Defining Bonkers

On his post about the Halbig case, my colleague Saul DeGraw says of the anti-ACA argument that the “logic behind their case is completely bonkers.” But what is striking to me is that neither he nor any of the subsequent commenters (including me) actually ever quote from the Halbig briefs. We are all, literally, arguing about some very vague impression of the argument, without addressing any part of it directly.

Kudos, however, to Will Truman, who linked to the Adler/Cannon argument, which was subsequently ignored by everyone. What I want to do here is quote at length from Adler/Cannon (because their argument is more succinct than the Halbig brief, making such quoting easier, and the logic is generally the same as in the brief, I think), and I challenge critics to explain why the logic is bonkers. Not why it is wrong, but why it is bonkers. Not why it is unlikely to persuade a majority on the Supreme Court, but why it is bonkers.

Understand, I’m not arguing for the Halbig side. I’m not saying it’s right, or that it’s likely to win. I’m only asking whether the logic has a reasonable basis in law–a basis discernible by those who understand constitutional jurisprudence–or whether it so lacks any meaningful legal basis that we can fairly call it bonkers. Put another way, I’m asking whether the claim that the logic is bonkers can be defended through an educated legal argument, or whether the claim was cheap-ass ideological rhetoric (and feel free to follow the lead of XKCD and move the hyphen one word to the right).

I begin on p.143, with footnotes omitted, a few ellipses to simplify the reading, and emphases in the original.

The starting point for statutory interpretation is the statute’s text. As noted above, the PPACA authorizes two methods for establishing an Exchange within a state. Section 1311 provides that ‘‘Each State shall…establish an American Health Benefit Exchange (referred to in this title as an ‘Exchange’)’’ and provides rules for state-run Exchanges. For purposes of Section 1311, the Act specifically requires that an Exchange must be ‘‘a governmental agency or nonprofit entity that is established by a State.’’ Section 1304(d) clarifies, ‘‘In this title, the term ‘State’ means each of the 50 States and the District of Columbia.’’

Two notes: First, Section 1304(d) specifically defines “State” in a way that excludes the federal government. This is an intentional definition, and under the standard interpretive assumption that Congress chooses its words with conscious intent and understanding of their meaning, the definition has substantial weight. Second, references to Section 1311 occur frequently, and it is 1311 that authorizes state exchanges.

Section 1321 requires the federal government to create an Exchange in states that elect not to create their own. Specifically…Section 1321 requires the HHS Secretary to ‘‘establish and operate such Exchange.’’ Section 1321 thus requires a federal ‘‘fallback’’ for states that do not create Exchanges of their own. State-run Exchanges created under Section 1311 and federal fallback exchanges created under Section 1321 are distinct.

That last line is important. The two types of exchanges are distinct, as they are created by different sections of the law. Consequently, subsequent sections of the law that refer to just one section, or one type of exchange, have an initial presumption (not an irrefutable one, just an initial one) that they do not refer to the other section, or the other type of exchange.

Section 1401…specifies that taxpayers may receive a tax credit only during a qualifying‘‘coverage month,’’ which occurs only when ‘‘the taxpayer is covered by a qualified health plan . . . that was enrolled in through an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act.’’ By its express terms, this provision only applies to Exchanges ‘‘established by a state’’ and ‘‘established . . . under Section 1311.’’

Notice that Section 1401 (assuming Adler and Cannon aren’t lying or really badly mistaken) clearly references only Section 1311 state exchanges, not Section 1321 federal exchanges.

Section 1401 further emphasizes that tax credits are available only through Section 1311 Exchanges when it details the two methods for calculating the amount of the credit. The first method bases the amount on the premiums of a qualified health plan that the taxpayer ‘‘enrolled in through an Exchange established by the State under [Section] 1311 of the Patient Protection and Affordable Care Act.’’ The second method bases the amount on the premium of the ‘‘second lowest cost silver plan . . . which is offered through the same Exchange through which the qualified health plans taken into account under [the first method] were offered.’’ Both methods therefore require that taxpayers obtain coverage through a state-run Exchange. The second method also relies on the concept of an ‘‘adjusted monthly premium,’’ which only applies to ‘‘individual[s] covered under a qualified health plan taken into account under paragraph (2)(A)’’-i.e., ‘‘through an Exchange established by the State under [Section] 1311.’

In short, section 1401 references Section 1311 (state exchanges) to the exclusion of Section 1321 (federal exchanges) in two different ways.

These clauses carefully restrict tax credits to state-created Exchanges. They either employ or refer to not one but two limiting phrases: ‘‘by the State’’ and ‘‘under Section 1311.’’ Either phrase by itself would have been sufficient to limit availability of tax credits to state-run
Exchanges… The repeated use of both phrases makes the meaning and effect of the language abundantly clear.

…every reference to Exchanges in Section 1401’s tax-credit eligibility rules is to an Exchange ‘‘established by the State under section 1311.’’ The Act contains no parallel language authorizing tax credits in Exchanges established by the federal government under Section 1321. Nor does it contain language authorizing the IRS to issue tax credits through the ‘‘functional equivalent’’ of a Section 1311 Exchange.

One of the arguments I saw on Saul’s post was that we can’t read the ACA text in a way that excludes the “clear intent” of the law. But that begs the question of how we know the clear intent. And as a matter of legal interpretation, the clear intent is often determined by the plain language of the law. It’s not dispositive (nothing is ever dispositive in constitutional interpretation, I think), but it normally is not wholly without force against a reading whose logic is “the plain text meaning is not the real meaning,” even if the logic of that latter reading is that the plain text reading limits the effectiveness of the law. Adler & Cannon’s next paragraph addresses this point.

Courts are to ‘‘give effect, if possible, to every clause and word of a statute, avoiding, if it may be, any construction which implies that the legislature was ignorant of the meaning of the language it employed.”

That quote they use, by the way, is to a Supreme Court case. It’s not just an interpretive approach they’re trying to persuade us is best; it’s one that the Supreme Court has explicitly asserted. Now, given the nature of the Court, in about the time it takes to microwave a burrito a smart person with access to Lexis-Nexis could probably find a dozen cases where the Supreme Court has ignored its own stated interpretive standard. But, again, I’m not arguing about whether this argument is the best, or whether the Supremes will buy it–I’m asking whether an argument based on an interpretive standard explicitly promulgated by the Supreme Court can fairly be labeled “bonkers,” and if so, for a clear explanation why. Continuing that same paragraph…

To treat federal fallback Exchanges as equivalent to state Exchanges established under Section 1311 is to ignore the PPACA’s repeated reference to Exchanges ‘‘established by the State’’ and render this latter language into mere surplusage. Further, as Professor James Blumstein notes, under the familiar canon of expressio unius est exclusio alterius, ‘‘the ACA’s granting of subsidies for income-qualified enrollees under state exchanges established under Section 1311 is to be construed not to grant comparable subsidies for income-qualified enrollees under federal exchanges established under Section 1321.

The fancy-pants Latin that lawyers use to separate themselves from the masses means “the express mention of one thing excludes all others.” Now, we don’t have to like that idea, but I think all of our legal scholars here will nod their head in recognition of its accepted place in the canons of interpretation.

Next, Adler & Cannon cite the Congressional Research Service.

As the Congressional Research Service has written, a strictly textual analysis of the plain meaning of the provision would likely lead to the conclusion that the IRS’s authority to issue the premium tax credits is limited only to situations in which the taxpayer is enrolled in a state-established exchange. Therefore, an IRS interpretation that extended tax credits to those enrolled
in federally facilitated exchanges would be contrary to clear congressional intent, receive no Chevron deference, and likely be deemed invalid.

Chevron deference (referencing Chevron v. NRDC) is an interpretive standard used when a federal agency is implementing rules for a law whose text is “silent or ambiguous.” In such cases the Court will defer to the agency’s interpretation of the statute unless it unreasonable. But if the statutory language is clear, no such deference is required–“the agency must follow, and the court must enforce, the clear and unambiguous commands that Congress provides through statute” (See CRS report on Chevron deference here). And in this case the CRS–Congress’s own non-partisan research service–has stated that the language is clear enough that a court could conclude that no such deference is required.

Now Adler & Cannon note in a footnote that the CRS subsequently qualifies that conclusion in the same memorandum. So let’s now leave them to look more closely at that memorandum, which is found here (the link provided by Adler & Cannon is dead). In beginning their analysis, the authors–both attorneys–write,

In general, the starting point for courts in interpreting the meaning of a statute is the language of the statute itself. The Supreme Court often recites the “plain meaning rule,” that if the language of the statute is clear and unambiguous, it must be applied according to its terms. As the United States Supreme Court stated in Connecticut National Bank v. Germain:

[I]n interpreting a statute a court should always turn first to one cardinal canon before all others. We have stated time and again that courts must presume that a legislature says in a statute what it means and means in a statute what it says there …. When the words of a statute are unambiguous, then, this first canon is also the last: judicial inquiry is complete.

I quote this to re-emphasize the importance of taking seriously the plain meaning of the text rule, which we cannot both dismiss easily and pretend we’re doing serious legal analysis.

But the rule only applies if the plain language of the text is in fact clear. Adler & Cannon make a decent argument that it is. I would argue that all those who suggested that the text can’t really mean what it looks like it means have also admitted, implicitly, that the plain language is clear. But let’s see what the CRS says.

Applying the plain meaning rule to §36B, it is possible that a court could read the phrase “an exchange established by the State under 1311 of ACA,” as being clear to not include an exchange established by the federal government. Indeed, this language seems to be straightforward on its face, which has perhaps led some commentators to suggest that the lack of reference to a federally created exchange could have been a drafting error. However, courts often assume that the language Congress employs, including additions and omissions to a particular statute, is intentional.Therefore, a court may be inclined to find that §36B presents a clear statement regarding the types of exchanges in which taxpayers may receive a premium tax credit, and may not look to any additional factors in its analysis.

Let’s pause here and think about the “bonkers” claim. Two lawyers working for the bipartisan Congressional Research Service, whose task is to provide “policy and legal analysis” (cite, emphasis added) are arguing that a court could reasonably accept this argument.

Now for the qualification that follows in this memorandum.

On the other hand, it is possible that a court could find that it is unable to rely on a plain meaning interpretation of §36B, perhaps finding the language to be ambiguous. In examining whether §36B is ambiguous, a court may look, for example, to the definition of “exchange” in ACA. ACA defines the term “exchange” as the following:

EXCHANGE.—The term ‘Exchange’ means an American Health Benefit Exchange established under section 1311 of the Patient Protection and Affordable Care Act.

Section 1311 of ACA, as referenced in this definition, seems to only address the creation of state-established exchanges. The section does not explicitly speak to federally created exchanges — those are addressed in §1321 of ACA. However, section 1321 of AC A also uses the term “exchange”: it states that the Secretary of HHS must establish an “exchange” if a state should fail to take certain specified actions [list of actions omitted: JH]

Plugging in ACA’s general definition of “exchange” into §1321 above arguably links a federally created exchange to one established by a state pursuant to the requirements of §1311. Thus, it may be questioned whether, based on the definition of “exchange,” a federally created exchange should in some way be synonymous with one created by a state under §1311 and how this could affect the interpretation of §36B.

So this interpretation–the interpretation favored by Saul and others commenting on his post–is “arguable.” It “may be questioned” whether it is in fact the correct one. That is, it could be the way the courts will interpret the statute, and that would be a legitimate approach. Or they might not interpret the statute that way, and that would also be a legitimate approach.

The CRS report (highly recommended reading) continues on to provide reasons why the Court might not take Adler & Cannon’s preferred route, including reference to another canon of interpretation stating

that parts or sections of statutes or Acts should be evaluated in connection with other parts and sections as one “harmonious whole” – requiring examination of not just one particular provision, but the broader legislative scheme in which the provision is included.

