amongst different agencies. they are often not the highest priority at other agencies. but in one place where that is the focus. he is very focused on what the consumer experience is. from that standpoint, from disclosures and things that banks confusing and other financial service providers at the consumers can benefit. the question is, to the tilt things so far in favor of the consumers that it costs these financial institutions more to offer certain services across turkey have a double-edged sword. that is for the concern of and raised. >> when the agency was newly formed, other critics said, they have the authority to write thousands of rules. who is going to stop them? what indication is there that is what they're doing? or could be? >> i don't know. they have done a lot already, but much of it has been setting

of the agency. they have not got into a lot of the substantive rules they need to do this year, a big issue is mortgages. everybody is waiting to see. what they've done so far is setting up their supervision program, setting up the ways they could set up the complete system. trying to give consumers answers to common questions. they're still in the startup mode. it is hard to point out a lot of things that are already, you know, red tape and high cost. >> so wait and see? >> and they took a cautious approach. things that would appeal, questions and answers, things the industry is not necessarily going to oppose. it will be interesting when they come up with some rules, that there is opposition to or could be opposition to how they than respond to that.

>> thank you both for being part of the show. >> thank you for having me. >> a look at the supreme court this morning, some visitors on the steps right before the court. ahead of the oral arguments that begin tomorrow on the affordable care act. some people waiting in line just to the left or to the right of this shot. all day, c-span will preview the supreme court with a look at some of the challenges to the health care law, including circuit court oral arguments in a discussion of some of the attorneys that will be arguing before the court this week. later tonight at 9:00 eastern, we'll have c-span's 90-minute documentary "the supreme court: home to america's highest court."

[unintellibible chatter]

>> a look at the scene outside the supreme court this morning but again, world arguments start tomorrow. they will last for three days. we will bring you the audio of those arguments and the same day they are argued in the court. tune in here at c-span or actually, c-span3, c-span radio and c-span.org. on june 29 last year, the obama administration won the first appellate review of the 2010

healthcare law approved 2-1 decision from the sixth circuit court of appeals in cincinnati held it is constitutional for congress to require americans to buy health insurance. here are the oral arguments before that court. this is just over an hour. >> we are going to begin the argument of the appeal. the first thing we would like to divide it into two creek sections. we're uncertain we read the documents filed in the fourth circuit. we like to address the anti injunction act question briefly first. your position and then proceed to the merit. >> thank you. as noted, i reserve five minutes for rebuttal. >> and we are starting fresh. >> thank you.

i think this court can decide the individual mandate question under the, cause separate from the penalty provision of the tax. the anti injunction act applies as the court stated to truly revenue raising taxes. the question is, this is to be revenue raising tax? the subject to the anti injunction act, perhaps could be an exception as to what it should not apply to this case, which i will address later on, or a penalty that must be authorized by some other congressional authority, that in the carmas clause. the inquiry requires the court to look at the statute itself to determine whether it is even a statute that falls within the prescriptions of the anti injunction act, which itself for habits the restraint or collection of any tax. . the court's role is determine

what congress intended, not necessarily to rewrite the act that congress in effect did. it appears from the act itself that congress did not intend to impose a tax when in imposed in a penalty. this certainly does not apply to the anti-injunction act. i think are several ways this court looking at the act itself, what congress did, demonstrates this is not a tax. >> but in your complaint, do not use the term "tax" that this was an unconstitutional tax? isn't that what the district court said that he sought a declaration that congress lacked authority under the commerce clause to pass the health care reform act and alternatively, a declaration of the penalty provision of the act is an unconstitutional tax? >> that is an alternative argument, your honor. it is not a stand alone. from the beginning we have

argued this is not attacks, but a penalty. this mandate was not tell-it was pursuant -- >> something like a requirement you must file a 1099 or not that, a day 10b? is that your belief this is viewed as a penalty, but nine of a criminal nature or taxing-type penalty? >> it is viewed as a regulatory penalty. trying to compel behavior in this case, the behavior require the individual mandate. >> ok. >> if you look at the construct, there are many iterations of the act before this court. in prior ones, the term tax was specifically used. in the one passed by the senate, alternately past,

specifically used the term "penalty." congress and the senate used tax a specifically referred to other provisions in the act that in fact did act now operate as a tax. the specifically relied upon congress's carmas clause authority for the individual mandate, not any authority under the taxing and spending power. they eliminated all the traditional irs enforcement methods for the failure to pay the tax and with that, also eliminated all the pre enforcement due process measures that would be in place for the individual who may be assessed the penalty. when you think about how this provision would operate, as was said in the declaration, she would be intending to purchase a minimum essential coverage rather than pay a penalty. she is a law-abiding citizen. so what is for recourse? unlike any other tax assessment

where if you assess the tax you can object to that and give printers at ways of trying to recruit that tax and if you do, then you can do a refund for it. she cannot file a lawsuit against blue cross, blue shield for spending $3,600 for an insurance policy that she is to abide by the mandate or abide by the law. >> i am not falling. i thought it was simple as she pays a penalty than challenges having to pay the penalty. >> but why this is not a tax under a standard tax. >> many of the enforcement mechanisms are exempted, so she still has that option, right? >> if you have someone who wants to challenge the individual mandate, purchase minimal the central coverage, they have no way to challenge other than what we're doing here. >> that is your point? >> exactly. if you have a law-abiding citizen compelled to apply with

the law, there's no recourse. you cannot file -- this is so different than any of your standard taxes. you do not have any of the standard enforcement mechanisms. >> even if, let's say you're right in this is not under the taxing powers, there is a sense in which this does not matter, right? anything a tax under title 26, congress can say whatever it wants when it passes this lot in terms of defining the penalty for other purposes as "a tax." it does not make legitimate under the taxing power, but it could bring it in to the descriptions of the engine act. there are quite a few definitional points here which suggest that is what they're doing. surely, they're doing that as a matter of enforcement. i do not think he there if you

have addressed 6201 which does not just talk about this for purposes of chapter 68, but taxes including penalties and then this title. theoretically, they can do that and bring something that is not a tax into the realm of the anti injunction act. >> the first question is court post when applicable. i think there has to be a threshold inquiry from this court whether this is truly a revenue generating tax statute as bob jones said i would get your point. let me finish on the first part could be looked at the statute, for different reasons why this does not operate as a revenue generating tax statute for the fifth one, they fail to identify in the legislation in revenue that would be raised from this

particular penalty. >> that is really a constitutional argument. >> it comes to whether this is a truly revenue-raising tax statute. you have to make that assessment first. you have to say, this is to the revenue-raising tax statute by which the anti-inflation act would apply, which is what bob jones, the court said in the bob jones case. if you look at the statute, it does not appear in any way to be a revenue raising -- >> so your answer is, no. >> no, it does not apply. in response to the second question, it would become no. you cannot just assumed it is a tax. you have to determine whether it is applicable by looking at the statute itself. you cannot just accepted on face

value. even the new look at the statute itself, and i'm sure opposing counsel and flesh out a little more, the government said the anti injunction act does not in fact apply. >> then we will move on to the next one. the limiting control that seems to prevent congress from expanding its scope of authority under the commerce clause seems to turn on this question of activity and inactivity distinction. why do you think that is? >> i think there is not a single case, control in case this court can point to where congress has had the authority under its carmas cause to regulate inactivity. >> why is the purchase of extended coverage for health benefits inactivity? >> if they want to regulate inactivity of purchasing, they certainly can. but there mandating some to

engage in commerce at the onset. they have never -- they are effectively regulating inactivity. when you look at race -- sort of the bookends. they made it clear. even as part of a broader regulatory scheme, for the government to regulate interstate activity this activity must be economic in nature. they describe it as consumption of distribution for the production of a commodity. that is the outer reaches of congress's authority to regulate under the carmas clause. >> what is the definition of economics and that reference also including the transfer of wealth? that is what the oxford english dictionary has referred

to, hasn't it, when it speaks to economics and economic activity? it is well. that is what you take your money to decide whether or not you wish to purchase something, and is something the purchase is a protection against excessive costs for your illness. why doesn't that and to the production consumption and the transfer of wealth? rex it was not the definition the supreme court used critics i disagree with justice thomas. he does not have a new dictionary, and i do. go on to amazon in which ended a brand new dictionary. >> forcing some to purchase insurance does not give anyone an exception of wealth. for congress pause power to tax the income tax, which would allow them to tax concession of well as direct from a source. you do not even have that here. it is certainly not tied to anyone's income.

this is one of the points i was hoping to make, if this court finds the individual mandate is unconstitutional, it does not mean the health care system or congress is without the power to fix the problem. it is just the means they choose must be in the means of the constitution. if they want to tax and come, -- income, the 16th amendment allows it, if you want to tax someone's income to then provide for some of the makeup and a shift in cost and provide exemptions for people who might want to purchase health care coverage, they could do that. that would be encouraging some to engage in behavior. you cannot force someone to engage. >> what the government agreed to provide everyone interns and just raised double the taxes? >> if the government wanted to raise income taxes -- >> to pay for health care. >> they could do that. >> and raise taxes for

everybody then give you a credit if he had health insurance. >> you could have exemption or credit for health care. they could do that. but that is not what they did. >> let me bring you this. i do not think the activity or inactivity thing is ingenious. all of the cases talk about activity. it makes sense. i think the average american understands it, which is not a bad thing for a role of constitutional law. i am not sure works with insurance. that is what i'm trying to figure out. risk is not having money when you needed. the point of the mandate is an extreme of money to buy health care when the need it. it is hard to think of risk as inaction. your own plant in trying to establish 1/2 standings are talking about financial actions -- or an plaintiffs and tried to establish standings are talking about financial actions. putting money in their bank account for when they need it.

i think there's something to this point, i just cannot figure out how it works with insurance. >> i think one of the main problems is there is no constitutionally significant limiting principle that can be applied for this broad power. the keep arguing, well, this is unique and different. well, because of its difference and uniqueness, to me, is very troubling. there is virtually no limit to congress's power. if we're talking about shifting cost, that is what they're arguing, the shifting of costs of health care, the best way to reduce the cost of health care is preventive methods. can congress -- there is no way to limit what they're asking. >> this gets to the broccoli argument critics exactly. broccoli, health care, wait, there is no limit to that. >> i get that point. i think the government has to respond to it.

but what about this makes a difference from the food, transportation, etc. there is is catastrophic component to it, which is unusual. you never know, but the odds are high all of us at some point will have $25,000 plus in medical expenses. might that be a limiting principle? might not that be a coherent one? >> my answer would be a ,not. there'd be nothing would prohibit them from having that power in virtually every -- >> people do not need to buy houses, they can rent them. they do not need to buy cars, they can provide buses. >> and people can pay for health care if they need to. people have catastrophic damage to their homes because of tornadoes and everything else.

