I don’t know if this has been brought up, but it’s news to me about the “intention” behind the statute in question:
http://online.wsj.com/articles/kim-strassel-the-obamacare-irs-nexus-1406244677
Given that before it became a politically charged issue, there was genuine disagreement among policymakers and wonks like Jonathon Cohn and Dr. Gruber about what this part of the law meant, I don’t think intent is a very useful thing to argue in front of SCOTUS.
Ah, an SDMB textual construction issue! I took your phrase “limiting text” to apply to the scope of what you called the “general definition” (as in, “the definition applies generally, unless the definition is curtailed within the context of a particular usage”) whereas you meant “limiting text” to bound to “applied statute-wide” (as in, “this definition shall apply only to sections x, y, z).” Amusing.
So I went and read King, and I don’t see anything in it that supports a pro-tax credit plain meaning argument. In fact, the majority’s reasoning said the opposite:
The only judicial argument I found supporting a pro-tax credit plain meaning approach was in the King concurring opinion, in language that I find almost self-refuting:
http://www.ca4.uscourts.gov/Opinions/Published/141158.P.pdf
So I’m left at the plain meaning stage, and wondering whether there are any pro-tax credit arguments that do not render the phrase “established by a State” either error or surplusage.
But you understand why we should not expect to find that argument in the judicial opinions, right? There’s just no need to get there. All the government has to prove is that it is, at worst, ambiguous. If the Court finds that much, it need not decide whether, in fact, the challenger’s reading isn’t even reasonable. I bristled at the suggestion that there is no plain meaning argument because lay people understand that to mean we are ignoring the text or trumping the text with legislative intent or the like. The government is not arguing for those things. So long as you’re not conflating “lack of plain meaning argument” with asserting those propositions, then we’re in satisfactory accord. 
That said, I do think there is an argument that only the government’s reading is reasonable, and the challenger’s reading is not reasonable. To summarize probably too much, the argument looks like this:
Therefore…
When 26 U.S.C. § 36B(b)(2)(A) refers to “an Exchange established by the State under [18031 of this title],” it is not trying to distinguish some PPACA-established exchanges from others, since under PPACA every Exchange meets that criteria, including ones created by HHS pursuant to 18041(c)(1).
That reading of the text is reinforced by other provisions that assume that every Exchange is established by the State, and that every Exchange receives subsidies, including the definition of “qualified persons” and the reporting requirements, among others.
None of that argument says anything about legislative intent apart from the words expressed in the statute. And if you accept that argument, then you must find that the challenger’s reading is not reasonable. You may or may not buy each premise of that argument, but it would be false to say there is no argument that only the government’s reading is reasonable. There is such an argument.
As noted previously, what you’re effectively saying is that various courts deliberately and gratuitously contradicted a reasonable argument that supported their own ruling, all because there was “no need” for it. That seems very dubious, to put it mildly.
Perhaps if your reading of what I say seems so obviously dubious, you should stop to ask yourself whether you’re misreading it, or perhaps ask me some question to clarify my position. Instead, it seems like you just want to score some rhetorical cheap shots, which is why I ignored the first one.
“Rhetorical”, yes. “Cheap shot”, no. It’s a valid point, like it or not.
You can respond or ignore at your discretion.
Every judge in the two Appeals Court panels that have ruled on this matter rejected the Administration’s argument at Chevron step one, that the plain meaning of the words of the statute mean what the Administration says they mean. Every single judge, even those who ultimately ruled in the Administration’s favor on other grounds, rejected the Administration’s argument on this point.
The notion that the plain language meaning of “established by the State under section 1311” clearly include exchanges established by the Secretary of HHS under 1321 is a dead argument. Indeed the DC Circuit ruling (since set aside) concluded at Chevron step one that the plain language meaning of those words expressed Congress’ intent to deny subsidies to federally run exchanges.
After Chevron step one both the DC Circuit and the Fourth Circuit then considered Congressional intent. IANAL, but is this some step 1.5 now? And again all of the reviewing Appeals Court judges rejected the notion that Congressional intent was clear. Every single one of them including those who ultimately ruled in the Administraton’s favor.
But since that time the much vaunted statements of Jonathan Gruber have come to light. At least twice he stated that, precisely on point, and what was the primary the counter-argument to the Administration’s position. And the twice or more made “the American people are too stupid to understand the difference” statementsabout getting Obamacare passed have done no favors, even if not strictly on point.
Gruber is not some random guy off the street. He is the guy that made the economic model that amici (pdf link) briefs in support of the Administration in Halbig and King (pdf link) are citing. He is the guy the Administration hired. He was integral to the design of the PPACA. And he handed a powerful Congressional intent argument to the appellants in King. He might as well have sent it gift wrapped with a little bow on top.
So the Administration, to win the day, needs to get past Chevron step one. And then they need to get past the Congressional intent. Only then does the reasonableness of the agency’s interpretation come into play. That is what saved the Administration’s argument in the Fourth Circuit. I wouldn’t count on it again.
I think this is looking so bad for the Administration that it may be worse than a 5-4 split.
Suppose Congress were to pass a law that offers special tax breaks for Kenyans. And said “For the purposes of this law, ‘Kenyan’ means anyone born in Kenya, or in Hawaii on August 4, 1961”. Obama could reasonably expect that the law affects him directly, as he qualifies under the second part. And he would be right.
But outside of that law, Obama is not a Kenyan, nor does the law make him a Kenyan. One could not say that Congress has decided that Obama is not eligible to be President, since he is a Kenyan. Because the wording is relevant only within the definitions of this law, and *nowhere else.
