Late last week, President Donald Trump signed an executive order directing the secretaries of the treasury and health and human services to cease making payments to health care insurance companies in behalf of the more than 6 million Americans who qualify for these payments under the Patient Protection and Affordable Care Act, commonly known as Obamacare.
Obamacare is the signature legislation of former President Barack Obama, enacted in 2010 and upheld by the Supreme Court in 2012. Its stated goal was to use the engine of the federal government to make health insurance available and affordable to everyone in America.
It seeks to achieve that goal by regulating the delivery of health care, giving federal bureaucrats access to everyone's medical records, compelling everyone in America to acquire health insurance and providing financial subsidies for those people whose household incomes are below certain levels and who do not otherwise qualify for Medicare or Medicaid. Under President Obama, the subsidies were regularly paid, and they had been paid under President Trump, as well, until he decided to cease paying them last week.
Here is the back story.
How is it up to the president to decide whether to spend federal dollars when the law requires him to do so? The answer to that question depends on whether Congress has authorized the specific expenditure of the tax dollars.
Under the Constitution, when Congress passes legislation that directs the president to spend federal tax dollars -- or, as is likelier the case today, dollars borrowed by the federal government -- Congress must appropriate funds for the expenditure. So for every federal program that spends money, Congress must first create the program -- for example, building a bridge or paving an interstate highway -- and then it must pass a second bill that appropriates money from the federal treasury and makes it available to the president for the purpose stated in the first law.
When Obamacare was drafted in 2009 and 2010, one of the many compromises that went into it was the gradual rollout of its provisions; different parts of the law became effective at different times. The law was enacted with all Democratic votes. No Republican member of either house of Congress voted for it, and only a handful of Democrats voted against it.
By the time the subsidy provisions took effect, the Republicans were in control of Congress, yet Obama was still in the White House. When Obama asked Congress to appropriate the funds needed to make the subsidy payments required by the Obamacare statute, Congress declined to do so. Thus, Obama -- who, as the president of the United States, was charged with enforcing all federal laws -- was denied the means with which to enforce the subsidy portion of his favorite legislation.
So he spent the money anyway. He directed his secretaries of the treasury and health and human services to take appropriated funds from unstated programs and to make the subsidy payments to the seven largest health insurance carriers in the United States from those funds. Of course, by doing so, he was depriving other federal programs, authorized and funded by Congress, of the monies to which they were entitled. But Obamacare was his legacy, and he was not about to let it die on the vine.
Can the president spend federal dollars, whether from tax revenue or borrowing, without an express authorization from Congress, even if he is following a law that requires the expenditures? In a word, no.
That's because the drafters of the Constitution feared the very situation confronted by Congress and Obama in 2013 -- a law that is no longer popular, is no longer supported by Congress and costs money to enforce, with a president eager to enforce it and a Congress unwilling to authorize the payments. To address this tension between a president wanting to spend federal dollars and a Congress declining to authorize him to do so, the drafters of the Constitution put the power of the purse unambiguously in the hands of Congress. The Constitution could not be clearer: "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law."
It follows that where the appropriations have not been made by Congress, the funds may not be spent by the president. When Obama declined to recognize this constitutional truism, the House of Representatives sued the secretary of health and human services in federal court, seeking to enjoin her from making the subsidy payments, and the House won the case. The court underscored the well-recognized dual scheme of the Framers whereby two laws are required for all federal expenditures -- one to tell the president on whom or on what the money should be spent and the second to authorize the actual expenditure. Without the second law -- the express authorization -- there can be no lawful expenditure.
President Trump, after making the same unlawful expenditures for nine months, decided last week to cease the practice. Whether he did so to bend Congress to his will on health care or he did so out of fidelity to the Constitution, he did the right thing, but he should have done it on his first day in office.
Let's not lose sight of the whole picture here. President Obama has triumphed over President Trump and the Republicans who control Congress because all but a handful of those who are faithful to the Constitution are behaving as if there were a constitutional obligation on the part of the federal government to provide health insurance for everyone in America. According to a plain reading of the Constitution -- and even as articulated by the Supreme Court in the case that upheld the constitutionality of Obamacare -- there isn't.
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