it is still a commodity. you are still forcing people to purchase a commodity. if they want to raise the taxes -- i think the reason is inescapable, the reason they did not raise taxes or other methods is because it was not politically powerful. that is a problem. they've gone trouncing this is not a tax, not raising taxes -- which is a serious problem. if they wanted to raise taxes to provide for these deficiencies and those who cannot cover health care, they could have done that but they chose not to. it is really important means they choose be within the constitutional limitations. the supreme court has made clear the limits of congress this reach, even on a pass a broad predatory scheme, it is to regulate interstate economic activity. if it was not that case, if you did not have that limit in principle, a decision by this court affirming that would incentivize congress to pass

broad regulatory schemes for it a lot of them couldn't regulate anything whatsoever that is intrastate to include non activity. that turns constitution on its head. the police powers of the type that reserve for the state. this case transcends health care. >> stop and think, if you are in ohio, for example, and had a mandatory health care like massachusetts. living in michigan, which had none. wouldn't it make sense if i got sick to just move to ohio? >> one of the reasons to move to ohio there are even more to move to kentucky, but we will not get into that. >> that goes to the point of the 10th amendment. where our founding fathers wanted have states with greater power. if you make a decision, you want to have this mandatory health care and pay higher taxes, then

you pick up and moved to the other state. the fact the states have the authority to do that for their police powers, does not mean the federal government can do it it should be more choices of individuals if they want to go from state to state -- that has been blurred more and more. the federal government is getting more and more power. there has to be on line drawn. the repercussions of a firming congress's authority under this provision transcends health care and really transforms the relationship and a power the federal government, those who govern, that being, the citizens of the u.s. this course should not grant him that authority. there is no case that stands for the proposition that congress can regulate interstate -- bad ast it strange, as it may seem to be, we have acknowledged it is permitted under the taxing power was

marred so far, i've not heard anyone come up with an argument of what the bill of rights or the 14 am -- or the 14th amendment prohibits it. for the most part, we are accepting it is ok. we're looking to something that is a grant of power, providing a limit on power. >> the with the constitution should be viewed, the powers specifically provided to congress are expressly reserved. >> i get the point. >> i don't agree the tax and spending clause permits this. it is totally different. >> it would be just as scores of to say, everybody pays the same additional health care tax, everybody pays it. and the only people that do not get are those with insurance? you don't think that would be coercive? >> there is no tax for failure

to pay tax. that is a deduction that may encourage -- what they're doing and the scenario i set out in your discretion under the taxing and spending are two different critics then just have the penalty and don't get insurance -- >> than just pay the penalty and don't get insurance. no one is forced to do anything in that sense. the economic incentives are both the same. you cannot say the law requires you to buy it, just penalizes you if you do not. >> is certainly requires you. people are law abiding and do not believe in the law of economics as to what motivates my behavior. i do not park in a parking space just to pay and the space and pay the penalty. congress is mandating an

imposing upon individuals a requirement, a statutory burden. >> if it is so clear the government could have done this under the power to tax cut do have any thoughts as to why they did not do that instead of just relying on the commerce clause? >> this is not exactly the same thing. i want to preface that. the reason they did not i think is clear because the health care act was very political. there were promises made that no taxes would be raised as a result of in it. political expediency -- >> they chose, for political purposes, a power they have under the constitution that has certain limitations that do not apply to the power to tax. >> generally, yes. i would say that is true. but the way the individual

mandate is set up, even if the put the enforcement provisions for the penalty which would still not be a proper exercise of the taxing power because this is a failure to act tax, essentially, but they did not do that. they relied on the commerce clause authority and made specific findings on that. that is what is at the heart of this case. >> you are some that are stuck with it. >> exactly. if they want to rewrite the statute, they can do that it is should not be for this court to do it. the language and method they chose is unconstitutional, so it should be struck down. >> the me ask you, the action and inaction, and now we have someone, the argument -- i can understand why someone would say it is just as egregious to have someone maintain insurance, but let's let the matter of action and inaction, assuming it is adopted, will have some complications in to where it applies. the sake of argument, the line

does not apply to maintain. just except that for the sake of argument. i know you disagree. if one took that view and in one also took the view, which i appreciate the exception for the sake of argument, apply distinctions and the commerce clause applies, why wouldn't you say in this case, listen, we've identified a meaningful group of people covered by this. those are the injured, for whatever reason, but think it is outrageous they have to keep this insurance, we think congress can do that, they can be regulated, therefore, we're unsure about this other group. we do not have to reach that today. it allows for judicial restraint. that would lead to officially upholding because it is a meaningful group of cable for

which think it is constitutional and a meaningful group, they be the largest group, for which we're not sure, but we can answer that some other day. >> in essence, i think you're redrafting statute. they're just regulating people who decided to purchase entrance, therefore are in that market to begin with. >> the question is, whether it is more constitutional to some than others? that is the point i'm making as we addressed to this court, its application in this context i don't think is appropriate. when you go into the question of what is the nature of congress's power, if congress does not have the authority under the carmas cause, it does not matter in terms of any specific application of that power to an individual because it is without that power i think the judge and the virginia used the term it wasn't "stillborn." i do not think salerno has any legal or practical implication

on this court's decision in that the only thing you can do is find it is beyond congress's authority to pass individual mandate whether it applies to an individual or otherwise and it is unconstitutional. or otherwise. i have about 45 seconds left on my time. and i will conclude with reiterating the fact that never has history congress sought to expand power so broadly to the point where the constitution will be rendered meaningless, because the enumeration and separation of powers are corn to be sold abroad that there will be no limitation. -- powers are going to be so broad that there will be no limitation. this court should not be the one to create it. we ask this court to find that acts, is an unconstitutional exercise of the congress' authority. thank you. >> thank you very much.

>> thank you, judge martin. may it please the court. i would like to first frame the merritt issue and then talk about the junction act. on merit, it is important to start with a three findings, which is the minimum requirement the regulates the activity that is commercial and economic in nature. economic and financial decisions on how and when health care is paid for. second, it is :"an essential part of the larger economic activity." third, that the act will reduce the federal up as a. those three findings of three independent bases to uphold act. the first argument is the minimum coverage provision

regulate how people finance commercial transactions, namely of saving health-care, an area that congress found substantially affects interstate commerce. i do not take my friend to disagree that the ends that congress was seeking to avoid the prevention of billions of dollars of cost shifting in the whole market and making insurance available to the 50 million uninsured americans are legitimate. the only dispute is the ends to get there. that is the first argument. the second as of the minimum coverage provision is just one aspect of a comprehensive scheme to regulate the insurance market. that part is critical to make the overall insurance reform work. >> does that mean in your perspective that it the individual requirements of purchasing insurance were declared to be in excess of the power of congress under the commerce call, up whole statute

would and wind? -- under the commerce clause, would the whole statute rewind? >> no. there is a presumption against several ability and the like, but it is the case, with respect to those provisions and what i just said to you, we do not think you could consider one without the other. that is what congress is doing, the second argument that is congress was regulating the insurance market, something that everyone thinks it's constitutional. no one is disagreeing with that because 50 million americans are being priced out of the markets because of pre-existing conditions and other reasons. congress said we are going to make sure insurance companies cannot discriminate those with pre-existing conditions.

but they knew to a certainty if they did that, without also calling it to the minimum coverage provision, the insurance reforms would not work. >> there were not be enough money for it? what was the last time congress chose to pass laws despite the fact that congress cannot afford it? >> we are not talking about the money and affording it. what we are talking about is the fact that you can give people the ability to buy insurance on the way to the hospital, once you fall sick, then everyone is going to wait. it is like giving someone the ability to buy fire insurance only when your house is on fire. >> this strikes me as a little unfair before the legislation passed. and then creates greater incentives for free greater share, and then say -- to meet, it is not your strongest argument. -- to me, it is not your

strongest argument. >> congress and to come in eight states did this. this was an experiment. seven states tried to do this without the minimum coverage provision. in each of them, they found that the insurance reforms -- insurance what the market because insurance got too high. the only state it worked was massachusetts because the couple the minimum coverage provision to the insurance reforms. >> are we talking about this in ability? several abili >> this is an argument for the merits. the necessary and proper clause in connection with the commerce clause provides congress

latitude, even if you grant everything my friend that said. even if you do not think there is a minimum -- >> the best way of putting is it is not proper to make people buy things. you can do it on the demand side by forcing people to buy things. is it true you can take a very big company and compel them to offer insurance products, so on the supply side the risk pool is bigger? i do not understand why it is not exactly the same . >> i do not think the answer is yes. it is a very different case. >> could congress compel on

the supply side to offer health insurance? not employees, but out in the market. so walmart is now supplying health insurance. it makes good sense. >> i do not know about that, because i think in the hypothetical you do not have what congress was dealing with here, which is $43 billion in cost shipping caused by a un it care.satedcompensated >> it seems a little funny to talk about this big number, and then exempt most of the people causing the big member from the requirements for the law.

that is strange to me. >> i am not sure it is broken down. it is an explicit finding by congress, something this court has to give much difference. the exclusion of the act are covered, and this part of the comprehensive insurance reform package, so that of the income 400%, toen 100% in one hand the government will give you a tax incentive. there are a variety of things to reduce the number of people and injured. congress gave specific findings about how many people would be injured after the plan took effect. the point on proper is that you cannot ride from the were proper a prohibition against people being able to buy something. >> regulate implies someone in the market. they are in the market.

you are offering interstate services and hotels in what ever so now we can regulate you, but we cannot force u2 offer hotel and restaurant surfaces and then regulate you. >> we responded to this in page 45 if you want to see the whole list of cases that deal with this. decisionrt's specifically said you could regulate an action. that is part of that decision and finds this court. we think this whole idea of activity verses inactivity those are really get -- >> we were talking about the were proper and regulate. why isn't the word regulate implies proper? you may have application, and i get that.

it is common sense. people understand it, and the courts could work it out as time goes on. take them i think all the way osborne.ive beens pursbbons vs that you could regulate even in action. fosse is a very good example of how words are no been creature games and they can break down and action. this court's decision was a dissent that said this cannot be constitutional. this was the regulation of child recovery act payments. what this court and the majority said was that the court could do so, that we conclude the distinction between activists structure and as illusory and reject any attempt to hide behind it. i think that tracks along line of cases going back to record

and justice jackson opinion that says when you were dealing with the commerce clause, it has to be practicality. it cannot be things like no one cloture and whether something looks more like manufacturing. the ultimate test is is this affecting commerce? here congress made a specific finding that the people without insurance are causing everyone's premiums to rise to the tune of $1,000 per family, because hospitals have to take these people, and that makes this market different than many of the other examples we were talking about. but there is cost shifting going on. this goes back to the first half of the question. the position is not that we're regulating people better enacted in the markets. i do not think the debate is can't congress regulate inactivity? i think the real question is,

can congress regulate in a market in which it knows where everyone is participating? they note to a virtual certainty that a fact as the mortality, people will need more health care, and providers to provide it -- that is one aspect. it is not just that everyone needs it, but that providers can not go without it. i cannot show up at the broccoli store without money and say give me broccoli. >> the only person that did not like broccoli was george bush. >> whether you like it or not, i do not get that. i do not get to show up. >> in the anti-thumping provision of the hospital requirement of the act back in

the 1980's. isn't that regulation very similar to this in the way the statute is structured? >> in a way, and i think it reflects the basic thing. >> it orders hospitals to accept any person that appears at their doorstep needing medical care, and they cannot be moved or dumped on to another hospital. that is how it got its distinctive name of anti- thumping. >> absolutely. american hospitals have a long tradition of giving emergency medical aid and congress restored the tradition. >> you are the only lawyer this week to cite one of my cases correctly. >> our point is that is an endemic feature of the health- care market, which makes it different. i cannot show up at the gm dealer and say give me a car. in the health-care markets you

can't, and that is what is the cost shifting. a huge economic across states problem. >> what about the large number of people that are not free riders? they are being responsible. why should you get to pull them into this? it seems to me that is the most compelling case. a group of people for which the fact finding does not apply. these were responsible people. they are healthy, take care of themselves, and they have not just money to pay for small health-care expenses, but big ones. >> if that person exists, it is certainly the case that these plaintiffs are not this one. they came to the court and said we have tight budgets and have to save money. >> so i am asking about whether there may be these challenges.