*
Now, suppose someone were to demand that the law be changed, or thrown out, because it disqualifies Obama’s presidency, That would be a “reasonable” argument in the general, common sense use we ordinary mortals depend upon. But the court should deny any such action, on the grounds that no such action is required, it is not necessary that the court intervene, because the designation of Obama as a Kenyan is only relevant within the confines of that law.
The motto above door of the Inferno of Legal Sophistry reads “Abandon Common Sense, All Ye Who Enter”. Within the structures of everyday life, wherein sensible rules apply, your objections are, well, “sensible”. And valuable. But you shouldn’t try to take them with you when you enter the Valley of the Damned.
Wihin my regnant capacity as Queen of Romania, I declare Richard Parker to be correct. Tremble and obey! Makes my head hurt, but he’s right.
Our good friends over at ThinkProgress have offered a **A Non-Lawyer’s Guide To The Latest Supreme Court Case Attacking Obamacare
**
Check it out.
Also check out a contrary view at: http://www.washingtonpost.com/news/volokh-conspiracy/wp/2014/11/12/the-test-to-textualism-in-king-v-burwell-a-reply-to-abbe-gluck/
As is so often the case, use of the word “clearly” [in this case, by ThinkProgress] flags that the author is dissembling.
No one argues that the statute defines “Exchange established by the State.” The question is whether and how the act defines “Exchange,” and whether the phrase “established by the State,” as used in the tax-credit section, limits that definition.
Among his other arguments, Richard Parker, for example, has argued that HHS stands in the shoes of the States for the purposes of creating exchanges, and that federal exchanges therefore should be understood as within the scope of the tax-credit provision. (Richard Parker, please correct me if I am misstating your argument.)
A distillation of the contrary position is that if all exchanges are Exchanges “established by the State,” then why are the extra four words necessary? Rules of construction, which favor parsimony, mean that the words must have meaning - and that “established by the State” therefore stands in contradistinction to the alternative, “established by the Secretary.” This is far from sophistry - this is how legislatures draft laws, how courts read them - and how the public understands its rights and responsibilities.
I just have to shake my head at the lengths that Republicans will go to to ensure that the people of the states they run remain miserable and neglected.
“Freedom!”
So it seems to ThinkProgress push is on claiming that the term Exchange is definitional and thus an equivalence must be drawn between exchanges established by the state and those established by the Secretary of HHS. Wishful thinking.
The PPACA (full pdf text here) does have several sections in which terms are defined.
Sec 1304 defines the terms GROUP MARKET, INDIVIDUAL MARKET, LARGE AND SMALL GROUP MARKETS, LARGE EMPLOYER, SMALL EMPLOYER, SECRETARY, and STATE. What is not defined there? EXCHANGE.
All manner of other terms are defined within the PPACA in other clearly delineated sections labelled as a definition. Seriously, there are a HUGE number of definition sections. What is not defined in such a way for the PPACA? The term EXCHANGE.
Rather the reference Richard Parker cites above as the definition for EXCHANGE is actually a line amending another law, the Public Health Service Act (42 U.S.C. 300gg–91(d)), to include the term Exchange. And he left something out. The full quoted reference for that section is:
***emphasis ***added
Which brings us full circle. If this is indeed the definition of “Exchange” the Administration wants to point to, it refers to section 1311 which is the section authorizing states to set up exchanges, not the Secretary of HHS.
Scalia once penned the line that has since been quoted by the Administration:
And yet now the Administration’s argument lies in the hope that Congress created a special tortured definition for the term EXCHANGE without ever labeling it as such. And that they did so by sprinkling clues throughout unrelated sections of the text of the PPACA and an amendment to another law. And somehow it reaches that definition by pointing solely to the section authorizing state exchanges.
Indeed, there is no elephant in that mousehole.
The nice thing about laws is that they can simply be changed. The only reason this is a big deal is because the Democrats used a tiny window of opportunity to pass it.
Thing is, that’s not the court’s problem.
That you characterize my posts this way tells me you did not understand them at all. The part you claim I omitted was in fact the focus of my argument as to that section.
And talk about finding elephants in mouseholes. You’re the one who thinks Congress saw fit to deny subsidies to federal exchanges by adding a few words to one of the subsidy calculations buried in the law, instead of the numerous other places you’d expect it to be.
Unfortunately, partisanship colors a lot of the legal analysis out there.
It’s a tough job but someone has to do it!
I don’t actually think that’s a fair setup of the issue. The government argues both that “Exchange” is a defined term, and that every Exchange is required to be established by the State (under (d)(1)). It is the combination of these facts, plus the fact that we know HHS is empowered to create a PPACA-eligible “Exchange,” from which the conclusion follows that the language in 36B is not meant to distinguish some PPACA Exchanges from others. Instead, the language is to distinguish PPACA Exchanges from non-PPACA Exchanges of the kind that existed prior to this legislation.
Indeed, for those like **Fotheringay-Phipps **who are persuaded that Congress simply failed to account for the later add-on of the federal option, how would you explain the presence of the qualifier “established by the State”? At that time, there was no federal exchange to distinguish. The obvious answer is that the phrase isn’t there to distinguish federal from state.
In short, there’s no doubt that “established by the State” limits the definition. The debate is about how it does so, and for what purpose.
In a sense, perhaps – if “partisanship” refers to a preferred approach to construction.
When the ACA’s constitutionality was challenged, I defended it: not because I was a fan of the program or its supporters, of course, but because the power to enact it was clearly one Congress had, at least since Wickard.
Here, I take a position because I believe the better interpretive method for courts to use is that Congress is held to the words it passes, and that the courts shouldn’t place themselves in a position to mortar over cracks Congress left in legislation – again, not because I disfavor the program.
The courts aren’t placing themselves in that position. They are perfectly entitled to defer to agency interpretation which already does that (allegedly). They don’t have to, of course, but they can.