Monthly Archives: August 2016

If You Like Your Plan

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Aetna Inc will withdraw from 11 of the 15 states where it currently offers plans through the Affordable Care Act exchanges, becoming the latest of the major national health insurers to pull back sharply from the law’s signature marketplaces after steep financial losses.

This is playing out exactly as President Barack Obama (D) and his Democratic cronies knew it would ‘way back in 2010—they knew because health experts told them.  These experts advised the Democrats that mandating insurance purchases and paying the sick to get it (those Federal subsidies) while requiring plan providers (no longer can they be called insurers) to provide coverage to all at the same “low” price would emphasize the sick over the healthy getting coverage.  The experts also pointed out that this emphasis on sick customers relative to healthy ones would explode plan providers’ costs.  Obama and his, though, chose to disregard this advice and to go with what they wanted to hear: the self-serving huzzahs of the likes of AARP, who thought they could make money by fronting for the plan providers and collecting a piece of the resulting premium stream through referrals and reselling plans.

Recall, too, that Aetna has merger plans with Humana that Obama’s Department of Justice is suing to block on the speculative grounds that at some future date the new entity might engage in anti-competitive practices.  Never mind that the merger might also have allowed the combined insurers to be large enough to remain in Obamacare.

I wonder if anyone in the Obama administration might know of some beachfront property north of Santa Fe that they might be interested in selling us.

A Thought on Chevron Deference

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Chevron Deference is a Supreme Court-created doctrine flowing from an appeal by Chevron Corporation to NRDC v Gorsuch, in which the Natural Resources Defense Council, during the Reagan administration, sued the EPA over a then-newly enacted regulation that allowed manufacturing plants to get pollution emission permits for new equipment that didn’t meet EPA emission requirements so long as the plant’s total emissions didn’t increase following the new equipment’s installation.

The Supreme Court found for the NRDC in Chevron’s appeal (Chevron USA v NRDC) and in the process created their Chevron Deference doctrine.  The heart of the doctrine, as articulated by Justice John Paul Stevens in writing for the majority, is this two-part test [citation and footnotes omitted]:

When a court reviews an agency’s construction of the statute which it administers, it is confronted with two questions.  First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.

“The power of an administrative agency to administer a congressionally created…program necessarily requires the formulation of policy and the making of rules to fill any gap left, implicitly or explicitly, by Congress.”

Eliding the specifics of the case and appeal, what Chevron Deference says in essence is that the Court owes Executive Branch offices considerable deference in those offices’ interpretations of statutes and the regulations those offices implement to enact those statutes: the Courts’ opening position should be that those offices are correct in their interpretations and implementations.  The problem, though, is in Stevens’ last sentence and in the sentence he quotes:

…whether the agency’s answer is based on a permissible construction of the statute[,]

and

The power of an administrative agency to administer a congressionally created…program necessarily requires the formulation…of rules to fill any gap left, implicitly or explicitly, by Congress.

Here is what the Constitution has to say on…gaps:

All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.

Legislative powers—every single one of them—are the sole province of our United States Congress, and not any other body.  That Congress, too, consists solely of a Senate and House of Representatives; it does not include Executive Branch offices or Cabinets…or Agencies, administrative or otherwise.

What about those gaps in legislation?  All legislation, of necessity, fills gaps, whether those gaps exist de nihilo or they exist, or develop, as the law is seen in operation and/or as society evolves—else there’d be no legislation.  That includes, naturally, gaps in legislation.

When an (administrative) agency creates a rule to fill a gap in legislation that agency is authorized to administer, it is doing far more than formulating policy, or setting out rules for carrying into effect aspects of the legislation.  It’s legislating into that gap, which only Congress can (not may) do.

There’s also a problem with the concept of deference.  Regulating agencies are subordinate entities of the Executive Branch, and as such they cannot have any status but a subordinate one to each of the three branches of our Federal government.  From the other side of this relationship, the judiciary is a coequal branch of our Federal government, equal in status, hierarchy, and power and authority to each of the other two.  As such, Courts owe no deference at all to either of the other two branches, much less to agencies subordinate to either of those branches.  The mindset that the Courts do owe deference is a dangerous one.

The Chevron Deference doctrine is wrong.  The right answer for a Court in adjudicating a regulation has a different second step:

First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is nearly the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress—so long as that intent is implemented in a constitutionally permitted manner, for if it has not then regardless of intent, the statute cannot stand.  If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, or allow an administrative interpretation to stand. Rather, if the statute is silent or ambiguous with respect to the specific issue, the answer for the court is to return the matter to the legislative (political) branch of the government so it can address what is strictly a legislative and a political question.

