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A Conspiracy Against Obamacare The Volokh
Conspiracy and the Health Care Case 1st Edition Randy
E. Barnett Digital Instant Download
Author(s): Randy E. Barnett, Jonathan H. Adler, David E. Bernstein, Orin S.
Kerr, David B. Kopel, Ilya Somin (auth.), Trevor Burrus (eds.)
ISBN(s): 9781137363749, 1137363746
Edition: 1
File Details: PDF, 1.52 MB
Year: 2013
Language: english
 A Conspiracy
Against Obamacare
This page intentionally left blank.
 A Conspiracy
Against Obamacare

The Volokh Conspiracy

and the Health Care Case

Randy E. Barnett
Jonathan H. Adler
David E. Bernstein
Orin S. Kerr
David B. Kopel
Ilya Somin

Edited by Trevor Burrus

a conspiracy against obamacare
Copyright © Randy E. Barnett, Jonathan H. Adler, David E. Bernstein, Orin S. Kerr,
David B. Kopel, Ilya Somin, and Trevor Burrus, 2013.
Softcover reprint of the hardcover 1st edition 2013 978-1-137-36073-1

All rights reserved.

First published in 2013 by PALGRAVE MACMILLAN® in the United States—a

division of St. Martin’s Press LLC, 175 Fifth Avenue, New York, NY 10010.

Where this book is distributed in the UK, Europe and the rest of the world, this is
by Palgrave Macmillan, a division of Macmillan Publishers Limited, registered in
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Palgrave Macmillan is the global academic imprint of the above companies and has
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Kingdom, Europe and other countries.

ISBN 978-1-137-36374-9 ISBN 978-1-137-36373-2 (eBook)

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Design by Scribe Inc.

First edition: November 2013

10 9 8 7 6 5 4 3 2 1
 Contents

Foreword by Paul D. Clement vii

Acknowledgments xi
Introduction 1
1 In the Beginning 9
2 The Law Is Passed 25
3 The First Decisions 59
4 More Decisions 79
5 Moving Up the Ladder 117
6 The Big Show 157
7 Argument 179
8 Decision Time and Aftermath 221
Postscript and Concluding Thoughts 257
About the Contributors 279
Index 283
Some posts in this volume have been slightly altered from their original form in order to avoid
redundancy, increase clarity, and address issues with hyperlinks. Most of the original hyper-
links have been turned into endnotes.
 Foreword
Paul D. Clement

The challenge to the Affordable Care Act (ACA) was a constitutional case like no
other. That was true in many respects, but for purposes of this remarkable volume,
four are particularly relevant.
First, the arc of the health care case that took it to the Supreme Court was
quite unusual. Many great constitutional disputes involving congressional stat-
utes present themselves as such from the very beginning. Take, for example, the
constitutional challenge to the McCain-Feingold campaign finance statute, which
culminated in the Supreme Court’s decision in McConnell v. FEC.1 In that case, the
congressional debates were constitutional debates about the meaning, scope, and
contemporary relevance of the First Amendment. First Amendment objections—
and related policy and political arguments framed in First Amendment terms—
had prevented earlier campaign finance proposals from becoming law. And when
McCain-Feingold finally passed, First Amendment arguments before Congress
transitioned almost seamlessly into First Amendment litigation before the courts.
Indeed, the statute itself recognized the reality of imminent First Amendment liti-
gation by including a provision for expedited Supreme Court review. Perhaps as a
result, the First Amendment litigation over McCain-Feingold was taken very seri-
ously from the outset.
Not so when it came to the constitutional challenge to the Affordable Care Act.
The trajectory of the health care cases was entirely different. While the health care
legislation was actively debated in Congress, it was a political and policy debate,
not a constitutional one. Legislators hotly contested the wisdom of the individual
mandate, but constitutional concerns about the mandate were not raised until the
very end of deliberations and were neither central to the debate nor taken particu-
larly seriously.
Thus, when a number of challengers—most prominently a number of states
with Republican attorneys general—filed suit and attacked the law as unconstitu-
tional, the challenges were near universally dismissed as frivolous. The suits were
seen more as a continuation of the policy debate and derided as political stunts
with little realistic prospects of success. Two things changed that: the decisions of
two federal district courts and the contributions collected in this volume.
The official game changers were the decisions issued in rapid succession by
Judges Henry Hudson of Virginia and Roger Vinson of Florida. Judge Hudson
first issued an opinion striking down the individual mandate as unconstitutional.2
Then in relatively short order, Judge Vinson did Judge Hudson one better and
viii FOREWORD

struck down the health care law in its entirety.3 Once these Article III judges
accepted the arguments against the health care statute, and in one case invalidated
it in toto, the challenges could no longer simply be dismissed as frivolous.
But there was an important caveat. While Judges Hudson and Vinson had
embraced constitutional challenges to the law, other district court judges rejected
similar challenges.4 And commentators could not help but notice that the judges
striking down the statute as unconstitutional were appointed by Republican presi-
dents, while those upholding the law were appointed by Democratic presidents.
This disparity received considerable media attention and fueled the perception
that the constitutional challenge against the Affordable Care Act was more a mat-
ter of politics than a serious constitutional theory.
Enter the Volokh Conspiracy (VC). Founded by my friend Eugene Volokh,
who clerked for Justice Sandra Day O’Connor the same year I clerked for Justice
Antonin Scalia, the Volokh Conspiracy had long (at least in Internet terms) been
a clearinghouse for serious constitutional analysis of contemporary issues with a
particular focus on libertarian and conservative views. But if ever a legal blog and
a constitutional moment were meant for each other, it was the Volokh Conspiracy
and the challenge to the Affordable Care Act. Precisely because the constitutional
challenge to the law came in like a lamb and not a lion and precisely because many
were eager to dismiss the challenge as a political device rather than the manifesta-
tion of a serious constitutional theory, there was a need for pointed constitutional
analysis and for voices ready to counter the cacophony of skepticism. And this
need arose over and again.
Thus, the second distinguishing aspect of the health care case was the intensity
and duration of the media focus. Unlike some of the contributors to the Volokh
Conspiracy, I was not present at the creation of the case. I did not become involved
until Judge Vinson’s decision reached the court of appeals. By then, the challenge
had grown to include over half the states in the Union. In the interview with mem-
bers of the steering committee, I mentioned that I had experience with earlier
high-profile cases involving everything from campaign finance to the war on ter-
ror to issues of race. Little did I know that the coverage of the health care case
would eclipse all those other high-profile matters.
In many ways, the health care case was the perfect storm for media coverage.
The impact on the economy in general and the health care sector in particular
were undeniable. As a consequence, the press corps covering medicine, health care,
and business issues were fully engaged in the case. In addition, for the talented
corps of reporters who cover the Supreme Court, the health care case was a tem-
porary reversal of fortune. In most outlets, Supreme Court reporters generally
seem to have to fight for a few column inches to cover momentous cases. With the
health care case, by contrast, editors seemed to have an almost insatiable appetite
for stories exploring any angle. And, finally, there were the political reporters fas-
cinated by the dynamic of the president’s signature legislative accomplishment
being evaluated by the Supreme Court in the midst of a reelection campaign.
This continual attention on the case from a still mostly skeptical media corps
created an unprecedented need for continuing constitutional commentary. In
most cases, the constitutional debate is confined to the briefs and perhaps a few
 FOREWORD ix