It’s fairly evident that this canon of interpretation can conflict with the plain meaning canon. And that’s why, as the CRS memorandum states, courts could also choose to follow the line of logic urged by Saul and others in his post and subsequent discussion. Or not. The memorandum tells us two things: 1) Adler & Cannon are not drop-dead unequivocally right, and 2) Adler & Cannon are not drop-dead unequivocally wrong.

This post is already more than long enough, so I’ll conclude it here. I hope I’ve made clear that I’m not arguing that Adler & Cannon & Halbig are right (woot! woot!), but just that I think their argument cannot seriously be dismissed as being wholly meritless, as so lacking in legal logic as to be “bonkers.”

The ball is now in others’ court. Rebut me. Defend Saul’s claim. Please don’t tell me why Adler & Cannon are wrong, because I’m not arguing they’re right, and I’ll mock you mercilessly for attacking a straw man and ducking the hard question. Instead, tell me why, as a matter of legal logic, there is no merit to their case.

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177 thoughts on “Defining Bonkers

  1. I am a little drunk now and will respond in further detail tomorrow when sober but I don’t think of the Federal exchanges as being distinct because of the different section. I think the Federal Government was merely knowing that states would not set up their own exchanges because of political/ideological reasons (the opposition came out strong and early) and was saying “If you don’t do it, we will.”

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    • I don’t think of the Federal exchanges as being distinct because of the different section. I think the Federal Government was merely knowing that states would not set up their own exchanges ..

      You “think.” But my question is not about what you think the federal government did or did not meant. I’m not arguing that your position is untenable. I’m asking you to demonstrate that the argument is bonkers. Or, since you talked about “good faith,” that no person could hold such an argument in good faith, which I think amounts to the same thing.

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      • I don’t think that “good faith” should come into this.

        I don’t think the plantiffs have a good faith argument. I think they are trying to exploit a poorly worded section of the law.

        However, that doesn’t make the plantiffs “bonkers” either.

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      • has the essence of it right here. Of course the plaintiffs are not acting in good faith. But that doesn’t mean they’re wrong, much less bonkers. It means they’re opportunistic.

        A healthy political system would extend the tax credit to Federal exchanges and be done with it. Congress isn’t going to do that because enough of its majority party are in thrall to the non-rational concept “OMG Obamacare = tyrrany!!!1!” that rational discourse with them is impossible.

        So, either tax credits can be interposed by regulation, or SCOTUS does its thing. So shame on Congress for sloppy legislative drafting, and shame on Congress for not cleaning up the mess. Put the blame where it belongs.

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      • I wonder if conceding bad faith on the part of the plaintiff lawyers might satisfy the basic intent behind Saul’s application of bonkers status to the argument. Not to say we’d be finding he’d be right that the argument is bonkers, but that if we all agree it’s in bad faith, he’d be willing to say that bad faith was closer to what he had in mind to say about it, or that on reflection he agrees it’s a better charge to make.

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      • I do think “bad faithness” is a different argument, and probably akin to Saul’s claim that the case was “ideologically motivated.” I, too, question the good faith of some of the proponents of this complaint. Well, maybe not the “good faith,” just their priorities. Why choose this particular point–subsidies to poor people–to take a stand against encroaching government?

        However, I know the right and wrong of the matter doesn’t work out quite as I frame it, with my side being completely right and the other side being complete ogres trying to attack poor people. If I read James right in his explanation of one of the plaintiff’s claim to standing, there is an identifiable harm in this one instance.

        If I shared Adler’s hostility to the ACA and if I shared his fears that it represented yet one more wedge toward arbitrary executive power and arbitrary, centralized government, I’d probably feel differently about the good faith of his challenge.

        I guess I’m conflicted. I used to have a lot of respect from Mr. Adler from the days I still read the Volokh conspiracy. And I still have a lot of respect for his intellect. But I really don’t like his choice of targets. And yet again, none of that is relevant to whether the law is well-formed or not. The fault is on the law’s authors, on those who claim to support it, and on those who claim to oppose it but won’t cooperate to improve it.

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      • I completely disagree that the right posture is to blame sloppy drafting. You put enough smart lawyers in a room and pay them enough money, they’ll come up with a compelling sounding issue with any complex statute.

        The question is whether the compelling sounding argument is compelling, incorrect, or bonkers.

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      • From a legalistic hairsplitting pov, the plaintiff’s aren’t bonkers, but as the scope of relevant issues widens to include statutory interpretation, consistency with other laws, legislative intent (stuff mentioned in nevermoor’s earlier comment), the likelihood of success (according to *those* considerations) diminishes to such a degree that viewing the plaintiff’s and their argument as bonkers gains credence.

        For my part, I think legalistic hairsplitting isn’t bonkers. Given that’s what lawyers are paid to do on the front end of legislation and contracts, it’s exactly what we’d expect them to do when presenting challenges on the back end.

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      • Not quite. I agree that their interpretation of the text isn’t bonkers. The argument that a court should adopt their interpretation is bonkers, for exactly the reasons you mention. And their lawsuit is an attempt to do the latter, not to have a philosophical debate about the former.

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      • My point in reference to good faith was not to suggest that Adler, et. al, are arguing in good faith, but to ask “is it conceivable that some person–some anonymous unspecified person–could make this argument in good faith?” If an argument could not conceivably be made in good faith, I’ll accept it falls into the boundaries of bonkers. If an argument could conceivably be made in good faith, I’m skeptical that bonkers could be an applicable description.

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  2. There is also the simple fact that the Federal Government did create the exchanges and millions of people do have subsidies via Federally set up exchanges.

    I wonder if Adler thought this consequence fully through and what it means for whatever his point is to have millions of people suddenly lose their tax exemptions and can’t afford insurance.

    Is any argument or point really worth that much pain and suffering?

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      • For purposes here, feel free to assume they’re all evil masterminds stroking mutant kittens and competing to see who can devise the most evil laugh, while they sup on roast roast fetus washed down with unicorn blood. The question is, do such wicked people have a legal leg to stand on or not?

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    • Anyway, I think it is a partial defense. A litigator needs to think out the full consequences of any course of action and if victorious, this is a highly plausible consequence. It is also highly plausible that Adler theorized a split in authority for Congress or with the President for a while and it would take a while for the states without an exchange to develop one.

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      • Disagree. A litigant doesn’t have any such obligation, and I’m not even sure a judge does.

        For example, if congress passed a simple clear law setting income taxes at 100% (or 0%), it would be trivially easy for a challenger to present evidence showing that the law would be a catastrophe. It would be impossible to show that the law was unconstitutional. A judge, then, should uphold the law.

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      • No, Saul, it’s not a partial defense. You said the logic of the argument was bonkers, not the consequence. But even if I grant the consequences as part of the argument, the consequences are just a return to the status quo ante.

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  3. I’ll be your Huckleberry.

    The argument for plaintiffs boils down to: 1. If the plain language of a statute is completely unambiguous, you have to disregard all legislative history, regulatory interpretation, and other methods to interpret statutes; and 2. Here, the language is unambiguous.

    The argument for defendants is: 1. The language is absolutely not unambiguous. Most significantly, the section allowing for a Federal backstop (1321) provides that when a state fails to establish its own exchange, the Feds “shall establish and operate such exchange.” A fair reading of this statue certainly can mean that the Federally-backstopped exchange is therefore the same as the State-run exchange for purposes of the rest of the law’s provisions. 2. The only way to assess whether our reading of the statutory language is better or worse than Plaintiffs’ is to look beyond the statutory text to legislative history, regulatory interpretations, and other factors. 3. The legislative history is 100% slam-dunk clear that the intent was for all exchanges to be subsidized. 4. The IRS has interpreted the statute to allow subsidies for all exchanges. No one involved in any way with the ACA at any time before this lawsuit thought that federally-backstopped exchanges would be unsubsidized.

    The argument that the government’s reading of the statutory text is so faulty it doesn’t create a need to look to other methods to resolve the statute’s meaning is absolutely bonkers. Almost no complex statute is that clear, and almost no non-poltically-motivated judge would ever so hold. And any look at anything outside of the statutory text makes it immediately clear that all exchanges were intended to be subsidized. There is absolutely no way to imagine a clearer set of extra-textual interpretive facts.

    So yes, the argument that courts should ignore all of that and adopt plaintiffs’ preferred statutory interpretation against the government’s is bonkers.

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    • Then bonkers may be a default status for legal argumentation, because just about every legal argument says, “no, only this is the correct interpretation, and all that other stuff is meaningless.” I think any argument that legal argument X is bonkers has to, at a minimum, show that it’s abnormal.

      I’m thinking of Ken White’s dissection at Popehat of people’s claims of slander when someone is clearly expressing an opinion. Those claims are bonkers, being so outside the boundaries of normal legal argument.

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      • “Then bonkers may be a default status for legal argumentation, because just about every legal argument says, “no, only this is the correct interpretation, and all that other stuff is meaningless.” I think any argument that legal argument X is bonkers has to, at a minimum, show that it’s abnormal.”

        In an adversarial system with a requirement of zealous advocacy, you have probably hit the nail on the head.

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      • You’re misunderstanding me. For Plaintiffs’ argument to work, they cannot merely argue that their statutory read is correct. They have to argue that theirs is the ONLY POSSIBLE read. And it isn’t. As soon as a court sees that there are multiple possible reads, we are out of strict-language land and Plaintiffs lose as thoroughly and completely as I’ve ever seen.

        I also do argue that this type of appeal is unusual. It’s not unusual to argue that one’s position is supported by the text of the statute, indeed that is always argued by both sides. It is somewhat unusual to argue that there is absolutely no other possible interpretation of the statute. That argument is essentially never made in an environment where the legislative history and other indicia of intent are so clearly opposed to the reading you urge.

        Further, I’ve seen you and a couple other people cite certain canons of construction as though they are dispositive. In fact, the list of such canons is nearly infinite, and there are directly conflicting canons in essentially every case. One that applies here, for example, is that courts should not interpret statutes in a way that creates an absurd result. Also note that there are always limits on canons of construction (including plain language). Here’s the USSC: “We begin with the familiar canon of statutory construction that the starting point for interpreting a statute is the language of the statute itself. Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive.” Consumer Product Safety Commission et al. v. GTE Sylvania, Inc. et al.,447 U.S. 102 (1980).

        So in my view, Plaintiffs are asking the court to throw out much of the body of statutory interpretation law to reach a result that no one involved in passing the law wanted. Which is bonkers. You might disagree, but all I can tell you is that I would not sign my name to an argument like that (whether or not the subject matter of the appeal was political). I value my credibility too much.

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      • They have to argue that theirs is the ONLY POSSIBLE read.

        I disagree. I think they just have to show it is the most plausible read.

        I’ve seen you and a couple other people cite certain canons of construction as though they are dispositive.

        Oh, no, I’ve said that. In fact if you read my OP here closely, I am explicit that they really never are. The only point I am ever making to people when I talk about canons of interpretation is that to understand legal interpretation you have to be familiar with them and taken them into account.

        One that applies here, for example, is that courts should not interpret statutes in a way that creates an absurd result

        I hear lots of folks calling the non-subsidies for federal exchanges an absurd result, but I don’t buy the argument that it’s an absurd result. The argument that has been made that Congress wanted to create a pressure on the states is not absurd. Indeed the argument that Congress was not trying to put any pressure on the states seems to me a bit out of the ordinary. So, no federal subsidy = absurd outcome just isn’t computing with me, at least as its been argued so far.

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      • “I disagree. I think they just have to show it is the most plausible read.”

