Interesting. Twenty States have argued another line.
This defect is true of the new health law, the Patient Protection and Affordable Care Act. Although the constitutional objections to its individual insurance mandate—the requirement that any person who isn't provided insurance by his employer buy it on his own—have gotten all the public attention, the law also has a "general welfare" problem. It will pile unspecified new costs on states by requiring them to extend their Medicaid coverage to more people. In Florida, 20 states have challenged these state mandates as exceeding Congress's spending power. Their challenge is based on South Dakota v. Dole (1987). --AOSHQ quoting the WSJ
In brief, the Feds are not allowed to "coerce" the States to spend money; thus the 'zero-out-your-Medicaid' threat of Obozocare is likely un-Constitutional.
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