blog entries. And generally speaking, even a substantial constitutional case engen-
ders coverage at the time of argument and the time of decision, and that is it. But
with the health care case, every decision by multiple courts as the issue made its
way to the Supreme Court, and every filing in the Supreme Court, engendered
substantial commentary, criticism, and rebuttal. And the most penetrating of that
continuing commentary is collected in this volume.
Third and relatedly, the health care case captured the public imagination like
no other case in recent memory. Whether because of the saturation coverage, the
political dynamic, the practical impact, or something else, many people who had
never paid significant attention to a constitutional case were riveted by this one. As
a result, the stakes could not have been higher. The case went beyond the precise
issues before the Court to implicate the general public’s confidence in the legal
system as a whole.
Thus, the attention placed on the party of the president appointing the district
court judges deciding the health care cases created the real prospect of the public
viewing constitutional adjudication as nothing more than politics by other means.
The seriousness and timeliness of the constitutional analysis collected here helped
provide an antidote to that, as did the courts of appeals, where the results neces-
sitated a more nuanced narrative. A number of prominent appellate court judges
appointed by Republican presidents, such as Laurence Silberman of the D.C. Cir-
cuit and Jeffrey Sutton of the Sixth Circuit, voted to uphold the statute. But at
roughly the same time, Judge Frank Hull, an appointee of President Clinton, was
one of two Eleventh Circuit judges to strike down the law in the challenge brought
by Florida and a growing number of states. The Volokh Conspiracy was there to
discuss all of these developments in virtually real time and to emphasize that this
more complicated pattern of judicial decisions both underscored the seriousness
of the challenge and demanded a more nuanced discussion of the relationship
between judicial philosophy and the political party of an appointing president.
Finally, the constitutional stakes in the health care case were and remain criti-
cally important. Much of the focus in the immediate aftermath of the decision
understandably emphasized the chief justice’s analysis of the taxing power and the
practical reality that, although there were four votes to do so, the Court’s majority
did not invalidate the law in toto. But that should not obscure the reality that there
are five votes to invalidate the mandate as exceeding Congress’s power under the
Commerce and Necessary and Proper Clauses, and a remarkable seven votes hold-
ing that the Medicaid expansion exceeded Congress’s spending power.
When the case began, there were confident predictions that there would be
seven or eight votes against the Commerce Clause challenge. Even on the eve of
argument, seasoned commentators were still insisting that the constitutional chal-
lenge was frivolous. And these predictions were not merely wishful thinking. It was
far from obvious that the new appointees of President George W. Bush would have
the same enthusiasm for federalism as the justices they replaced. While former
Chief Justice William Rehnquist and especially Justice O’Connor cut their teeth in
the state courts and in state politics, both Chief Justice John Roberts and Justice
Samuel Alito had their formative experiences in the executive branch of the federal
government. There was a palpable sense in some circles that the health care case
x FOREWORD

could be the swan song for the federalism revival—marking the end of one of the
signal doctrinal achievements of the Rehnquist Court.
Thus, the Court’s decision was an important constitutional moment because
it underscored the Court’s continued willingness to pursue its ongoing project of
identifying judicially enforceable limits on Congress’s power. The comments col-
lected in this volume are critically important to understanding that constitutional
moment—in terms of both why it happened and what it means. The Constitution
had its Federalist Papers, and the challenge to the Affordable Care Act had the
Volokh Conspiracy.

Paul D. Clement
Partner, Bancroft PLLC,
43rd Solicitor General of the United States,
Counsel to 26 states in the challenge to the Affordable Care Act

Notes
1. McConnell v. FEC, 540 U.S. 93 (2003).
2. Virginia v. Sebelius, 728 F. Supp. 2d 768 (E.D. Va. 2010).
3. Florida v. U.S. Dep’t. of Health & Human Servs., 780 F. Supp. 2d 1256 (N.D. Fla. 2011).
4. See, e.g., Liberty Univ. v. Geithner, 753 F. Supp. 2d 611 (W.D. Va. 2010); Thomas More
Law Ctr. v. Obama, 720 F. Supp. 2d 882 (E.D. Mich. 2010).
 Acknowledgments

The contributors to this volume give special thanks to Eugene Volokh, creator of
the Volokh Conspiracy, for inviting them to join that special community. We’d also
like to thank the readers and commenters at the Volokh Conspiracy, without whom
we would have little incentive to keep blogging.
Additionally, we’d like to thank Paul Clement for both contributing to this vol-
ume and for masterfully bringing the case to the Supreme Court. Paul and his
team, as well as Mike Carvin and those at Jones Day, could not have done a better
job in bringing NFIB v. Sebelius to the Court.
We’d also like to thank Brian O’Connor and Scarlet Neath at Palgrave Macmil-
lan for believing in this project and effectively seeing it through.
Ilya Somin would like to thank the Washington Legal Foundation (WLF) for
giving him the opportunity to write amicus briefs in several of the health care
cases on their behalf and that of a group of well-known constitutional law schol-
ars and members of Congress. He also thanks Cory Andrews of the WLF for his
invaluable assistance with the briefs. In addition to VC bloggers, several scholars
gave helpful advice about the briefs or other writings he did on these cases, includ-
ing Steve Calabresi, Brad Joondeph, Gary Lawson, and Neil Siegel.
Trevor Burrus thanks Matt Gilliam for help gathering material, and Ilya Shap-
iro and Roger Pilon for giving him time to work on the project. Additional thanks
go to Roger for offering him a job at the Cato Institute right as the Obamacare
litigation was gaining momentum.
 Introduction

T he constitutional challenge to the Affordable Care Act (a.k.a. Obamacare;

ACA) was the biggest Supreme Court case in decades. In the beginning, how-
ever, it was just the “little case that could,” chugging along to get up a steep legal
hill. Legal academics derided the challenge as hopeless. Pundits called it political
posturing. At the Volokh Conspiracy, however, a group of legal academics were tak-
ing the case very seriously.
As you will see in the pages that follow, the bloggers at the Volokh Conspiracy
helped popularize and refine the arguments behind the challenge. More impor-
tant, they also influenced the arguments submitted to the courts—and eventually
the Supreme Court. Never before had a legal academic blog influenced historic
Supreme Court litigation.
For over a century, law reviews have been at the center of legal scholarship. Dur-
ing the early to mid-twentieth century, law professors were more likely to publish
articles that helped practitioners, perhaps by clarifying difficult issues, explaining
how new laws could be advantageously used, or advocating for coherently restruc-
turing laws. The American Law Institute focused on clarifying the common law
through the restatements and proposals such as the Model Penal Code. Treatises
were written to help practitioners understand complex legal subjects. While these
works were certainly not free of ideology, assisting the bar was still seen as one of
law professors’ paramount duties. Professor John H. Langbein wrote that Ameri-
can legal education in the 1960s “was distinctively practical and rigorous, reflect-
ing its orientation on training and writing for the needs of practicing lawyers
and judges.”1 Now, writes Langbein, “This vision of the mission of the national
law school has largely vanished.”2 Or, in the words of Chief Justice John Roberts
(a man who will play a prominent role in the narrative that follows), “Pick up a
copy of any law review that you see, and the first article is likely to be, you know,
the influence of Immanuel Kant on evidentiary approaches in 18th Century Bul-
garia, or something, which I’m sure was of great interest to the academic that
wrote it, but isn’t of much help to the bar.”3
The new medium of blogging, because of its current-events focus and ability
to dynamically respond to events as they happen, can be more relevant to current
legal issues than law review articles. The Volokh Conspiracy contributors’ discus-
sions on Obamacare were the bellwether for an emerging trend in legal scholarship.
This book collects those discussions over the course of the Obamacare saga, both
before the law was passed and through the Supreme Court’s fateful verdict. Its nar-
rative arc plays out in real time as arguments get refined, modified, and discarded.
2 A CONSPIRACY AGAINST OBAMACARE

