The short version is this: the states never really took the tax argument seriously, and didn’t prepare an adequate defense.
Here’s the longer version.
The tax argument was something of a Hail Mary pass by the government. They believed that ObamaCare is constitutional because of the Welfare clause, the Commerce clause and the Necessary and Proper clause. But they threw the tax argument in as a last resort, basically saying “just in case you don’t agree with us on these three, we still have this arrow in our quiver.”
The states defense against the tax argument amounted to “Nuh uh. It’s not called a tax in the law, and they never called it a tax before. They can’t call it a tax now.”
SCOTUS’ response was “Nuh uh isn’t a valid argument. And it doesn’t matter what it’s called. If it looks like a duck, walks like a duck, and quacks like a duck, it’s a duck.”
SCOTUS envisions that the way this will work is that there will be a line on your income tax form that says something like “Provide proof of health care insurance”, and if you don’t, then the next line will be “Otherwise, pay $XXXX”.
While SCOTUS doesn’t say this directly—at least that I’ve seen so far—this is similar to the child care credit. If you provide proof of child care, you get a tax credit for it. Yes, the health care provision works in the opposite direction, in that it’s a penalty, not a credit. But it could have easily been written the other way, to match the child care scenario. Of course the reason it wasn’t is then it would be impossible to argue that it’s not a new tax, which was one of President Barack Obama’s (D-USA) original statements.
The court makes a good point here, and one that it’s really hard to argue against. And maybe the reason the states didn’t prepare a proper defense against this argument isn’t that the didn’t take it seriously, but that there isn’t one.Still, regardless of what you think of this argument, there’s no doubt that today’s decision is a loss for defenders of personal liberty and freedom in the United States, and a victory for the socialist movement. We must now pin our hopes upon repeal. That won’t be easy, either though. The stamp of approval by SCOTUS will sap quite a bit of the political will for repeal on Capitol Hill. It’s time for the Tea Party to truly show it’s strength, or to quit and admit that the American experiment is a failure.