        All due respect, fair to assume you aren’t a lawyer? It’s true that the ultimate decision would be which read is more plausible, but the only way Plaintiffs have a chance (other than pure ideological decisionmaking) is for them to show that there is only one possible reading, because that largely prevents courts from considering legislative history or other interpretive aids. If courts have any excuse to look at those, Plaintiffs lose because all of those are crystal clear in support of Defendants.

        “The argument that has been made that Congress wanted to create a pressure on the states is not absurd.”

        Again, not a lawyer right? This isn’t a question of logic, its a question of what the legislature was actually intending to achieve. Which is answered by reviewing pre-passage speeches, documents, and other evidence. There is simply nothing in the legislative history to support Plaintiffs’ side, and plenty to support the argument that the whole point of the law was for every eligible American to get subsidies. Literally everyone involved (both Dems supporting and GOP opposing, all scoring of the ACA’s budget impact, etc etc) assumed that all 50 exchanges would be subsidized. Whether or not something different would have been logical too is completely meaningless.

        This part is critical to understand, because it’s the core reason the case is fairly described as bonkers. They’re asking the court to read ambiguous language to have the opposite meaning that everyone involved understood that language to have. Which you simply can’t do in American jurisprudence.

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      • says, “The argument that has been made that Congress wanted to create a pressure on the states is not absurd.”

        Which is a good assessment of a basic premise I’d challenge when it comes to the Exchanges; because I think having Federally-run exchanges was also a relief of pressure and burden; having the feds do it meant the state didn’t have to put resources into doing this; it was a huge and complicated data-processing task to coordinate. For state’s that wanted their own state-branded system, go for it. And there were plenty of states that didn’t rise to that challenge. A federally-run system was not just pressure to develop your own, it relieved pressure to develop your own.

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  4. At the risk of making an ad hominem, Saul has admitted to typing first and thinking second. I fear our colleague has done so yet again with his use of the term “bonkers”. It seems bonkers to him so thus must be so.

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  5. There’s a couple things here.

    1. I’m not actually sure that the text of section 1401 (and 1402 for that matter) is actually clear that a plan needs to be purchased through a state exchange. Or rather there’s a subsection that provides pretty wide secretarial discretion note:
    ‘‘(3) SECRETARIAL AUTHORITY.—The Secretary of Health and Human Services, in consultation with the Secretary, shall prescribe rules setting forth the methods by which calculations of family size and household income are made for purposes of this subsection. Such rules shall be designed to ensure that the least burden is placed on individuals enrolling in qualified health plans through an Exchange and taxpayers eligible for the credit allowable under this section.

    Not to get too nitpicky, but this subsection seems to imply that there’s some leeway in implementing tax credits, but they must be done so in a way that provides the least burden to a qualified taxpayer. It doesn’t specify that the plan must be purchased through a STATE exchange, simply through AN exchange. (Which unlike other sections that explicitly brings up 1311).

    Some of the other sections in the actual law that mention Section 1311 based exchanges, also tend to have an “Or” clause that specify that the Secretary of Health and Human Services is allowed to make changes based on comparative metrics for plans that aren’t enrolled through Section 1311.

    On a second note: I think the idea that statute has to be read this narrowly is a bit bonkers because it assumes that Congress has never actually talked about allowing regulatory leeway to agencies to protect taxpayer interests. Specifically it goes against the various administrative law based laws passed since the 1940s, including the Regulatory Flexibility Act and the Administrative Procedure Act.

    Finally, Hobby Lobby was also, more or less, a law challenging the ACA under administrative law reasons, but the conclusion reached by SCOTUS actually requires that there be the flexibility available to HHS/IRS under the RFA.

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    • Side bar:
      Section 1311 is a lot longer and a lot less unambiguous as the arguments presented in OP suggest. Specifically:

      (f) FLEXIBILITY.—
      (1) REGIONAL OR OTHER INTERSTATE EXCHANGES.
      —An Exchange may operate in more than one State if— each State in which such Exchange operates permits such operation; and
      (B) the Secretary approves such regional or interstate Exchange.

      Seems to at least suggest for the likelihood of interstate exchanges, with Section 1321 then clarifying that the Federal government will create an exchange if necessary. (And would, as likely fall under the approval of HHS and by the state itself.

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      • Last reply, I promise:

        Note that Section 1321 isn’t trying to actually create a distinct second federal level exchange. Rather Section 1321 is set down as a method for the Secretary of Health and Human Services to determine if a state is in compliance with the law’s requirements, and in this case, specifically to section 1311.
        The actual text, verbatim is:

        (c) FAILURE TO ESTABLISH EXCHANGE OR IMPLEMENT REQUIREMENTS.—
        IN GENERAL.—If—
        (A) a State is not an electing State under subsection (b);
        or
        (B) the Secretary determines, on or before January 1, 2013, that an electing State—
        (i) will not have any required Exchange operational by January 1, 2014; or
        (ii) has not taken the actions the Secretary determines necessary to implement—
        (I) the other requirements set forth in the standards under subsection (a);
        or
        (II) the requirements set forth in subtitles A and C and the amendments made by such subtitles; the Secretary shall (directly or through agreement with a not-for-profit entity) establish and operate such Exchange within the State and the Secretary shall take such actions as are necessary to implement such other requirements.

        The bolded section, at least to me, seems to imply that the Federal exchange system will actually be the state’s internal state exchange rather than it being a separate distinct entity. Given that this entire section is about the “failure to implement” and that the Secretary CAN implement these exchanges “within” the state – ie this is intended to be a state exchange, not a distinct “federal” exchange.

        Given that there is also a lot of sections (notable in 1311) that also talk about how the Federal government is allowed to provide help to states in creating web portals or navigator programs as part of establishing those exchanges, this actually doesn’t seem as cut and dried as the arguments made above. It does seem a bit odd (and convoluted an argument) to suggest that an implementation enforcement section referring back to the previous section should be considered distinct.

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      • seems to imply

        I totally agree. You’re making a good argument for why Adler & Cannon might be wrong. But then I’ve explicitly agreed they might be, so that’s not really what we’re debating here.

        As to your claim that advocating a narrow reading is bonkers, I am going to reiterate that “bonkers” suggests an abnormal argument, and that is a very normal type of argument. Normal does not mean “correct in this case,” of course, but it does mean “the type of argument that is made as a matter of course because it is often successful.”

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      • No. Backwards.

        If you buy the claim that A&C’s interpretation might be wrong, then their argument is bonkers. Because there is no argument whatsoever that any other interpretory tool supports their bizarre desired outcome.

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      • Nevermoor,

        If you buy the claim that A&C’s interpretation might be wrong, then their argument is bonkers.

        That, of course, doesn’t stand on its own, but requires your second sentence as argument.

        Because there is no argument whatsoever that any other interpretory tool supports their bizarre desired outcome.

        And as I noted above, I think the claim that their desired outcome is bizarre is unpersuasive.

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      • If you don’t think their desired interpretation is bizarre, show me proof that the legislature intended to limit subsidies to state-run exchanges and not federal ones. I’ll accept floor speeches, bill scoring, or anything any member of congress said before the bill was passed.

        Good luck.

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      • show me proof that the legislature intended to limit subsidies to state-run exchanges and not federal ones.

        To be fair to James here, he’s only arguing that the plaintiff’s case isn’t bonkers, not that it’s correct. *Also*, the “proof”, such as it is, is contained in the quotations contained in the OP where he highlights the distinction between a provisions allowing for the federal creation of exchanges *as well as* provisions limiting subsidies to “exchanges established by the state.”

        I think, anyway.

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      • Nevermoor,

        Please read the Congressional Research Service report Will Truman linked. If the CRS legislative attorneys thought it was a plausible–not conclusive, just plausible–argument, I’m having a hard time seeing it as bizarre just because some guy on the internet with some unknown degree of expertise says so.

        And as I said, Congress often uses financial pressure to encourage states to take positive action to implement federal policy, so a priori, there’s nothing at all bizarre about thinking Congress could conceivably have taken that approach here.

        I’m only so-so on law, but public policy really is in my wheelhouse, and I know that’s an absolutely normal approach for Congress. That doesn’t mean they did so here–I’m not making that assertion. But a priori, before we even consider the text of the law, a claim that their having wanted to use financial pressures to push the states to set up exchanges is not bizarre. So an interpretation that produces a relatively normal outcome cannot be dismissed on the grounds of producing a bizarre outcome. Whatever basis there is for arguing that the no-fed-exchange-subsidies argument is bonkers must come from another line of interpretation.

        As to your request for proof, I’m afraid that I asked first, so I’m going to stick to that. I made my argument above and I asked commenters to persuade me that the argument is bonkers. So it’s your turn to provide evidence. Show me the floor speeches or what congressmembers were saying before the bill passed. I’ll accept CBO scoring if it explicitly justifies its assumptions, but otherwise no because we can’t tell if the scoring’s assumptions are well-grounded or not.

        And keep in mind, I’m not asking for an argument that Adler & Cannon’s argument is just weak and unpersuasive. Bonkers means nuts. It means an argument that no intelligent person with experience in the field could accept. We’ve already had two Circuit Court judges accept it. I’ll be generous and say let’s dismiss them on the assumption that they’re simply ideological. But you still have the problem that two CRS legislative attorneys argue that the interpretation is plausible. How are we to deal with them?

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      • Nope. The proof I’m referring to is information outside the text of the statute suggesting it was not intended to cover all exchanges, whether state or federally-run.


        On your request for something, fair enough. Here’s a CBO scoring made during the reconciliation process. Table two shows projections of tens of millions of exchange enrolees with only a few million unsubsidized. That would have been a crazy projection in a world where subsidies were going to be limited to less than half of the exchanges. Your turn.

        The survey doesn’t move me at all. They’re saying Plaintiffs have a plausible statutory reading. Fine. So do Defendants. So you look to other sources to determine which plausible reading is correct, and they unequivocally tell you that every exchange was intended to get subsidies. Again, Plaintiffs aren’t bonkers only if their interpretation is psycho. They’re bonkers if their interpretation is anything less than the only possible interpretation for the reasons I’ve been discussing.

        Finally, I’m not sure why you go back to plausible public policy tools. This is not an abstract argument (and I’ll freely grant that congress COULD HAVE set up the exchanges to only subsidize state-run versions). This is an argument about things that actually happened, so intellectual policy-structure arguments are completely irrelevant.

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      • nevermoor,

        The proof I’m referring to is information outside the text of the statute suggesting it was not intended to cover all exchanges, whether state or federally-run.

        Well, that doesn’t seem fair since James’ argument all along has been that statutory language alone suffices to make the argument not-bonkers, and that *that* is sufficient to make a case (not a definitive case or necessarily even compelling case) against the subsidies issue.

        Seems to me you’re objecting to the plain language criterion which James invokes more than James invoking of the plain language criterion, yes?

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      • Nevermoor,

        Finally, I’m not sure why you go back to plausible public policy tools.

        Because I keep hearing mention of the “bizarre outcomes” standard of interpretation. Obviously we both know that’s a real interpretive standard. But if the outcome is not bizarre, then it doesn’t apply.

        As to the CBO scoring, it doesn’t meet the standard that I mentioned. You may object to that standard, and perhaps fairly so, but that’s the standard that will move me. And without meeting that standard, I can’t agree with the “unequivocal” claim.

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      • Not sure why it has to seem fair. It’s the way courts do statutory interpretation. If that way seems unfair to the argument that Plaintiffs aren’t bonkers, maybe Plaintiffs are bonkers…

        Nice to know you’re unmoved by facts but heavily focused on theory. Start reading this PDF on page 69 (of the file, not the document pagination).

        Do you have any reason whatsoever to believe that anyone involved in passing the ACA thought exchanges would not all be subsidized, or are you just digging your heels in (note: not that such a structure could theoretically be established, but that the plan was actually to do so)? It isn’t an idle question, ideologically motivated people have been looking for years, and the best they’ve come up with is the Gruber video which shows a guy who explicitly disagrees with them misspeaking once (among lots of times he didn’t misspeak).