***

After months of intense debate, President Barack Obama signed the Affordable
Care Act into law on March 23, 2010, radically transforming American health care
for the worse.
Some argue that the inefficiencies of America’s pre-ACA system demonstrated
that free-market mechanisms do not work for health care. This is an odd thing to
say about a system that essentially lacked two of the most important qualities of a
market: meaningful prices and fluid consumer choice. Call your doctor and ask for
the price of a basic procedure. At best, you’ll wait a few hours, if not days, and then
only get a vague and probably inaccurate answer. More likely, however, is that the
receptionist will ask if you’re serious. The predominance of the insurance model
of health care, as well as the growth of Medicare and Medicaid, helped create a
literally “priceless” system.4
The ACA took the dysfunctional parts of our former system—particularly the
persistent, incorrect, and damaging belief that health insurance is the same as
health care—and made them worse. The act tries to create the functional equiva-
lent of a single-payer system—mandatory coverage for the sick at no extra cost
to them with the extra funding coming from healthier citizens—and wrap it in
the patina of a market. By using the trappings of a market, lawmakers got many
bonuses. Not only were they able to sidestep the criticism of a “government take-
over of health care,” but they were able to hide the true cost of the ACA, an enor-
mous political win.
The ACA rests on three pillars: (1) “community rating” price controls that force
insurers to sell coverage to those with preexisting medical conditions at the same
premiums they charge healthy people of the same age, (2) an “individual man-
date” requiring essentially everyone purchase a qualifying health insurance plan,
and (3) subsidies to keep people of modest means from walking away from the
overpriced insurance the individual mandate forces them to buy. The second and
third pillars are necessary to prop up the market under the weight of the first.
Many people outside of the insurance market are younger, healthier, and do not
consume much health care. To offset the cost increases from the first pillar, the
individual mandate forces healthy people to buy coverage at much higher premi-
ums than they would pay in a competitive market. By mandating that individuals
make those payments to private insurance companies, and again by subsidizing
insurers directly, Congress hoped to get insurers the needed funds to cover people
with preexisting conditions.
The law’s passage brought immediate lawsuits. Two cases were the most promi-
nent. One was spearheaded by Virginia’s Attorney General Ken Cuccinelli II. The
other was led by the National Federation of Independent Business (NFIB); Pam
Bondi, the attorney general of Florida; and 25 other states. The Florida/NFIB case
eventually reached the Supreme Court.
The legal challenges mostly focused on the individual mandate, particularly
whether Congress has the power, pursuant to the Commerce Clause and the Nec-
essary and Proper Clause, to compel people to enter into commerce. A few aca-
demics argued that the taxing power justified the mandate, but that was a sideshow
 INTRODUCTION 3

to the commerce power argument. This, of course, would come back to haunt the
challengers when Chief Justice John Roberts unexpectedly upheld the mandate’s
penalty as a “tax.” The provision that induced states to drastically expand their
Medicaid programs or risk losing federal funding for all Medicaid programs was
also challenged.
Volokh Conspiracy bloggers were involved in the challenge to the Affordable
Care Act from the beginning. Before he joined the NFIB’s legal team, Randy Bar-
nett joined the Cato Institute on amicus briefs filed in lower federal courts. Ilya
Somin authored briefs on behalf of the Washington Legal Foundation, as did
David B. Kopel on behalf of the Independence Institute. Very few people engaged
with the challenge to the Affordable Care Act more than the bloggers featured in
this book.

***

For many of the public, and for most legal academics, the case against the indi-
vidual mandate seemed too clever by half. The arguments often focused on subtle
distinctions and minute differences in wording in order to distinguish the indi-
vidual mandate from the broad scope of Congress’s commerce power.
But the case against the mandate was always more clear to me than those
nuanced discussions. Effective lawyering requires careful language and subtle dis-
tinctions, but only because lawyers must play the hand the Court dealt us.
For me, the argument was, and is, simple: A pure “effects-based” theory of
the commerce power has no limits. Congress’s power must be limited by kind,
not degree.
The Court accepted that argument in United States v. Lopez5 and United States v.
Morrison.6 In those landmark cases, Chief Justice William Rehnquist decided that
enough was enough. Since the New Deal, the government had won every chal-
lenge to the scope of Congress’s commerce power, mostly with the argument that
“everything affects everything else.” Such limitless expansion of federal power had
to stop. Chief Justice Rehnquist believed that if a limited national government is
more than a forgotten lesson from civics class, that if the federal government is to
be actually rather than theoretically limited, then the commerce power must not
be a blank check based on Rube Goldberg–like connections to commerce. Thus,
he ruled that having a gun in a school zone (Lopez) or committing violence against
women (Morrison) were not the kind of quintessentially economic activities that
fall under scope of the Commerce Clause and the Necessary and Proper Clause,
regardless of their effects on interstate commerce. With the individual mandate,
the government believed they could avoid running afoul of Lopez and Morrison by
arguing that decisions not to purchase a product were economic in a way guns in
school zones and violence against women are not.
But all purchases and nonpurchases, as well as all actions and nonactions, obvi-
ously affect commerce, and this would have been obvious to any Framer. If you
walked into the Pennsylvania State House during the convention (or, better yet,
joined the equally important after-hours discussions at the Indian Queen Tavern
or at Benjamin Franklin’s house), and argued that the inchoate Commerce Clause
4 A CONSPIRACY AGAINST OBAMACARE

could lead to “everything-affects-everything-else” reasoning, the Framers would’ve

looked at you quizzically. Someone, perhaps Edmund Randolph, would’ve said,
“Yeah, it could allow that, but who would make such a spurious argument, and why
would the states ever accept such tenuous reasoning? They would revolt at such a
usurpation, and rightly so. ‘Commerce’ is a type of thing we’re giving Congress the
power to regulate, not a zone of effects. If that were the nature of Congress’s com-
merce power, why would we spend time listing any other powers?”
Some may chastise me for invoking the illegitimate specter of “Framer’s intent,”
which was rightfully discarded from the most prominent theory of originalism
decades ago. Yet I do not need to peer into the heads of the Framers to make my
central point: Whatever “commerce” means, and whatever interpretive method
you use to fill in that meaning, it must be a “type of thing” rather than a zone of
effects. If “commerce” is merely a zone of effects without de minimis exceptions,
then the Constitution ultimately fails in one of its central purposes: to ensure that
the federal government does not have limitless power. Granting Congress limitless
power violates any legitimate theory of constitutional interpretation.
Perhaps, to make my point clearer, it would be helpful to put the Constitution
and the Framers’ discussions into a modern context. The Founding Generation
seems remote, and our post–Civil War, post–New Deal nation looks very different
from the early United States.
Let’s look at the European Union. The EU was mostly created to facilitate an
economic union—that is, a free trade zone between the member states. The core
powers of the EU are related to facilitating the free flow of people, goods, services,
and capital across sovereign boundaries. Questions about manufacturing regula-
tion, local agriculture, and other internal economic practices are largely left to the
sovereign members under the correct theory that Germany, France, and the others
are better situated, fully capable, and authorized to take care of local issues within
their borders. If Brussels took jurisdiction over those local concerns, the member
states would be rightly upset.
But what is truly “local?” The Netherlands’s lax drug laws certainly affect the
other nations, particularly those sharing its borders. Germany’s labor laws and
manufacturing regulations affect interstate commerce. France’s limits on weekly
working hours affect the economic intercourse with other nations.
The Netherlands, Germany, and France cannot dispute those effects. Instead,
they must rely on the principle that drug laws, labor laws, and manufacturing
regulations are not the type of thing the EU has power over. That will be the only
useful argument if and when the centralizing forces in Brussels start to view local
laws as impediments to their well-crafted schemes.
When that time comes to Europe, and in some subjects it already has, the issues
will be the same as they were, and are, in America. Defenders of the sovereign
powers of the member states will say that “manufacturing” is a type of thing that
is not commerce, despite its obvious effects on commerce. Advocates of central-
ization will say that the distinction is arbitrary and that an “effects test” is neces-
sary for Brussels to accomplish its goals. When they look to America for guidance,
the defenders of limited government must say, “Don’t give in. Give them an inch,
they’ll take a mile.”
 INTRODUCTION 5

