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Insurance mandate being ruled a tax saves healthcare reform

June 28, 2012|By Kathleen Hennessey
  • Supporters of President Obama's healthcare law celebrate outside the Supreme Court after the court's ruling is announced.
Supporters of President Obama's healthcare law celebrate outside… (David Goldman / Associated…)

WASHINGTON – Democrats have probably never been so happy to be wrong.

As they struggled in 2009 to pass the bill that became the Affordable Care Act, Democrats in the Capitol and the White House insisted the individual insurance mandate was not a tax.

To their chagrin and delight, the Supreme Court on Thursday disagreed and saved the law.

Shortly after the ruling came down, conservatives and others circulated a September 2009 interview with ABC’s George Stephanopoulos, in which President Obama vigorously disputed the notion that collecting a tax penalty from people who don’t get insurance is a “tax increase.”

He accused Stephanopoulos of stretching the definition of tax and blamed his critics who “say everything is a tax increase.”

“For us to say that you’ve got to take a responsibility to get health insurance is absolutely not a tax increase,” the president said. “I absolutely reject that notion.”

Chief Justice John G. Roberts Jr. and four liberal justices didn’t. The court ruled that the government could not require individuals to buy health insurance under the interstate commerce clause in the Constitution. But it could levy a tax on people who chose not to buy insurance – and that is what the healthcare law does, according to the majority opinion written by Roberts.

Obama and Democrats had a clear reason to avoid the tax label. As the legislation was being crafted, the only thing more unpopular than a new government mandate in the halls of Congress was a new tax. But take the law out of the political arena and put in the court and the opposite turns out to be true – it’s apparently easier to find constitutional support for a tax than a federal mandate.

The Obama administration actually made this shift months ago when they made the tax argument before the court. But the political ramifications may just now be coming home to roost.

Republicans already are using the court’s ruling to switch the focus of their criticism. Yesterday, it was an unconstitutional mandate. Today it is a new tax on the middle class.

Either way, Republicans say, they’ll continue their push to repeal it.

kathleen.hennessey@latimes.com

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