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      • Perhaps I should have gone ahead and quoted further from the Adler/Cannon essay. At the risk of sounding like I’m browbeating, which is not–quite–what I intend, I will do so now. Referring to a Finance Committee bill and the Health, Education, Labor, and Pensions (HELP) bill, they say:

        Both the Finance bill and the HELP bill withheld subsidies from taxpayers whose state governments failed to establish an Exchange or otherwise failed to implement the bills’ requirements.

        The PPACA’s closest antecedent was the Finance Committee-
        reported ‘‘America’s Healthy Future Act of 2009’’ (S. 1796). The
        relevant language in the PPACA is nearly identical to that of the
        Finance bill. Indeed, the four ways Section 1401 confines tax credits to state-run Exchanges appear almost verbatim in the Finance bill. The HELP bill even more explicitly withheld credits in states that failed to implement its requirements, and it employed that strategy to encourage state cooperation even if
        the federal government created the Exchange. .. If a state failed to meet these criteria, its residents would be ineligible for credits. When an ‘‘establishing state’’ fell out of compliance, the HELP bill went so far as to revoke credits that state residents had already been receiving.

        Obviously this doesn’t prove that PPACA does the same, but that is not what I’m arguing. This does demonstrate that the “bonkers” interpretation was explicitly a part of the overall legislative debate that produced PPACA.

        Later, they write:

        The statute and the lack of any support for the IRS rule in the legislative record put defenders of the IRS rule in the awkward position of arguing that it was so obviously Congress’ intent to offer tax credits in federal Exchanges that despite a year of debate over the PPACA, it never occurred to anyone to express that intent out loud. A better explanation is that the PPACA’s authors miscalculated when they assumed states would establish Exchanges. … Prior to enactment, HHS Secretary Kathleen Sebelius proclaimed states were ‘‘very eager’’ to create Exchanges and predicted most would quickly do
        so. The end result would ‘‘very much be a State-based program.’’ Shortly after signing the law, President Obama predicted, ‘‘by 2014, each state will set up what we’re calling a health insurance exchange.’’

        These statements suggest that they did not see subsidies for federal exchanges as being necessary.

        Subsequent to this, beginning on p.186 they address the CBO argument you raise.

        . The CBO score of the PPACA’s Exchange provisions is entirely consistent with the plain text of the statute and the prevailing assumptions about how these provisions would operate in practice.The JCT and CBO produced revenue and spending estimates that assumed tax credits would be available in all fifty states. But this is not the same as ‘‘assum[ing] that the tax credits will be available through the federal exchange,’’ and neither the CBO nor JCT stated such an assumption when conducting their analysis. Indeed, the CBO has acknowledged it did not conduct a legal analysis of whether the statute authorizes tax credits through federal Exchanges.

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      • Of course the CBO didn’t do that analysis, because there was no active debate about whether some exchanges would be unsubsidized. Which is the whole point.

        Instead, it assumed that all exchanges would be subsidized. Just like everyone else did (including GOP opponents, fwiw). Which is also the whole point.

        Again, do you have ANY reason to believe that ANYONE thought the ACA as passed would do anything else?

        I’m also not sure why I’m supposed to care that a different law with different provisions was different. The ACA doesn’t have those state-punishment mechanisms (and instead encourages states to suggest alternatives).

        That said, I’m not sure there is any discussion to continue unless you at least attempt to answer the question in bold above.

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      • Instead, it assumed that all exchanges would be subsidized. Just like everyone else did (including GOP opponents, fwiw). Which is also the whole point.

        Again, do you have ANY reason to believe that ANYONE thought the ACA as passed would do anything else?

        First, you obscure the point of the CBO reference. If the CBO was assuming all states would set up its exchanges, then its scoring says nothing about whether the law authorized federal exchange subsidies. Since you brought up CBO scoring as one of the evidences for federal exchange subsidies, this seems relevant.

        Second, I am puzzled as to how we can interpret the vase legislative silence on the issue as evidence for either position. You seem confident that the lack of any statement proves one of the non-stated positions, and that makes no sense to me.

        And this is where the relevance of the other versions of similar bills in that debate are relevant–they demonstrate that some Congressmembers very much were thinking about denying subsidies to federal subsidies. And since the ACA does not specify, that is A reason why SOMEONE could think the ACA as passed did so.

        Again, I’m not arguing they are correct. I am arguing that this logical structure–1) other versions denied federal exchange subsidies; 2) PPACA is not clear about them, one way or the other; 3) there is a legislative silence on the issue; and 4) the CBO scoring can be satisfactorily explained without invoking federal exchange subsidies*–makes the belief plausible.
        ___________________
        *Adler and Cannon cite Max Baucus as the only Congressmember addressing it, and they say his statement supports the claim that PPACA denies subsidies on federal exchanges. But frankly I don’t follow their interpretation of his statements, and the meaning of his words is not readily apparent to me.

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      • To the extent you’re actually confused about my “silence” argument, I’m making two points:

        1. Everyone assumed that every exchange would be eligible for subsidies. Contemporary CBO reports use that assumption, the statements and other documents referenced in the PDF I link say so, etc. And remember, the CBO reports weren’t some obscure documents, they were driving the whole political process (Obama was insistent that total projected spend be less than $1T, GOP was insistent CBO was cooking books, Dems were trumpeting projected net savings, etc). If ANYONE thought that fewer-than-all exchanges were subsidy eligible they would have said so in response to any of that stuff.

        2. What people were silent on is the bonkers argument Plaintiffs here make, because it was obviously not what anyone was intending to do. Why address/analyze whether federally-backstopped exchanges are eligible for subsidy when everyone believes they are and intends they should be.

        To believe otherwise is to believe that there was some silent majority of lawmakers who ignored every CBO estimate produced, every statement Obama or other lawmakers made, etc. because they secretly knew the ACA wouldn’t cover all exchanges. You know what that theory is? Bonkers.

        Other contemporary H/C reform laws would be relevant if they had the same language about state sponsored exchanges, federal authority to step in if states refuse, and limited subsidies to state-run exchanges. If legislators said that law was intended to deny subsidies to federally run exchanges, I’d consider it relevant. Here, though, it looks like those other laws used other language/structures to ensure federally run exchanges weren’t subsidized. What that tells me (to the extent it says anything at all about interpreting the ACA, which I doubt) is that legislators knew how to adopt that structure and chose not to do so.

        Also, to borrow your line, evidence about other laws doesn’t meet the standard that I mentioned. Do you have any evidence to suggest any member of the legislative or executive branches said anything to suggest that the ACA was intended to limit subsidies to state-run exchanges? If not, how could we possibly believe they secretly meant that, despite everything they said to the contrary? Bonkers!

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      • Nevermoor,

        I think we are at an impasse. You are not clarifying your arguments, but repeating arguments I have already rejected.

        Everyone assumed that every exchange would be eligible for subsidies.

        You keep asserting that, but have not produced actual evidence for it.

        Contemporary CBO reports use that assumption,

        No, the CBO reports used the assumption that every state would set up exchanges. That’s mathematically equivalent to allowing federal exchange subsidies, so the numbers produced don’t indicate anything about a federal exchange assumption, either yea or nay.

        What people were silent on is the bonkers argument

        If people were not actually silent on subsidies for federal exchanges, then I would expect you could show me somebody talking about them contemporaneously. You have asked me for that level of evidence, so you can’t avoid bearing a duty to meet that same standard yourself.

        To believe otherwise is to believe that there was some silent majority of lawmakers who ignored every CBO estimate produced,

        No, because those CBO estimates were based on an assumption that every state would set up an exchange. So it would be logically consistent to accept the CBO estimates as the effect of the law’s full effect while assuming only state exchanges got subsidies, because the math works out precisely the same.

        every statement Obama or other lawmakers made,

        What statements? You’ve given me no contemporaneous statements.

        I accept that I haven’t persuaded you. But your arguments all lack any smoking gun evidence as well. They could be correct, but you haven’t demonstrated their correctness.

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      • Did you read the PDF I linked? You seem to suggest I never presented that evidence (and have never responded to it, instead simply asserting I’ve given you no proof).

        Excerpt:
        In addition, the three House Committees with jurisdiction
        over the ACA legislation issued a fact sheet explaining that
        States would have a choice whether to create their own
        Exchanges or have one run by the federal government, and
        “the Exchanges” would make health insurance more
        affordable. The fact sheet recognized income level as the only
        criteria for subsidy-eligibility.

        Here’s a more in-depth discussion of the bonkers-ness of Plaintiffs’ position, which includes a link to that fact sheet along with more legal citations.

        Please explain how this fails to meet your standard of proof (or, at least, acknowledge that this is the second time I’ve presented it). Please explain why there is any basis for any other interpretation of legislative intent (keeping in mind Plainttifs have failed to find any, despite no shortage of funds or motivation).

        I know it’s always tempting to adopt a moderate “no one is being unreasonable, democrats are being shrill” posture, but it really really doesn’t fit here.

        Other nit: “No, because those CBO estimates were based on an assumption that every state would set up an exchange.” Says who?

        Long story short, we may be at an impasse, but I’m stumped as to why.

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  6. What I don’t understand is why any of the anti-federal exchange tax subsidies cases were allowed to go forward. Federal jurisdiction requires that the plaintiff have standing to sue, meaning that they usually need an actual injury to him or herself of some sort. Merely being a taxpayer is usually not considered standing unless the establishment clause is at issue.

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    • Taxpayer status was not the basis for standing. See my reply to Gabriel here.


      Not really. It just means someone has to be injured by the law in a more substantive way than having to pay taxes for it. Essentially it’s a pragmatic rule the Court has developed–since we’re all taxpayers, and everyone objects to some government action, every single law could conceivably get accepted for a process of judicial review is taxpayer status itself created standing.

      I can see that being somewhat amenable from a libertarian perspective, but it would mean that the courts could be utterly bogged down in reviewing laws the overwhelming majority of which would pass constitutional muster (at least as the Court interprets things, if not as you or I might wish them to). They wouldn’t be able to cope with the potential flood of cases, were it to materialize, so there’s a fair amount of pragmatic self-interest in the doctrine. But it might also block review of other things we care about, like violations of due process, leaving even more innocent people wrongly convicted to rot even longer in prison.

      But effectively every law has actual affects on actual people, so it’s a rare law (there may be some, but I can’t think of any examples off the top of my head) that doesn’t create someone who has standing.

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  7. Not that it matters, but I never, or only briefly a few months ago, thought the argument was bonkers myself. (I had previously to Saul’s post read parts of the briefs (I think, or papers, or something with the argument presented at some length), various Adler Volokh posts or exchanges with Cannon an interlocutors, etc.) The text makes it a plausible argument. Just as a proposition pre-evidence, I do think it’s a bit bonkers to think it was really the intent of the law’s authors to make the core of the law being put in place dependent state-by-state on affirmative action to that effect in each and every state. It would be bonkers to write the law that way, IMO. But the Gruber video and the bad drafting makes the argument that it nevertheless happened something short of bonkers.

    But it nevertheless didn’t happen. The argument is wrong.

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    • The Gruber video is meaningless. As soon as we admit that legislative history is relevant, it is overwhelmingly clear (including from Gruber himself) that the law was intended to work the way the Government has implemented it.

      Unlike modern politics, the goal in reviewing such interpretive guides would be to find the truth. Not to find gotcha video clips.

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    • I do think it’s a bit bonkers to think it was really the intent of the law’s authors to make the core of the law being put in place dependent state-by-state on affirmative action to that effect in each and every state. It would be bonkers to write the law that way, IMO.