For us, the individual mandate was the last mile in a marathon we’ve been run-
ning since the New Deal.
Although I’m not here to remind you of lessons from high school civics, it
might be worthwhile to keep these abstract concepts in mind as you read the pages
that follow. The discussions between contributors to this volume may seem eso-
teric, but at the core they are talking about drawing lines—even if they’re argu-
ably arbitrary lines that only partially map onto our interconnected world. The
Supreme Court once asked whether there is a meaningful line between “manufac-
turing” and “commerce” and decided that there wasn’t. With the Affordable Care
Act, we looked for a meaningful line between “action” and “inaction.” Sure, these
distinctions are nuanced, but should the lack of easily discernible lines make us
throw up our hands and abandon our federal system altogether?
Even national borders are powerless against a pure, effects-based jurisdictional
test. Yet if the United Nations began asserting jurisdiction over U.S. manufactur-
ing laws based on the theory that the effects of our laws are not contained within
our borders, we would boldly and confidently assert that our laws are none of their
business. Our manufacturing laws certainly have extraterritorial effects, but they
are not the type of thing the UN has power over.
Obviously the UN is a poor analog to our integrated federal system. Yet many
of the reasons we don’t want the UN running our health care also apply to repos-
ing those personal choices in Washington, D.C.
Nevertheless, some regard these attitudes as philistine. For many, the course of
human progress requires centralization, and those who stand in the way of Con-
gress’s attempts to solve problems of a national scale are reactionaries holding on
to unenlightened theories no longer relevant to modern nations.
To this I say that it is hardly enlightened to require every group with deep con-
victions about health care—from Catholics to Jehovah’s Witnesses to those who
simply don’t believe in Western medicine—to create lobbying organizations in
Washington so they can defend their convictions in a tribal, yet dapper, Hobbesian
war over what our “national health care plan” looks like.
Because of the synergistic effects of constitutional interpretation, the only
way to resist such centralizing force is to stand against an illegitimate proposal
even if you think it is a good idea. If you believe that the Constitution autho-
rizes all good ideas, then you do not really believe in the Constitution—you just
believe in good ideas.
With the legalization of marijuana in Colorado and Washington and the legal
quagmires that have emerged due to the quirky fact that marijuana is simultane-
ously legal and illegal in those states, perhaps some champions of centralization
are realizing the costs of an expansive federal government. The untenable situa-
tion in Washington and Colorado is a good indicator that the federal government
has overstepped its constitutional boundaries. After all, whereas Congress once
believed it lacked the power to prohibit alcohol without a constitutional amend-
ment, they now prohibit drugs by statute. They do this based on the same Supreme
Court cases—for example Wickard v. Filburn,7 NLRB v. Jones & Laughlin Steel
Corp.,8 United States v. Darby9—that were the basis for the argument that Congress
can force inactive people to purchase health insurance.
6 A CONSPIRACY AGAINST OBAMACARE

Much of this kvetching about ships that have long sailed and discussions of
rudimentary constitutional analysis may seem simplistic and mostly irrelevant.
Yet the purpose, structure, and principles of our Constitution have been forgotten
by many. Most disturbingly, many people have forgotten the most important rule
about power: every time you consider granting a new power to government you
must first imagine that power in the hands of your most feared political opponents.
Due to the chief justice’s unpredictable opinion, we are now likely stuck with
a law that I fear will seriously damage the health of Americans. What’s more,
attempts to further centralize power will not stop at the individual mandate. When
the law fails, as I predict it will, it will be said that the federal government lacked
enough power to make it work. The chief justice’s opinion gives people a real
choice whether to comply with the requirement to purchase insurance or pay a
“tax.” Many people will not, and as the price of insurance goes up, more and more
people will choose to remain uninsured. This will certainly be called a “loophole.”
Similarly, the Court also gave states a choice about whether to comply with the
Affordable Care Act’s Medicaid expansion. Another “loophole.” Finally, the states
that don’t create health care exchanges will also throw wrenches in the law’s over-
all scheme. “Loopholes” all around. Having freedom of choice in deeply personal
health care decisions, however, is not a loophole.
When the time comes to revisit the Affordable Care Act, those choices by free,
sovereign entities (citizens and states) will be blamed for the law’s dysfunctions.
To paraphrase philosopher Robert Nozick, liberty disrupts patterns. Free choice
inevitably upsets the carefully crafted plans of Washington.
As a solution to the law’s problems, more power will be proposed. A few voices,
such as many who write for the Volokh Conspiracy and those of us at the Cato
Institute, will strenuously argue that the problem is not a lack of power but a lack
of freedom. I am not optimistic, however, that very many entrenched bureaucrats
and politicians will locate the problem in the mirror rather than in the freedoms
of the American people.

***

I am deeply grateful that Randy, Ilya, Dave K., Dave B., Orin, and Jonathan asked
me to be a part of this exciting project. The conversations recorded here are truly
historic, and I hope that this volume will be a valuable and novel contribution to
Supreme Court history.

Trevor Burrus
Research Fellow
Cato Institute Center for Constitutional Studies

Notes
1. John H. Langbein, “Scholarly and Professional Objectives in Legal Education: Ameri-
can Trends and English Comparisons,” in Pressing Problems in the Law, Volume 2: What
Are Law Schools For?, ed. Peter Birks (New York: Oxford University Press, 1996), 3.
 INTRODUCTION 7

2. Id. at 5.
3. “Annual Fourth Circuit Court of Appeals Conference,” CSPAN, http://www.c-span
.org/Events/Annual-Fourth-Circuit-Court-of-Appeals-Conference/10737422476–1.
4. For more on this theory, see John C. Goodman, Priceless: Curing the Health Care Crisis
(Oakland, CA: Independent Institute, 2012), and David Goldhilll, Catastrophic Care:
How American Health Care Killed My Father—and How We Can Fix It (New York:
Knopf, 2013).
5. United States v. Lopez, 514 U.S. 549 (1995).
6. United States v. Morrison, 529 U.S. 598 (2000).
7. Wickard v. Filburn, 317 U.S. 111 (1942).
8. NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937).
9. United States v. Darby Lumber Co., 312 U.S. 100 (1941).
 1

In the Beginning

F rom the moment he took office, President Barack Obama saw health care
reform as one of his administration’s top priorities. In February 2009, Presi-
dent Obama announced to a joint session of Congress that discussions on reform-
ing American health care would move forward as a priority. Meetings were held
with industry leaders, lobbyists, and influential senators and members of Congress
over the next many months.
The discussions in this chapter occurred prior to the signing of the final version
of the Affordable Care Act (ACA). As Congress, pundits, and average Americans
debated health care reform, so too did the Volokh Conspiracy (VC) bloggers.
On November 7, 2009, the House of Representatives passed the “Affordable
Health Care for America Act” by a 220–215 vote, with 39 Democrat votes against
and 1 Republican vote in favor.
In the Senate, the road was more difficult. Senate Republicans vowed to filibus-
ter, so any bill needed a filibuster-proof 60 votes. Having only 58 votes at the time
(before Senator Al Franken (D-MN) won his recount and before Arlen Spector
switched parties), Senate Democrats had to appease their more centrist colleagues.
The Democrats were further stymied when, in late August, before the bill could
come up for a vote, Senator Ted Kennedy (D-MA) succumbed to brain cancer.
Senate Democrats focused on getting the votes of their moderate colleagues, par-
ticularly Connecticut’s Joe Lieberman and Nebraska’s Ben Nelson. Lieberman would
not support any bill that had a “public option”—that is, a government-run insur-
ance program that competes with private insurers. In exchange for Lieberman agree-
ing to support the bill, Senate Majority Leader Harry Reid permanently shelved the
public option provision, much to the anger of many Democrats and liberal pundits.
That left Nelson. During late-night negotiations, Reid approved several of
Nelson’s “concerns,” the most famous being higher federal Medicaid payments to
Nebraska, which would become known as the “Cornhusker Kickback.” Whatever
name people wanted to call it, Reid got Nelson’s vote.
Early in the morning on December 24, 2009, Reid called the vote and the bill
passed 60–39. All Democrats and two independents voted for; all Republicans
voted against, with one abstention (Jim Bunning of Kentucky).
In January 2010, Republican Scott Brown was surprisingly elected to Ted Ken-
nedy’s seat. Senate Democrats had lost their filibuster-proof voting bloc, but they
Other documents randomly have
different content
On the issuing of the eleventh edition of the "Encyclopædia
Britannica," I was asked by the editor to write two articles on
Bookselling and Publishing, with biographical notices of British and
American publishers' houses. I did this with much pleasure, and
afterwards received an invitation to a dinner at the Hotel Cecil to
celebrate the Encyclopædia's completion and publication. Among
some 600 guests who were present, there were representatives of
great distinction from every department of learning, such as the
Speaker of the House of Commons, Mr. Balfour, Sir W. Harcourt, Lord
Brassey, Lord Bryce and Viscount Wolseley. These names are
sufficiently representative of the guests, although it would be
difficult to give a complete list of them. Altogether, it was a
wonderful gathering, and my association with it was most gratifying
to me.