i am curious how you respond to them. >> we do not think that is a large percentage of the market. for the median family income in america, they can only pay for half of their medical expenses. >> how about the 30 year-old in the country that for the most part are pretty healthy, do not have catastrophic health problems and when not -- and would prefer not to buy health insurance? >> under 30 is slightly different. with respect to that, the 30- year-old cannot guarantee when they walked out of the court room that they will not get hit by a bus or struck by cancer. the premise is that congress can legislate on a broader scale. this court has said numerous times that as long as it rationally relates to congress -- >> the more extravagant you make

it, the bigger the class. >> i have heard that argument. that is made by the dissent. that is what they said pages 45 and 47 in their dissent. >> what justice stevens is talking about is the point you cannot take an individual and ask whether that individual's decision in terms of marijuana suffice, burke's gets to activate the like-minded group. the question i am asking you is whether it is a like-funded group and whether it is fair to aggregate these clauses to make bigger regulation? take of that is precisely what the defense is saying. there is a group of people to -- >> i think that is what justice

stevens means by defining the class. >> here is what he says on page 25. putting aside the political checks that would occur congress's power to enact a brought comprehensive scheme, there is no suggestion that this act constipates pervasive type of legislation. and there is somewhat will for the court to say is this a vase of legislation? >> go ahead, judge grams. ani want to make sure you get yr licks in here. >> did you state the evasive or invasive? >> evasive. it is our point that this court and the supreme court have given wide latitude when it comes to

means. for example, this court's decision said that even purely homemade a wholly interstate child pornography could be renovated. they are dealing with a real problem that exists. there are two different arguments that congress is advancing with respect to commerce. one is the cost shifting it sells substantially affects interstate commerce, and the second is even if you disagree with that, and the insurance reforms that are undoubtedly constitutional can only work effectively if you have the minimum coverage provision. and the score in the supreme court have given wide latitude to congress. and >> >> if i may, i ask for the

clarification of terminology, because i have a concern about the concept of e evasiveness. your argument about the congress under theunder t commerce clause, and i am having difficulty seeing how there is any limit to the clause as you are defining it. i am starting with the premise that just about everything human beings do, every human function i can think of, has some economic consequence. it the power to commerce regulates includes the power to regulate any economic activity, and it becomes substantially affecting interstate commerce by aggregating it, in other words

might economic individual activity does not amount to that much, but not this not what counts. it is counting everyone who was involved in this activity. sooner or later you will get to a bigger amount, so you will always be able to satisfy this, and if every human activity could be aggregated in that way and if every human activity has economic consequences, were ultimately is the limitation on congress' power, and how can the courts begin to who restrains congress when it begins to do something that may be in basis invasive? requiring a person to

purchase the product they do not want. >> i agree with every word you just said. that means we're not here saying there are unlimited powers under commerce. we think lopez and morrison established prohibition that would strengthen adding up -- what lopez and morrison say is you have to be economic in nature. that it cannot be the aggregation of a whole bunch of un economic activities. 0 + 0 + zero will always equals zero. we are saying in this market what congress is regulating is not the failure to buy something, but the failure to secure financing for something that everyone is going to buy. it is just about cash or credit for something like that. there are some people that may or may not ever be in the

market, but congress is reacting to a lion share of people who buy and consume health care, but without having financing that is quintessentially economic in the way that morrison and lopez are not. that is the limit. we are not here standing before you saying congress should be able to force people to buy things. >> where does the principle come from? the power does not extend their even though it might affect congress? >> we are not claiming that. i just cannot think that is the question we're dealing with here. >> i am saying suppose there were precedents on the board says government cannot

for someone to buy something and create a substantial effect on commerce. i do not think that would alter the results here. what we're saying is in this unique market in which everyone seeks health care, providers cannot opt out of it, and there are catastrophic effects that at here when this happens, when people need health care, that sets up caution. i would also say there is another limit suggested by george martin when he referred to zero higher of in-state setting up their own insurance schemes and so on. that is -- >> what happens to the massachusetts health care plan? it is gone, isn't it? >> i do not think it is necessarily gone. i think the massachusetts brief illustrates what they think will happen there. they say it will help -- be

helpful because it is a useful supplement to what they are doing. i think what congress found on state-by-state bases you have the problem that george martin alluded to before, which is it any one state guarantees issue -- it is hard for any individual state to do so. healthcare is a national phenomenon. and that also provide some measure of comfort to this court, because congress is dealing with a quintessential national problem, which is health care markets. this decision in court and referred to medical care for reproductive services being a national thing and crossing state borders. to go maybe the federal government should wait and see how the massachusetts plan works so we have the benefit of states to dealing with a problem we all have to deal with. there may be better solutions

then. that is not one to be possible. >> that is precisely the debate that happened in congress. congress determined there was enough evidence to act now, that this was a catastrophic problem for americans. we are at 18.6. the number of insured people have dropped 10%. those projections get worse in the future without this bill. this is quintessentially economic and a way that other things were not. >> congress has never use this particular type of will to solve this issue. there are cases where congress is part of our broader regulatory scheme. >> sure.

>> the u.s. supreme court. how would it go there? has never supreme court been confronted directly with that. there have been a number of cases that could be directed that way. >> they are in the business are ready. >> they are forcing people to serve, to do something they would not otherwise do. >> in response to that wall, they could have said we exit the business. to kosher. if we're want to play that game, it could be played here as well. the minimum coverage only kicks and the people have earned a certain amount of income. and it is not just on self in sharing on their own. one could say, just like the restaurant owner could depart the market, one does not need to

learn that much income. i think both are kind of fanciful. >> the idea that the solution is make a little less money? >> the justice was not at the heart of atlanta hotel that said you do not have to be restaurant owners and the like. i think what congress was reacting to was a world in which there are 50 million people who are uninsured and increasing the premiums of state lines by the tune of $1,000 per family. that is quintessentially economic. all of the things my friend said about tax and how you can do this from a tax power is not a complaint about congress. there may be a concern about individual liberty and invasive, but they are not making those arguments before the court. they made them in the complaint, not before the court.

to call in this not economic, to call this not commercial, i think, is a very tough argument. the percentage ofpercentaguest: citizens in three that does not file a tax return every year? >> they are exempt. i do not know the percentage. the number is about $9,000 per year. >> there are certainly large numbers in many urban areas where the group does not filed taxes. >> absolutely. the group that deals with that is subsidizing. >> that becomes a national issue of citizens wreak protection, does it not? the congress basically made one assessment, is that we have this as a national goal to ensure the health of our citizenry. that is the carry over into that

point. >> absolutely. that is another part of the constitution. >> right. they said you can tax and effectively do that for the whole population. >> the city of cincinnati propose raising the tax 1 cents, and the place went ballistic. nobody wants to pay more taxes. >> what congress has done here is less evasive than that. congress is giving choice. you cannot have different insurers as opposed to the single payer system that they say would be constitutional. i do not think single payer is better or worse. this court president says overwhelmingly in the supreme court, has said time and time again --

>> we all have a lot of different opinions about a lot of things. >> whatever the case is, it does not strike me as the guidance here. you have your officer of the court had on. i realize that distinction is very helpful. i cannot quite figure out if it applies to the commerce clause, which is a grain of power. >> i think that we win this case either way. to the answer your question, i think the facial challenge of does apply. i say this because of slobbery, which does apply to the enumerated powers argument. here is the language, we did not strike down a language because there are hypothetical

situations in which the connection may be conceivably dictators. it is for only when there are no set of circumstances in which the statute's application would be application. we think undoubtably there are application all statutes. this lawsuit must fail. and maybe the course there may be some other lawsuit that may be brought. >> do you think it makes sense to grant the power? i'm curious what you think about it? >> i think it does make sense. you know the court better than we do. what do you think? i do not know what they're going to say about this. to g

>> it is reflected in your own opinion in warsaw. on this point, judge burton, i am not sure that is the case. what you said was the facial challenge standard have to do a lot with judicial restraint. and i think it is really a problem when individual litigants come in, sometimes with changed circumstances, and can say they have our problem. this entire act test of all. that is what i think salerno was getting at in the united states vs. foster was getting at. >> we need to hear from you on the indian junction act precisely. congress would not have wanted to wait until after the interconnected provisions are

implemented and relied upon by millions of individuals for challenges to the constitutionality of the amendment. is that, remaining your position -- those that remain your position? > >> it does. as officers of the court, we're trying to give you the best sense and tell you we do not think the anti-injunction act applies. >> thank you very much. >> why don't you wait a minute? people have been in here for an hour and a half. we will miss you dearly, but please do it at this moment. shows you have interest lags at the end. [laughter] we must get through it all.

i believe we have had the departures -- all right. stand by. one more in the door will close and we will hear your closing. this court asked my friend about any cases he could point to that would show congress have the authority to regulate in activity. one of the main cases was united states forcevs. fosse. this case was dealing with the commerce clause of challenge to the child support recovery act. the court specifically said that act regulates interstate commerce. one of the primary categories. it regulates the challenge.

one of the categories that congress can regulate under the commerce clause. , because congress properly enacted that. you have an individual who fell within the statute because he had a court-ordered child support payment that was due to a child who was in a different state. he fell within that particular statute. because he did not make his payment, he was in violation of the statute enacted. that is not even what we have here. he did not have the individual mandate provision. he did not have the basis for congress to pass that at conception. you are dealing with something that is applied with the commerce clause because it regulated interstate commerce that plainly does not fall within the category here. look at the heart of atlanta

hotel case, but in those cases in the heart of atlanta, you have the individual or entity that was already active that chose to engage in commerce. once they were engaged in commerce, commerce had great authority to regulate them. the hospital decides to engage in commerce. the federal government tells them if someone wants to have the emergency services, you have to provide for them regardless. that is because they were already in commerce. the individual mandate is forcing people to participate in commerce. cane's no point -- casey point to that, for someone to open a hotel, to have our restaurant, to own a hospital, and once you have done that we can regulate you. these are acts to engage in commerce at the outset, and commerce can regulate them

there. it is significantly different. >> what would you say about this law, only about catastrophic health care, so that in affect everyone was forced into the market? on the theory that outside religious objectives clearly is a very small group of people that would cost over $50,000, so that it was there to generalize. and there do say they want to be left alone. i think average person with a heart attack will not object when the wife drives them to the emergency room and the emergency room treats them whether they have health care or not. wouldn't you think that would be ok? >> there are certainly a lot of heart wrenching stories we could come up with the health-care market, but that does not provide a principal for granting congress the authority to remedy the problem. i am saying everyone has to

have a catastrophic health care. to g >> they are trying to regulate it and describe it as an economic area. >> everyone does get the health care for which they cannot pay. >> that is not true. that is not true at all. >> we're down to a pretty small group. >> there are other ways they can solve problems. in this court's role is not to determine whether the ultimate objectives were liable objectives. the role is to determine whether the means they chose were within the constitution. there is no way this court can conclude the federal government can force someone to engage in economic activity and then

cause a federal penalty. there is no precedent whatsoever. every case he cites to is absolutely distinguishable. congress created the problem to begin with that community rating. now their cause problems for the insurance companies and our remedy is to force people into the market, and they cannot do that. >> thank you very much. up to both of you, compliments and depreciation. it has been an excellent afternoon. the case will be submitted. an opinion will be forthcoming. we will give you no date or time. normally i would say you have three of the more attuned judges who believed it is better andknow yes than to wait deciliter. we will adjourn the court. thank you very much.

>> the west pediment of the supreme court's. the figure of liberty in the center. the scales of justice guardians. pai-hed by two yesterday was another rainy day here in the nation's capital. a tea party rally still took place at the capitol. the speakers at the rally included the virginia attorney general who challenge the law in court, and the former republican presidential candidate herman cain. if you miss their remarks, you can view them on our website c- span.org. we're going to check the supreme court seen throughout the day. the media getting ready for the people that will be attending the remarks.

there has also been a line of people gathering outside the supreme court. some of those people may be paid. they are paid waiters who hold the line for people who cannot hold the line all day. that is according to a " washington post" article. o>> it is like in france, when you have to do with the waiter all your life.

