judge on the 5th Circuit panel is skeptical that the court can even hear this appeal in its current form.

I think a higher court should, and ultimately will, overturn the lower court’s ruling in Texas v. Azar. But there are rules. Courts need a legitimate case or controversy in order to act. Today, it became less certain that they will.

The probability that Texas v. Azar will stand may have only risen from 0.5 percent to 5 percent, but I never would have thought it would reach even that high.

For more, see Nick Bagley.

Joe Biden on Impeachment for Illegal Warmaking

I don’t know if the moderators of tonight’s Democratic primary debate are taking requests, but here’s my question for former vice-president—and current frontrunner—Joe Biden:

“Mr. Biden, the last time you were running for president, you promised that if George W. Bush ‘takes this nation to war in Iran, without congressional approval, I will make it my business to impeach him.’ Now, over a decade later, war with Iran is again on the horizon, and just this Monday, the president said he does not need congressional authorization to wage war. If he acts on that belief, will you call for Congress to impeach President Trump?” 

In December 2007, when then-Senator Biden made those remarks, the crowd in Davenport Iowa answered with hearty cheers.

At the time, there was a serious concern that President Bush would use prior congressional authorizations–like the 2002 Iraq War resolution or the post-9/11 Authorization for the Use of Military Force (2001 AUMF)–as cover for a new war with Iran. A month before Biden’s speech, then-Senator Barack Obama introduced a joint resolution designed to foreclose that option. “There is absolutely no reason to trust that this Administration will not use existing congressional authorization to justify military action against Iran,” Obama warned.

Here we are again: now, nearly 12 years later, there’s no reason to trust that this administration won’t use the 2001 AUMF as justification for war with Iran. Secretary of State Mike Pompeo has suggested as much, behind closed doors, to members of the House Armed Services Committee. 

Joe Biden knows something about the 2001 AUMF: he voted for it, three days after 9/11. And, like practically every other member who passed that resolution, he described it as a limited measure, aimed at those who were responsible for the attacks. As the New York Times reported after the vote: “Senator Joseph R. Biden Jr., chairman of the Foreign Relations Committee, said Congress was not ceding its constitutional authority to declare war or intending to write a measure like the Gulf of Tonkin resolution, which President Lyndon B. Johnson used in 1964 to justify escalation of the war in Vietnam.” 

The 2001 AUMF has now been in effect almost three times as long as the Gulf of Tonkin Resolution, and the current administration thinks it can draw on that authority to wage war over the “Gulf of Oman incident.”  

In the short term, Congress has limited means available to it for heading off war. Most of the measures currently being debated on the Hill would have to make it past a presidential veto. A sense-of-Congress resolution threatening impeachment for unauthorized warmaking would not. Biden’s no longer in a position to do more than advocate such a move, but it seems to fit with how he described his 2007 impeachment threat: “a prescriptive way to make clear to this man that there will be severe consequences, because [attacking Iran] would be the most dire action we could take at this moment.” Back then, Biden insisted that an unauthorized strike on Iran would be an impeachable offense. Does he still think so today? 

If he got the question, my guess is that Biden would answer, “yes.” Willingness to use the dreaded “I-word” might help shield the Democratic frontrunner from attacks on his left flank. Of course, given Biden’s service as vice president in an administration that ran roughshod over congressional war powers—that answer might also give rise to some awkward questions. But this is the business he’s chosen. 

 

The Auer Doctrine Suffers Pyrrhic Victory in Kisor v. Wilkie

Sometimes it’s possible to lose in name only. Consider, for example, Cato’s position in Kisor v. Wilkie, which the Supreme Court yesterday decided.

By a 5 – 4 vote, the Court upheld the Auer doctrine, or binding judicial deference to an agency’s interpretation of its own regulation. Only four Justices actually validated the Auer doctrine; Chief Justice Roberts provided the fifth vote solely out of respect for precedent. In a brief supporting the petitioner, Cato had argued that the Court should overturn Auer, so technically our position lost.

Nevertheless, the opinion of the Court “reinforced” and “expanded on” the doctrine’s limits. In Part II.B, Justice Kagan set forth several “markers” to guide lower courts regarding the boundaries of Auer deference. In practice, these limits gut the doctrine. As rightly observed by Justice Gorsuch, Auer emerges “maimed and enfeebled.” And because Auer deference has been rendered impotent, opponents of the doctrine effectively “won,” even though we officially “lost.”

