1. Is ObamaCare constitutional?
2. If not, can it be made constitutional?
3. Who is doing the suing and why?

First, a caveat: I am not a lawyer.  All lawyers: please chime in.

Is ObamaCare Constitutional?

Next, some Constitutional basics.  The way our form of government works, each and every law that Congress passes must find some authorizing basis from within the Constitution, because the 10th Amendment of the Constitution clearly states:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

In other words, Congress has to find a basis for the law from within the Constitution.  For the better part of three centuries, however, Congress has largely been able to get around this restriction through what has become known as the Interstate Commerce Clause (Article I, §8 Cl. 3):

[The Congress shall have power] To regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes;

“Commerce among the several states” has been interpreted to mean, for instance, the ability of someone in New York to charge for access to its waterways.  That was what Gibbons v. Ogden (22 US 1) in 1824.  It’s largely the basis of how drug laws are authorized today by the federal government.  Some people might say that this is a stretch of the clause, and that in fact requiring expenditures from individuals on health insurance would be even more of a stretch.

So what’s the logic in favor of the law?  That has its basis in the theory of insurance.  Here I will say that I am not an insurance expert, by the way.  This much I know: a risk pool requires that everyone not make a claim at the same time, and the lower the likely percentage of claims over some period of time, the need for less money by the insurance companies to satisfy claims.

In the context of health care, if only old and sick people buy insurance, because they make up for the bulk of claims, the money required to pay out claims would require very high premiums, thus reducing any benefit to having insurance.  On the other hand, if only healthy people bought into the system, since there would be very few claims, there would be no need for high premiums.  Indeed, healthy people might not buy insurance at all, or very limited policies.  In short, insurers can only sell health insurance to sick and old people if they have a group of otherwise healthy and young to reduce costs.

Does the decision of someone to not buy insurance in one state impact consumers in and companies in other states?  If there exist risk pools that cross state boundaries, then the answer would appear to be yes.  Otherwise it would seem the answer is no.

If ObamaCare is not constitutional, can it be made so?

Supposing the Supreme Court found mandatory premiums unconstitutional, what could the Congress and administration do to get around it?  The tax system offers us one possibility.  The 16th Amendment authorized Congress to tax us:

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

One way the Congress could get around this would be to impose a tax that is the amount of a minimum premium, and then allow for a credit based on the costs expended on that premium.  Loophole?  Perhaps.  But not the first.

Coming back to the Commerce Clause, the Congress probably could not have imposed a national speed limit without relying on highway funding.  They probably could not themselves have prosecuted individuals for traveling over 55 or 65 mph.  Instead they required the states to pass laws or face losing highway funding.

Who is doing the suing and why?

Ultimately if we look at the states that have filed suit, I’m sure we’ll see a distinctly Republican red tinge to them.  For one thing, the strategy of Republicans has been to obstruct any Democrat initiative, no matter the harm that obstruction causes to individuals.  Here, what possible benefit could individuals who are uninsured gain from not having health insurance?  Today 45 million Americans don’t have a choice because they cannot take part in a well balanced risk pool, and hence cannot afford any coverage.  Tomorrow even if they don’t have a choice on insurance, at least they’ll have some coverage.

Summary

In short, while considering the constitutional elements is interesting at an academic level, the officials doing the suing are harming the very people they are supposed to be serving.  Perhaps voters should remember that.

Steve (played by a 6 year old boy): Hmm..  the reception on my iPhone 4 sucks.  So let’s just cover it up with a software update.

Consumers Report (played by Mommy): Steve, your iPhone 4 isn’t receiving properly.  And I caught you trying to cover it up.  That will be a time out.

S: But MOM! RIM isn’t receiving well, and Motorolla isn’t receiving well.

C: That may be so, Steve, but we are talking about you and not your friends.

S: But Mom!

C: Don’t but mom me. First you caused a problem for a vast number of consumers, and then you tried to cover it up.  The least you can do is apologize, and try to make up for it.

S: Ok, here’s this phone condom.  That will certainly make up for the waste of hundreds of dollars per consumer.

C: Steve!  Go sit in the naughty chair.  You may stand up and go play with the other children when you apologize and really mean it.

Interestingly, when polled unscientifically by the Wall St. Journal, parents in Steve’s community are equally divided over whether he behaved well.  What kind of parents are those who accept such behavior?

But here’s a new approach that might actually fly.  An African American man was found to have a natural resistance to HIV.  This in itself was amazing, but now scientists seem to know why.  Here’s a great article from Medscape that discusses two new antibodies that might both prevent and cure AIDS in the future.

Even so it’s early days.  Let’s all hope “this time for sure”, as Bullwinkle might say!

Ringo at 70 (NYT)

Ringo Starr asks for his birthday today, according to this article in the New York Times, that everyone at noon their time put their fingers up and put our fingers up and say, “Peace and love.”  Sure!  why not?  It’s in twenty minutes for me, and we certainly could use more.

The article is really quite funny, and represents a light style that Starr is famous for.  Happy birthday Ringo Starr!

But our story doesn’t end there.  As you may recall, airlines may now be fined for such behavior, but there’s a catch: the rule applies to domestic flights.  A Virgin spokesman said that because they are a UK-flagged carrier they are not subject to U.S. laws.  If that is indeed the correct logic, and that you’d receive the protection with a US carrier, then Virgin is encouraging you not to fly their airline.  Go figure.