Prior Restraint

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The EU has it.  And it doesn’t hesitate to reach overseas to try to inflict it outside EU jurisdiction.

The European Union’s antitrust authority on Thursday opened a full-blown investigation into plans by Dow Chemical Co and DuPont Co to merge, on concerns the deal would reduce competition [in] the global agricultural sector.

The European Commission said it would investigate whether the deal may reduce competition in areas such as crop protection, seeds, and certain petrochemicals. Announced in December, the proposed merger aims to create an American industry giant with a combined market cap of about $122 billion.

Never mind that the EU, like the US, has plenty of laws with which to deal with actual anti-competitive or monopoly abuse behaviors.  Never mind that prior restraint is destructive of innovation and of competition.

Never mind that this is an American merger between American companies, or that global markets reach far beyond the EU while the EU’s legal reach is limited to the EU.

Here’s a thought, one that takes advantage of the wide world beyond parochial Europe.  Dow and DuPont should simply ignore the EU and merge if they think that makes sense.  And then contribute to that global competition reduction by walking away from Europe (save post-leave Great Britain) and focus their competitive and innovative efforts on that wide world.

California’s Disdain

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…for religion is made manifest by its SB 1146, Equity in Higher Education Act, currently under consideration before the California Senate.

As it currently stands, parochial schools—church schools, religious schools, schools run according to a clearly stated set of religious tenets—are exempt from discrimination laws where such discrimination is centered on religious beliefs.  Schools and their students are free to follow their conscience and to require employees, and students, to adhere to certain basic sets of behaviors.  As Archbishop Jose Gomez and Bishop Charles Blake put it in their piece,

Current California law exempts religious schools from nondiscrimination laws in cases where applying these laws “would not be consistent with the religious tenets of that organization.”
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For years now, this policy has worked well, enabling church-run colleges and universities to hire personnel and establish policies and expectations regarding religious practice and personal conduct that reflect their beliefs and values.

California State Senator Ricardo Lara’s (D) bill seeks to destroy this (Gomez and Blake are more polite about Lara’s motive and his bill’s overall impact.  I don’t agree, though, that Lara doesn’t understand what he’s doing).  His bill would only exempt seminaries or other schools that train clergy and ministers; it would rescind that religious freedom protection everywhere else.

Any other faith-based school that receives state monies or enrolls students who depend on the Cal Grants financial aid program would be forced to change their policies to accommodate practices that in some cases would be contrary to their beliefs and teachings.

Detailed provisions in the legislation include rules for bathroom use and sleeping arrangements in dormitories. The bill even has the government setting guidelines for what “religious practices” and “rules for moral conduct” will be acceptable on these campuses.

All in the guise of “protecting” individual choice.  Never mind, though, that Lara knows full well that those who wish to work or study at these schools are making their choice at that point.  Never mind, either, that Lara knows full well that his bill allows those who disagree with the school’s religious tenets can attend, or get hired, and then force the school to violate its own tenets to accommodate these.

Never mind, either, that Lara knows full well the damage his bill will do to those he claims to be trying to help, low-income and minority families—including millions served by our respective faith communities here in Los Angeles.  As Gomez and Blake note—and as Lara surely knows—60% of these religious schools’ students are minorities and nearly 90% need financial aid.  Aid that Lara’s bill would cut off unless these schools kowtow to his demands.

It shouldn’t take elders of the religious community to point this out.  Any lay person—me, for instance—can see this plainly.  Which means, in particular, that Lara, whose bill this is, sees it plainly.  And doesn’t care.

Keep in mind one other thing, too.  Rights granted by Government, or presumed granted by Government, can be withdrawn by Government, too, and at that Government’s whim.  Lara’s bill is a clear demonstration of that.

A Judicial Error Regarding the 2nd Amendment

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A Federal trial judge in Seattle has ruled that it’s OK for the Federal government, in the form of the Bureau of Alcohol, Tobacco, Firearms and Explosives, to ban ammunition originally “designed” for AK-47 rifles.  The ammunition in question, Russian-manufacutered 7N6 armor-piercing rounds had been imported prior to BATF’s ban, to the tune of 100 million rounds, and as the importer, PW Arms Inc noted in its suit—the one in which the trial judge ruled for BATF—none of those rounds had been misused.  PW Arms noted in its suit

In fact, before ATF banned 7N6, this ammunition was used lawfully by sportsmen as rifle ammunition for target shooting.

In 2014, though, BATF decided it didn’t like this and instituted its ban.

The Seattle-based Federal judge screwed this one up badly.  As we all know, a ban on ammunition is a ban on the weapons that use them—which is a violation of our right to keep and bear those Arms.

This is another example, too, of the jeopardy in which our judiciary will be under a Clinton White House and Democratic Party Senate.