So, how did the Court reduce Auer deference to a “paper tiger”? Justice Kagan set forth three big limitations.

The first is a requirement for courts to discern whether the regulatory text is ambiguous. While it might seem obvious that judges should ensure that a legal text is ambiguous before deferring to an agency’s interpretation, courts routinely skipped any meaningful textual analysis before assuming a deferential posture under the Auer framework. In an empirical study, I found that circuit courts failed to meaningfully examine the regulatory text about 35 percent of the time when they applied the Auer doctrine over a 15-year period. The upshot is that there’s a lot of room for courts to improve their craft when it comes to reviewing regulatory interpretations.

Kisor’s second limitation on Auer deference is a requirement that an agency’s regulatory interpretation reflect agency expertise. I expect that this “marker” on Auer’s domain will have the greatest influence on controversies over how to interpret an agency’s procedural regulations. After all, courts are more expert than agencies where due process is implicated. As a related aside, it bears noting that Kisor pertained to a dispute over the regulatory term “relevance” in an evidentiary context, which seemingly rests squarely in the wheelhouse of judicial expertise. Justice Kagan, however, did not draw this connection.

The third significant limitation on Auer was Kagan’s concession that binding deference is “rarely” warranted when an agency has changed its regulatory interpretation. This is huge; by itself, this call for interpretive consistency would have provided a mortal wound to the Auer doctrine. If a regulatory provision is of any consequence, and if it has existed for longer than one presidential administration, then there are vanishingly small odds that the agency’s interpretation has remained consistent. By holding that these interpretations would “rarely” achieve deference, the Court performs most of the work that goes into “enfeebling and maiming” the Auer doctrine.

Today’s unsung hero is the Solicitor General of the United States, Noel Francisco. Justice Kagan didn’t come up with these “markers” on her own. Rather, she borrowed them from the SG’s brief. As I previously explained, the SG’s unusual Kisor brief asked the Court to check the Auer doctrine, even though such a reform would diminish the government’s power. During oral arguments, Justice Kagan seemed concerned about the government’s anti-Auer argument, and she questioned in passing whether the petitioner and government were sufficiently adversarial. Given these apparent reservations, I’m a bit surprise she wholesale adopted the government’s arguments. In any case, the Solicitor General deserves kudos.

Federal Subsidies Micromanage Local Activities

The federal government spends more than $700 billion a year on 1,386 subsidy programs for state and local activities such schools, transit, and housing. In a recent study, I described 18 reasons why these aid programs should be eliminated. 

One reason is that the rules that come with federal subsidies undermine citizen control of their own communities. The Obama administration, for example, tried to manipulate local zoning laws through the Community Development Block Grant (CDBG) program. Those particular rules have been loosened up, but micromanagement is an ongoing threat from all federal aid programs.

A recent local news story from Pennsylvania reflects the CDBG manipulation problem. Note that CDBG is not so much a program for “low-to-moderate income individuals,” but rather a program that hands-out business subsidies, as discussed here and here.

Nonprofits and residents in Hampden Township have been unable to receive some federal grant funding for three years – but that might be changing soon.

The Hampden Township Commissioners chose to opt out of Cumberland County’s Community Development Block Grant program, which provides federal funding for low-to-moderate income individuals, several years ago. At the time, commissioners cited fears that the program might allow federal authorities to change and influence local zoning laws.

Now, thanks to a change in federal law that would make that practice unlawful, township commissioners are considering rejoining the program. They will meet for a special workshop at noon on Friday to discuss the topic.

… Hampden Board of Commissioners President Al Bienstock said the township opted out because previous rules meant the U.S. Department of Housing and Urban Development (HUD) could change local zoning laws based on perceived discrimination.

“The provisions were so onerous in ceding the zoning authority to some unelected bureaucrats in the federal government that, reluctantly, we opted out,” Bienstock said. “Congress included last year in an appropriations bill something that effectively reversed that HUD rule.”

Why Is Economic Populism Supported By Those Who Loathe Political Populism?

The Economist, perhaps more than any other magazine or newspaper, has outlined the dangers of populism in recent years.

In the past month alone, headlines on its website have included: “Why cosying up to populists rarely ends well for moderates,” “Populists fall short of expectations in the European election,” and “Populism and polarization threaten Latin America.” The populist style of politics, which seeks to pit “ordinary people” against “elites,” is rightly anathema to a magazine rooted historically in a classical liberal worldview.

