Health care predictions

Like the saying goes, “It’s hard to make predictions, especially about the future.”

I am in the minority view here, but I think the Court still upholds the whole law in a quite narrow opinion in a 6-3 decision authored by Chief Justice Roberts. Maybe I am naive in my belief that laws matter, but I just don’t believe that the Court is willing to limit the Commerce Clause on some made-up wacky distinction like “action” vs. “inaction.”

I’d also give about 20% odds that the Court punts entirely, either by ruling on the Anti-Injunction Act provision (rendering all the lawsuits invalid) or by delaying the decision entirely by another year.

Predicting the Supreme Court is tough, but the ones who would know think it’s looking rough for the individual mandate. I’m hoping that the judges remember that law matters.

We’ll find out Thursday, along with everyone else.

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Subsidizing charity? Or subsidizing the rich?

Do they need our charity?

President Obama has released his tax returns–that ever-strange feature of American politics. Yet, the tax return gives us an interesting view into one bit of our tax law that needs substantial reform: the charitable donation. As you’ll note from my shoddy circling, President Obama donated $5,000 to Sidwell Friends School. If that name sounds familiar, it’s because the President’s daughters attend that school.

Now, Sidwell Friends School is a private school with high tuition ($31,960 a year). Do they really need additional funding? Or perhaps, put differently, do they deserve tax-deductible charitable giving?

Furthermore, to what extent can this really be considered charitable giving? Presumably, this is much closer to a quid pro quo relationship — the school, I imagine, strongly encourages parents to donate additional money to the school. Might those parents donate expecting special or different teacher? Might the school have incentives for treating the students of donors differently than those who merely pay tuition?

I’m not impugning the President’s motives here, but his public tax returns give us an opportunity to take a magnifying glass to someone’s tax returns other than our own. Consider that the President and First Lady gave as much money to Sidwell Friends as to any other charity, save the Fisher House Foundation (an excellent organization that runs comfort homes for military and VA hospitals). Does an elite private school really deserve an extra $5,000? Does an Ivy League university? And more importantly, should the American taxpayer be partially financing these types of donations?

We have a system that encourages charitable giving, but does not interrogate closely the reasons or purposes of the charities themselves. As a result, non-profit organizations and charities can easily serve as tax shelters to fund trips, meals, and other expenses for their operators.

The charitable deduction is not necessarily a way of funding charities; it is definitely a way to subsidize (mostly) the rich to make decisions about investments they wish to make. After all, only the rich benefit substantially from the itemized deduction; those of us taking the standard deduction (about 70% of taxpayers) don’t deduct much for our charitable donations. Should we really allow people to deduct for donating to, say, the opera (an organization that overwhelmingly benefits the rich)? The Center for American Progress or the Federalist Society (essentially political advocacy organizations)? Churches and other religious organizations? A private dinner club?

Again, I’m not saying that giving to charity is bad; I myself donate to charities. But, we do need to think more about why we subsidize charities and the outcomes that those subsidies create. Are we OK with subsidizing the ability of the rich to give money to organizations they like? Are the bad outcomes (such as non-profit bloat, fraudulent organizations, tax shelters, and charities that benefit the rich and privileged, etc.) worth the good ones (such as civic participation, communitarian values, market-driven donations, and charities that benefit the poor and underprivileged)? Like I said, I don’t know the answer to these questions, but it’s important that we ask them rather than act as if the charitable deduction must be a universal positive.

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Just so we’re clear…

When the government decides that it can completely strip search you for anything, even an incorrect suspicion of not paying a fine despite your possession of proof that you have in fact paid the fine, and even despite your crimes having nothing to do with possessing contraband substances, whatever, that’s fine.

But when the government devises a mandate which, when combined with subsidies and a ban on excluding those with preexisting conditions, is designed to increase access to health insurance for tens of millions of people, FUCK THAT GOVERNMENT OVERREACH STRIKE IT DOWN.

Got it?

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Do oral arguments matter?