>> i am not from france. i am an american. >> maybe it is just the french waiters i had to work with. >> stopping by arlington national cemetery to visit a couple of buddies that are buried there. take a what is everybody doing here for the supreme court today? >> [inaudible]

>> here is a look at some of the people waiting in line. some of them may actually be paid according to "the washington post" article. people can make up to $350 to stay here in the line. they are paid by individuals, and sometimes lobbying groups and law firms in order to make sure those people get a seat when it comes time to go inside the court, which will happen tomorrow. the core holding three days of oral arguments. we're want to bring you for audio of the oral arguments on the health-care law tomorrow afternoon at 1:00 eastern time.

win[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] >> we are born to be checking the scene outside the supreme court throughout the day today, and looking at some of the challenges to the wall. tomorrow we will same -- air same-day arguments on the campaign in networks c-span3.

the health care act just past the second anniversary of being signed into law. now we will show you some of the debate on the bill from back in 2009 when it was making its way through the senate leading up to a vote on december 21. the senate version passed a few this christmas eve. >> mr. president, it is obvious why the majority who think you. it is obvious why the majority has cooked up this amendment in secret, has introduced it in the middle of a snowstorm, has scheduled the senate to come in session at midnight. has doubled over 04 1:00 in the morning, insisting it be passed before christmas, because they do not want the american people to know what is in it. it is a deeply disappointing legislative results, but friends on the democratic side seemed determined to pursue a political kamikaze mission

towards a historic mistake. this will be bad for the democrats, i am convinced, but even much worse for our country. thank you, mr. president. >> it all began in the presidential campaign. i do not like to spend much time recalling it, but health care was a big issue in the presidential campaign, on october 8, 2008, just a less -- just less than a month before the election, president obama said concerning health care reform and, "i will have all of the negotiations are around a big table. we will have negotiations televised on c-span, so the people can see who was making arguments on behalf of their constituents and who is making arguments on behalf of the drug companies." that was a statement made by a then that senator obama.

so what we have seen here is a dramatic departure. there has never been a serious negotiation between republicans and the other side. there has never been that -- i say that with a knowledge of someone who has negotiated many times across the aisle. do not stand up and say there were serious negotiations between republicans and democrats. there never were. there was negotiations with special interests, farmpharma. clearly this administration and outside of iowa was on that side of pharma, because they got a sweetheart deal of $150 billion that would of been saved if we would of been able to reinforce prescription drugs.

a r pete got a sweetheart deal. got a sweetheart deal. there was throughout this, we should have set up a tent and put a person webs in front of it. that is the way this has been conducted pier yen and the the we have to take care of special senators. we have the louisiana purchase, cornhuskers' kickback. i got the florida flim flam, the one get that gives the medicare advantage in florida, but my constituents do not. so an answer to this question today, the majority leader said "a number of states are treated

differently than other states." really? legislation is all about. that is compromise. where is that what? a number of states are treated differently than other states. that is what legislation is all about. that is compromise. that is not what the american people call in governing. that is called an opposite definition of what the president of the united states said where he said we will have negotiations television -- televised. the leader from illinois the other day just a few days ago, i said what is in the bill? the senator from illinois and i do not know. i am in the dark, too. here we are as the senator from tennessee set in the middle of the night, and here we are about to pass a bill with 60

votes. now, 60 votes represent 60% of this body. i can assure my friends on the other side of the aisle it does not represent 60% of the american people. 61% of the american people say they want this stopped. they disapproved of it. i guarantee you, when you go against the majority opinion of the american people you pay a heavy price, and you should. i will tell my colleagues right now, when you -- this will be, it is passed, and we will not give up after this vote, for the first time in history, for the first time in history, there will be a major reform passed on a party-line basis. every reform has been passed in

a bipartisan basis. this will be a strict party-line basis. >> i just heard the senator from arizona saying this is not a bipartisan bill. i have heard talk about how this should be bipartisan. let's look at that for a second. as i see it, the republicans have no bill of their own. our bill has 60 democrats. a super majority. a super majority. i guess there is a bill over there with seven co-sponsors. that is it. and that is it. nothing else. my friends on the other side are all over the place. they cannot even agree among themselves what they want to do. they have no comprehensive bill

like we have come up with. so i keep hearing that we democrats are not bipartisan. but who do we deal with? just the senator from arizona? justice senator from tennessee? how about the senator from oklahoma or south carolina? i am sorry. i feel sorry the republicans are all split up. they have not done their own homework to pull their own senators together for something positive. so what they have done is they have pulled it together to say no to try to kill the reform bill that we have worked so hard on all year. we extended a hand. if we had really wanted to phase out the republicans, we would have followed their lead in what they did in 2001 when they ran through the tax cuts for the wealthy. they did it on reconciliation so

we could not filibuster. so we could not have any debate on it. that is what they did. we did not do it that way. president obama said we want to hold the olive branch out and work with republicans. so that is what we tried to do. we had numerous meetings with republicans. we had a market session that lasted 54 days. we accepted 161 of their amendments. in the end, everyone on the republican side voted against it. senator baucus bent over backwards. he went the extra 500 miles. he tried to get republicans to work with him on this bill. and in the end, only one republican would vote for the bill out of the committee. that is what we have. i am sorry to say my friends on the other side are in total disarray.

they have nothing they can agree on. we have something we have agreed on, 60. a super majority. a bill moving forward. a pivotal point in our history. decade-long march. it eluded presidents going back to theodore roosevelt. my friends on the other side defend the status quo. they want us to vote with fear. everything you hear is fear. be afraid. it will not work this time. what the american people want is not fear, they want hope. they want to have the peace of mind and security of knowing

that their children, if they have a pre-existing condition, they they will be covered by health insurance. the peace of mind knowing that they lose their job they do not lose health insurance. and they want the security of knowing that if they get ill, they will not be dropped by their insurance company. they want the hope and security to know that they are not just one illness away from bankruptcy. we are the only country in the world, the only one, where people could go bankrupt because they owed a medical bill. no other country would allow that to happen. we're the only one. this bill is going to stop that. people will not have to fear going bankrupt, because someone in their family got a chronic illness or a disease that cost a lot of money. american people want us to move

forward. we're going to do it tonight at 1:00. we're going to move forward. >> the democrat bill we are voting on tonight raises costs. that is the administration's own budget scorekeeper. it raises premiums. that is the non-partisan congressional budget office talking. it raises taxes on tens of millions of middle-class americans, and it plunders medicare by half a trillion dollars. it forces people off the plants they have, including millions of seniors. allows the federal government, for the first time in our history, to use taxpayer dollars for abortions. so a president that was voted

into office on a promise of change said he wanted to lower premiums. that change. he said he would not raise taxes. that change. he said he wanted it will work costs. that change. he said he would not cut medicare, and that changed, too. 12 months and 2.3 trillion dollars later, lawmakers who have made the same promises to their constituents are poised to vote for a bill that will not bend the cost curve, will not make health care more affordable, and it will make real reform even harder to achieve down the road.

i am understand the pressure our friends on the other side are feeling. i do not doubt for a moment their sincerity. but my message tonight is this, the impact of this vote will long outlive this one of frantic weekend in washington. mark my words, this legislation will reshape our nation. americans have marty issued their verdict -- have already issued their verdict, they do not want it. they do not like this bill. they do not like lawmakers playing games with their health care to secure the votes they need to pass it. >> a look at the supreme court

this morning on a cloudy day. expecting rain in washington. a few visitors outside making their way up the steps. there is a line forming to get theo tomorrow's arguing of t affordable care act.

. >> we will bring the new body of the supreme court's argument on the health care law that will start tomorrow afternoon on air companion network. c-span 3. we will be checking the scene throughout the day at the supreme court. >> last month, former u.s. solicitors general precede the

supreme court arguments, focusing on the individual mandate. they also argued before the 11th circuit court of appeals. the represented states that were against the act and one. the law required the purchase of insurance was unconstitutional. bloomberg lot hosted this discussion. >> good morning. i am pleased to welcome new to supreme court arguments briefing, co-sponsored by bloomberg law. we are preaching -- approaching the two-year anniversary. since president obama signed that into law, it has been challenged numerous times, culminating before the supreme court. this morning, we have to explore some of the arguments underpinning that case. i now have the distinct honor of

introducing lyle. he is uncovering the supreme court for 54 years. in that time, he is covered one- quarter of the justices to set on the court -- has reported on the entire careers of 10 of those justices. he is the author of the reporter and the law, techniques of covering the court, and it is still available. i would like to welcome lyle. [applause] >> good morning. we are glad you are here. if you were not here, we would not be. contrary to perceptions of some of my colleagues in the press

room, i was not around when the -- case was decided. that was one case --that was one case in which he did not appear. i was not very far behind when peter roosevelt began exploring the possibility of a national health care lot in the early 1900's. i can a long after that. my task is not to discuss the case but to give you some outlines of the logistics of what is going to be happening. the first thing that i would tell you for sure is settled is that justice kagan and thomas will participate in the case. there have been repeated discussions about whether one or both of them should

disqualify themselves. there is one case urging justice kagan to refuse. there have been opportunities for them to refuse and they have not done so. it is perfectly acceptable that they will continue to participate. there will not be in a live television coverage of the oral arguments in late march. there is a request. i do not believe there is any possibility that there will be live coverage. one other thing that is settled is the court has completed the briefing schedule but not all are in yet. i did a count last night in the press during -- pressroom. there are 93 briefs. there are still more briefs to come including tomorrow i think it is due tomorrow on the server ability question. some issues that are almost

settled are how much time there will be for the oral argument. they are committed to pipeline five hours but the parties have asked for another half hour. we presume we will see an order from the court asking for the competing allocation of time request. there probably will not be a safe date release of the

audiotapes made. the current chief justice has a policy that he prefers not to release any idea taste on the same day of the hearing. now the common practice is to release all of the audio tapes on the front of the argument. -- friday following the argument. the daily press has lost interest by that time. there could be a change in policy for that case. it treats this case differently. the court has some of the filings in the case of the website. the court also has set aside 5.5 hours of argument for this case. i would urge you to not overlook the anti induction issue. this is one of the issues for the main street press.

it tends to fall over division. there is a mandate. i would like to take up a few issues. most importantly, the birth control mandate is not an issue before the court now. if you wish to see where that kurdistan's as the legal matter, and they published the regulation region where that

stands as a legal matter, at the published-- if you wish to see where they stand on the legal matter, they publish the regulation where it stands as a legal matter. it will require insurance companies to provide care. i would also like to address one major issue. this is the equivalent. it has been suggested that perhaps i should offer a prediction as to how it should come out. the following panel could be very informative.

thank you very much. [applause] >> thank you so much. in the publisher of a blog. -- i am. we are grateful for those who are watching streaming or three c-span. everybody understands the case that are about to hear on the act. there are incredibly well meaning people on both sides of the case. one small point of privilege is that i have a dog in this fight as a lawyer. i want to make clear that my job here has nothing to do with that.

it is simply to facilitate the folks who will do the talking. we have produced a media guide for the folks who are here. you can find links to the bias in the back. we can give you a little bit of backgrounds about each compliment. he is a former solicitor general. half the states have sued the constitutionality of the statute. he's arguing every case. eking compass at least 10 of the oral arguments. michael carbon is a partner at the bankrupt.

he is a partner at jones day. he is the former deputy head of the office of legal counsel. they have a principal lawyer for the plaintiffs. they have been formulating the legal strategy. they have been involved in the matter involving the business community and a lot of conservative issues. my last is the former acting general. he argued a most of the cases in the court of appeals as this was being litigated. he is now co-head of the super practice which is an

international law firm. he is regarded at the very least among the same generation as the leading democratic lawyer. keela is a professor at yale university. he regarded fairly as one of of the five ones in america today. a particular, my own view. rather than gravitating toward esoteric, action gravitating toward the importance and clear hear. we are here to talk about cases

as the whole. we will have a question appeared at the end. it goes on to ask about them, you are welcome to do so. you could talk about this for 5.5 hours. we have less than that. we're going to focus on the core of its. i have urged the panelists to engage other and not call back. none are known as shrinking violets and that should not be a problem. they really should cut to the heart of the matter. and lots of folks know it had bought the case. a lot of folks will not know as much about it.