CHAPTER VI
The Bookselling Trade and Underselling
THE published price of a book being publicly advertised, there is
probably no other trade which gives the same opportunity of
attracting the public by underselling as that of Bookselling, and evils
of a greater or less degree in this direction have been practised since
the days of Caxton. In the early days of the nineteenth century
serious attention was directed to underselling, and an association
formed entitled "The Associated Booksellers." This was formed in
1812, but the notorious Lackington carried underselling, and what
he termed "remainders," to such an extreme that the very existence
of the Bookselling trade was seriously threatened. This Association,
however, lacked sufficient strength to take the necessary steps to
stop the underselling mania, and it was not until 1850 that another
Booksellers' Association was formed which nobly fought a most
difficult and trying battle. The Association failed, owing to the
decision in 1852 by Lord Campbell, Mr. Grote, and Dean Milman that
the question of a bookseller having "paid the purchase money shall
not resell it under a certain price, derogated from the rights of
ownership which, as purchaser, he had acquired." This decision had
the effect of dissolving the Association.
Some years after attention was again directed to the evil of
underselling, which it has taken nearly a century to bring to an end,
for it is hoped that by the adoption of publishing on the net book
system and the Publishers' and Booksellers' Associations, discounts
to the public will be entirely abolished. On looking through the
volume for 1864 of that consistently intelligent trade journal, "The
Bookseller," I find the editor saying that "The opening of the new
season appears to be a very appropriate time for a few remarks
upon the ruinous system of underselling, which seems to be the rule
rather than the exception, not only in London, but in most provincial
cities. How far it will proceed and what may be the extent of the
damage it may do, none can predict. We, however, believe
underselling to be wholly unnecessary and that it may be checked, if
not altogether stopped, if publishers and booksellers will come to an
understanding on the subject." The article goes on to point out how
by publishers, if necessary, reducing their selling prices, they might
do away with the discount allowed to the public, or, in other words,
encourage the adoption of a net system. It is pleasant to see a letter
on this point issued the same year, and signed by A. Macmillan.
When about to publish their celebrated Globe edition of
Shakespeare's works at 3s. 6d., after speaking of the number of
pages, the quality of the paper, the printing and the binding, Mr.
Macmillan goes on to say, "Why should the trade throw away their
profits on a book that needs no further cheapening to put it within
the reach of all. I have neither the will nor the power to dictate to
the trade what they shall sell the books for after they buy them from
us, but I would be glad and grateful if they would try the experiment
on this new book whether the underselling which has crept in of late
years, does good really to anybody." It is most gratifying that the
present head of that firm should have done so much to bring to an
end the unjust system of discounts. It was stated that nearly 80,000
copies of the Globe Shakespeare were sold within six months of its
publication.
In 1867, after many years of unrest, matters were again brought
under discussion through Mr. Thomas Bosworth, of Regent Street,
giving excessive discounts. I have before me a leaflet issued by this
bookseller entitled "Rattening in the Book Trade." In this leaflet he
complains of Messrs. Hamilton, Adams & Co. having closed his
account, owing to his continuing to sell to the public books at trade
prices and sometimes less than that. This did not continue very long,
as I find that in 1869 he had to make a composition with his
creditors. In 1890 the parent of the Associated Booksellers of Great
Britain and Ireland was formed, under the title of "The London
Booksellers' Society," and I am proud to record that I was one of the
early members of its Council. The main object of the Society was to
restrict discounts to 25 per cent., and it issued a price list from 6d.
to £2 2s. showing these discounts. Had it not been for the
introduction of the net system, this Booksellers' Association would in
all probability have followed the footsteps of its predecessors.
A correspondent in "The Bookseller" for 1877 gives a very
despondent account of the bookseller and the way the bookselling
trade was carried on. This despondency was caused mainly by the
iniquitous system of discounts which were then being given to the
public and the unfair methods of business, owing to the want of
harmony and business regulations. The correspondent says that "A
bookseller of to-day is very often a man who might just as well be a
cheese-monger or a pork-butcher for anything he knows or cares
about books; and as for him being capable of guiding or advising his
customers, they have sometimes no little trouble in making him
understand a requirement that lies just outside the current of
popular demands. The cause of this degeneracy is not far to seek: it
is the undignified and unneighbourly scramble for custom, in which
each man's object is to give away a larger discount in the shilling
than anyone else. Unless booksellers can be found who will have the
courage to stand out of this scramble and be content to serve such
customers who are willing to pay a fair price for their books, it is to
be feared that the race of booksellers will become extinct."
Fortunately, by the introduction of the net system, this downward
tendency has been stopped, and the bookselling trade is gradually
taking the place it deserves in the world of letters.
The Publishers' Association was established in 1896. Mainly through
the influence and the exertions of Sir Frederick Macmillan, the net
book scheme was officially recognized by the Publishers' Association.
It has grown ever since that time and has undoubtedly been the
salvation of the Bookselling trade in this country, and it is hoped that
it will lead to further and better conditions for every one connected
with the trade.
This question of underselling is so closely associated with the
general condition of the Bookselling trade that I have decided to
reprint in this chapter the following article which appeared in the
"Publishers' Circular" and was written by me in 1915. Though a
development in some of the particulars has been obtained, there is
still much to be done. As the article was reprinted and distributed by
the Associated Booksellers, and I also receive so many
congratulatory letters respecting it, I feel that it may probably be of
service when some of the details of the trade are again under
discussion. I have omitted from the article such portions of it as time
has shown to be unnecessary. What I have here reprinted I hope
may be found of interest.
SOME NOTES ON BOOK-SELLING