      Michael, that’s just regulated federalism through and through. The national 55 mph speed limit was put in place dependent on state-by-state action, as was the national drinking age of 21, as has been NCLB. And for each of those the mechanism was federal financial pressure on the states (although in those cases it was directly offering states money, while ACA is obviously more indirect than that).

      It’s such a norm for Congress to have national policies implemented state-by-state that–without making a claim about whether that’s what they intended this time–I just don’t see how it can be seen as inherently bonkers to think they might have done so this time as well.

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      • It was presented as comprehensive national health care reform. In the social insurance realm that has not been the norm that I’m aware of. Medicaid offers money, but all they really need to do is spend it. To me that’s a significant difference. it may be regulated federalism through and through, but as you say, it would be a pretty distinctly hands-off way of doing it you’re trying to reform health care nationally. It would be bonkers to do to that way in this context, and if it weren’t for some evidence they at least thought about it, it would be bonkers to think they would. But we can agree that because ther is that evidence it turns out not to be bonkers to think it.

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      • …It’s a point we can have a reasonable disagreement on, though.

        And it’s certainly true that prima facie, knowing nothing else, it’s not bonkers that Congress would have used regulated federalism. but in this context, if I didn’t know they thought about, I’d say it is. Medicare didn’t, Social Security didn’t. Medicaid did, but just made the dollars available directly to the states. But suddenly this reform is dependent on states undertaking the complicated task of setting up exchanges, even while there’s a provision for federal backstops in states that don’t, but they’d be basically nonfunctional? That’s a bit bonkers.

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      • Michael,

        Let me approach it this way. They very explicitly asked the states to set up their own exchanges and promised them support in doing so, including a literally unlimited budget for the costs of setting them up, with the federal exchanges clearly meant as a backup. So the state exchanges are the law’s clearly expressed preference.

        A lack of subsidies for the backups would be expected to put pressure on states to set up their own exchanges. Giving subsidies to the backups would reduce the pressure on states to set up their own exchanges. So subsidies for the federal exchanges would be expected to undermine the law’s goal of having the states set up their own exchanges.

        Against that we have to set the law’s more fundamental goal of getting everyone covered by health insurance. But if that more mechanistic goal–each state setting up an exchange–was satisfied, then that fundamental goal would also be satisfied (that is, every state having an exchange means everyone gets covered).

        Now if the mechanism didn’t work out as expected, that’s a problem, but it doesn’t tell us anything about the intent of the law. If–emphasis on if, please–the law’s authors thought the subsidies for state exchanges and lack of subsidies for federal exchanges would be sufficient to persuade all states to set up exchanges, then the lack of federal subsidies would not have been expected to undermine the fundamental goal of getting everyone covered, even if that is how it would work out in practice. And in that case–if it is the case–the failure to work out in practice would not be evidence that the law was meant to be understood otherwise.

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      • Why bother including federal exchanges at all, if they were never intended to be used and don’t seem to be workable without the subsidies? Wouldn’t it provide an even greater incentive for the states if there were no backup available?
        As I understand, that is how the law’s provisions for the Medicaid expansion were originally supposed to work: either the states expand the eligibility cutoff or they get nothing at all.

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      • A lack of subsidies for the backups would be expected to put pressure on states to set up their own exchanges. Giving subsidies to the backups would reduce the pressure on states to set up their own exchanges. So subsidies for the federal exchanges would be expected to undermine the law’s goal of having the states set up their own exchanges.

        Depends on the strength of the preference/how much pressure was meant to be applied to get states to set up exchanges, some degree of which might reasonably be seen as bonkers. Given the clear aim for comprehensive national reform, in the absence of evidence that they did, IMO it’s reasonable to think (and not to think) that it is bonkers to think they’d use the setup imagined by Adler/Cannon. (But there is evidence they thought about it, so it’s not.)

        [Edited to mark quotation.]

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      • Owen–backup and compromise. We could turn the question around and ask why bother with the states at all if they were going to have federal exchanges? The answer is that it wouldn’t have gotten enough votes. Doing it by state was the compromise that gained ACA enough Democratic votes to pass. Having the federal exchange backup assuaged those who (rightly, as it turned out) worried not all states would comply. But Sebelius and Obama are on record at the time of passage as saying they thought all the states would set up their own exchanges, so to say they thought so is not a retcon.

        Or in other words, this is the normal messy bastardized practice of lawmaking in the U.S., but in this case bumped up another magnitude because of how controversial health care reform was, with a dose of shortcircuiting that had to happen because they lost a crucial vote they needed when Scott Brown won the Senate. When that happened, they needed to rush the final product through before he took his seat. The bill really needed a final careful combthrough by a conference committee, as Michael Caine notes below, but the Democrats just didn’t have time for that.

        That’s not a criticism of them, I want to emphasize. It’s just the position they were stuck in. Had they not gotten it through, it probably would have been just like in the Clinton reform case, dead for another uncertain number of years.

        But it makes something of a fiction of the interpretive canon that Congress knew what they were putting in the law and intended it to be written exactly as it is. Not as much a fiction as the Patriot Act, which none of them even saw before voting on it, but still, the bill seems not to have been quite a complete job. Nevertheless, legally we have to assume they meant to do whatever they actually did, but the vagueness leaves “whatever they actually did” open to debate.

        Have I mentioned lately that I think we need a fundamental overhaul of our governing system?

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      • Well, it felt like I was asked “what benefit do you get from telling the truth as you see it?”

        The implication was that my interpretation of events would, somehow, refect upon the universe as it manifested itself to me. I mean, it made sense to me that it was possible to interpret the law a certain way. Indeed, a guy closely aligned with the laws’ creation argued that that was the proper way to interpret it.

        Asking why I’d benefit from interpreting it that way is a fairly insulting question. Must I benefit to reach a conclusion? Is that the only reason to reach the conclusion in question?

        There’s a poem (of course) by C. P. Cavafy that sums the position up:

        For some people the day comes
        when they have to declare the great Yes
        or the great No. It’s clear at once who has the Yes
        ready within him; and saying it,

        he goes from honor to honor, strong in his conviction.
        He who refuses does not repent. Asked again,
        he’d still say no. Yet that no—the right no—
        drags him down all his life.

        It’s like asking the person who says “no” why he benefits. It’s because there are five lights. And there is no benefit beyond that.

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      • I can see how the original question was insulting (although perhaps it was a roundabout way of suggesting that it’s hard for someone to have legitimate standing). And frankly, I agree, and have said as much in these threads, that a reasonable person could read the statute as Adler, et al., have.

        Still, I just don’t get why the allusion to the TNG episode applies. Is Saul trying to torture you?

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      • No, not at all. It’s more that the question of “what benefit do you get from telling the truth as you understand it?” is one of those questions that seems to me to be asked by a completely alien perspective. The closest perspective that I could come up with for who would ask it, in an official capacity anyway, is someone working for The Ministry Of Truth.

        In an unofficial capacity, of course, we see someone asking the question in comments.

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  8. The argument for “A-C are not bonkers” as presented above includes a few assumed premises, namely:

    [1] First, Section 1304(d) specifically defines “State” in a way that excludes the federal government. This is an intentional definition, and under the standard interpretive assumption that Congress chooses its words with conscious intent and understanding of their meaning, the definition has substantial weight.

    That subsection varies the ordinary definition of “State” only to include the District of Columbia, so as to include the District — which is not ordinarily considered a “State” — within the scope of the Act. It is not noteworthy that the term “State” is not defined to include the federal government, because the term “State” is not generally understood to include the federal government. Accordingly, there is no reason to read that subsection as expressing a specific intent to give disparate treatment to exchanges operated by the federal government under 1321.

    [2] The two types of exchanges are distinct, as they are created by different sections of the law. Consequently, subsequent sections of the law that refer to just one section, or one type of exchange, have an initial presumption (not an irrefutable one, just an initial one) that they do not refer to the other section, or the other type of exchange.

    This implies that there is a convention of statutory drafting that attributes a particular meaning to whether subject matter is addressed in different sections of a law. That is not at all correct. Sometimes a lot goes into a single section of a statute and sometimes just a little. It’s not unlike the way novels are divided into chapters: sometimes those divisions reflect transitions between different subject matter (e.g., different periods of time, different storylines) and sometimes they don’t.

    [3] The fancy-pants Latin that lawyers use to separate themselves from the masses [expressio unius est exclusio alterius] means “the express mention of one thing excludes all others.” Now, we don’t have to like that idea, but I think all of our legal scholars here will nod their head in recognition of its accepted place in the canons of interpretation.

    Application of this canon logically depends on our agreement as to the difference between the one thing mentioned (the unius) and the other thing not mentioned (the alterius): if I asked you to put an apple or some grapes in my lunch, you can infer that I didn’t want an orange, because we all agree that oranges are not apples or grapes. Here, the question posed is whether an exchange operated by the feds for a state under 1321 is different from an exchange established by the State under 1311, or whether those two things are not different. Applying the canon to determine whether those things are different in the first place begs the question.

    With that as prologue, here is why the A-C argument is bonkers. There is a provision right there in the ACA — section 1321 — that expressly permits the federal government to operate an Exchange on a State’s behalf if the state does not have an 1311 Exchange in operation. (Significantly, that section 1321 is expressly titled “STATE FLEXIBILITY IN OPERATION AND ENFORCEMENT OF EXCHANGES AND RELATED REQUIREMENTS” and is the first section in a part of the statute titled “STATE FLEXIBILITY RELATING TO EXCHANGES.”) There is no text in the ACA that expressly distinguishes between the treatment accorded to 1311 Exchanges and 1321 Exchanges: all the text pointed to by A-C is text relating to Exchanges or 1311 Exchanges, and so far as I can tell there is nothing they point to that says “1311 this way and 1321 that way.” All of it the A-C argument as to the purported different treatment of 1311 and 1321 Exchanges is based on begging the question of whether those things are subject to different treatment, like so:

    I. The difference between 1311 Exchanges and 1321 Exchanges is really, really important, as we shall demonstrate.

    II. Various parts of the ACA refer to 1311 Exchanges without mentioning 1321 Exchanges, and we must treat that statutory text as particularly significant because we know, per (I), that the difference between 1311 Exchanges and 1321 Exchanges is really, really important.

    III. Therefore, per (II), those parts of the ACA which refer to 1311 Exchanges must be construed to apply only to 1311 Exchanges and not 1321 Exchanges.

    IV. The very different treatment that the ACA applies to 1311 Exchanges and 1321 Exchanges, per (III), establishes that the difference between 1311 Exchanges and 1321 Exchanges is really, really important.

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    • Looking this over, it occurs to me that someone might try to rescue the A-C argument by appeal to the “mere surplusage” canon of statutory interpretation, which is the principle that “if possible each word should be given some effect.” The argument might be that references to 1311 Exchanges rather than must be construed to mean something other than simply Exchanges generally, because otherwise any reference to Section 1311 would be unnecessary, and therefore the references to 1311 Exchanges must be read to exclude 1321 Exchanges. That would put a lot of weight on a very small amount of redundancy, to an extent that I think can fairly be regarded as bonkers. Judge Scalia has recently observed that “the rule against giving a portion of text an interpretation which renders it superfluous does not prescribe that a passage which could have been more terse does not mean what it says.” Bruesewitz v. Wyeth LLC (2010).

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      • I believe that is exactly part of the argument. I think it even works on the 1311/1321 uses of “Exchange” like you suggest, but I’m not sure of that. Certainly the mere surplusage principle is part of their argument.

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    • This implies that there is a convention of statutory drafting that attributes a particular meaning to whether subject matter is addressed in different sections of a law. That is not at all correct.

      No, that’s a pretty common way for courts to interpret things.