There’s much hand-wringing today from liberals regarding the oral arguments for the Health Care Cases, with Jeffrey Toobin calling the oral argument a “train wreck” for liberals, and Dahlia Lithwick fairly pessimistic about the affair.

It’s worth asking, though, whether these oral arguments will matter at all. In smaller cases, the Court may actually care about the quality of arguments floated at oral argument, in order to better define the contours of the case for them. Let’s not kid ourselves; the Justices didn’t need to ask any questions today to get the answers they were looking for.

That’s not to say that oral arguments don’t show some sign of the arguments to come, but that’s only the case if the lawyer is totally blindsided by the arguments. For example, in United States v. Lopez, the first case since the New Deal to actually limit Congress’s Commerce Clause powers, everyone assumed that the case, which involved Gun-Free School Zones, was a no-brainer. After all, no one had challenged Commerce Clause power seriously in 60 years. But then, in the first few minutes, Justice O’Connor (the then swing Justice) asked then-Solicitor General Drew Days whether there were any limits to Congress’s Commerce power. It was a shock at the time, because everyone assumed it was a settled question.

By the time of the Health Care cases, these issues are well-known and in the open, so when Solicitor General Verrelli got the question today, he was ready with responses, even though commentators found his performance wanting.

My point is that from oral argument alone, particularly in cases where the stakes are as high as this, you can understand almost nothing. This is the grand theater of the Supreme Court, but honestly, the operation of the Court is behind closed doors and won’t really be known for a decade or so (or more).

Justice Thomas is often criticized for not speaking during oral arguments, but he’s just not willing to acknowledge that it’s mostly a sham. Justice Thomas knows he won’t learn anything from oral arguments, and that much of it is about showing off for the Justices, not about developing theories of law.

We agonize over and parse the oral arguments because that’s all we have. Tea leaf reading must occupy us while the Supreme Court does the debating in chambers.

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What is a child’s right?

Amanda Marcotte has a thought-provoking post about anti-vaccination parents, but her formulation of the problem highlights a problem with “children’s rights” as we have constructed them in the contemporary sense:

Obviously, this is not about children’s rights. The children’s rights are being violated by their parents, who believe their right to use their children as symbols to prove their piety trumps their children’s right to health.

But to whom to these children’s rights inhere? That is to say, are children to be protected from their parents by the state? Or are they to be protected by their parents from the state?

Consider some of the core examples of what we consider children’s rights. Child labor, for instance, is not permissible, but we permit it in many family businesses. In some sense, the state wants to protect children from their parents (who would put them to work or accept exploitation by others). Yet, the state doesn’t want to impose unnecessary burdens on parenting (or on children themselves, who might want to help their family out in the business).

Or consider the famous case of Tinker v. Des Moines School District, where children were found to have free speech rights in school after coming to school wearing black armbands to protest the Vietnam War. The Tinker kids’ parents both supported their decision and were noted area peace activists. Would the children have been protesting at all had their parents not been part of the peace movement? Or, more importantly, would the children’s parents have brought suit for them (as next friends, as necessary in court for minors) if they disagreed with them?

If we envision children’s rights as the state protecting children from their parents (or other adults through increased penalties for crimes against children, for example), then Marcotte is correct and children need vaccinations to protect them from their moronic parents. (And they are morons, for the record.) But if we envision children’s rights as parents protecting their children from an encroaching state (like Tinker!), then the vaccine-fearing parents, wrong though they may be, are asserting a vision of children’s rights that is not altogether insane.

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A quick note on the Prop 8 case

As Linus noted, the 9th Circuit upheld the lower court ruling that Prop 8 was unconstitutional. Dahlia Lithwick has a good piece here about how narrow the ruling is (in short, the judgment only holds that Prop 8 in particular includes animus towards gays because it was removing a right that had already been granted by California’s Supreme Court in the Marriage Cases). That particular set of facts has no analogy anywhere else and thus the ruling would be limited to California.