In using the term "bookselling," it is intended in this article to

include all those businesses, exclusive of authorship, which are
interested in the making, distribution, and selling of books, and
while offering a few suggestions to these trade organizations,
there will be no attempt to dogmatize on any particular sphere
of it. As their working conditions are so continually changing,
these must therefore fall in with modern requirements or give
place to others which can accommodate themselves to the
altered conditions.
Since the origin of printing there have been differences and
grievances, many of them imaginary, in connexion with the
trade of bookselling. Some of these complaints are
characterized as a decay of the author, the book, or the
bookseller; sometimes it is the over-production of books or their
cheapness, due to underselling or to outside firms being allowed
to trade in them, but all these complaints either die a natural
death or turn out to have little foundation, and the trade goes
on in much the same way as it has done for centuries past.
There is occasionally a reason for some of these criticisms, and
although there have been variations in both the production and
the distribution of books, yet many of the salient features
remain the same as those existing in the early days of
bookselling.
Before suggesting a solution of some of the difficulties which we
find current in the bookselling trade to-day, let us inquire into
that of book production.
Foremost among the real or imaginary difficulties is the question
of over-production. This is, from many points of view, an
important question with distributors of books, both wholesale
and retail.
Take the following interesting particulars, which appear
somewhat out of harmony with our unsatisfactory means of
distribution, but when we compare these figures with those of
other countries, they seem insignificant: In the year 1913,
9,541, and in 1914, 8,863 new books were published in
England. In 1913, 10,607, and in 1914, 10,175 new books were
published in America. In the year 1912, 34,801 new books were
published in Germany, and in 1913 no fewer than 35,078 were
issued from their various presses. Nearly four times as many
books were thus yearly produced in Germany as in England—
but it must be admitted that many of these are of a local or
ephemeral character—and over three times as many as in
America. A comparison between the number of authors and
their proportion to the population is no less surprising. In 1910,
there were 9,000 writers of books in America; there were 8,000
in Great Britain; while in Germany there are over 31,000 of such
littérateurs. Of course, the war has greatly changed these
figures.
It is computed that the total number of printed books in the
world is no less than 11,638,810, and that about 8,714,000 of
these have been published subsequently to the year 1800. From
1500 to 1535 the number of books produced annually averaged
only 1,250. It was not until 1700 that the annual average
passed 10,000, and it was not until 1887 that it reached
100,000. From 1900 to 1908, however, the world's annual
output averaged 174,375. Some interesting statistics relating to
the production of printed books are given in the "Bulletin de
l'Institut International de Bibliographie."
The complaint of over-production is almost as old as the art of
printing itself, for, according to Charles Knight's "The Old
Printer," it is stated that some Roman printers of the Latin
Classics in 1471 petitioned the Pope to interfere on their behalf.
In their petitions they stated that "they were the first who
introduced this Art, with vast labour and cost, into His Holiness's
territory, and encouraged by our example, other printers have
done the same. If you peruse the Catalogue of the books
printed by us, you will admire how and where we could produce
a sufficient quantity of paper or even rags for such a number of
volumes. The total of these books amount to 12,475, a
prodigious heap, and intolerable by reason of those unsold. We
are unable to bear the expense of housekeeping for want of
buyers, of which there cannot be a more flagrant proof than
that our house is full of quire books, but void of every necessary
of life."
From this it would appear that the question of over-production
has an early origin and is continually being repeated, but I dare
venture the remark that there is not now or never has been any
over-production in books that are worth putting on the market,
and if publishers would refuse the bribes offered by those
anxious to see their names in print, and only issue such books
as in their mature judgment they consider worth putting before
a community of intelligent readers, there would be less outcry of
over-production. This question is very far-reaching, and
especially affects the sellers of books. Frequently the publishers
issue books, the cost being paid by an ambitious author; but for
this the public would probably never hear of him; the book is
shown to the trade, no reference whatever is made to its origin,
and booksellers are often led to buy and stock a book by their
trust in the publisher, and find out to their cost that there is no
demand whatever for the book, and it remains upon their
shelves. It is a fair contention that the bookseller should be
warned against such books, in which the publishers have taken
no risks, neither should the booksellers be persuaded into so
doing. Undoubtedly, if the trade is to prosper, there must be
more discrimination in selecting stock. There are now so many
influences at work to advertise a book: not only are there the
ordinary media, but an author will go round to the booksellers,
talking about his book, telling them it will sell in thousands, and
that there has never been such a book written before. Instances
have been known where the author has gone to a number of
booksellers and ordered copies of his book, never calling or
paying for them. The bookseller, by these means, has to put
into his stock books which he is unable to sell. There should for
safety be a method of allowing returns to be made of such
books before the publishers make up their accounts; there
would then be an inducement for a bookseller to display a book
upon his counter or in his window, with a possibility of sales
being made through the publicity given to the book.
Many books are published for which no reasonable market
exists, but as long as education continues to influence the mind
there will be found persons who think their ideas are inspired,
and they must give them expression in the printed book. There
is to-day a larger reading public than ever, and the all-important
point is how to get hold of them. On this point much has been
written and said. It is of no use discussing the old methods, so
much extolled, of how the bookseller formerly lived over his
shop and existed with, if not by, his books, and what men of
encyclopædic knowledge these ancients were. These times are
gone, and the men are gone with them. We must, therefore,
deal with events as they are to-day. Every one engaged in the
business of bookselling would no doubt confess that he is out,
inter alia, to try and make money and earn a living, and this is
one of the points I wish to discuss. First, the men who
constitute the bookselling trade are probably as intelligent and
as up to date in knowledge as they were in the past. It has
been said that the second-hand bookseller is the only man with
a knowledge of books, but this is not so. Unfortunately, the
exigence of our social life often prevents him from giving as
much attention to his trade as formerly. This has been
intensified by the margin of profit not being commensurate with
the labour; therefore in many cases other kindred businesses
have been added to that of bookselling.
Undoubtedly the greatest benefaction which has ever fallen to
the book trade was the introduction in January, 1900, of the net
system. By this system a reasonable profit was guaranteed, and
members of the book trade were brought together and the
trade organized and extended in a manner which would have
been impossible without some such rallying point as that offered
by the net system. This has now obtained such a hold, both
upon the trade and the public, that it must remain one of the
axioms of the bookselling trade.
A similar system was started in America in 1901, and for many
years considerably helped the publishers in that country in
organizing the trade, and protecting that of the bookseller in his
attempt to remedy some of the evils caused by undersellers and
unfair competition. Unfortunately, an adverse decision in the
American Supreme Court in what is known as the "Macy case,"
caused the members of the Association to wind up their
organization. This was done at the end of 1914.
In these days of increased business pressure and competition, it
appears especially unfortunate that so large and important an
organization affecting the publishing trade in America should so
suddenly come to an end. It is, however, hoped that the
publishers will be able before long to reconsider the situation
and establish in some form or other a new representative
organization to take charge of and to promote the general
interests of the American publishing and bookselling trades, for,
undoubtedly, without some such central control, the trade of
bookselling cannot thrive in the same manner as it otherwise
would do.
A very important point is the relation of the publishers one to
the other. If there were more trade-regulations to bring into
harmony many of its unwritten laws, some of the difficulties
which now often arise would never occur. At present the
Publishers' Association mostly consider questions outside their
own business workings, and nothing in the shape of terms or
personal arrangements is touched upon or discussed; therefore
unnecessary competition and varying terms exist to a
considerable extent. How much unpleasant feeling might be
avoided if some broad but definite rules were laid down for the
guidance of publishers towards each other, and also to the
wholesale and retail bookselling trades. This question will be
further discussed later on. A very important question is,
however, now awaiting solution—that of sending out books on
sale or return. Continental booksellers adopted this method of
bringing books before the public many years ago, with a great
amount of success and satisfaction, but of course this is a very
debatable question.
It appears somewhat difficult for publishers to realize how much
could often be done by a bookseller in pushing the sale of a
book if he were guaranteed against loss: especially is this
applicable to a book by a new author. How much better it would
be for author, publisher, and bookseller, if in certain cases books,
such as before mentioned, could be shown in windows of retail
booksellers, and that the publisher should take them back or
exchange them within, say, six months from publication, if still
unsold. By these means books by unknown authors would get
an advertisement such as could be obtained in no other way,
and it would certainly help the bookseller with a show of books
which at present he is unable to obtain.
It is somewhat strange that so little difficulty regarding cost or
selling price has yet arisen with the issue of the modern cheap
editions of books. These cheap issues are published at net
prices, they yield a fair profit to those through whose hands
they pass, and the public are quite satisfied. Recent history of
popular literature shows that success is obtained, not by high
prices, but by big sales. What is wanted is the realization of
what Matthew Arnold once wrote, "that he hoped for the day
when food and books shall both alike be felt as needs."
In connexion with the trade of publishing, the question is, how
best to help the bookseller to obtain his supply of books, as the
miscellaneous character of the books published, and the
increasing number of publishers, and the cost of "travelling"
books in the country, make it imperative that some distributing
medium should be engaged in this work. In most countries such
an agency exists, but methods vary in each country; it is
represented here by the wholesale agent, who supplies from his
own stock or collects from the publishers everything a country
bookseller may have ordered. By some publishers this agency
has a poor recognition, but without such distributing houses it
would be quite impossible for the ordinary retail bookseller to
obtain his supplies, as the public when ordering books scarcely
ever give the publisher's name, and frequently give half a
mutilated title, which only those in daily intercourse with all
published books could recognize, so that this part of a general
system of distribution should not only be fully recognized by the
publisher, but in calculating discounts and expenses this
distributing method should be considered. One is inclined to ask
if there is anything wrong with the trade; if so, is it with the
retail bookseller, for after all it is this agency which comes in
direct contact with the public. Until the introduction of the net
system before mentioned, there was a war of discounts existing
which would have eventually meant ruin, and it is only a
reasonable conclusion that what every bookseller recognizes as
a good to the trade should be further extended. Is not the time
ripe for more organization, without oppression, to be adopted
by the trade? We have now the organizations of both the
publisher and bookseller, to which all the leading members of
each of these branches of the trade belong. Why cannot, as
before suggested, some rules of a broad but inclusive character
be laid down and agreed upon by members of both
associations, so that the differences and difficulties which so
frequently arise may be easily adjusted? By these means a
dignity and influence as of old would be restored to the
booksellers, petty grievances would be easily removed, and the
question of a living discount would be more easily discussed,
and the book world (which formerly had only two interests, that
of author and publisher, but now has the bookseller as a
separate factor) would be placed on a firmer foundation and in
the position which, by its literary association, it deserves.
In recommending closer co-operation between the Publishers'
and Booksellers' Associations in the internal arrangements of
the bookselling trade, my object is to advocate centralization,
but with a liberty which should not be abused. How often a
publisher wishes to bring before the various distributing
agencies of the trade some work in which he has invested
intelligence and money, and which is not a machine-made book!
If such co-operation can be freed from jealousies, what better
medium could be found for disseminating information than a
central association formed of the above-named organizations?
At first there would be much give and take, but if there could be
a sub-committee of each association formed which would meet
and discuss questions to be submitted to the respective central
councils, matters would soon run smoothly, and if the respective
presidents or secretaries could be so in touch with each other
that preliminary difficulties could be made plain, there is little
doubt that results satisfactory to the trade would follow. That
important results would follow is practically certain. Take, for
instance, the present arrangements for the Annual Meetings of
the Publishers' and of the Associated Booksellers. The only
attraction of the former is the chairman's address, which,
although often eloquent, seldom leads to either a discussion or
suggestions, with a result that everything is cut and dried in the
most orthodox and dry-as-dust fashion.
Almost the only difference in the Booksellers' Annual Meeting is
that it brings members together from all parts of the country
and helps to promote social intercourse. Festive gatherings and
outings are a greater attraction than the business agenda, and
the business man must often have forced upon him the fact that
time which is frequently taken up in dinners and receptions
could be better spent in discussing business questions. It can
scarcely be denied that the two trade associations are capable
of far greater usefulness than they at present achieve.
In looking through a recent number of the "Publishers' Weekly,"
I was much struck by the practical way in which the annual
meetings of the book trade of America were conducted. From
the report of their proceedings I find that some twelve different
subjects associated with the bookselling trade were discussed,
among them being the following: Undue Competition of
Jobbers; Postage Extra; Self-addressed Circulars issued by
Publishers in their interest rather than the Dealers; Discounts to
Lending Libraries; Uniform Discounts according to quantity
purchased for every dealer alike; Failure to include Juvenile
books in the net class.
Surely there could be found a sufficient number of members of
the bookselling trade to discuss some of the above or other
subjects to the advantage of the trade generally?
When one reflects that the yearly output of English books is
considerably less than that of America, which is about one-third
that of Germany, and that one-fifth of the inhabited world is
dominated by the English language, it is surely time for all the
members of the bookselling trade to wake up.
It is not my intention to go into the details of cost prices, but all
are agreed that to make an effectual organization for the book
trade, the question of profits and terms must come in, both for
the publisher as well as for the wholesale and retail bookseller.
There is, however, a question which has often been much
discussed as to whether trade terms should be based on a flat
price, or the system of odd copy and discounts be continued.
There is much to be said for both systems, but the method of a
sliding scale is invariably used both here and in other countries.
In America and Germany, as well as in this country, sometimes
the odd copy is given, and even in those countries which charge
flat rates there is always an advantage in prices which
correspond with numbers. This is only a reasonable concession
to those who will speculate, or have built up a business in which
a considerable amount of capital is locked up. There are few
businesses where speculation is more precarious or where the
articles of commerce so quickly deteriorate in value as that of
the bookseller, and it is hoped that publishers will soon
recognize that bookselling as a trade wants more help and more
consideration than it receives at present. Otherwise, the small
man will be pushed out, and the trade become centralized in a
few big establishments, who will be able to dictate terms for
distributing the books published, and a trade union of
distributors may be formed which will prove a harder taskmaster
than the most tyrannical trade union that has ever dictated
terms to its employers. Every one, however, in the trade
sincerely hopes that when the publisher and bookseller are
brought more in contact with each other through their
associations, these important points will be mutually considered
from a practical point of view.
It is often wise to see how the business of bookselling is carried
on in other countries, so a glance at some of their methods
should be interesting.
In Germany, before the war, nearly all booksellers had an agent
in Leipzig. This agent receives his client's order every day, and
after dispatching them to different publishers, he collects the
parcels and sends them off by post or rail. A "collector," as we
know him in London, is not known there.
Most firms give credit, and customers go into Leipzig once every
year to the "Booksellers' House," when they pay their agent and
the publishers.
Firms in Berlin have a special way of dispatching their books,
etc., to other firms in the country. It is a kind of private post
service between the Booksellers' League in Berlin and
booksellers and wholesale agents in other towns. Each member
of this League pays a certain amount yearly, and has his goods
sent on by the private post service. This is not a very quick
method, although it is cheap.
The following Consular Report upon this subject will be found
interesting:—

