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The States' Rights Scam
Published on Thursday, June 27, 2002 in the Boston Globe
The States' Rights Scam
by E.J. Dionne, Jr

WASHINGTON -- IT IS TIME to admit what was once obvious and is becoming painfully obvious again: The doctrine of states' rights, so often invoked as a principle, is almost always a pretext to deny the federal government authority to do things that conservatives dislike. These include expanding claims to individual rights, increasing protections for the environment, and regulating business.

How do I know this? Because when states have the temerity to try doing the things I just listed, conservatives are quick to use federal power to stop them from exercising their right to act.

Big government in Washington is bad, in other words, unless it can be used to quash progressive state action. And ''judicial activism,'' long a target of polemicists on the right, is becoming the movement's weapon of choice whenever it can muster five votes on the US Supreme Court.

Take last week's case testing the right of states to pass patients' bill of rights statutes. You would think that conservative justices who have written one decision after another supporting states' rights would shudder at the idea of the federal government preempting the 42 states that have passed such laws.

In fact, the four justices who would have overturned the Illinois patients' rights law - and by extension, all the other laws - included the three most reliable states' rights votes on the court, Justices Clarence Thomas and Antonin Scalia and Chief Justice William Rehnquist. They were joined by their sometimes ally, Justice Anthony Kennedy.

The case was interesting because health maintenance organizations claim that the 1974 federal Employee Retirement Income Security Act, known as ERISA, should override state patients' rights statutes. ERISA includes a broad preemption of state laws that relate to employee benefits, but it includes an exception for insurance regulation.

Fortunately, five justices supported an intelligent decision written by Justice David Souter that embodied judicial restraint. Souter argued that HMOs have taken over so much business ''formerly performed by traditional indemnity insurers'' that the states had every right to regulate them.

But writing in dissent for his not-this-time states' rights colleagues, Justice Thomas seemed terribly alarmed over the idea that states would intrude in this area of federal jurisdiction.

''Allowing disparate state laws that provide inconsistent external review requirements to govern a participant's or beneficiary's claim to benefits under an employee benefit plan,'' he wrote, ''is wholly destructive of Congress' expressly stated goal of uniformity in this area.''

Now hold on. Aren't states' rights advocates such as Thomas always arguing against the terrible ''uniformity'' imposed by Washington? Don't they constantly praise states as our ''laboratories of democracy''? Maybe states' rights are only valid when they can be invoked to cut programs for the poor. In this case, the states are trying to strengthen the rights of individuals against the HMOs, and the court's states' rights advocates felt compelled to say no.

Even more remarkable was the four dissenting justices' little venture into the realm of public policy: ''To the extent that independent review provisions ... make it more likely that HMOs will have to subsidize beneficiaries' treatments of choice,'' Thomas wrote for the dissenters, ''they undermine the ability of HMOs to control costs, which, in turn, undermines the ability of employers to provide health care coverage for employees.''

What does this argument have to do with the law? Nothing. It's ideology. You might even call it judicial activism. It's a perfectly respectable case for the HMOs and their political supporters to make. But if these four justices want to get into the thicket of policy-making, they should quit the court and run for Congress. In fairness, these justices are not the only conservatives who dislike states' rights when they get in the way of their preferences. As The Washington Post reported last week, major Wall Street firms have drafted amendments to federal law that would block state securities regulators from investigating whether stock analysts misled investors. They're responding to New York Attorney General Eliot Spitzer, who forced Merrill Lynch & Co. to pay $100 million to settle charges that its analysts privately derided stocks that they were publicly touting to investors.

Representative Richard Baker, a Louisiana Republican who chairs the House Financial Services subcommittee on financial markets, derided Spitzer's effort as ''a failed attempt to usurp federal rulemaking and oversight of capital markets.''

''If 30 different states come up with 30 different sets of rules regulating financial service firms,'' Baker said, ''that's a calamity.''

In other words, states' rights are great until Wall Street firms or HMOs decide they don't like them. Then they're a calamity. So much for states' rights.

© Copyright 2002 Globe Newspaper Company


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