Academic journal article Education Next

Can Carrots Become Sticks: Court Knows Coercion When It Sees It

Academic journal article Education Next

Can Carrots Become Sticks: Court Knows Coercion When It Sees It

Article excerpt

Can federal grants-in-aid, which entice states to embrace national policies, ever coerce states and thus violate constitutional principles of federalism? More simply, can federal carrots become unconstitutional sticks? That lingering question was answered, although not clearly, in the Supreme Court's health-care decision. For opponents of federal interventions in education policy, the ruling offers hope that power has swung back to the states.

Even if the states are, in the theory of federalism, separate and sovereign entities, they have never enjoyed much encouragement from the Supreme Court to resist grant-in-aid conditions through litigation. In its few rulings on the subject, the Court has refused to draw a line on where coercion might lie, and concluded that states were not coerced into cooperating but acted voluntarily in response to financial inducements.

Still without defining a line, the Court ruled 7 to 2 in late June that the Medicaid provisions of the Affordable Care Act impermissibly crossed it. Wherever the line might be, the Affordable Care Act was "surely beyond it." Without invalidating the Medicaid provisions, the Court ruled that the states could choose whether to embrace them.

Chief Justice John G. Roberts wrote that the act was a "gun to the head" of the states, an act of "economic dragooning." By threatening the states with the loss of all of their Medicaid grants unless they agreed to a major expansion of Medicaid that would cover the health-care needs of the entire non-elderly population with incomes below 133 percent of the federal poverty level, the act compelled them to accept not a mere revision of Medicaid but an entirely new program. The financial stakes were large. Medicaid spending accounts for more than 20 percent of the average state's total budget, with federal grants covering from 50 to 83 percent of what the state spends. Federal grants would increase with the new program and cover 100 percent of the added cost through 2016, but would gradually decrease thereafter to a minimum of 90 percent.

It was the size of the stakes that enabled the Court to distinguish Sebelius from South Dakota v. Dole (1987), a grant-in-aid case in which it had sided with Congress. …

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