What Lithwick doesn’t mention is that there may be a long game that the 9th Circuit is playing here. Let’s say that at the Supreme Court, the Court finds that the 9th Circuit’s reasoning is wrong. In the meantime, more states will be passing same-sex marriage laws (Washington, maybe Maine, maybe Maryland, maybe Illinois, maybe Rhode Island). Then, the case goes back to the 9th Circuit on remand. The court of appeals still needs to schedule arguments, etc., etc. More time passes; more social norms change. Then, the 9th Circuit adopts a broader constitutional tone, more in keeping with the original Judge Walker lower court opinion. Then the case goes back to the Supreme Court. In the ensuing period, same sex marriage has become essentially normal (and may even become moot if California passes anti Prop 8).

My point is that same-sex marriage will be here to stay in California for at least some time. Even the social conservatives on the Supreme Court will probably be wary to overturn the 9th Circuit in a way that again revokes a right to same-sex marriage in California for the second time.

Court opinions matter in the short term, but in the long term, it’s all about values changes, and that’s the fight that the same-sex marriage advocates are winning. (Consider the polling on interracial marriage, which was way worse when Loving v. Virginia was passed in 1967.)

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Re: The Affordable Care Act cases

As Linus alluded to, I do indeed have a prediction about the Affordable Care Act cases, although it is not altogether interesting: I predict the Court will uphold the entire law, as well as severability generally, and that the Court will reaffirm the reach of the federal government’s tax-and-spend power.

That said, I think the real story will be how the opinions are structured. If Kennedy goes for upholding the law, it seems plausible that Roberts would glom on specifically to assign the opinion to himself to write a more conservative opinion in line with Judge Kavanaugh’s D.C. Circuit dissent ruling the whole mandate nonjusticiable on procedural grounds. And if Roberts is on board, Scalia may even hop on in hopes of writing a concurring opinion that has some precedential effect.

The long and short of it, however, is that the Court’s ruling here will probably have only marginal effect on the law itself. If the Court were to rule all or part of the ACA unconstitutional, it would be in a world of political attack. Calls for Thomas’s impeachment would grow; Obama would run against the Supreme Court as a countermajoritarian institution (combining Citizens United, Parents Involved, and the ACA cases together). After seeing the discomfort of the Justices at being targeted during the State of the Union, I doubt they want to hurt their institutional reputation any more. Better to find a way to wriggle out of the ruling than to be the next Court to be packed.

Even if the Court were to strike down the individual mandate, all that would do to the ACA is make it cost a lot more. For all our hand-wringing about debt, we don’t care so much about, say, Medicare Part D or other large spending packages. I doubt much would change with the law other than a few tweaks. Plus, if insurance rates really do go down thanks to local exchanges, more people, even healthy young people who usually don’t buy insurance, would be willing to partake without a mandate.

Caveat to all this is that court-watching is an inherently unpredictable sport: Famously, the last major Commerce Clause case in which a federal law was found unconstitutional was U.S. v. Lopez (the Gun-Free School Zone case) which everyone thought would be a slam-dunk for the government. 8-1 at least, with only Thomas in the dissent. And then, at oral argument, it became clear that the conservative members of the Court were looking for a limit to Commerce Clause power and believed they had their case. 5 votes later, down came the first Commerce Clause case since the New Deal to strike down a federal law.

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Well, here we go

To the surprise of no one, the Supreme Court will take on the health care law. This became a near certainty once multiple federal appeals courts issued differing opinions. They’re setting aside over 5 hours for arguments, which some reports have said is the most time ever set aside for a case. The ruling is expected in June 2012, leaving plenty of time to have huge ramifications for the presidential election five months later. Most legal analysts I’ve come across have said that if precedence is any guide, the law should have no problem being upheld. But because one appeals court has come to the opposite conclusion already, and because I am a huge pessimist, and because Thomas and Scalia and Alito and Roberts are toolbags – and Kennedy is anyone’s guess – I’m guessing the law will go down. Even if it’s just the mandate that goes down, that effectively dismantles the entire law, since the mandate is the only reason the ban on dropping people for preexisting conditions is even possible. I wonder what my more law-ful coblogger thinks.