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      • I’m not sure what alkali means in that comment, but my experience is that quite often each *subsection* of the Code will contain definitions for terms contained within, and that often those definitions are than those in other sections. (That’s why each there’s a “definitions” category for each section/subsection/sub-subsection/etc.)

        Eg, in the tax code, I’ve seen the term “the United States” defined as (approximately!) “the fifty states comprising the US”, “the 50 states including DC”, “the fifty states including DC and territories”. Other times “the United States” is defined as including the Federal Gum’t. Other times it’s defined as meaning onlythe federal gummint (and territories).

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    • There is no text in the ACA that expressly distinguishes between the treatment accorded to 1311 Exchanges and 1321 Exchanges: all the text pointed to by A-C is text relating to Exchanges or 1311 Exchanges, and so far as I can tell there is nothing they point to that says “1311 this way and 1321 that way.”

      You’re right, and that’s a very important point.

      Reading the law, I can’t find any evidence that the law talks about ‘exchanges created under 1321’ or ‘exchanges created by the federal government’. Is there any place the law treats them differently *at all*? (Besides the obvious place in 1321 where they are created differently.)

      Hell, do those phrases even appear in the text of the law?

      You would think if there were some vitally important different between the two types of exchanges, and we’re supposed to treat ‘exchanges established by the states’ as a subset, and ‘exchanges’ as the the total set, there would be at least some *tiny* bit of the law that would apply to the other subset, that would apply only to federally-established exchanges. Or at least mentioned as an exclusion.

      For example, a line like ‘people on exchanges established by the federal government are not eligible for these subsides’ in 36B would clearly have been really useful if that was the law’s intent.

      Likewise, if there were indeed parts of the law intended to apply only to state-established exchanges, you’d think they’d explicitly *explain* that somewhere, perhaps group such parts together. And follow it up with a section that only apples to federally-established exchanges.

      Instead, the lawmakes appear to have randomly applies parts of the law to all exchanges, and all remaining parts to just state-established exchanges, and not a single part to federally-established exchanges. That seems rather dubious lawmaking, and a much more logical interpretation is that ‘exchanges’ and ‘exchanges established by the state’ are intended to refer to exactly the same set of all exchanges.

      Incidentally, there are actually a third ‘kind’ of exchange. There are exchanges that can either be created by a state compact, and they operate in multiple states. And none of the ACA seems to talk about *them* specifically either, except the part that allows the creation of them.

      So now not only do not know whether those sorts of exchanges count as ‘established by a state’ (They’re established by *states*, plural, not ‘a state’.), so there’s confusion there, but regardless of that, they certainly weren’t created under 1311. And *they* don’t ever seem to be explicitly mentioned either by the law.

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  9. Mostly, I agree with James that there is a case here. I also agree with Nob that the fact that there *is* a case doesn’t mean it is compelling when compared to other cases in the legislative/court history.

    That aside, I see two possible logic tree outcomes, here.

    One, Roberts rules to the effect that federal law requires administrative leeway and the defendants win. I think this is more likely because I’m guessing Roberts doesn’t really want the court to be swamped with squabbles between the legislative and executive branch… if this guess is right then the decision to hear the case in the first place is largely a “Jesus, let me make this clear, you’re stuck with it, not stop bothering me” attitude from J.R.

    Two, Roberts flips and rules with the plaintiffs. The result is the blue states that were going to go Democrat in 2016 anyway lose nothing. The red and purple states now acquire an even more monumental load of uninsured folks than they had before by rejecting Medicaid expansion. In some of the states, that might not matter, but in others you have to somehow manage to sell “this is the *federal* government’s fault”. I don’t see that as a winner across all states. In fact, I think Roberts is canny enough politically that he’ll save the GOP from itself and rule with the defendants.

    I don’t see a great way out of this for the GOP. If they lose, they lose their number one rallying cry (although the half-life of that is expiring anyway, I suspect).

    If they win, they get what they say that they’ve wanted all along, which comes with all sorts of unpopular consequences. The only way for them to turn that into a winner would be to actually offer something that isn’t Obamacare that does what Obamacare does, which they’re constitutionally incapable of designing, because as near as I can tell in the mind of the GOP having uninsured folks is a natural consequence of the market and that’s preferable to all alternatives.

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  10. I find it incredibly fascinating that the ideology of people who use ‘tort reform’ as a campaign platform, year in and year out, also allows them to (literally) grind governance to a halt with nit-picking legal challenge.

    Go see what Scalia’s progeny does for a living. Use the rule of law to thwart the rule of law is a well-respected past time in certain circles.

    That’s what’s bonkers. So I agree with Saul, this is bonkers. But not because the details might so work out; but that small discrepencies in details is used in an ongoing effort to gum things up.

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  11. The starting point for statutory interpretation is the statute’s text.

    Here’s a law you might have heard of:

    No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

    Let’s focus on that last clause.

    nor shall private property be taken for public use, without just compensation

    It restricts the taking of private property for public use. What about the taking of private property for private use? Not a word. Nor is it possible to argue away the word “public” as a meaningless parenthetical, as is almost universally done by highly principled textualists with the mention of “militia” in the Second. You could argue based on legislative history, precedent, or simple common sense that taking property for private use should be either more restricted or completely forbidden, but that’s not what it says. In fact, if the statute’s text is what matters, Kelo should have been a 9-0 slam dunk. Instead, all nine justices, including the highly principled textualists, completely ignored the plain meaning of the words, and not a soul criticized them for it.

    TL; DR: pull the other one.

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    • Instead, all nine justices, including the highly principled textualists, completely ignored the plain meaning of the words, and not a soul criticized them for it.

      Dude, Kelo was 5-4.

      O’Connor’s dissent was joined by Rehnquist and Scalia and Thomas, for some reason, bothered to write his own dissent instead of just saying “ME THREE” after Scalia said “ME TOO”.

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      • I don’t think you’re responding to Mike’s point, which is this:

        You could argue based on legislative history, precedent, or simple common sense that taking property for private use should be either more restricted or completely forbidden, but that’s not what it says. In fact, if the statute’s text is what matters, Kelo should have been a 9-0 slam dunk.

        But it wasn’t. So the language of the specific, literal language used in a statute or constitutional gets us … where, exactly?

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      • Well, it seems to me that we’re stuck between saying that they’re both reasonable positions or saying that some serious shenanigans are going on with one side. (I imagine that there’s a third position that could argue that both sides are shenanigan-laden but that’s pretty meta-.)

        So do we want to argue that both sides have a reasonable point that the government should be able to take houses from families and give them to corporations (while agreeing that it’s equally valid that the 4th Amendment seems to indicate that they shouldn’t)? Or do we want to argue that something went wrong in the process at some point?

        So let’s look at what Oyez says:
        In a 5-4 opinion delivered by Justice John Paul Stevens, the majority held that the city’s taking of private property to sell for private development qualified as a “public use” within the meaning of the takings clause. The city was not taking the land simply to benefit a certain group of private individuals, but was following an economic development plan. Such justifications for land takings, the majority argued, should be given deference. The takings here qualified as “public use” despite the fact that the land was not going to be used by the public. The Fifth Amendment did not require “literal” public use, the majority said, but the “broader and more natural interpretation of public use as ‘public purpose.'”

        If the 5 rely on saying that the word does not require being taken literally… well, there we are. I’d say that we’ve found the problem.

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      • Jaybird,

        I think you’re confusing Mike’s and my comments as expressing a view about Kelo, rather than expressing a view about the idea of using “the plain meaning of the text” as an anti-interpretive bullet to settle otherwise existing interpretive questions.

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      • Well, are we in agreement that the 5 justices implied pretty heavily that they weren’t using the plain meaning of the text?

        I mean, if we can agree on that, maybe we could agree that using the plain meaning of the text would have gotten them to a different conclusion.

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      • Not really, since again, you want to talk about what the justices actually did, whereas Mike’s initial comment was about what they ought to have done if the plain meaning of the statutory provision was the operative principle in play. It shoulda been, as he said, a 9-0 slam dunk in favor of gummint takings for private use since there is nothing in the provision which restricts gummint from doing just that.

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      • Well, I kinda see it as relevant that they said that they weren’t using the plain meaning of the text.

        Should I stop being hung up on that?

        Because it seems to me that the argument that a plain meaning of the text would get us to the whole “not doing this sort of thing”… and if the justices who said that we should do this sort of thing said that they weren’t using a plain reading of the text to reach the conclusion they reached, that at least opens the door for the argument that they agree that a plain reading of the text wouldn’t have allowed them to reach the conclusion they reached.

        And, honestly, that’s something that I think is interesting enough to add to the evidence that the plain reading of the text would have gotten us somewhere other than 9-0.

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      • Jaybird,

        The text, as Mike mentioned way up there, says *nothing* about government takings for private use. Do you disagree with that? I mean, when I read the text, it pretty plainly doesn’t include any restrictions on public takings for private use. That’s just the literal interpretation of the text.

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      • Oh, I understand the distinction. Since the Constitution doesn’t mention the government not having the power to X, therefore X is assumed to be allowed?

        I can’t help but notice that the list of things not mentioned in the Amendment borders on the infinite. As such, this strikes me as a novel, if clever, legal argument.

        Does anyone know if this argument has ever been attempted for real? If so, how far did the argument get?

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      • Kelo was about an action of a local government, not the federal one. Are you trying to argue “The federal government wasn’t explicitly granted power X, but incorporation, therefore state and local governments lack that power too?” It’s an interesting counterpoint to the nutjobs who insist that states can establish religions, but it’s not workable.

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      • Well, when I played poker on New Year’s Eve with my old group, the old man always told the same joke when the deal got handed around to him. “We’re going to play a little game called ‘me win’.”

        Individuals? Well, they’ve got to learn that they didn’t build that.

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      • Individuals? Well, they’ve got to learn that they didn’t build that.

        Classic, Jaybird, in that it has nothing to do with the topic at hand other than im jousting. You think yours is better! Fair enough. YOu win, then. In your own mind anyway. As yet, tho, you haven’t said a single thing rebutting (is that actually a word? I hope so since I’ma use it) Mike’s argument up above.

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      • Well, how’s this? The justices in question went out of their way to say “we’re saying that we’re not using a word literally in order to lean heavily on the word ‘public'”.

        That is to say, they wanted to argue that this was public use, insofar as it provided jobs open to the public, and those jobs would provide a public good.

        Which, I suppose, would be fair enough except for the fact that the field where houses used to stand are now nothing but flowers following the crash… and, in practice, these people had their houses bulldozed for the public good… except the corporation colluding with the justices is nowhere to be found at this time.

        Only you and Schilling are arguing that this is perfectly reasonable. Well, maybe John Yoo would stand alongside.

        Personally, I’d point out that not even the most liberal of justices relied on this novel “private use” interpretation of the government being allowed to take the homes of private citizens in order to give them to corporations. Now, if you want to embrace an argument that not even the weakest of justices relied upon… have at it.

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      • Only you and Schilling are arguing that this is perfectly reasonable.

        Comments like this are good reminder that I shouldn’t engage with you in an actual discussion. You’ve just expressed, in point of fact, that you have no idea what either me or Schilling are getting on about in this subthread. And that’s OK. I tried!

        I’m just sad you’ll continue to believe the problem is the ideological blinders that me and Schillingwear.

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      • We don’t have to say whether you agree with what he did in practice, of course. Just whether you agree that he, in theory, may have had a point beyond a reasonable doubt.

        Using this standard here, of yours.

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      • Using this standard here, of yours.

        Whoa. Now you’re even further out there than I initially thought.

        Schillingwear: contemporary, stylish outerwear for the tech-oriented, math-comfortable Giants fan.

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      • Well, then, I’ll let you continue to discuss judicial arguments not embraced, even in theory, and I’ll argue against the ones actually given as having been not only wrong, but wrong according to taking the terms literally.

