Thursday, July 5, 2012

Is It A Tax or Not? If Three Distinguished Harvard Law School Alumni Can't Decide, Then How Can We Lesser Mortals?

Is it a Tax or Not? If Three Distinguished Harvard Law School Alumni Can’t Decide, Then How Can We Lesser Mortals?

If the best and the brightest don't know, then how can we?

Is the mandate a tax or a penalty? That’s a simple question which calls for a simple answer. Otherwise, we are in the realm of the brilliant Yale Law School grad, President William Jefferson Clinton, who could not define “is.”

The brilliant Chief Justice John Roberts, a Harvard College and Harvard Law School grad penned an incomprehensible opinion of one, splitting the difference. He wrote it as a “politician” trying to have it both ways.

The Anti-Injunction Act prohibits lawsuits against taxes until the tax has actually been paid. Since the individual and business penalties for failure to cover health insurance have not yet gone into effect, these suits would be premature. Chief Justice Roberts held it was not a tax for purposes of the Anti-Injunction Act.

That seems clear, and if the penalty is not a tax, then he agrees it would fail under the Commerce Clause.

However, Chief Justice Roberts then said it’s a tax for purposes of legalizing the mandate. Since the Supreme has granted broad latitude in the past to Congress’ power to tax under the Taxation Clause, it’s valid as a tax, ignoring the gyrations and contortions his opinion went through to get there.

The Chief Justice’s otherwise erudite opinion omitted the most this most pertinent citation from Humpty Dumpty.

     “When I use a word,” Humpty Dumpty said in a rather scornful tone, “It means just
       what I choose it to mean – neither more nor less.”
    “The question is,” said Alice, “Whether you can make words mean so many
        different things.”

       “The question is,” said Humpty Dumpty, “which is to be master, that’s all.”

Alice was dumbfounded and could not respond.

President Obama, former President of the Harvard Law Review, was pleased with the result, but continues to argue the mandate is a penalty – not a tax. In that case, to be intellectually honest he should refuse to enforce it.

Governor Romney’s campaign staff was slow out of the gate in responding, but earlier this week agreed with the President that it was a penalty and not a tax.

The Governor (JD and MBA Harvard) earlier today said that since the Supreme Court by a 5:4 decision held it was a tax, it is a tax.

One lawyer joke is that if you get three lawyers in a room together, you’ll get four opinions.  Here three Harvard Law School grads with 5 Harvard degrees opine 4 ½ opinions.

How are us lesser mortals able to decide?

Does it matter at this point?

There's 21 express taxes and tax increases in the Act; why should it matter if there's one or two additional taxes?

Tax or penalty - either way it’s a substantial infringement on personal freedom.

(Technically it does matter. If it’s a tax, and a Republican Congress repeals the tax, then the mandate should fall.)

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