Friday, June 29, 2012

Consequences of the Verdict

A number of commenters opposed to Obamacare have argued that the verdict, while an immediate loss for their side, might be a win in the longer run, either because keeping the unpopular program will hurt the Democrats in the election or because the legal principles on which the case was decided restrict government actions in important ways, even if not enough to render the mandate unconstitutional.

I do not know enough about either law or politics to have a confident opinion as to whether they are right, but I think there is an important consequence they are missing. 

First a digression ... 

One puzzle for public choice theory, the economics of politics, is why people vote even though they know that, in a large polity like the U.S., their vote has essentially no chance of affecting the outcome of the election. The answer I find most convincing is that most people vote for the same reason that many people cheer for their team in a football match. They enjoy being partisans, feeling "part of the team." That, in my view, is the reason why sports teams, unlike most other sorts of firms, are routinely connected to cities and universities. The connection brings with it a precommitted band of partisans and so increases the value of the entertainment being provided.

One round has just been completed in a giant game that is played out every four years with the future of the world at stake, a game that you can be a player in at the cost of a few minutes spent in the voting booth. However the other side may try to spin it, Obama won that round. Part of the fun of being a partisan is identifying with your side. It is, on the whole, more fun to identify with winners than with losers.Whatever other effects the outcome of the Obamacare case may have, that one will be a significant plus for Obama's team.


Nathan said...

The process you describe seems very likely to cause a feedback loop as one side becomes more and more successful as it attracts more and more followers. The fact that most democracies have two or more parties seems to be evidence against it working the way you describe.

David Friedman said...

More precisely, there must be other things going on as well--for instance the process that my next post sketched.

Also, one can be unsuccessful for reasons other than not having won the latest election--lose a war, say, or have the economy go sharply down when you insisted that, under your stewardship, it was going to go up.

Mike said...

There were the Nika Riots, which really illustrate your point.

Glen Whitman said...

It might be useful here to distinguish between attracting marginal voters versus mobilizing your base (a common trade-off in politics). A team with a recent victory may well attract new supporters of the "fair-weather fan" variety. A recent example is the sudden increase in Los Angeles hockey fans when the L.A. Kings took the Stanley Cup. But on the other hand, losses can also energize the losing team's most committed fans. Think, for instance, of the loyalty of Red Sox or Cubs fans. No matter what happens, they are *not* switching teams, and a recent loss just convinces them to give their team even more vigorous support.

In the present case, the victory of ObamaCare in court may well attract some marginal voters to Obama's team, but it will also energize the Republican base to organize and vote. It's an open question which effect is larger.

Anonymous said...

Won't it be easier now to point to the flawed outcomes of the medical insurance and medical care industries and tie those outcomes to the government control of those industries?

Prior to the enactment of Obamacare it was rather difficult to tie outcomes from these industries to government legislation which regulated them. Your father made probably the best case in his essay "How to Cure Health Care", but I believe it has been too costly for people to understand this article because of the basic economics involved and the poor communication technology that existed when the legislation that your father refers to was enacted. For example, too few people know the history and economics of why medical insurance is tied to one's employment. Basic economics is too complicated for most people.

Now Obamacare is an extremely well-known brand for medical insurance and medical care. The government's reputation to centrally plan whole industries is at stake. People won't need to understand basic economics to know that Obamacare lead to bad outcomes.

The Supreme Court's decision could not have been better for people who want to persuade others of the flaws of central planning.

I look forward to making fun of Obamacare for years on end.

Milhouse said...

I am one of those you describe; I'm opposed to 0bamacare, and am disappointed that it was upheld, but still think the decision was an overall win. And I don't think this has anything to do with the explanation you give, wanting to be on the winning side. I'm very used to being on the losing side, I'm on the losing side on most issues, and I have no problem with this so long as I'm confident that I'm on the right side. And I'd really much rather have won the immediate issue as well as in the bigger picture. But I really do think that the most important issue at stake in this case was the commerce clause, and I'm happy that the Court has finally put a real limit on its expansion. That alone makes this decision a net win, in my opinion.

Of course it's not much of a win. The commerce clause has not been rolled back; we still live with Wickard, Heart of Atlanta, Reich, and all the rest of it, and those need to be reversed. But we were about to see the clause expanded even further, to an unprecedented and essentially unlimited extent, and that loss was prevented. We're no worse off than we were after Raich. And that's something to celebrate.

I've seen people complain that this comes at the expense of expanding Congress's taxing power, but I can't for the life of me understand where such claims are coming from. Nobody argued that Congress didn't have the power to impose this "mandate" as a tax; the only argument was over whether it had actually done so. Roberts thinks it did; I disagree, but so what? The power remains exactly as it was. Congress can use taxes for social engineering, so long as the imposts it imposes remain essentially taxes and not penalties. Drexel Furniture is still good law, and a "tax" that is so onerous it leaves people with no practical choice but to comply with Congress's wishes, or that has a scienter requirement and other trappings of a penalty, will be struck down, exactly as was the case before this decision. So how are Congress's powers expanded?

Peter Donis said...

Milhouse, unfortunately I'm not sure that even the limitation on the Commerce Clause will stick. Justice Ginsburg, in her opinion, says "if history is any guide, today's constriction of the Commerce Clause will not endure." I'm afraid she's quite likely right.