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    • Here’s another, from the Clean Air Act:

      …regulatory requirements must be applied to any stationary source that has the potential to emit two hundred fifty tons per year or more of any air pollutant.

      Last term’s Utility Air Regulatory Group v. EPA was decided on the basis of what Congress meant by the use of “any” in this phrase, and examined everything from testimony at the time to subsequent EPA funding levels. Since CO2 is now an officially recognized air pollutant (a decision upheld by the SCOTUS), the plain language of the text scoops up a lot of stationary sources that have never been regulated in the past. For example, almost any large hospital with laundry facilities and backup electricity generators has the potential to emit ≥250 tons of CO2 per year.

      Over the course of the opinion and various dissents and partial concurrences, we have four interpretations. (1) That “any” means what we think it does, but since Congress clearly didn’t intend to regulate tens of thousands of fixed sources, CO2 can’t be a pollutant under the act. (2) That Congress really meant the first “any” but not the second, so the EPA can use thresholds higher than 250 tons. (3) That Congress really meant the first “any” but not the second one, the EPA can’t change a number like 250, so the CO2 sources that can be regulated are those that emit ≥250 tons of pollutants other than CO2. (4) That Congress meant the second “any” but not the first, so the EPA is free to start with the big sources and eventually work its way around to the smaller ones like hospitals.

      #3 is the interpretation that prevailed (in a peculiar slice-and-dice fashion).

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      • Thanks for including that example Michael. It’s a pretty good example of how pragmatics, practicality, history, legislative intent, etc all combine to create a slice-n-dice ruling that seems reasonable and just. And justifiable. Sorta.

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      • Technically speaking, that text would require them to regulate *forests*, because it’s pretty easy to make forests emit two hundred fifty tons of CO2. We usually try to *stop* them from doing that by pouring water on them when they’re on fire, but they certainly have the *potential* to emit that much. (And forests appear to be stationary sources, Macbeth aside.)

        Of course, we do want to ‘regulate'(?) wildfires, but probably not by using the EPA’s industrial regulations on forests.

        ‘Who built this forest here! It’s right next to a watershed! In fact, it is a watershed! And let’s not even get started on the endangered species here. Nope, we’re going to have to tear this entire forest down.’

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      • No, Mike, I’d rather not play your games. Because no matter how explicitly the Court says “We begin with the text that says….” you can just come back with a claim that it’s just a subterfuge to get them to their preconceived ends. Not, of course, that you could prove the subterfuge, but in such a case, with a sufficient dose of cynicism, the assertion is sufficient unto itself.

        It’s a clever little trap in which you might catch someone more naive than I.

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      • Partisanship doesn’t apply. No one, on any side, uses that clause to mean what it says literally. Nor should they; it would be ridiculous. I think we can all agree on that. But if “follow the text” is a fundamental principle, and there’s an obvious case where no one follows the text, there must be overriding principles. That’s not a trap; that’s simple logic.

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      • if “follow the text” is a fundamental principle, and there’s an obvious case where no one follows the text, there must be overriding principles

        There are conflicting principles, as I discussed that in the OP. That doesn’t mean those other principles override the text, because sometimes they’re overridden by the plain text principle. Which one will be overriding in any particular case is unpredictable.

        And all of that matters because my point–again, as discussed in the OP–is not that the plain text reading is the “right” reading, but only that using it is not obviously bonkers.

        So it appears to me that you’re tilting at something of a strawman here.

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      • By the way, I didn’t say anything about partisanship, just cynicism. My assumption was that you’re cynical about the court’s legal objectivity in general, not simply Team Red’s Justices objectivity.

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      • James,

        My guess is that you’re cynical about the courts objectivity too. Am I wrong about that? I mean, take a relevant example: Roberts activism in the earlier ACA case?

        I think Mike’s point in all this, to cut to the chase – and state in a sorta paradoxical way, I suppose – is that objectivity is a subjective term. We’re way into metaland when we talk about this stuff as we are, dontcha think? I mean, consider Jaybird’s arguments regarding Kelo as evidence that appropriate truth predicates for claims regarding these issues are highly ideologically subjectively dependent.

        One thing I completely agree with you about (well two things) is that the Halbig challenge to the ACA isn’t bonkers (by the lights of at least one criterion constituting not-bonkersness) and that the plain text criterion is a legitimate consideration. I think we start there, and when we (quickly!) realize that the text itself doesn’t resolve the issue at hand, we move on to other relevant considerations.

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      • Unless there’s some way of determining when the textual reading is dispositive and when it’s not, it does seem to me that it’s simply one argument of many, with no special claim. So when someone writes:

        The starting point for statutory interpretation is the statute’s text.

        And what follows assumes tacitly that the only thing that matters is a close reading of the text, he many not be bonkers, but he is full of it.

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      • And what follows assumes tacitly that the only thing that matters is a close reading of the text, he many not be bonkers, but he is full of it.

        I’m confused about the scope of this comment. Do you mean what follows from the plantiff’s argument, or from James’ argument? Cuz James has made it pretty clear that he’s only interested in establishing that the argument itself, taken as it is, isn’t bonkers. I think he’s shown that. He’s also not arguing that the argument is correct or can’t be challenged.

        This was discussed upthread a bit, but there’s two ways the argument could be viewed as bonkers: legalistically and practically. Legalistically, the argument isn’t bonkers, seems to me. Practically, ehh…. Like Burt said way up there, the plaintiff’s aren’t arguing in good faith, they’re trying to achieve an outcome on a formal, rather than substantive, discrepancy in legislative wording. People ought to be upset about the SC deciding to hear the case more than they are the motivations/intelligence/rationality of the plaintiffs.

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      • Mike, that’s a fair criticism of Adler & Cannon, but once again, I’m not arguing that they’re right. And as a criticism, it doesn’t rise to the level of proving bonkersness.

        Stillwater, Not as much as you might expect. Justices have generally been professionalized into the discipline in a way that breeds a respect for the concept of law as not wholly synonymous with politics, and that has some effect. How much of an effect is something that can be–wait, no, that is–argued endlessly, of course. And even when we look at the Court as political, to take the Robert’s example, it’s not always political in a strictly ideological sense. Sometimes its ideological in a “let’s protect the Court’s aura of legitimacy sense.” And of course sometimes, as in Bush v. Gore, it throws that out the window. And then sometime the ideology is not garden-variety political ideology but a sincere perspective on how the democratic and legal processes are supposed to work and to interact, and on how the law in general should be understood.

        I’d argue that anyone who applies a single variable to explain the Court is being overly simplistic. Pure cynicism doesn’t work, but neither does a total lack of cynicism.

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      • Justices have generally been professionalized into the discipline in a way that breeds a respect for the concept of law as not wholly synonymous with politics,

        Man, I’d like to think this is evidence that normal folks views of things are also not determined by ideological identification since average Joe and Jane seem to view things along exactly the same predictable lines as SC justices. :)

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      • There were two cases where members of the Supreme Court decided a presidential election, 1876 and 2000. Both times they voted along strict party lines, so I think it’s fair to say that in that circumstance partisanship trumps judicial professionalism.

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    • Schilling’s…right?

      Wait. that doesn’t sound right.

      That’s going to take me a while to process. Anyway, I think Kelo was correctly decided, and I said so at the time. I don’t like the outcome, but not all bad laws are unconstitutional, especially at the level of the states, whose powers are not so tightly constrained as the federal government’s. It’s worth noting that many states did pass laws limiting eminent domain after Kelo, so this is a rare case of the system working.

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  12. No, they’re not bonkers. The statute is sloppily written in several places. It shows all the signs of being written by a large number of staff, in a hurry. When staffer A wrote “established by the State under section 1311,” there probably wasn’t a section 1321 or 1401 — staffer B hadn’t written them yet. I mentioned in a comment under the other post that the conference committee is the usual place to do all of this sort of tidying up. The overall pace for the bill, and the lack of a conference committee, were a result of the Dems having a very fragile filibuster-proof majority (eg, 59th or 60th vote Ben Nelson (D) of Nebraska killed the public option in the Senate bill, even though such was prominent in the House bill).

    Ten years or so ago, I used to argue that our health-care financing system would be “ripe” for reform, and hence be an important issue, in the 2016 campaigns. By that time, I said, employer-provided health insurance would have become bad enough (in terms of expense, coverage, and availability) and the behavior of the insurance companies so egregious that the two parties would be able to agree on some sort of compromise. I suspect that such a compromise would have been significantly simpler than the ACA, would have included universal coverage, and would probably looked a lot like Switzerland’s system.

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    • You might be interested to know, if you don’t already, that congressional observers have noted the decline in conference committees over the past decade or so. It doesn’t seem to be so much about increasing partisanship as just finding it more convenient to do informal discussions and bargaining rather than have a series of grand sit-downs.

      I just learned this a couple of weeks ago, and I don’t yet know what I think about it.

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  13. Two points:

    1. Any argument that gets four votes for grant of cert is pretty much definitionallly not bonkers.

    2. By any fair review of the history of Chevron, the EPA, CERCLA, and any number of other really complicated statutes, the argument should be bonkers. Because the real first principle of statutory construction is to give effect to the intent of the legislation insofar as it can be determined.

    The first tool of interpretation is statutory language. But in any piece of litigation, there is room for interpretation. And the more complex the law, the larger the space for interpretation. What Adler had done — and gotten four votes for — is to come up with rule of construction that serves as a veto point. Does anybody seriously believe that the voters for the ACA meant to punish dissenting States? And if you do, are you really willing to have the exact same tools of interpretation used against a bill you like? No and No are the honest answers.

    So here we get the libertarian shift. Instead of starting with the general rule — intent of the legislation — and then going to the specific rule — language, we go the other way around. And that’s awfully convenient for someone whose basic principal of governance is that the best government governs least. Because in a complex law you can always find some language that can be given an interpretation that destroys the usefulness of the law.

    I’ve never met a law professor before who’s working quite so hard to kill people.

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    • 1. Misstates the situation. There weren’t four votes for Plaintiff’s theory (at least not yet). There were four votes for reviewing the King decision. The standard there is not “you got the decision wrong.” It’s this is an important question that the Supreme Court should resolve (rule here)

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    • Does anybody seriously believe that the voters for the ACA meant to punish dissenting States?

      Does that fact that both the Finance Committee bill and the Health, Education, Labor and Pensions Committee bill explicitly withheld subsidies from states that didn’t establish exchanges shine any light on that question?

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      • Michael,
        The problem is the bill doesn’t clearly either do or not do.

        But I took Francis’ question to mean, “does anyone seriously believe PPACA’s supporters had any intention of punishing states?” And the answer to me seems to be that clearly, yes, at least at one point some of them clearly were thinking that. And while they may not have meant that with PPACA, at no point did they explicitly repudiate that.

        Above, nevermoor makes a big deal about the lack of debate on the issue, as thought that proves what they meant. But to me the combination of a lack of a clear statement one way or the other in the law and no legislative debate means we really don’t know what they were thinking.

        And comments two years after the fact, when it became clear that states weren’t going to all set up exchanges–as both Sebelius and Obama said they believed the states would–are not reliable. They could be truthful, but they also could be responses to events that occurred during that two year gap.

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      • By its text it clearly does not withhold subsidies. The provision providing for subsidies is less clear than one would like, but it’s clearly there. There’s a barely-not-bonkers but still clearly wrong argument that it does withhold subsidies that we’re currently being subjected to.

        But the contrast to bills that did explicitly withhold subsidies (possibly the HELP bill) is clear, though it’s not clear the Finance Committee bill did that. The Finance bill was the one whose language on this point was most closely adopted, though with changes that made it even more clear that subsidies weren’t meant to be denied on the state exchanges the feds acted to establish for the states. In particular, the (state) exchanges the federal government was directed to establish on behalf of the states were defined to be “such Exchange[s]” as “an Exchange established by the state under 1311 of the Patient Protection and Affordable Care Act.”