It’s therefore surprising that the magazine’s Charlemagne column has endorsed a populist as the next president of the European Commission. On Tuesday, a piece entitled “Why Margrethe Vestager ticks all the boxes,” backed the current competition commissioner for the presidential role. It described her as having “applied both a liberal sense of consumer rights and an interventionist commitment to defending the little guy to the task of regulating technology giants.”

Make no mistake: on economic issues, Vestager is a populist in the truest sense of the word. A new paper, Antitrust Without Romance by Dr. Thibault Schrepel (an assistant professor of antitrust at Utrecht University), documents this by analyzing her speeches and comparing them with previous commissioners. He shows clearly how populism and the moralization of antitrust and competition policy has accelerated in recent years in the EU, with Vestager in the vanguard.

Rather than explaining antitrust as a sort of technocratic pursuit, the study finds Vestager’s discourse “emotional.” She seeks to pit the people against the elites in the form of big digital companies. In terms of populist rhetoric, Vestager refers to “the people” in 91 percent of her speeches, to companies as “them” in 81 percent, and puts herself in the “us” camp – as part of “the people” - in 85 percent of speeches. She has ramped up talk about “fairness” in competition policy since 2016.

Her ire has been wrought most obviously on the digital giants, who she pitches as elites undermining the interests of the people. They are said to “distort or fabricate information, manipulate people’s views and degrade public debate,” or help “harmful, untrue information spread faster than ever, unleashing violence and undermining democracy.” She has drawn analogies between digital technologies and products that cause death, and at various times has talked up public “fears” about companies.

This kind of rhetoric is a complete break from her predecessors. Dr. Schrepel finds that while previous Competition Commissioner Joaquin Almunia talked about the “people” often, he did not tend to pitch them against the companies, sometimes referring to the latter as “our firms.” Neelie Kroes, Competition Commissioner from November 2004 to February 2010, made very few references to “us” and “them.” When she did, she always described converging rather than diverging interests between the public and companies. Mario Monti, Commissioner from 1999 to 2004, scored lower still on all metrics of populism and moralism, only using “us” to refer to “the people” twice, instead using it regularly to refer to the European Commission or his competition team.

Dr. Schrepel’s work warns of the dangers of this populist rhetoric manifesting itself as a moralizing and highly politicized approach to antitrust, rather than a policy framework seeking to keep open and competitive markets with high levels of consumer welfare.

It is striking that The Economist and others are alive to the dangers of political populism, which pitches “the people” against political classes, the media or government institutions, but ignores the same techniques and rhetoric when it comes to business competition.

More Proof That Breakfast Is a Dangerous Meal

James Betts and his colleagues at the University of Bath in England have consistently produced reliable data on breakfast—which we need, because the cereal and bacon companies bombard us daily with their mantra that breakfast is the most important meal of the day, which we should eat like a king. In my recent book Breakfast is a Dangerous Meal, I argued that the healthiest option was to skip breakfast and, instead, to go for a run (or a swim or a cycle ride) before work. In their recent paper, Betts and his colleagues found that a group of healthy young men, when challenged with such a regime, lost 400 calories a day, even though they were free to eat as much as they wanted at lunchtime and during the rest of the day.

This is dramatic confirmation that slimness is readily available for anyone who is brave enough to skip breakfast and fit enough to engage in moderate exercise before work—and is willing to acknowledge much of what we “know” about nutrition may be incorrect.

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Trump Isn’t Only “Constitutional Crisis” Afflicting Congressional Oversight

Earlier this week, Vox’s Sean Illing asked 10 law professors whether President Trump’s sweeping refusal to cooperate with congressional investigators has plunged the nation into “a constitutional crisis.”  I recommend the article, and I also observe that I’m 100% on Congress’s side regarding the legitimacy of its information queries. Indeed, I’m with my colleague Gene Healy, who has rightfully Tweeted that, “#ExecutivePrivilege is something judges just made up out of penumbras and emanations of Article II.”

For this post, however, I argue that congressional oversight, per se, is in its own state of “constitutional crisis” wholly independent from Trump. Specifically, I will make two claims. First, I explain why congressional oversight always has been sub-optimal. Then, I explain why contemporary oversight is acutely awful.