if i could just ask paul to set the table with a brief description of what the individual mandate is. >> i will give it a try. i think neal of have a different way of describing its. this has generated the most controversy. there is the individual mandates. it requires with one in two minor qualifications them to maintain health insurance. it is the act when you're putting together this. they have to do other insurance reforms including to make sure

it is available to everybody and then you have not be denied insurance. they have run into problems. one state tried it with an individual mandate that was perceived as more successful. i do not think it was preceded by everybody. it was the only way to accomplish it. there were earlier versions of the act that more affirmatively embraced the taxing authority. it included an individual mandate. it gives rise to the individual issue. this is really completely unique depending on your

perspective. there have been a lot of crises in the country where congress might have thought that forcing individuals toward a particular good or service might be useful. the government never did it. it has resonated with me. it is compelled purchase would have even been more effective regulation. it has incentives for people by giving them the incentives. it would have been much more proficient to simply say that everybody over a certain income level had to buy a car. the government never seen fit to

do that directs requirement. it gives rise to the basic issue to the governments. i think they can see this. many suggest it is a fairly straightforward regulation. the challengers. to the nature of the imposition. there is the government's seeming inability to eliminate a principal such as can engage in this regulation. in a nutshell, i hope that this response of the setting the table. >> thank you for this wonderful event.

i'm glad to be here with all of you. it i am not here now representing the government. i agree with a large part of what paul said. let me fleshed out exactly what congress is doing. it did not understand why this existed until i started getting really into the argument. congress is reacting to a problem with it the people uninsured. a large part of that has to be conditions. if you're in one job, they have other employer were to do. this person has high risk and so on. 50 million people are uninsured. conagra said we will eliminate

-- congress the discrimination and insist that everyone be rated a certain level and the community. once insurance companies are told you have to do this at a fair cross-section, then everyone could wait to buy them until they got sick. that way you economize on their costs. that will create a massive adverse selection problems. they tried to reform the insurance market. what congress did is they said they would have an individual

mandates so everyone has to have a certain amount of insurance. right now congress bounce every american -- found every american family that pays health insurance pays $1,000 extra for those who are uninsured. that is really what congress was saying. it is approximately 18% of gdp. it is a comprehensive regulation. why did the government do this with respect to the automobile industry? that is not a situation in which she can show up at the car lot, a drive off with a car and stick the bill to your neighbor. that is what is going on in the health insurance market. the uninsured and uni and are paying for health insurance are paying for them.

that is an economic effect that israel -- and you and i are paying for the health insurance for them. >> is called insurance different in a way that explains how they could impose a mandate here but not in some other contact? >> no. he is always wrong for three reasons. he missed described congress's purpose. this comes straight from this. what we're trying to do is prevent the insured from subsidizing the uninsured. it is the opposite. what you're trying to do is conscripts individuals to buy insurance before and makes any sense for them to do it. it requires insurance companies to give it to all of the sick

people. you counterbalanced by bringing in to people whose insurance some plea makes money. -- simply makes money. how much subsidy coming in from the individual mandates. 28 to $39 billion a year. you are taking a bunch of how the third year olds except for a catastrophic insurance. the only stymied what that is a 30 year old. -- the only time you what that is a 30 old. they say have to buy the contraceptive and wellness programs and things that'll do you a whole lot of good. why do we do that tax what your insurance money.

as for the adverse selection problem, there is an 11 month time period you have a certain opportunity to buy insurance. what kind of person will sit there and say i really need insurance but i'm going to become a casino gamblers. i will be able to buy insurance on the way to the emergency room. cbo did not score it appeared there was not a line of testimony trying to document what causes this election. we can disagree about the policies and economics. what difference does it make.

the court is not want to second guess what is beneficial for congress. congress is the one that makes the power. he can come up with whatever policy differences they think are important are what unique aspects. once congress has the ability compelling duty by the one is there. congress has the power. but congress has the power, that is the proper role. of the government tries to build these economic reasons while allowing this case, it is not unique. they can require you to buy a car. a gm car. we impose all kinds of restrictions on the car company

that drive up the cost of cars. just like the nondiscrimination provisions strive of the cost of provision. -- insurance. if congress is allowed to force tankers to the provision, there is no reason in the world that they cannot do it just like they can do it and the health care context. as the justice department has been unable to show, congress has the power to serve the public welfare to improve congress, a game over. they can do it for banks and anyone else they want. >> among your reactions, both paul and michael have said that there is no limiting principle. is there no limit in principle or does it matter? >> the most important decision

that the supreme court ever issued is mccullough versus maryland. the take them seriously, everything that they said is clearly wrong. clearly. here is what john marshall says. the argument is that this creates a corporation and it is special. marshall says wrong. he says of for reasons such a applicable. the corporation has already been created under other causes. why not here? george washington signed his name to individual mandates. i will read the language before the end of today. here is what he says about the limiting principle. q government tax me? yes. can they take money and buy stuff with it?

yes. the only security and the abuse is against it itself. the act upon the constituents. this is sufficient security. if you do not like this, vote the bums out. i personally did not much like any aspect of law as a matter of policy.

i would prefer to see a lot of torts reform. my wife is a physician and we have been sued in malpractice. my brother has been sued. i do not like this as a matter of policy. if you do not, roll them out. we voted for president obama and his party and they said they were going to do this. that is what they did. if he did not like it, we will have another presidential election contest. the limiting principle is that they are taxing us. they are making us pay. if they do a cash for clunkers, i do not think they will because there is no room for it. we do not need constitutional lawyers and judges pulling

principles out of thin air to limit the ability of congress to pass a loss on cash for clunkers requiring you to buy a car. congress will not do it. there's not a need for its. if they do do it, i want to see why they do it. there maybe a reason for it. mike talked about construction. -- conscription. let me read you the language of a law that george washington find his name to. it is this sufficient bayonet and bill. they had a knapsack and bill. does not less than 24 cartridges. if you're 30 years old, you do not need a health insurance policies unless you're going to

get hit by a truck. they're subsidizing older folks. welcome to social security. in denver people may be going in. there's nothing unconstitutional about that. to be will roll back 70 years of progressive legislation. on conscription, the next attack could very well be biological. the germ warfare. everyone will need vaccines. viruses do not respect state lines. today is social security means everyone needs to have vaccines. they are more likely to have it if they are required to have insurance. >> i wanted to make sure, there are too arguable constitutional

basis for the statutes that have been discussed. the three be taught about the commerce clause. he has put on the table that there is another power that can be used to justify the statutes. it has blown a little bit hot and cold. can you address the question of whether this is a tax so that even if it worked not within the power, it is within the taxing power? >> mike will probably supplement them. there is this arguments that even if this is not on the individual mandate under the power that congress expressed, he said it was exercised. and nonetheless might be supported by the exercise of

congressional power that at least the president said was not being used here. that is the taxing power. in some respects, i think the simplest answer to that argument and to his point about mccullough, which i embrace. here is the thing. the simple reason why the mandate is not a tax is because it was not labeled as a tax. it does not operate the way a normal tax does. it is clearly something different. we have not described how the tax does that. >> there is no tax.

>> what this does, the mandate is a requirement that every individual, say people that are incarcerated in people that are native americans have a separate plan. everybody else has to get health insurance. there is a separate provision which is penalty that operates as a penalty against those who do not buy insurance. that penalty, which is a little bit closer than the mandate does not apply to everybody to him the mandate applies. there are a lot of people, virtually all the low income people that are subject to the mandate. they're not subject to penalty if they don't. it is not the principal focus. it is not the mandate that really has everybody else says. this is to the point from the call-up. what the chief justice said is

that the taxing power is brought power and that once you have the government exercising the taxing power there will not be a lot in court to limit the power and get the taxes too high for that it is some doubt impermissible. all that is fair. the limit on the taxing power has to be structural and has to be people who are the taxpayers. that is as likely what the people said. that is why in earlier versions congress contemplated something. the people did speak. the people who passed this law and congress knew full well there not the votes to do this.

they use the mandate. it is a sneaky tax. it is not on any group of people you'd otherwise rationally say to be subject to a tax, like people who are high income people are people who engage in certain transactions such are risky. all of that might make sense from a logical taxing policy. it taxes what your people you and not logically want to tax, reasonable help the, recently unpeople who do not have a lot

of spare income. they are inclined to save their money. it has a lot of assets of the tax. it does not have the one thing that chief justice marshall said is critical, the kind of up front accountability that allows the structural process to work. he said we could start a serious conversation if we had an answer for why this is different from taxing people and taking things from some people in giving them to others. i think the short answer is that this is completely different. there's a lot of accountability in being very clear about to is getting the benefits of the tax. a group of insurance companies who otherwise would protest long and hard against a new impositions that are implicit in the insurance reforms were

basically quiet it. an effective subsidy was devised for they got all this money on the backs of relatively healthy individuals. it would not have passed. >> i absolutely agree with every word he said. anything that congress can tax and take and give to an individual, congress can require one individual to pay for another. since congress can pay for somebody's insurance premiums and can require you to pay for this person's insurance premium. we all agree there is no constitutional limits in principle want to give congress the ability to take it for me and give it to you. this is the honesty of the political process. somebody ran for president and

said hillary clinton, i am opposed to an individual mandates. bill not raise it on anyone with the west into a $50,000 a year. he could not endorse the individual mandate and impose taxes. the big difference is the tax system does apply to all americans or should. everyone to accomplish this, we need to do for the greater societal good. if you are forcing people to engage in a public good, at the

public as a whole should pay for its. that is how we have done it if we require hospitals for people with their normal charitable instincts. this is all we're asking for. if congress wants to force one private citizen to help other people for obvious charitable reasons, is terrific. what you do not do is then not pay for it. what you do not do is make that take the entire tax. if we think it is so important to get protections against insurance discriminations for pre-existing conditions, terrific. that is a policy choice. we have to pay for it. the cannot ask someone to pay for the other insurance premiums. >> i think you can read this

until you are blue in your face. you'll never find the principle. that is that congress has to somehow face it. but she is saying is that the great check is the political process generally. i do not think anyone was fooled that this was a tax and therefore constitutional. the way that you sign up for health insurance, you have to report it on your 1040 tax form and pay a penalty. you are reminded that this is a tax. the way that it is calculated is that it looks to a percentage of your gross incomes.

it looks and smells like a tax. congress founded functions like a tax that will raise money. the cbo found it will raise $19 billion and putting it in the federal coffers. it is in the heartland of the power. i do not think it is as much about the tax power as what is the real check against these worries that my friends have pointed to. isogloss school in the early 1990's. i thought -- i went to law school in the early '90s. i thought it was a great idea do we get this stuff done. i am struck by the change. it is now striking legislation down. they cannot get their victories through the political process.