Even in this changing age the organization of the German

book trade remains in principle what it has long been. The
two main principles which make the trade as flourishing as
it is, are the fixed selling price and the right of the retailer
to return unsold books. The first, combined with very long
credits, is the solid basis of the existence of the small retail
houses, and has favoured the establishment of retailers
everywhere. There is in Germany one bookseller for every
5,000 inhabitants, and the consequence of retail shops
being found everywhere is that the German publisher
spends very little in advertising, for he sends out all his
novelties on sale according to a system established with the
retail trade, or special wishes of the retailers, which he
learns by means of his inexpensive circulars. In no other
trade is there so close an understanding cultivated as
between the German bookseller and his educated
customers. The retailer circulates all his new books
amongst likely buyers, and they become better known than
through advertisements. The retailer pays for all the books
bought during the year at the Easter Fair of the following
year. The discounts vary according to the class of book,
from 25 per cent. on the selling price of scientific books to
40 and even 50 per cent. on juvenile literature, besides
which eleven copies are sent for ten, or thirteen for a
dozen. The enormous number of scientific books published
in Germany, including pamphlets, can only be explained by
the existence of the intelligent retailers all over the country.
The legal organization of the trade is the Verein in Leipzig,
consisting of 2,685 members, which lays down regulations
for the members of the trade amongst themselves, and for
them in their dealings with the public. Thus the
maintenance of the selling price (5 per cent. being allowed
for cash, periodicals excepted) is rigidly insisted on, and if
the rule is broken, it is adjudged by the Verein that
publishers shall not supply the offender, or that they shall
give him no credit or discount. Connected with this
institution is a sort of publishers' and booksellers' clearing
house in Leipzig, by which the ordering by retailers and the
keeping of accounts between them and the publishers are
facilitated and simplified, and the processes of ordering,
packing, dispatching, and paying are greatly cheapened. It
appears designed to prevent a great variety of petty
expenditure, and to it, coupled with the fixed selling price
 and the long credit, is attributed the success of the trade in
Germany.

