I don’t have time today to get into detail on the Michigan trial court decision upholding the Obamacare mandate under the Commerce Clause.  The decision can be boiled down to these three words:  “Inactivity is Activity.”

Here is the money quote from the decision (at pp. 16-17)

There is a rational basis to conclude that, in the aggregate, decisions to forego insurance coverage in preference to attempting to pay for health care out of pocket drive up the cost of insurance. The costs of caring for the uninsured who prove unable to pay are shifted to health care providers, to the insured population in the form of higher premiums, to governments, and to taxpayers. The decision whether to purchase insurance or to attempt to pay for health care out of pocket, is plainly economic. These decisions, viewed in the aggregate, have clear and direct impacts on health care providers, taxpayers, and the insured population who ultimately pay for the care provided to those who go without insurance. These are the economic effects addressed by Congress in enacting the Act and the minimum coverage provision.

The health care market is unlike other markets. No one can guarantee his or her health, or ensure that he or she will never participate in the health care market. Indeed, the opposite is nearly always true. The question is how participants in the health care market pay for medical expenses – through insurance, or through an attempt to pay out of pocket with a backstop of uncompensated care funded by third parties. This phenomenon of cost shifting is what makes the health care market unique. Far from “inactivity,” by choosing to forgo insurance plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now through the purchase of insurance, collectively shifting billions of dollars, $43 billion in 2008, onto other market participants.

Here is Randy Barnett’s explanation:

…Judge Steeh offers no limiting principle to the “economic decisions” theory. His acceptance of the government’s argument that the health insurance market is “unique” is window dressing. Allowing Congress to regulate all “economic decisions” in the country because Congress has a rational basis for thinking such mandages are essential to its regulation of interstate commerce cannot and will not be limited to the sort of public goods argument offered in support of this mandate. Given that his decision, on his own account, is expanding federal power beyond existing Supreme Court doctrine, was it not incumbent upon him to deal with the slippery slope issues raised by his newly-minted “economic decisions” doctrine? 

And also check out Orin Kerr’s somewhat contrary analysis.

This is just the first in what will be a line of trial court decisions.  Everyone knows this is going to the Supreme Court, so I’m not particularly worried by this decision.

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