>> the challenge has been laid down by paul and michael. i want to make sure whether we agreed on it. they say that under the view of the defenders of the statute, there is no nonpolitical limiting principle. there is nothing that you could go to a judge and say this mandate is unconstitutional. is that right that's correct that is absolutely wrong. -- is that right? >> that is absolutely wrong. >> it is important to appreciate lawyers. the governor would not come in and say here are limiting principles and close the future

congress from something they might decide is necessary on all sorts of situations that we cannot anticipate right now. the government job is often to say here is what the heartland of our claim is. those cases are for down the road. if they wanted to, the principles are fairly easy to articulate. the bill of rights cuts and a structural power -- in any structural power. it will reduce health-care costs. the privacy will preclude the government from acting in that way. the second principle is that they limit this. these are the courses and 1995 that would strange the government. the government takes them seriously. the most important limiting principle is this. when congress is asking to solve a truly national problem that is one in which the states are

separately confident to fall, that is one is at its effigy. congress found that when any individual state like massachusetts ties to reform the health insurance market, and tries to reform the health insurance market, other states will come in and swat the markets. states often will not enact legislation to deal with the problem. they do not want to come back for the uninsured. the only way to solve this crisis is a truly national solution. >> i read you a passage from apollo where he was talking about a tax power. --; mccullough or he was talking about a tax power. there are two different bases for what is constitutional, taxation and interstate

commerce. they have to be right about both. we just have to be right about one or the other. there are at least three different clubs that argued the tax. the constitution does not use the magic word of tax. sometimes it is excises or revenue. the word "revenue" is in. it is titled 26. it is the internal revenue code enforced by the internal revenue service. cbo says it will raise 100 billion overall. it will lower the cost by $100 billion. it will be revenue positive. it is passed by the house and senate under specific internal rules but only apply to revenue measures. if you do not pay income taxes at all, the mandate does not apply for the tax form. if you want to look at the word

tax, if you think that is important, they understand it is a tax -- the word taxable, taxation, a tax payer appeared 34 times in section 26 which is the relevant section. what are the limits that it really has to be a revenue measure. it is. they understand this. on commerce, it passed to actually regulates to act as a whole. it has to really be trying to solve a problem of interstate commerce. it has to be an interstate spillover problem. one problem is the welfare magnet program -- problem that neal pointed out. you have a job now.

you are worth more to the economy. they're willing to pay you more. we have to be paid by the system. they are not their highest. if they do not pay for you, you're not going to want to travel. i do not know the answer. every monday, i am in new york. if i fall sick, and they will take me to a new york emergency room. i hope they will take care of me there. new york is paying for a connecticut person. that will not be fair and must actually have insurance.

you need to provide for emergency room care so people will be guilt free to travel interstate. the need to make sure that people have insurance so some states are not taking advantage of others. this individual mandate itself need not actually regulate interstate commerce. it needs to be a part of a comprehensive thing as a whole. this is what's they explicitly said in the case. you look at if the law as a whole tries to solve the interstate problems. >> that really puts handcuffs on congress. we have been listening to 20 minutes of this. do you know what congress has to do? the regulation does not have to do anything with congress.

as long as to attach it to a bill, that is ok. >> did it its due. did it its due. it is not just attached to something. it is part of an integrated scheme. that does not make it constitutional. explain why it is right to say there is a spill that has five pieces that worked together. one of them is an individual mandate. what we do is assess the constitutionality weather them getting away with the statute as a whole. -- rather than getting away with the statute as a whole. >> i am not sure i really heard one. i think akhil give a great

defense on why this might be in interstate commerce. in doing so, he laid out an argument that would apply to almost every commodity. >> but those are the limiting principles. >> when i asked for my limiting principle, i pointed to [inaudible] that has nothing to do with this particular power. this power is unique, the power to compel people into commerce. that power is what does not have a limiting bridge. there is really no commerce that i cannot foresee to engage in on the theory that could then be easier for the federal government to regulate for the broader commerce.

>> the basis for the regulation is not the individual mandate. there is an individual mandate. this is one way. >> maybe we should transition into the question tom asked mike. your point is that you do not have to show really anything about the interstate commerce or individual mandate as long as it is a broader regulatory structure that regulates congress. we take issue with that. >> your initial statement of the fax, twice he said - -facts, you said "a critical part" of a comprehensive plan to deal with a genuine interstate problem that no individual state can handle. john marshall had no problem with that. >> every word you emphasized in that sentence are the kind of words that the supreme court will prefer to. it is genuine.

in the next context, it is all caps, exclamation point "genuine." myi'm sitting at home in living room. i am not buying insurance. how can they force me to enter into the stream of commerce? this is not like them growing wheat where he is producing a product that is an distinguishable from they predict which is indistinguishable from the interstate product. -- a product that is indistinguishable from the interstate product. how am i a problem when i make a choice not to buy insurance? they can still require insurance companies not to discriminate against people with pre-existing conditions. i am a solution to the problem

congress has created. every time congress rises up with a regulated company, they can say it is sobbing and interstate commerce problem. -- it is solving an interstate commerce problem. maybe i have a right not to eat broccoli. i can sure make you buy it. i am making two points. one is the limiting principle. this is unique in our prudence. every other person has been regulating an impediment to the congressional scheme at the interstate level. they have abandoned the distinguishing characteristics between interstate and intrastate. they can get local bootleggers his liquor never crosses state

lines. the question is can they get people who decided i do not want any part of the liquor business tax you will help it if you start making the buy wine -- and to not want any part of the liquor business? you will help it if the start making them by wine. >> he is doing something that affects the national economy. that is what the government is saying. that is what congress is saying. the failure to buy it is different. everyone could get this. >> what does that give rise to a limiting printable? the problem is that people were sitting in their living room and

they were not buying cars. that was a problem. >> what congress is saying is that health care is different than the buying of cars. everyone needs health care and those costs are externalize of people right now. maybe you can make that argument. i do not quite think so. you cannot predict when you will get struck by cancer or heart attack or get appendicitis. let me finish. this is something that is a product that everyone is going to buy. congress reaction is not the failure to buy but the failure to pay for it. health care is going to be consumed by everyone inevitably including mike as he sits on the couch in his living room. congress found those costs

aggregated mean that each american family spends $1,000 per year extra. that is across state lines. maybe he can tell the story with other markets. i do not quite think so. >> even if you are right and we can debate the tax that the health care -- the facts, why does that limit any principal? if the the supreme court says you can regulate this into the power and is a decision not to purchase health care and has a profound market, why does it mean the next time congress tries to do this with the sec same theory that it is making it a pain to regulate that particular market so we will make you buy its? the next time it'll be cars. some people do not buy cars. they walk. why will that make one bit of difference under the structure

of the argument that the government is making? >> you are truly the best lawyer of a generation. it cannot win this case no one can. i do not think you can because the power congress is seeking -- congress is forcing someone to buy something they would not otherwise by. what congress is saying is that everyone is glad to buy health care. they're going to use health care in consume it. what they're doing is regulating the financing of its. they can easily right in opinion that say that health care is a market that is different than any other markets because of that and because of the demonstrate a cost that occur across state lines. >> healthcare is very distinct because everyone needs to have it and will have it at some

point. that is not a direct the states. it has to solve an interstate spillover problem. there are cases which the supreme court said congress went too far and established a limit. we are on the correct side of those cases. lopez and morrison are cases where there reynaud interstate problems. -- where there were more interstate problems. people in one state were opposing cost of people in another. >> of me ask you to respond to this. what congress is doing is saying that you cannot pay for health care with your own money. you are going to have to pay for with insurance. what michael says you make a rational economic decision not to buy health care, he is

talking about an economic choice that is being made by individuals. fundamentally, the decision not to use insurance is being regulated by congress. is that a limiting principal? >> no. >> no. every time you decide not to buy a product, whether it is books or school curriculum or any kind of traditional thing -- i making a purely economic. if you want me to i will. cars are economic. you are going to buy health insurance is the premise of is that it.

you are going to buy its. we will tell you how you are going to buy it. you're going to pay their this with their insurance. it is different telling you how it is that you have to buy health care. it is a when you get health care, you'll pay for with insurance rather than -- how is that different? >> i have decided to self move or a scooter or a cap or an airplane. we are just telling you which way you decide to engage in transportation. it is not a limiting principle. this is the only market most americans will go into. the labor market, however, fell into the labor market. it is predictable than 95 simmel gone to the labor market. >> this was about as interested in market as you can get. this is not the theory. it is thought have anything to do with economic activity. growing wheat for your on props on your own land and having marijuana in your own basement

for your own use affects the interstate market. do you know what facts they were probably right. i do not know how you distinguish between homegrown wheat and homegrown marijuana. we lost that battle in the 1930's. economic and activity has less to do with economic activity than the guns. they have already held -- i do not know --

if they're limiting principles and establishing the nexus of interstate commerce, we what the battle -- we lost that battle in the 1930's. demonstrates the precise limits that they were separately confidence to deal with guns. gun problem. by contrast, health care is one in which one state does. if you can tell your story by which neighbors do not get stuck the same way with bills, maybe it may be something that is constitutional down the road.

you came up with this by saying it is a thing that were-- worked perfectly. and you are opening of a cathedral about the -- >> massachusetts supports the solution that did not work effectively because it was -- [talking over each other] this rationale. if insurance companies have to insure people after their houses are burned down, it raises rates. i am not saying it is a wrong, charitable decision to make, but to say it won't drive

premiumsthe patient protection was protecting six people against discrimination by insurance companies. offset the premiums that the companies suffered a. -- suffered. >> it has to do with your false assertion that this is a unique factual scenario where congress is never going to be able to cobble together a nexus. every time somebody doesn't pay someone, costs are shifted. other customers and absorbed the costs. it is not a limit in principle. -- limiting principle. >> they want you to think that there is something distinctively dangerous and problematic about a mandate to buy a private supplier.

how do we test that idea? we don't see any particular concern about that. they have come up with that, but you won't find it in any supreme court case. it is not in the constitution that it is a special concern. it is exactly like -- the corporation is somehow very bad. john marshall says there is nothing particularly problematic about a corporation. like there is nothing particularly problematic about a mandate to buy -- hold on. >> they would say there is not a big concern about this because there has never been a statute that requires somebody to purchase something. >> every state requires you to

are exporting costs, it is a mandate to support costs. this is proof of the following point, that there is nothing particularly problematic about this. states do it all the time. they do it for cars. massachusetts doesn't, connecticut does it. you are imposing risk of cost ofcar insurance, there is other>> their point as i take it is state should be doing. i don't think they will be persuaded by saying that states do things like this.

give them their due? requires you to purchase a product? >> is the act of 1792. guns. >> you can be given a health insurance policy. way down. one, there is nothing wrong in principle with the government. government requires you to buy something. the government's view that all now, the federal government can't do everything that state governments can do. and that is where the word that state comes in. there is nothing wrong with a mandate. for insurance and cars, the only traditional governmental tool that has been in operation for a hundred years is a sensible tool to deal with the distinctly federal problem where

people in 1 states are imposing costs on people in other states. that is the interest a problem to be solved with this traditional regulatory tool. i am well, how are you? >> and you want me to respond to the militia act? >> on the question on whether there is a limit in principle, you agree that congress could have done this if they werei also guess that you agree that congress could require that before you actually consume

health services, you require health insurance at the point of sale, you're going into the hospital, that sort of thing. does that cut into the concern of limited principle and if they can accomplish this through other means? >> it suggests that there is a limit in principle that you individual mandate. ways that would be more important. there is a health care policy debate that i am happy to wade into to the extent necessary to argue this case. there are people talking about the health care market and have dedicated their lives to studying health care. and to the extent that they honestly believe that this series of requirements is necessary. they should take great comfort in the fact that there is a way for congress to accomplish this. you can't have the shortcut of

the individual mandate. that is a really important principle, and to make two points, it really is important to distinguish between the mandate and the penalty. because if you decide you're not going to buy health insurance, he will pay a penalty if you are not exempt from the penalty, and a lot of people are. that is something that you will have to do on april 15. you don't see the premium, which is really what congress wants. they want you to get compliant health care. and you're not going to write a check to the irs on april 15. he will write a check to an insurance company, and to the extent that it is really a tax, it is really pernicious.

