Cushman on NFIB v. Sebelius and the Child Labor Tax Case

Barry Cushman, Notre Dame Law School, has posted The Health Care Decision and the Lost Generation of Child Labor Reform, which is forthcoming in volume 89 of the Notre Dame Law Review (2013).  Here is the sbstract:

In National Federation of Independent Business v. Sebelius, Chief Justice Roberts wrote for a majority of five justices in holding that the “shared responsibility payment” required by the Patient Protection and Affordable Care Act (“ACA”) constituted an imposition of a “tax” rather than a “penalty.” Thus, even though the Chief Justice and four other justices had concluded that the provision was not a legitimate exercise of the Commerce Power, the Court held that it was a valid exercise of the Taxing Power.

The origin of the distinction between taxes and penalties in Taxing Power jurisprudence is found in the 1922 decision of Bailey v. Drexel Furniture Co., more commonly known as the Child Labor Tax Case. There the Court invalidated a provision of the 1919 Revenue Act imposing an excise of ten percent on the net profits of all firms employing children under specified ages in various tasks, for longer than specified hours, or at night work. Bailey was followed in other, similar cases in the 1920s and 1930s, and none of these decisions has been formally overruled.

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