Jeffrey Rosen’s Proposed Limiting Principles for Federal Power

In a recent response to critics of his earlier column on the individual mandate case, Jeffrey Rosen claims that upholding the individual mandate would not lead to unlimited congressional power because “Congress [still] cannot use its commerce power to regulate activity that has no substantial effects on interstate commerce and where there are no collective action problems that make it impossible for the states to act on their own.”

If these two proposed constraints are interpreted in such a way as to allow the individual mandate, they would also allow any other mandate as well. In and of itself, the “activity” being regulated by the individual mandate – not having health insurance – has no “substantial effects on interstate commerce.” Not having health insurance does not involve purchasing any products across state lines or incentivizing anyone else to do so. It does, of course, have an effect on commerce in the sense that a person who doesn’t purchase health insurance could have made a different decision, which would have involved purchasing the product in question. That, however, is true of any decision to do or not do anything. A person who chooses to spend an hour reading a book at home could have instead used that time to earn income or buy a product, thereby affecting interstate commerce. The time I devoted to writing this post could have been spent doing consulting work for pay. Any decision to spend time on A is necessarily a decision not to do, B, C, or D. And the failure to do some of the latter is likely to have an effect on interstate commerce.

Rosen’s collective action limitation fares little better. If the Court seriously examines the individual mandate to determine if there is a collective action problem preventing states from adopting mandates of their own, it should find that no such problem exists for reasons I articulated in this article (pp. 90-94). If the mandate works as advertised – reducing health care costs and increasing access – both individuals and firms would be happy to be in states that adopt it, as Massachusetts did. Insurance companies, of course, have every reason to operate in states that require people to purchase their products. It is also strange to argue that the federal mandate solves a collective action problem between the states when 28 state governments are suing to have it overturned. That suggests that most states’ failure to enact a mandate is not caused by collective action problems, but by substantive opposition to the policy. If most states wanted a mandate, but could not enact one because of “race to the bottom” fears or the like, they would welcome the federal mandate instead of opposing it. I address these points in more detail in my article, as well as respond to various possible objections.

Of course the Court could find that the federal mandate solves a collective action problem if it chooses to defer to Congress’ assertions that it does. But such deference could be used to justify virtually any other mandate as well. For example, as I explain in the article, it could equally easily justify a federal broccoli purchase mandate:

The federal government could always posit that some sort of collective action problem inhibits state enactment of any mandate with enough political support to get through Congress. Indeed, the very fact that many states had not yet enacted a
mandate, or not enacted a strong enough version of it, could be cited as evidence for the “plausible” assumption that a collective action problem exists.

Under this minimal level of scrutiny, even the much-discussed broccoli mandate could probably be upheld. Increasing consumption of broccoli might lead to an improvement in public health that would reduce health care costs and increase economic productivity. But individual states face a collective action problem in enacting such a mandate. Any state that enacted a broccoli mandate on its own might face outmigration by residents who prefer a tastier, but less healthy, diet. As a result, its tax base would be eroded, while neighboring states that chose not to enact a mandate would benefit at the first state’s expense.
Even though the states as a group would be better off if all or most enacted a broccoli mandate, collective action problems prevent them from doing so without some form of federal intervention.

This collective action argument would likely fail any form of rigorous scrutiny. But it would surely meet minimal standards of plausibility in a regime of heavy judicial deference to Congress.

[I have omitted a footnote citing studies showing substantial improvements in health from eating broccoli].

As Randy Barnett points out in his reply to Rosen, the Court is highly unlikely to adopt a rule that requires it to carefully scrutinize Congress’ collective action arguments. If it did so, many defenders of the mandate would probably accuse it of “conservative judicial activism.”

In any event, Rosen’s collective action limitation only seems to kick in if the court has already found that the “activity” at issue does not affect interstate commerce. But, as discussed above, if not having health insurance qualifies as such “activity,” so too would any other decision to do or not do anything.

There is an intellectually serious case for abolishing all judicially enforceable structural limits on congressional power. The most coherent defense for a judicial decision upholding the mandate would have to rely on that case rather than on potential limiting principles that either fail to actually limit anything or would require the Court to strike down the mandate itself.

UPDATE: I have addressed other aspects of Rosen’s earlier piece here and here.

UPDATE #2: I presented a more general critique of the “collective action” theory for interpreting the scope of congressional power here.