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Why incentives matter

This viral video (Not Safe For Life… seriously, fairly disturbing) of a Chinese toddler getting run over by a van has been making the rounds. Most infuriating, the video shows many bystanders passing the toddler and refusing to help. This has led to substantial discussion about how cold-hearted the Chinese are, as well as other cultural stereotypes.

But one thing worth noting here is that many cultural differences stem from the incentives developed in default rules.

Consider this quote from the driver of the van:

According to reports the van driver had just split up from his girlfriend and was talking on his mobile phone when he hit the girl.

“If she is dead, I may pay only about 20,000 yuan ($3,125). But if she is injured, it may cost me hundreds of thousands yuan,” said the driver over the phone to the media, before he gave himself up to the police.

This sounds like absolutely vile cost-benefit analysis bordering on straight-up murder, but the way that costs are distributed in accidents changes our behavior before and during accidents. Vile though it may be, were the costs shifted differently, and the costs of death higher than the costs of injury, perhaps the driver would have behaved differently.

Similarly, much outrage has been directed towards the “cold-hearted” bystanders who watched for seven minutes before a rag collector moved the girl to the curb. Why a rag-collector and not one of the middle-class shopkeepers and shoppers? China does not have a Good Samaritan law that protects bystanders who help in an accident. As a result, there are cases picked up in the media like this one:

In November of 2006, an elderly woman surnamed Xu in Nanjing, Jiangsu Province, suffered two fractures after falling at a bus station. She later successfully sued a man named Peng Yu, who claimed to have voluntarily helped her.

Despite a lack of evidence, a local court ruled that Peng was guilty and ordered him to pay compensation of over 40,000 yuan ($6,184) to the woman. The verdict was based on the “logical thinking” that it was highly possible that Peng had knocked the woman down, otherwise he would not have helped her to hospital. The case was eventually settled out of court with mediation from provincial officials.

Since then, the name “Peng Yu” has become a label for such cases, leading many to believe that helping out an old lady might not be the best idea.

Now, I know what you’re thinking. The reason you would get out of your car to help someone injured in the road has nothing to do with your legal liability. Because of the kind of person you are, you would risk your life, financial standing, etc. to help a person in need.

But we live in a society where that background norm is enforced through Good Samaritan laws, and a strong presumption in favor of the person coming to aid. If the background norm were different, you might behave differently. And if the incentives moved in the other direction, one might expect many fewer Good Samaritans.

Consider a final example. The Japanese famously return stolen and found goods to the authorities (most notably after the recent earthquake and tsunami). Many chalk this up to a cultural norm that the Japanese have of honor, duty, and communal strength. Yet, it is also a reflection of a legal regime that strongly encourages finders to return stolen goods and encourages police to return goods to owners. Police boxes dot Japan for people to place found goods, and finders get a small reward for found property. Furthermore, keeping the found goods counts as embezzlement with a substantial fine. Japan also has firmer policies in place regarding police return of stolen goods. (As James May puts it on Top Gear, “I would have obeyed the speed limit, officer, but frankly, the police never found the TV that was stolen from me.”)

Maybe the Japanese return goods because they are naturally honest and communatarian. Maybe the Chinese commit hit-and-runs and ignore injured toddlers because they are naturally cold-hearted.

Or maybe cultural differences have as much to do with legal incentive structures as with innate culture.

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I wonder if they’ll help me find stuff I’ve lost

Four San Francisco Police Department officers accompanied corporate security officials from Apple to look for the “lost” iPhone prototype during a home search.

If SFPD officers can just be borrowed every time there’s a missing corporate prototype, maybe they’ll help me find random crap that I’ve left in bars.

I wonder about the type of preferential treatment received by Apple and other major corporations. I doubt that SFPD officers are that helpful when a person on the street loses their iPhone. In fact, I’d say retrieving stolen property is generally pretty far down on the list of police priorities.

I guess all animals are equal, but some animals are more equal than others.

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