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Obamacare Returns to the Supreme Court, Economic Forecasting

By Administrator ~ March 3rd, 2015

Hi,

 

Tomorrow, the Supreme Court gets a second bite at the Affordable Care Act/Obamacare apple. King v. Burwell, the case before the Court, will likely determine once and for all whether Barack Obama's key domestic legacy remains the law of the land.

 

To my mind, the case is very simple: Does the text of the ACA, as written, dictate that individuals can only get subsidies on their health insurance if they sign up through a state exchange SET UP BY THAT STATE? In other words, if you live in a state where the Federal Government set up the insurance exchange, are you ineligible for subsidies? Based on the wording in the law, and multiple - like 20-something - subsequent videotaped speeches by key advisor Jonathan Gruber specifically explaining the logic of the actual verbiage in the law, it seems to me the intent was to bar non-state-established insurance exchange participants from getting subsidies. Open and shut.

 

But it's never that simple. Last time Obamacare stood before the Court, Chief Justice John Roberts somehow managed to determine that the ONE THING the Obama Administration clearly said was true - that the ACA was NOT a tax - was the ONE THING that made the Individual Mandate legal. So just because there is copious evidence to verify my own opinion from the previous paragraph, there is no way to determine how or what Roberts or the other Justices will use to determine their decision(s).

 

It is very likely Roberts will strive to avoid a purely party-line decision, seeing it as unseemly and "partisan." In order to achieve this goal, he will likely have to come up with a way to compromise with both the liberals and conservatives, which in this case will be more difficult than the first case, as there is less at issue here. Originally there were multiple points of dispute - the Medicare Expansion, the entirety of the ACA and the Individual Mandate. Roberts could give the liberals the overall victory they sought while still giving the conservatives something by making the Medicare Expansion voluntary. Nobody was 100% satisfied, but at least everyone got something. Not this time. This is, as they say, for all the marbles.

 

An interesting trend before both hearings on and decisions for major cases is the multitude of articles and talking-heads who decry the partisan nature of the Court and entreat Roberts to "secure his legacy" by not allowing the court to simply vote along ideological lines, as if that is a terrible thing. Well, I guess it is for the liberals and progressives right now... One reason we see such discussion (other than the obvious need to fill countless hours of programming on 24/7 news channels) is because right now the Court is 5/4 conservative. Would the same people be concerned if the Court was 5/4 liberal? All the talk about how the Court won't be respected if they vote along party lines seems odd to me, in that it suggests nobody will take Congress seriously if they vote along party lines, yet they frequently do just that. The Supreme Court is the equal of Congress and the Executive Branch (the President). The Court gets legitimacy not from which Justices (or how many) vote for what side on any given issue, but from the Constitution. When talking heads suggest otherwise, they are not just being partisan themselves, they are unfairly diminishing an equal branch of government.

 

Michael

 

And now here's arnold with economic forecasting:

The DJIA looks to be higher to 19000 and maybe up to 20000 before a major correction ensues.

Gold could still climb to $1400, but it is unlikely.

Oil did not make it to $64 in the bounce and looks to be over and should test $40 and drop to $30ish.

The dollar is down somewhat and should rise again significantly.

Interest rates have risen somewhat on the 10 year Treasury, short term rates will not rise.

Real estate pricing appears to be in the blow out stage which is indicative of a top.

The economy to arnold appears to be ucky (yes, that is an economic term).

 

Arnold

 

 

 

 

 

 

 

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