However, one problem with net neutrality is that it can mean different things to different people.  To some it might mean protection from service providers charging for services that they themselves do not provide.  To others it might mean an inability for service providers to manage what they deem as excessive use of a shared resource (their network) by some consumers, as their cost models are all structured on the notion of over-subscription.  That is– if everyone tried to use a vast amount of bandwidth at once, we would all get very little, and not those megabits/second in the advertisement.

Here are a few facts to think about when you hear the term net neutrality:

• The tools service providers might use to give themselves some sort of market advantage are the very same ones they may need to use to protect consumers against denial-of-service attacks: it is in the average consumer’s best interest that bandwidth from rogue BoTs be limited.  Differentiating between protection against BoTs and protectionism may prove difficult to regulators.
• Bandwidth on the Internet is not the same as a phone call.  If you’ve ever been in a disaster situation, such as an earthquake or a hurricane, you’ll remember that there may have been times when you picked up the phone and got no dialtone.  That is not how the Internet works.  Most applications make use of Transmission Control Protocol (TCP), which is designed to share whatever bandwidth there is.  While voice and video require a minimum to function properly, even modern day tools like Skype & iChat AV can step down their use of bandwidth when they see quality degrading.
• Most of us weren’t born yesterday, and it’s plainly obvious that there are very few telcos in the United States.  The government has, since the passing of the Sherman Act in 1890, taken the position, with good reason in my opinion, that monopolies are bad, and that high levels of concentration are not good for consumers, either.  Prosecution through that act as a means of redress, however, is a last resort, because…
• Such prosecutions take years if not decades, are often at the whim of administrations, and often do not succeed. Three examples of arguably failed prosecutions include IBM, AT&T, and Microsoft.  In the case of IBM, the U.S. dismissed the case when Ronald Reagan became president.  AT&T is arguably a failed attempt, because we are very close to right back where we started.  In the case of Microsoft, European regulators have provided far more oversight than our own Justice Department, perhaps in part due to the non-European nature of the company, but also due to a lack willingness to go further by the Bush administration.  Hence it is better to nip a problem in the bud.  This is one reason for the FCC to have a role.
• At stake is not whether or not consumers will see a choice of service providers, but whether content providers and etailers, sites like mlb.com and Amazon will have a choice.  Otherwise, we get to a two-sided market, where those who own the so-called eyeball networks also own the other end, providing an enormous price control lever.
• Properly considered, network neutrality as a concept protects against the idea that you have to go to a service provider to implement new applications features in the network.  This is the core strength of the Internt, but it’s not clear that regulation is needed.  For one thing, I would hope that providers understand that new features and applications are in their best interests, since they get to sell more bandwidth, and perhaps even offer a few such features to their, and other, customers.

That’s what all the fuss is about.

• Guns, Privacy, and Crime, by Allesandro Acquisti (CMU) and Catherine Tucker (MIT), provides an insight into how addresses of gun permit applicants posted on a Tennessee website does not really impact their security one way or another, contrary to arguments made by politicians.
• Is the Internet for Porn? An Insight Into the Online Adult Industry – Gilbert Wondracek, Thorsten Holz, Christian Platzer, Engin Kirda and Christopher Kruegel provides a detailed explanation of the technology used to support the Internet Porn industry, in which it claims provides over $3,000 a second in revenue.
• The password thicket: technical and market failures in human authentication on the web – Joseph Bonneau and Sören Preibusch (Cambridge) talks about just how poorly many websites manage all of those passwords we reuse.
• A panel on the credit card payment system, together with a presentation that demonstrated that even credit cards with chips and pins are not secure.  One of the key messages from the presentation was that open standards are critically important to security.
• On the Security Economics of Electricity Metering – Ross Anderson and Shailendra Fuloria (Cambridge) discussed the various actors in the Smart Grid, their motivations, and some recommendations on the regulatory front.

The papers are mostly available at the web site, as are the presentations.  This stuff is important.  It informs industry as to what behaviors are both rewarding and provide for the social good, as well as where we see gaps or need of improvement in our public policies, especially where technology is well ahead of policy makers’ thinking.

Here we see the juxtaposition of many principles:

• The government responsibility to protect Americans on the ground and in the air from terrorism;
• The individual’s freedom to travel;
• Government responsibility to enforce trade other policies, such as that of importation of prohibited goods; and
• An individual’s right to freedom from unreasonable search and seizure.

Americans have the fewest rights when flying back to the United States.  You can expect to be searched, probed, and prodded.  You don’t have the right to carry a bottle of water into an airport, and you can expect substantial inconvenience, especially if you are disabled, when traveling.  You can expect your laptop to be confiscated.

The situation is changing, however.  A recent decision by a federal judge limits rummaging through laptops of American citizens.  Another decision is clearly needed: Americans deserve the right to face their accusers, to hear allegations, and to be able to respond to those charges so that they can receive justice.  The basic premise of an airport search is to address threats that are not amenable to taking the time to have such a hearing.  Several weeks should be more than plenty of time for a case to be heard by a competent judge.  Having some random person stick your name on a list is what one should expect of  Nineteen Eight-Four and Brazil, and of America.

What would you do if it were your son trying to get home?