Treasury ups the ante in government losses at GM and Chrysler

According to the Detroit News yesterday, the Treasury Department increased its estimate of government losses in the $85 billion auto bailout by another $170 million.

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States challenging Obamacare file before the Supreme Court UPDATE

Today, 26 states and the National Federation of Independent Business filed a Petition for Writ of Certiorari before the United States Supreme Court.  A “petition for writ of cert” is simply a request by the parties that the Supreme Court hear the case.  This is an appeal from the 11th Circuit Court of Appeals opinion, filed August 12, holding that Obamacare’s individual mandate is unconstitutional.

If you recall, Judge Vinson of the Federal District Court for the Northern District of Florida declared the entire law to be unconstitutional.  On appeal to the 11th Circuit, that court upheld all parts of the law except the individual mandate.  Consequently, the states are appealing to the Supreme Court and requesting that Judge Vinson’s decision be reinstated.

What is interesting here is that the states “beat the administration to the punch”.  The administration had until November 12 to file its petition for writ of cert, and most expected it to consume every second of that in the hopes of delaying any consideration, and ruling into 2013.  After all, the more of Obamacare that gets implemented, the harder it is to unwind it should the law be found to be unconstitutional.

The other point of interest is that many, if not most lawyers believe it is far better to be the one presenting the claim (the appellant) than the one defending against the claim (the appellee).  If you are presenting the claim, you file your initial appellant’s brief, you opponent files the appellee’s brief, and then the appellant may file a reply brief contesting points made by the appellee.  This is somewhat akin to two bites at the apple.

The government could have been in this position, but, delay apparently was far more important.

I wonder if they realized that the states had appealable issues as well?

Finally, it should be noted that the Supreme Court does not have to accept the case, and can do so by simply denying the petition for writ of cert. 


Yesterday afternoon, the administration filed a Petition for Writ of Certiorari before the United States Supreme Court seeking review of that portion of the 11th Circuit opinion finding Obamacare unconstitutional.  Given this, it is highly unlikely that the Supreme Court would refuse to hear the case.


11th Circuit holds Obamacare unconstitutional UPDATE

I have not yet read the opinion, but, the United States Circuit Court of Appeals for the 11th Circuit has just held that Obamacare’s mandate that all buy insurance or pay a penalty is unconstitutional.  This was the case brought in the Northern District of Florida by 26 states.  I will provide an update as soon as I have a chance to read the opinion, but thought you might like to know at least this much.


In a 2-1 decision, the 11th Circuit held unconstitutional that section of Obamacare requiring all to purchase insurance or pay a penalty.  However, it reversed that section of the district court’s opinion holding that the entire law was unconstitutional because the mandate could not be “severed” from the rest of the law.  Should you be so inclined, you can read the entire 304 page decision here.

Although concerned about the issue of “activity vs, inactivity”, the court (at page 113) essentially defined the issue as follows:

Everyday, Americans decide what products to buy, where to invest and save, and how to pay for future contingencies such as their retirement, their children’s education, and their health care.  The government contends that embedded in the Commerce Clause is the power to override these ordinary decisions and redirect those funds to other purposes.  Under this theory, because Americans have to spend money and must inevitably make decisions on where to spend it, the Commerce Clause gives congress the power to direct and compel an individual’s spending in order to further its overreaching goals, such as reducing the number of uninsureds and the amount of uncompensated health care.

The court found this concept “breathtaking in scope” (p. 130), and if it were to be true, there would be no limits on the reach of the Commerce Clause (p.137).

In delving into an area that no court has really analyzed, beginning at page 139, this court looked extensively at the  “findings” used by Congress to support the mandate, most particularly, the concept of “cost-shifting” from those without insurance to those with insurance.  Essentially, the court found that the law, without the mandate, handled that problem.  Many of the cost-shifters are illegal aliens, and, the law exempts them from the requirement to purchase insurance.  Many of the cost-shifters are the poor, and either the law exempts them from the mandate, or, they are covered by the law’s large expansion of Medicaid.  And finally, many of the cost-shifters were those who were unable to obtain insurance because of preexisting conditions, and the law now provides them with coverage.  At page 140, the court said:

In reality, the primary persons regulated by the individual mandate are not cost-shifters but healthy individuals who forego purchasing insurance. [emphasis in original]

As to the government’s argument that because the law requires that insurance companies issue policies to anyone who applies (regardless of their health), the mandate is needed to prevent people from waiting until they are sick and then applying, the court (at page 165) basically told the government that it was the architect of its own dilemma.

At best, the individual mandate is designed not to enable the execution of the Act’s regulations, but to counteract the significant regulatory costs on insurance companies and adverse consequences stemming from the [Act]. [the first emphasis is in the original, the second is mine]

In conclusion, the court (at page 206)  found the individual mandate to be:

…a wholly novel and potentially unbounded assertion of congressional authority: the ability to compel Americans to purchase an expensive health insurance product they have not elected to buy, and to make them repurchase that product every month for their entire lives.