Rob Natelson
Tenth Amendment Center
September 27, 2011

On August 12, the U.S. Court of Appeals for the Eleventh Circuit struck down Obamacare’s mandate that individuals buy insurance, but upheld the Medicaid mandates imposed on states. As I already have explained, the Medicaid ruling was wrong under the Constitution’s original meaning. In this post, I explain why the ruling also is incorrect even under the modern Supreme Court’s cases.

Those cases date to the 1930s, when the Court began to pretend that Article I, Section 8, Clause 1—which grants the power to tax for the general welfare—also grants the power to spend for the general welfare. Today, therefore, courts and law professors often call the Taxation Clause the “Spending Clause.”

The modern “Spending Clause” cases allow Congress to authorize grants-in-aid to bribe states to undertake projects favored by Congress, but actually outside Congress’s enumerated powers. Those cases also authorize Congress to impose extensive conditions (mandates) on those grants-in-aid. Although federal-state grant programs initially were small and targeted, like almost everything else about the federal government they have morphed into monstrosities of astounding size. By 2008, Federal Medicaid revenues alone (not counting state revenues) amounted to about 21% of the average state general fund budget. (The data on which this calculation is based are here.)

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