when we try to figure out this huge budget mess, we will start by looking at what the tax revenues are and government expenditures. to have something that is really a tax that will be completely off of that budget, people are taxed to whatever level they are at forced to buy a product that they don't want, but if they are forced to buy it, they might as well have its. you'll have this whole thing kind of off-budget. i don't think that is what the framers had in mind. >> called a tax? it is unconstitutional because you end up buying the insurance? >> as michael suggests, it will be distributed in a different way more broadway. -- broad way. >> at least it would be on- budget and i think it would be

better. i can't resist saying something about the militia act of 1792, because i do think it is different. congress was given the power to raise a standing army and can certainly be argued that the militia act was pursuant to that power. it is important for two reasons. congress is given the power to raise armies and regulate. it was recognized that those were separate things. the power to raise an army was very controversial. the power to regulate and army wanted was raised was not controversial at all. by contrast, if you look at the commerce clause, which gives congress the power to regulate commerce. it assumes that there was actual commerce ongoing that congress had the authority to regulate. that was the power, because it assumed congress to be regulated

that was not controversial of all. if you go back to the minds of the framers and causing the idea that they really thought the congress hall clause was brought and if empowered compelling people and congress in order to regulate, the whole constitutional history would be different. we would have had he amendments at the framing in order to control this really brought, potentially dangerous powered to compel people to engage -- >> i want to make sure that we have time for questions. >> all the arguments against the act, there is a lack of political accountability, it is somehow stolen to the unsuspecting night and seems to be the weakest.

i think paul's concession, i understand if they did it using the word tax a few more times, it would be constitutional and really cuts the legs out from under them and comes to a point about unlimited government. they say as long as they do it with the word tax more than 32 times, somehow it makes it constitutional. and we are haggling over how many times they have to say it. >> i am saying you can accomplish the same objective by raising everyone's taxes and providing a direct subsidy to the health insurance industry and end up with the same public policy result, guaranteed issue, community rating, and everybody paying for it. >> i misunderstood you. >> there is no difference

between requiring people to do something directly and creating financial incentives to do so. their entire argument on medicaid as we are not forcing states, we're just giving them a strong financial incentives to>> we have 20 minutes left, let me make sure that we have the opportunity to ask questions. i think we have microphones available. here we go. if you could just introduce yourself. >> i have two questions that rather lively debate. the first is, if this is a tax collected by the irs and can be characterized as a tax, why is it not covered?

a therefore putting the case of until 2015 or something like that? my second question, i would like you each, at least one of you to address the question of supper ability and why if you lose any part of this case, the rest of the statute should stand or should not stand. >> let me ask neal first. is that ok? >> i don't remember all the details, it could be close to those two. the first problem of the question is you refer to its as yet. but it is important to distinguish between the mandate and the penalty that enforces the mandate. it looks a little like a tax and is what is collected by the irs. the challenge focuses on the

mandates. most people, if they were rational, they are not going to stubbornly said that i am not going to buy health insurance anyways because the tax penalty is key to the amount of the premium you would otherwise pay. most people will make the rational choice that if i have to buy insurance for mss -- asses a penalty, people will pay. >> assume that the statute is of the -- upheld. does it run into the anti- injunction act. >> it is not a problem because the principal challenges the mandate. it creates an important

difference for understanding the anti-injunction act. it basically says if you are a taxpayer and you are upset about a tax that you think is unconstitutional, you have an option that most people don't. most of the time, you face an obligation from the government. you can comply or brain a pre- enforcement challenge. i can pay the taxes and get a refund and to litigate that way. once i pay my premiums to the insurance company, i can't get a refund from them. anti injunction act is still aone of them, i will give you too. how long line of supreme court cases that don't interpret it in a way that making it seem jurisdictional.

they make it seem like it is a defense that the government can raise and also waive the defense. i have created exceptions. the government and to the private parties and the states all agree that the anti- injunction act should not apply. they don't have to reach it if the court agrees it is not jurisdictional. we have arguments as to why the anti injunction act would apply to the states no matter what. >> if the individual mandate goes down, does the rest of the statute have to fall apart? got to the government has taken the position that if the individual mandate falls, only a few provisions would be apt to fall, the insurance market reforms and community ratings. the theory is what i outlined at the beginning of the hour together, that the reason why

the individual mandate was put in was to deal with the adverse selection problems from the community rating and guaranteed issue provisions in the act. some folks have said, there are 24 pages of the act have to fall including things like funding for abstinence education. i think people think is a tough argument to have the entire act fall to make sure that there is no clause in the legislation, that is what gives that argument some teeth. alone, it is not this positive. >> is there a question of what falls apart if the mandate goes down? >> i don't think reasonable people can disagree that the individual mandate is tied inextricably to the guaranteed issue and community ratings provisions. the two provisions that gave the patients the most protection or

the guarantee issue and no ban on pre-existing conditions. the thing that made it affordable again was massive subsidy. once you have taken away both pillars of the act, once you have ripped the heart and lungs out of the body, it can't matter if the figures continue to move. it matters if they move in the way that congress intended. it is no way that you can possibly say that the rest of the act is ok. i suppose you can take the anti- competitive provisions out and still have an anti-trust division that can function. but it can function in a manner that congress intended. this is particularly true of this act because we know it was a series of compromises and if pulling out any one part was going to do them, pulling out the biggest car will doom the whole thing. >> rather than killing the whole tamoxifen, it would be to say,

if it is all about the fact that they use the word revenue rather than tax, it would be obviously ok. we write a the statute so that wherever it's as revenue, it says tax and people have political accountability. that is what other cases have done. marshall, and the fact, rewrites one clause of section 13 of the original judiciary act. if the whole point is that people need to understand that the supreme court can make that clear, one other very important fang, we talked about an individual mandate. strictly speaking, you can simply pay instead. it is not a lawbreaker if you

choose for philosophical or other reasons not to buy the insurance. >> of the statute is structured in such a way that paying the penalty is not in compliance with the mandate. the mandate continues. >> strike that part down, read the statute so that it is clear that as long as you pay the penalty, you are in compliance. it is a very nice holding. >> i don't care if they call it a tax, penalty, or banana. it is a mandate to do something and if you don't do it, you are in violation of federal law.

if a ban cigarettes in the united states tomorrow and said that the enforcement mechanism is a for dollar penalty for every pact to sell, everyone knows the difference of the impact of cigarettes. and the government conceded that if there is any distinction between a tax and something else, it is not a payment for an un-lawful act. if they had said the, you can have guns within 1,000 feet of the school in the penalty is a purely monetary penalty, that is not a tax because they have made the act of having a gun near a school of unlawful. it is not only from the citizens' perspective, it is from congress's perspective. congress doesn't want people to pay this penalty, i want them to solve the problems that you folks have articulated all morning. that is why people mandated the purchase of insurance. it is not semantics, it is a fundamental distinction between

being a lawbreaker and a person that complies with the law that besides the pay their taxes. >> anti-government's position is that to reach the goal of universal coverage, it is necessary to require people to buy private health insurance. earlier this week, 50 medical doctors filed a brief in this case saying that they believe that this mandate is unconstitutional because the government missed an alternative, the single payer that must industrialized countries have. >> i am a libertarian, but unfortunately, i don't think

that the supreme court should judge action by if it is adopted by western europe. is this regulating commerce? it is not remotely involved in commerce, much less commerce among the state to buy a particular product. the powers to congress are completely irrelevant to this decision. >> there are other options including single payer that might be scored differently by the american libertarian association. the fact that they are doable is not irrelevant. this is not an unsolvable problem that this is the only way to go. this is one way to deal with it and it happens to be a way to do it. if the argument is that they could have called this a tax rather than congress, what is the big deal? who cares if we went on the commerce clause?

you should grant us this power because it will not hand as the ability to achieve your policy objectives. really what you are saying is that this is just a two over for congress and this time they have to be honest with the american public during the legislative process and say this is attacks. what is the big deal? i don't happen to believe that, but if that is their position, that seems to be a strong strike against their argument, not in favor of it. >> another question? >> barbara perkins, crs. what is the basis of the argument that the mandate is unconstitutional? >> the court has made clear that you have to go back to first principles. federal government is inherently different from the states because the federal government is one of limited

enumerated powers. if you enter the commerce power to essentially give them to brett of power that the state's -- breadth of power that the states have come out that in power is to say that the standing alone is wrong. much greater than the commerce power -- i start with the text, regulating commerce. even if there is ambiguity with that, we know that is going to be wrong, because if anything is visibly truth from this month, is that there is no limit in principle. congress can treat citizens like they treat militias, which is not a whole lot of limiting principle, and bill of rights would prevent states from doing this. that just means that the feds and states have precisely the same power. that is what the limit in

principle conversation is so important. >> as the court has said, you should not get up to on on whether the limiting principle -- the court has said repeatedly it that as long as it is within the enumerated powers, the ends are legitimate, there is a means by which the court will defer to congress. why not have a $5,000 minimum wage and punished if you don't pay it by the death penalty? you could come up with a certain samples -- with absurd examples. every government power can be taken to the extreme. do you really want the federal court to be adjudicating these questions on the basis of observe hypotheticals? the court said from mcculloch on no, absolutely not. >> you can to the same thing with the income tax. they do not concede that there is a living principle. mike said that, i emphatically disagree. he does not want me to keep repeating it.

the limit in principle on the commerce clause is about whether commerce among the states -- congress has to be legitimately trying to address a genuine problem between the states, where no single state can actually solve the problem on its sound because of spillover effects of one the state passed a policy on another state, positive or negative. you give insurance to one state with health care and you become a welfare magnet. we have one system to deal with the welfare magnet problem, certain social security, other state workers' compensation. the limit in principle under the commerce clause is that congress has to act to be tried

to address the problem that individual states are not able to handle on their own. >> i just want to make a comment, because when i went to law school in the 1980's, i spent a lot of time talking about that, and i don't remember ever talking about no limiting principles other than interstate constraints and the bill of rights. how can the supreme court>> there is an obvious distinction between regulating small producers of the product and the congress that passed the law in the 1930's, instead of telling mr. silver he could not grow wheat, if they told every american to buy wheat. that would have addressed the problem and not more directly

than harassing poor mr. filburn. the fact that congress has never done this before, even during, as tall pointed out, at times of extreme national emergency, standing alone it is the indication that they never had the power, and the difference between filburn and my clients is the difference between a local bootlegger and teetotaler. it is far more to require somebody to purchase a product than it to limit their ability to produce the product among interstate. >> in wickard, these were situations where people are not doing anything at all. she was not engaged in interstate commerce when she was trying to grow marijuana in her backyard. as justice scalia said, as long as that regulation on marijuana was part of a comprehensive national solution, it would be constitutional. here the same structure of the

argument applies, that there is this one apart, the individual mandate, a overall reform to the health insurance market, and it is constitutional, and you cannot slice and dice and say that that little provision is unconstitutional. you have to look at the overall structure, figure out what congress is reacting to, and defer accordingly. that is what the supreme court has done and why they have an extremely hard case. >> you offered -- you have heard all this talk about the limits, lopez, morrison, we think we are on the correct side of these cases. they basically draw the line between congress and trying to solve a problem that really does spell over across the state's, an economic problem, and congress can regulate that. there really is an interstate market in drugs.

situations where congress was intervening and there was no interstate problem to be soft, of violence against women and guns in schools. >> neal's commentary will capture the government's position. the administration like half of justice scalia's position. we have response to that there are other statutes, other cases, where the court has not hesitated to strike down one part of a broader statute that it did not question. i think i can support it to focus on at that part of justice scalia -- i think it is important to focus on that part of the justice scalia's opinion, that what government was doing in regulating conduct involving marijuana was not regulating commerce at all, and that it was necessary and proper to the regulation of interstate commerce.

