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Supreme Court wrestles with a more dependent world

The high court hears a complaint from states about the health-care law’s ‘coercion’ to accept an expensive expansion of Medicaid. The issue reflects a more dependent world in government, trade, and high-tech. 

In the last day of its debate over the health-care law, the US Supreme Court wrestled with a big issue in this interconnected age: When does voluntary dependency slip into coercion and perhaps even blackmail? 

The justices heard a complaint by 26 states about the law’s expansion of Medicaid to all adults with incomes up to 133 percent of the poverty line. The added cost of this state-administered program could hit local taxpayers, the states argued. 

Yet, while states can legally opt out of Medicaid, they are also threatened with the loss of all federal spending if they don’t comply. 

Like a debtor in too deep, states will likely be stuck with paying for much of Medicaid’s expansion in the coming decades. It’s a type of unforeseen overdependency – in which largess can turn to duress – and which can become more common with the growth of federal spending, global trade, and personal technology. 

Washington, for example, remains hooked on China’s willingness as the world’s largest banker to continue buying US debt in order to keep the American economy going. The world’s high-tech industries are also dangerously reliant on China’s almost-exclusive supply of rare earth minerals used in manufacturing many digital goods. Beijing has threatened to withhold exports of such minerals unless high-tech companies open plants in China. 

America’s dependency on foreign oil persists despite the lessons of the 1973 OPEC oil embargo and spikes in gasoline prices. Even with improved energy efficiency and alternative sources, the United States has a $300 billion trade deficit on petroleum. Countries like Iran and Venezuela can still easily disrupt oil markets. 

After joining the euro, Greece became addicted to easy credit from foreign banks. Now, after the possible collapse of the euro, it must endure difficult austerity imposed by Germany and others. One irony is that an axiom of ancient Greece was “everything in moderation,” which was engraved on temples at Delphi. 

In the US, easy credit during the housing boom of the last decade left many homeowners at the mercy of lenders when the bubble burst. Now a quarter of homeowners owe more than their houses are worth while others are forced into foreclosure by banks. 

In technology, worries have ebbed and flowed about a dependency on giant companies like Microsoft and Google. Apple became famous for its 1984 ad challenging IBM’s dominance, but now it is the world’s wealthiest company with a dominance in tablet computers and cellphones. And Google finds it difficult to live up to its motto of “do no evil,” especially in preserving people’s privacy. 

Young people are becoming dependent on social networks. Facebook users have an average of more than 130 “friends,” and they rely on this collective of friends to make many decisions. But that can also easily turn to peer pressure. Digital links can quickly become a social ball and chain.

In the Medicaid case, the Supreme Court may be reluctant to rule in favor of the 26 states. In similar cases about federal conditions imposed on states in order to receive funding, the court had a hard time defining coercion. 

Yet the issue persists. A century ago, more than half of all government spending was local; less than a third was federal. Now Washington accounts for more than two-thirds of public spending. As scholar Lynn Baker notes, “The biggest threat to state autonomy is, and has long been, Congress’s spending power.” 

It’s more difficult these days to live by old adages like “never a borrower or lender be” or “beware Greeks bearing gifts.” Interdependency brings many benefits. More can be done through better networking and sharing of wealth. 

Codependency in any relationship, whether personal or institutional, can run amok if one side makes onerous demands. That’s the basic issue before the Supreme Court. As a lower court judge stated in this case: There must be “a line somewhere between mere pressure and impermissible coercion.” 

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