Even decades ago, when Members of Congress were policy savants relative to now, congressional oversight was known as the body’s “neglected duty.” In a famous 1984 article, Professors Mathew McCubbins and Thomas Schwartz lent a conceptual framework to explain this inadequacy. Their core insight was to identify two types of congressional behavior regarding oversight. The first was the “police patrol,” which describes ongoing monitoring of the law’s execution. The second type was “fire alarm” oversight, by which the professors meant that lawmakers snap to attention only when hot-button issues become sufficiently politicized.

Quite obviously, the “police patrol” method is superior because, if it is done faithfully, then such supervision could head off the crises that lead to “fire alarms.” Nevertheless, the “fire alarm” approach takes less work, and it reaps more political currency in the form of attention. Due to these incentives, Congress has underinvested in oversight for as long as legislators have delegated power to execute the law.

In this manner, oversight was shortchanged in Congress during the first three quarters of the Twentieth Century. Back then, however, a decentralized power structure within the legislature provided a counter-incentive for the use of preferable “police patrol” techniques. As I explained in a prior post, Members of that period cared about policy because policy chops were necessary to succeed in Congress. At that time, committees and subcommittees competed with the president to manage administrative agencies, and, as with life generally, competitors do their homework.

Starting in the 1980s, however, power in Congress shifted from committees to party leadership. Many factors were at play in causing this change. Crucially, congressional leaders, such as Reps. Tip O’Neil and Newt Gingrich, altered the rules to facilitate centralization. The modernization of mass media played another important role, in that it allowed to party leadership to push a national message. Finally, recurrent impasses with the president over spending and budgets—known as the “fiscalization” of politics—facilitated the centralization of power by creating the necessity for high-level negotiations, which, naturally, would be conducted by congressional leaders and thereby enhanced their power accordingly.

Due to this shift, partisan affinity now trumps institutional prerogative, such that one party loses interest in oversight whenever “their guy” occupies the White House. Also due to the shift to centralized power, Members of Congress know less about policy-making because there’s little incentive to have such knowledge. Each of these factors works to undermine the occasion and performance of “police patrol” superintendence of the administrative state.

Yet the current contretemps between Congress and the Trump administration reveals that the legislature’s oversight function has withered further, such that “fire alarm” investigations, too, are falling by the wayside. To be precise, they’ve altered from an inferior form of oversight (relative to “police patrols”) to a worthless form.

Historically, “fire alarm” oversight pertained to catastrophes or governing scandals. In either case, the investigatory lodestar was reform. That is, congressional investigations traditionally sought to discern how something bad happened, and then how to try to make sure it doesn’t happen again. Even investigations that don’t easily fit this usual framework—such as Watergate—shared a nexus with governmental reform. Nixon’s excesses inspired institutional responses, including the 1974 Budget and Impoundment Control Act and the 1977 Legislative Reorganization Act.

As I survey the current landscape of fire-alarm investigations, I see a qualitatively different application in the present day. When it comes to resource allocation for oversight, I can think of any number of “fire alarms” to sound, including:

  • The reported possibility of war (!!) with Iran;
  • The president’s declaration every other day of a fake “national emergency” to get what he wants without Congress getting in the way; and,
  • The EPA sneaking a major New Source Review regulation into the (unrelated) revision of an Obama-era climate rule.

Despite these—and many more—worthy targets for serious congressional oversight by opponents of the Trump administration, House leadership is pouring resources into getting Trump’s tax returns and relitigating the Mueller Report. I find Trump as off-putting and dangerous as anyone, but these strike me as the silliest possible subjects for oversight.

On the one hand, I think these investigations don’t inform anyone. Who doesn’t think Trump would fire subordinates—and then Tweet about it—to head off an investigation? And who doesn’t think Trump exaggerates his wealth all the time? Notwithstanding these qualities, which are baked into Trump’s brand, the American people elected him president, alas. The upshot is that I’m not convinced that these investigations bring much new to the table.

More importantly, I fail to see any prospect for reform. Neither of these investigations bears any relationship to a specific policy outcome. It’s all about Trump, the man, and none about Trump, the policymaker. Nor am I sanguine about the prospect that these investigations ultimately could inspire institutional reforms the way that Watergate did. Well into the third year of this presidency, I have not once seen the democrats reach out to Never-Trumpers to explore curbing the power of the office. Instead, the majority in the House seems to want only to damage Trump politically, and otherwise maintain the president’s power for when their party takes control.

In sum, I wholeheartedly support Congress’s right to information from President Trump, but I also bemoan its present use of that right.

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