his case rested on the necessary and proper clause, and that is the third clause you will hear about in these arguments. necessary and proper is going to be at issue. that way of analyzing, that half of justice scalia's opinion, i think is quite helpful to the challengers in this case, because if you focus on the fact that when somebody is in their living room, they are not engaged in commerce. the question is is forcing them into cars to more efficiently regulate commerce -- forcing them into commerce to more efficient at regulate commerce part of the necessary and proper power? it may not be necessary, but in all events it is it not proper, simply not a proper exercise of congress's limited and enumerated powers to force some into commerce and regulate them. you recognize that the interstate fire arms market was something that congress could

regulate, but it wasn't necessary and proper to force state regulatory -- state officials to be commandeered into the regulatory scheme. i think there is an analogy between that and what is at issue in this case. >> these are not commerce clause cases, and paul's is the problem is that when you are sitting in your living room, you are, congress found, affecting interstate commerce. creating infrastructure to deal with the problem that you cannot predict when you are going to get struck by cancer or heart attack. >> i really appreciate it, and thank you all for coming. [applause] [captioning performed by national captioning institute]

[captions copyright national cable satellite corp. 2012] >> a look that said the supreme court today. this is the west side of the

building that faces the u.s. capitol. some visitors have been coming by, walking the steps, taking pictures. the media and the public are getting ready to cover the court as justices get ready to hear oral arguments starting tomorrow on the health care bill. apparently, a vigil is going to be held in a little while by a pro-lifers group. they are planning on scattering of flowers around the building. [unintelligible]

[inaudible]

>> they will be checking the scene outside the supreme court here on c-span and looking back at some c-span coverage of the challenges to the law. we have a special web site set up for supreme court related issues with profiles of those involved in the arguments and links to special twitter feeds and facebook pages. >> former cbo director says the

president's health care law will be more expected then -- will be more expensive than what they thought. the affordable care act is too big. his remarks were part of a -- report of a conference looking at the future of the u.s. health corps -- health care system. [applause] >> the standing ovation? [laughter] wow. my people. [laughter] i went to thank ever won for the chance to be here today and to spend a little bit of time talking about the cost associated with the affordable care act and close with a little bit of speculation about its likely future. and then, answering a few of the questions that the audience might have. i warn you in advance and that the discussing the costs of the affordable care act is not suitable for mixed company and i am also a former director of the

congressional budget office and i have to stand up and talk about apocalyptic things of this will be entirely depressing presentation. there are really four kinds of costs associated with the act. the first is the budget costs and i will walk you through those to talk about the jobs that thescbo h -- the cbo has. there are costs that are not often recognized. there is some cost associated with that bill and some genuine economic policy issues that are going to burden the u.s. if the bill continues in its current form. there has been some severe political fallout and an unmistakable implementation for our future. i want to close by answering your questions. the first question always comes up, you know, is this really going to close the budget deficit by $124 billion or not? i want to say just as clearly as

i can that the cbo has received enormous amount of criticism fr om conservatives in america about their scoring and i think they did an absolutely superb job. i think they conducted themselves in exactly the fashion they were asked to and unfortunately, the cbo operates with some golden handcuffs. those golden handcuffs say that they are not allowed to ever say two is about a piece of legislation. it can ever say that is not a good idea and it cannot ever say that never happened. it is not allowed to every judge in future congress and whether they will stick to something. they're not allowed to judge whether something is a good or bad idea. many of the holes the transformed the affordable care act from something that is on paper balanced over 10 years to something that will widen the

already frightening deficit we face comes from the fact that the bill contains of literally a menu of budgetary mixes. -- budget gimmicks. this includes things like a class act which ignored the spending that would happen after the budget window, thus providing some cushion. it rolled the student loan policies into a bill and counted on cutting $470 billion out of it medicare over the next 10 years. these take two forms. one of which cuts medicare advantage which we can debate over the policy of that and particularly a program that is disproportional used by low- income and minority seniors.

also, appear provider cuts. we have seen the movie -- the movement before. the congress has said they will not do it. the congress rethinks that and usually while the phone calls hit their office and they put the money back in. we cannot say it is impossible that you are going to take $500 million out of medicare. greg foster said if we do this as it is written, we will see hospitals close all over america. we have to pretend the cuts will take place. you will see an explosion of costs in the bill. this cdo cannot say that cadillac tax on high plans they will impose, we saw how that worked out during the legislative debate. every time you said you would do it, the union said, don't you dare. they kept making it look less important. there are a whole bunch of reasons to believe that the bill

will not to actually execute and we will see something that, instead of having $500 billion in cuts and 5 $1 billion in taxes to pay for one trillion dollars for the spending, we will not get those cuts and those taxes. even worse, the one place where i would disagree on a professional level with the analysis of the bill, i find it impossible that we would see only a tiny number of americans in the federally subsidized changes. it will be the case that people making as much as $70,000 will be eligible for 10% of their income. there'll be some much money on the table that basic arithmetic will say that an employer can stop providing insurance, give the employee raise and that employee can take the after-tax rays and other subsidies and buy insurance that is more generous than that which their employer had been providing them and they

will be better off. the employer can pay a penalty and still be better off. but the employer in the play will be ahead of the game and they will end up in the exchange of economic arithmetic. the only loser will be the american taxpayer because if you end up with 35 million americans, the cost of the bill explodes. there are many scenarios by which that can happen. it could be pure employer drops or some employers never get into the insurance business. it could be that employers do not offer family coverage anymore. they were all for the employee coverage of the spouse and children will be left to find the changes and get insurance on their own. one way or another, if you put enough dollars on the table, people will show up and they will use it the. it is my concern about the future of the affordable care at any time when we need to spend less, control our debt more, we are going the wrong direction

and that is a central cause of the bill. i want to be labor that point until you pass out in extortion. [laughter] the budget costs are not as they seem. there are severe opportunity costs. in my view, health care reform should have begun with medicare and medicaid reform. that was the agenda -- [applause] kumbaya using medicare as a financing medic -- mechanism and expansion of coverage, the bill is so intertwined with a political volatile issue that it takes off the table in any reasonable way since or -- sensible reforms. the medicare program runs a gap between premium and payroll taxes and spending going out of $280 billion. it is the fiscal cancer. the program will not survive

with a next generation of seniors to use it does the key part of the social safety net. it is a disgrace for a country of his greatness to have a program in such disrepair in to leave it unattended for extended periods of time and that is what we will do. [applause] medicaid is probably worse. many of the beneficiaries cannot see primary care physicians and the end up in emergency rooms. medicaid is an attack on the federal budget. it is entirely deficit finance. there are key elements which will not survive for the next generation of seniors. that is a real cost of the affordable care at. we did not take on the health care in america. what does it actually cost?

i know i am talking to an insurance card and i am not just playing to the house. insurance is a side show. insurance -- our problem is the bill is too big. [applause] this is why they hate the policy people. that is not our problem. do not do that. galway. [laughter] we missed the chance to take on bending the cost curve a. we're still burdened with a fundamental problem which is that spending rose faster than the economy and we have not taken that on at all and all we have done is lay in insurance reform that will make insurance more expensive and less flexible and in the end, less high-quality be. that is a real cost. that is all the goodness. [laughter]

here is what i am really worried about. this economy is struggling along and if you pretended there was not this debate over health care and insurance, and just ask yourself, is this good economic policy? it is really hard to a manchin that this is what we need in to put americans back to work in to deliver to our children an economy that is the largest and it -- the largest and strongest on the earth. it is a bill which has in its hundreds of billions of dollars in new taxes. it is a bill that has two naille and fatima programs, the insurance subsidies and a class act, which way it -- which may mean an entirely timely demise in the near future. it we need to set those up when we already have the entitlement spending problems. you can look at the research from around the globe at

countries that have our problem here is our problem is slow growth, high debt. it debt to gdp will explode over the next decade. that growth, bad debt problems. the recipe is to keep taxes low and reform them. and cut spending. not all spending is created equal. you need to preserve the core function of the government, national security, infrastructure, education. those things which have been around since the founders of this republic and you need to take on the scale of government and the necessary transfer programs. you have to have an efficient social safety net. this bill, this bill sets of the transfer programs what's will not survive and it sets of new taxes which include taxes on net investment income, the kind of saving investment and new technologies that we need. it has an enormous regulatory

push that is simply almost impossible to fathom. hear, i want to take a self -- i want to take a moment of shameless self-promotion. i am part of the american action forum. one of the things we do is that we have a health-care forum -- re-for peace. we have a fabric -- fabulous website tracking the affordable health care act costs. it is very depressing. is such an enormous burden between the basic benefit packages and the care organizations. the list of regulatory intrusion, federal rate review, this is a recipe for bad economic performance in the insurance sector. this will mean higher costs. employers will bear them. we know how this works. workers pay for those higher

costs than do not get the raises they otherwise would. beyond the employer -- the economy will continue to be burdened with debt, saddled with higher taxes that do not promote growth but instead inhibit the accumulation of greater wealth in the future. this is exactly the wrong medicine at exactly the wrong time. >> get them a job. [applause] >> i want to close with three points. there are several pieces we do not understand how they will play out. i want a -- i worry about what it does to the quality of innovation in the medical sciences, the devices, the

pharmaceuticals, every aspect of what have been some of the most vibrant and internationally successful aspect of our economy. an example of this is the so- called independent payment advisory board. do you think about the job they were given. the job it was given was, find us something we can do in a year that will bring medicare payments down to a target relative to the economy basically, in one year, what can we do to hit that target? no matter how well-intentioned they might have, there are not many leverages you can pull to get that to happen. we will much as they so much for something or cover it all. the things most likely to be singled out for reduced reimbursement will be the expensive things. that will be the newest technologies that are hitting

the medicare population. they will be deemed an affordable and it will be taken off the table. if you are an innovator in developing a device and you have, at the end of all of your hard work, a paper whose approach is to randomly tax you or cut you off entirely, that is not an innovation and senate. i am worried that, given the heavy regulatory burden and tax burden and the subtle innovation incentives, is this bill will harm the core reason that we have been so successful as a country. we have had greater innovation, greater technology, greater productivity than any other country. this is the kind of policy that undercuts that. that is my deepest concern from an economic point of view. the second thing i worry about is what it has sent to our policies. the hero but got back, the u.s. recognized that we needed healthcare reform. it needed a way to make patients

the center of the care and give them high quality insurance options at affordable cost. there were no disagreements about that. instead, we have a bill which meets my definition of a bad bill because the policy was that and the politics were worse. good bills are bipartisan in nature. they are durable. if you do not walk out with an incentive to overturn from a political point of view. they are informed by both sides. this bill does not make this test. partisan what is bad law. one of the things that happens in this is we failed to get the white house leadership necessary for bipartisan bill. i worked on the campaign and i say this not is a criticism of the president himself as an observation about the way our system works. only the white house is positioned to go to its party and say, you know, we get it.

the judge always wants is. we promise you, whatever this may be, they can do that. only the white house can go to the other side and say we understand. that is our pledge. we saw a super committee struggle last fall. it was a sincere effort. i worked with both sides said they worked hard. they meant to get a deal. they tried very hard to get a deal. they failed miserably because the congress along cannot surmount the hurdles necessary. only the white house can bring in there and we now have failed during the decade when it was crucial to fix the intent of programs and health-care programs to get the leadership to do that. now we have to do that we are already growing slowly and when everyone is retiring. we have a harder problem that it will require greater leadership. that is a great political cost in my view. i do not know how it will play out, but in a world where my

anxiety closet is full and is not budging -- [laughter] eyes are on the supreme court case. my organization has filed three briefs about the individual mandate and about the medicaid expansions and the improper burden placed on sayings. you can adamantine to sever the mandate. there would be no more broken insurance than the affordable care act. i do not know what will happen. we are going to do health care reform. we are. i think there is only one thing to look at in how this evolves. the central objective will be achieved if we could medicare and medicaid on the budget. our fundamental problem with these programs as we say to the beneficiaries, you may have all th