        Background.

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      • …But it’s fair to point out that Francis phrased the question broadly. I certainly took him to be mean, “in the way being discussed here, i.e. as Adler/Cannon suggest?” which it’s not actually clear to me that either the HELP or Finance bill did. But reading Francis’ question broadly enough, obviously the answer is yes, as nearly everyone who supported the law was miffed that the Court so significantly softened the stiff punishment ACA proponents overwhelmingly strongly supported relating to the Medicaid expansion.

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      • Michael Drew,

        From your link:
        In context, however, the words are at a minimum highly ambiguous, and arguably actually clearly provide for subsidies on the federal exchanges.

        “Arguably…clearly.” I have no problem with that. It’s less than totally definitive, though, no?

        And that’s all I’m really saying. I think the argument in your link is the most solid argument in favor of federal subsidies, and I think it ultimately wins the day. But even so, its own supporters are limited to saying “arguably clearly.” If the best argument is not “indisputably clearly,” can we truly say an opposing argument has no merit?

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      • …Though I haven’t, and am not saying it’s the case in this case. I’ve said they’re clearly wrong. But things are almost never indisputably clear, and it’s certainly possible for an argument to be bad enough or clearly enough wrong as to have no merit even while the case for a competing proposition is something short of “indisputably” clearly correct. You can dispute questions with arguments that have no merit – often very great to-dos, and not insignificant pain, can be occasioned by just such disputes. These kind of specious disputes nevertheless render the questions demonstrably disputable. I’m sure you’ve seen this yourself.

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      • “If the best argument is not “indisputably clearly,” can we truly say an opposing argument has no merit?”

        Yes.

        Well, yes. I phrased that badly. The best argument not being indisputable in itself says nothing about the quality of the other argument. What I should have asked is “if the best argument is not ‘indisputable clear,’ then can we say with any certainty that the strength of that argument is such that on that basis a counter-argument is thereby rendered bonkers?”

        I’d be very skeptical about a yes answer to that.

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      • No, not thereby. But that just means that Gluck’s characterization of the proposition that there is a provision for subsidies for the federally assisted exchanges as being “arguably clear” doesn’t show that Adler/Cannon’s thesis is not without merit. It could be entirely meritless even while it’s arguably clear that there is a provision for the subsidies. That’s so noncontradictory that it sounds weird to suggest it as such. The ideas instead seem to be suggestive of each other (though not mutually necessary).

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      • The other thing about “arguably clear” is that it’s not an upward cap on how clear a person really thinks it is. In this context, with Adler & Cannon having gone so far out on a limb on this (in his view), it’s possible that Gluck is simply out of professional reticence deciding not to say that he thinks it’s utterly clear (or significantly more than just minimally arguably clear) that the provision for the subsides is there, because that would amount to saying that Adler & Cannon either are saying they see black as white (complete bad faith), or are in fact seeing black as white (they’re bonkers), and he doesn’t want to say that about his colleagues. He could well think that and be choosing not to make it explicit, which, given the thrust of this post, you could hardly criticize him for. And thinking that it would be entirely consistent with saying that it is arguably clear that the text provides for the subsidies.

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      • (I would say that, though of course I understand the form of the argument (“It’s at least situation X that advances my case, if not situation Y that advances it even more”), that it makes little sense logically to hold the position that at one and the same time the question could be seen (by him!) as either highly ambiguous or maybe even clear. It could be a bit ambiguous or else maybe clear. Those might be hard to separate. But he should be able to say whether it’s either highly ambiguous on the one hand, or arguably clear on the other. If he looks at it and honestly thinks it can be seen as highly ambiguous, I don’t see how he can also think he could argue that it’s clear. That he can’t argue that it’s clear is what it would mean to say that it’s highly ambiguous. And: he makes a pretty good argument that it’s clear.

        So my sense is that he’s using a kind of lawyerly humility (not that I’d know about either of those), arguing for the proposition that is most likely to BOTH win the case if adopted by the judge AND actually be adopted by the judge. But to me, his argument that the language providing the subsidies is right there to be seen, and his suggestion that it might be clear notwithstanding another suggestion that it’s highly ambiguous suggests to me he actually thinks it’s pretty clear. Obviously you’re likely to look at it differently (or not).)

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      • @michael-drew

        Michael’s simple yes was the right one here. As explained above (and hopefully you’ll now agree on re-review of some legislative history), Plaintiffs’ burden is not to identify a plausible reading. It’s to either identify an inescapably clear reading or to prove that its plausible reading is what the legislature intended to do.

        I think you agree that Plaintiffs’ reading is obviously not inescapably clear. I hope you will now acknowledge that the legislative intent is inescapably clear against Plaintiffs. Given those two things, Plaintiffs’ case is bonkers even though Plaintiffs’ reading is only reasonable-but-incorrect.

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  14. I’m not sure whether this meets Prof. Hanley’s standards of bonkers and haven’t jumped into the details of the statute myself, but this post at Scotusblog makes quite a case that the plaintiff’s interpretation is incompatible with the text of the statute.

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    • Don,

      I don’t think your comment should be deleted. You found the link independently, so it’s not like you’re just echoing someone else.

      And I think that argument is probably the stronger argument. That is, I think it defeats the no-federal-exchange-subsidies argument. But I don’t think it demonstrates that the other argument is “bonkers.”

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      • I don’t know whether or not to consider it bonkers. What I would say is that this is an issue where I go well past simply being persuaded by the defendant’s case. I think that the case is overwhelming, and that to side with the plaintiffs would be a miscarriage of justice that would make me question the good faith of the majority, as it has already lead me to question the good faith of most of those in the blogosphere that are cheering on this particular challenge.

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      • The context you’re overlooking here is that the “interpretation” of the that allowed any of this law to go througConstitutiontois a load of unadulterated horseshit. Neither in the text of the Constitution, the historical context, nor the contemporary writings is there any support for it whatsoever. Nor for most of the Federal government’s other activities.

        This interpretation of the ACA is far more reasonable than the interpretation of the Constitution that allowed the ACA to stand in the first place. At least it has some textual support.

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      • When I say “bad faith,” your comment here is exactly what I mean. People oppose the ACA itself for policy reasons, then try to gin up a case on the basis of a mild drafting error to try to gut the whole thing. If you didn’t have an opinion about the ACA going in, could you possibly reach the conclusion that the DC circuit reached? If Janice Rogers Brown had not had an opinion about the ACA going in, can anyone argue with a straight face that she would have ruled the way she did? It’s motivated reasoning at its most basic, not dispassionate legal analysis, that has allowed this case to reach the Supreme Court.

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      • Neither in the text of the Constitution

        General Welfare for the win!!!

        the historical context…

        What, you don’t think Alexander Hamilton’s views were the most predominant at the ratification conventions? Even the Anti-Federalists found his arguments persuasive.

        nor the contemporary writings is there any support for it whatsoever

        Last I checked, constitutional history begins with Warren Court (or was it the New Deal?).

        Hopefully you can put that sentence back together.

        Once you get with the program, I’ll help you. Remember – Lochner = Evil and you’ll be all set.

        /sarcasm

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      • Bad faith is what allowed the ACA to get this far in the first place. Congress passed it in bad faith. Obama signed it in bad faith. And the Supreme Court upheld it in bad faith. That’s the system we have, it’s the system the left wanted, and it’s the system that allowed the federal government to metastasize to the point where the ACA was not merely conceivable as a federal law, but reality.

        I don’t have a strong opinion on this particular legal question. James seems to have laid out a plausible case above. It’s a technicality, sure, but that’s more than can be said for the straight-up bullshit that got it upheld in the first place.

        But the legal merits are beside the point, anyway. Litigation isn’t about whether the law is on your side. It’s about whether the judge(s) and/or jury are on your side. As such, any challenge is legitimate, as long as the court will hear the case. For supporters of the ACA to cry foul now, when they have ignored the law to advance their own agenda for so many generations, is the height of hypocrisy. That is bad faith.

        Of course, this is also why I’m pretty sure that the case will fail regardless of its merits: The court is on the side of the ACA, and that’s all that matters.

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  15. So we have an exchange system itself, set up to run in all 50 states (plus DC and I’m not even sure about the territories). Everybody watched it built. People enrolled. A lot of people; even in states that didn’t set up their own exchanges because, you know, if your state didn’t, the Feds would do it for them.

    So something akin to 9,000,000 families purchased health insurance via the exchanges, and most received a subsidy. You have to earn a lot of money before you’re not eligible for one. They’ve planned their budgets accordingly; they may be paying for college, for a new vehicle, a home loan. Maybe they started a business.

    And because the intent that everybody saw unfold was — the exchanges were established either by state or by the feds, the rollout was a mess, and people enrolled in numbers surpassing expections — but according to this lawsuit, it was not really the intent, and all those people’s financial decisions are now in limbo.

    That’s bonkers. It truly is.

    It creates tremendous economic uncertainty in the lives of millions of middle class families.

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    • What the executive branch does and what Congress intended are two distinct, discrete, and severable things.

      “The executive branch did X” has no bearing on an analysis of whether Congress intended X, else we would accept every executive implementation of the law as self-evidently legitimate.

      In this case Congress certainly may have intended X. That’s a distinct issue. But to say “X was implemented, therefore Congress intended X” is not a supportable general argument, and if you had any qualms about any of the actions of the Bush administration it’s not an argument you want to support on general principles.

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      • Well, then I think we’d have heard this huge outcry from the “repeal” Knogress Kritters that, as the exchanges were set up in their states, and people in their states began receiving subsidies, that this is not what the law intended.

        There is precisely no evidence of that happening at all; and anyone who claims otherwise (other than Baucas’s concern, which everybody ignored) is trying to rewrite the history of what and how the GOP repealers actually behaved.

        I get that the language issue is potential; I’ve spent a lot of time parsing those meanings in dozens of scenarios over the last 20 years. But what actually happened, without objection other than “repeal” indicates that not only was what happened the intent of the law, it was how Republicans in Congress expected the law to be implemented; it’s evidence of their understanding of the intent.

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      • “The executive branch did X” has no bearing on an analysis of whether Congress intended X”

        Completely false. Judges routinely extend deference to regulatory interpretations of statutes. Its one of the most important parts of a statutory interpretation case. Example analysis here. That doesn’t mean that “we [] accept every executive implementation of the law as self-evidently legitimate” but it does mean that it’s a lot harder to challenge an interpretation of a law once the relevant regulator has adopted that interpretation.

        Also, keep in mind the argument that Plaintiffs are making. They’re saying that congress INTENDED to prevent subsidies to federally-backstopped exchanges. If that’s true, don’t you think someone somewhere would have sounded the alarm (or, at minimum, issued even a mild objection) when the IRS subverted their intent to massively increase the number of subsidized Americans?

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      • By the logic of the expiring Bush tax cuts (that letting then expire is a tax hike) this is, one could argue, a tax hike on those families, @brandon-berg; and one that will push many families down below the poverty line.

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  16. Related

    I assigned the identical memo prompt all 3 semesters. The goal was to get them to look at the text of the law and the IRS regs and decide what they thought; it is an assignment in making a decision and writing persuasively. I provided little to no discussion of the issues prior to their writing. The breakdown of student views across the 3 semesters were as follows (No means a conclusion that tax credits cannot legally flow to persons buying in a federally facilitated exchange; yes means they are allowable):

    Fall 2012: 5 no, 37 yes
    Fall 2013: 14 no, 21 yes
    Fall 2014: 18 no, 12 yes (these were due today; there were several students who have yet to turn in their memo)

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