Again, there is that industrious little country, Norway, which has

been termed "A Bookseller's Paradise." But it must be
remembered that in that country wealth is more evenly
distributed than it is here. There are no paupers, and public
schools are plentiful. The English, French, and German
languages are taught in most schools, and the Norwegian
bookseller is usually a well-educated man and a product of one
of the public schools.
The following facts are from a summary of an able address
given by Mr. W.H. Arnold before the American Booksellers'
Association, and are well worthy of the study of the publishers
and the booksellers in this country:—

Bookselling in Norway is so organized as to eliminate

almost all the risks to which English booksellers are
exposed, to secure satisfactory results for the publishers,
and to provide a fair reward for the author. Three trade
organizations are in existence—The Publishers' Association,
the National Association of Booksellers, and the Provincial
Association of Booksellers, the qualification for membership
in both the first and the last named being membership of
the National Association. All booksellers must be members
of the National Association. The Provincial Association
includes all booksellers except those in Christiania. There is
a National Board of Directors, composed of members of
each association.
An applicant wishing to become a bookseller addresses the
National Board. A young man of eighteen may become a
bookseller when he is thirty; he has twelve years' training—
four years as apprentice, eight years as assistant. Besides a
knowledge of books, he must give security, and if he can
prove he has sufficient funds in hand, the National Directors
will give their permission for his beginning business on his
own account; but the Directors have it in their power to
decide whether a new bookshop is wanted in the district
mentioned.
A town of 8,000 people would afford scope for two
bookshops. Molde, familiar to English tourists, with a
population of 2,200 has one thriving bookseller; Aalesund,
with a population of 14,000, has three bookshops, and
none of these booksellers need fear the incursion of other
rivals.
The subscription to the National Association is 10 krone—
about 12s.—per annum; and for the Association's weekly
journal, 6s. per annum is charged. An annual list of
publications is issued, and once in ten years a reference
catalogue is issued, costing about 20s. All miscellaneous
publications are issued in paper covers, and can be
obtained in cloth, but the paper is the more popular format.
The book buyer who decides that the paper volume is
worth preserving, if so minded gets it bound in cloth or half
leather, cloth costing 1s. 6d. and leather 2s. 6d. Retail
prices are always net—there are no price cutters in Norway.
Publishers do not require to call on the trade: a descriptive
circular is all that is necessary. The bookseller, after reading
this, settles how many copies to buy outright, and
additional copies can be had, subject to return. Prices of
fiction range from 2s. 6d. to 4s. No reduction in the price of
a book is allowed until five years after publication.
Payment for bought books is usually made half yearly, in
January and July, and "on sale" volumes are accounted for
in January, the volumes sold being paid for in March. The
usual trade discount is 25 per cent., and when ten copies
are bought an extra copy is included. School-books are
always bought outright.
 The Provincial Association has a central depot in Christiania,
the stock of which company is owned by the Association
members. The central depot "collects," packs, and
dispatches to its members in the provinces, charging a
scheduled rate for this service. Subscription books are all
sold through the book stores, the only books disposed of
outside recognized channels being religious publications
handled by pedlars.

Of course, there can be objections raised to many points in this

organization, but what I wish to point out is, that if an
association can be of great value to the trade in a small
community such as Norway, which experience shows it to be,
surely by organizing and blending the different associations in
our trade here, similar results may follow. Anyway, it can be
safely relied upon that something definite and more workable
should take the place of our present half-hearted and semi-
distinct organizations which are supposed to supervise the
workings of the book trade in this country.
There are other questions one might consider. That of the cheap
reprint is often a debatable one, some maintaining that it
interferes with the sales of the more expensive editions; others
that it often creates interest in a particular book, and, through
its issue, inquiries are made for the author's previous books.
From some points of view both these arguments have in them
an element of truth, but it all depends upon the character of the
book.
As a rule the life of works of fiction is very short, except in
special cases. The life of works of an author of, say, two or
three books, would probably be about three to six months, so
for books in this class a limit of twelve months should be
allowed before a cheap edition is issued, and according to the
popularity of the author, these times should vary up to two or
three years before cheap editions of books by authors of long
standing are issued, and also the better edition should be
cleared from the bookseller's shelves before the cheaper edition
is published. From a bookseller's point of view, there is no
language too strong in condemnation of the system now much
in vogue, that a 2s. edition of a 6s. novel may be issued, and
both editions kept in circulation at the same time. Editions
selling at various prices are often sold by the author to different
publishers, and each price is supposed to appeal to a different
public. Can a bookseller be expected to keep a stock of all these
editions? If so, his stock of cheap reprints would demand a
special warehouse.
The most reasonable course to pursue in all cheap issues is first
to see if there is a public to which a cheap edition would appeal,
settle a moderate price at which it should be published, allowing
a fair profit to the trade, and after a sufficient time has been
given for the original edition to have a good run, there may be
issued the cheap edition, which, while appealing to a fresh
public, will be remunerative to the author and publisher, and, let
us hope, a help to civilization and the betterment of mankind.
Much the same argument applies to the speculative religious
work. There would not, of course, be so many different editions,
but if the book in its special issue is of a distinctly
argumentative character, and appeals to a thoughtful and
intelligent public, a cheap edition is desirable, not only because
it will sell, but because it will make people think, and truth is
generally brought to the surface and put into operation by a
public who thinks.
I am, therefore, convinced that when due time and
consideration have been given to a book, a cheap edition is
often not only advisable, but necessary.
Another question is, "Should a book be remaindered, and if so,
under what conditions?" This is a very important one, and I am
convinced that no definite rule can be laid down which would be
applicable to all classes of remainders. There are books
remaindered which will sell quickly when brought to the notice
of a particular class of readers, and others which are only fit for
the hawker's barrow or to be pulped as waste. I have known
many books which have been remaindered and have thus had
attention drawn to them; occasionally they have been quickly
bought up, and often resold at their full published price. To
instance only one, the first edition of Fitzgerald's "Omar
Khayyám" was sold from a fourpenny box, and copies of this
edition afterwards fetched £25. By this means a reputation was
established and a position for this book secured. I maintain that
discretion should be shown in this as well as in other
departments of our trade. There are books which are only fit to
become fuel for the fire, while others, either through over-
printing or want of pushful advertising, have reached a very
limited public, and through the book being reduced in price it
has reached an eager public delighted to get a book of such
value at a price suited to their limited means. Although
bookselling is a business, and a most interesting one, yet it does
not exist only for those who carry it on. If there were no
bookseller's shops some means would have to be found for
disseminating that which goes to making the intelligence of a
nation. "Show me the literature of a nation, and I will tell you
the character of the people," said a great man, and I am quite
convinced that if limits were placed upon the distribution of our
books for the benefit of author or bookseller, the Government or
the people would soon find some means by which their
intellectual wants were supplied.
My firm conviction is that no book should be destroyed which
appeals to the intellect or which goes to the formation of
character. When the time comes in the life of a book that it has
exhausted the sphere for which it was intended, let it be offered
as a remainder, and I am sure that it will percolate through the
various strata of society until it finds its level of usefulness. This
may be in the library of the collector or in the more useful
sphere of the homes of the working classes, but a book of any
literary value should never be destroyed.
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