Forget Broccoli

Americans are either celebrating or damning the Supreme Court’s 5-4 ruling that the individual mandate is constitutional.

I find it hard to believe that anyone believed that the Supreme Court would rule any other way. Precedent dictates that the Commerce Clause, and Federal powers of taxation are unimpeachable, and have been so since the New Deal. That’s the state of reality, and I found it puzzling that the individual mandate to purchase healthcare might be deemed unconstitutional when the collective mandate to collect taxes to purchase next-to-everything (including both healthcare and broccoli) has been considered constitutional for the best part of a century.

If America wants to overturn current legal norms America needs to elect different politicians. But with a greater and greater welfare-bound population, it seems inevitable that more and more Americans will vote themselves greater and greater quantities of free stuff.

Yet there is a bigger point to all of this, and it’s nothing to do with broccoli.

If Congress can constitutionally create a mandate for individuals to purchase healthcare, then Congress can create a mandate for individuals to purchase financial securities. Which — given the fiscal cliff that we are about to run off, and the reality that more and more sovereigns are dumping dollars and treasuries — could well be a useful weapon in keeping the Treasury’s borrowing costs low and the bread and circuses flowing.

Here are the GAO’s own figures:

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