Of Rule by Experts and Rule by Law

February 22, 2022 Leave a comment

Photo by Adam Szuscik on Unsplash

In the 1990s I was part of a congressional delegation to Argentina, when the Argentine economy was growing strongly and steadily, and inflation was low, the currency convertible 1-for-1 with the dollar.  Trade barriers were being lowered, commerce was booming.  I recall asking Argentines what could possibly darken what seemed to be a bright future.  They were quick to reply:  “Here in Argentina we have no rule of law.  You can have no confidence in getting justice from the courts.”  Not long after, political shenanigans to reward one part of the electorate by a transfer of wealth from others threw the Argentine economy into turmoil.  Momentary good policy is a tough path to walk across bogs of inadequate legal safeguards.  Freedom has rested upon rule by law rather than rule by men.

Fundamentally, the American Revolution was an assertion of the rule of law.  Most of the Declaration of Independence is a litany of abuse by the English rulers.  The Revolution was intended to take power away from man and men and rest it upon laws and rights, soon to be secured by the world’s first written Constitution.

The Progressive Movement, which thrived over a century ago, was a retreat, aggressively stepping backwards to the rule of men as an impatient alternative to the rule of law:  the Rule of Experts.  Their new view—really a very old view dressed up in modern rhetoric—was that there are benevolent experts, to whom we can safely yield our governance, for such understand the process of modern government better than ordinary people do.

It sounds akin to the ancient theory of Divine Right of Kings, that the worldly monarchs are chosen by God and invested with greater wisdom and perspective than the average man and woman.  To their benevolent expertise and fatherly care was entrusted the governance of the rest of us.

Today’s benevolent experts are invested by their colleagues with varieties of credentials certifying their expertise.  Not very democratic, they make no secret of their impatience with the Congress and other constitutional brakes on arbitrary authority.

Just as not all men are always just, not all men are reliably wise.  The American Founders thought to address this problem by the separation of powers, dividing political authority among three branches in the Federal Government and the States.

The current regulatory program rests heavily on the notion that benevolent experts should be entrusted with authority for the big questions and increasingly smaller questions, too.  It has evolved by progressively engulfing the constitutional separation of powers, merging legislative and executive—and often judicial—authority in “independent” regulatory agencies headed by unelected officials.  The unelected federal regulator writes the details of mandatory regulations, charges violators, assesses guilt, and applies penalties.

Professedly efficient, it does not work well in practice.  First, the regulators are not dispassionate umpires, limited to calling the balls and strikes.  They are also players in the game, having their own set of particular interests and incentives that they take care of first.

Second, reliance on benevolent experts assumes what is an unproven, undemonstrated level of knowledge, insight, and forecasting skills.  Regulators are not dumber than the rest of the population, but they are no smarter either.  It is just that life is too complex and the society of the living is proving too much to be run by any designated group of humans and their computers.

A third flaw is mission creep.  Even if the tasks are too great or require too much knowledge, insight, foresight, and other skills in unachievable degree, the regulators still take them on, with each failure met with calls to increase resources and power of the agency.  

An example is the Federal Reserve (commonly called the “Fed”), created with a specific and rather narrow purpose, to make enough funding available for the banking system in times of financial stress.  Before long, the Fed gained control of monetary policy and the practice of controlling interest rates.  Later, it was tasked with promoting maximum employment.  In 2010 the Fed’s role in supervising banks was enlarged to supervising any financial business considered to be systemically significant.  Each augmentation has drawn the Fed away from its narrow, objective task. 

This expansion of authority affects every business and every home.  The Federal Reserve is the world’s biggest rigger of interest rates.  Its prolonged policy of keeping short-term rates at or slightly above zero has resulted in penalizing all savers and those who live off of their savings, transferring trillions of dollars of wealth to borrowers, the biggest borrower being the Federal Government.

A partial but simple solution toward strengthening the rule of law and reducing exposure to the caprice of men would be returning to elected representatives the making of laws.  It is a messy process, exactly the messy process that the Founders intended to preserve freedom from the encroachment of arbitrary and oppressive government.  The regulators, which are theoretically part of the executive branch, should be limited to the duty of implementing the laws that the elected and accountable representatives make. 

If Congress were required to write the rules and mandates, and delegate only the implementation, the mandates of government would be circumscribed by the exposure of a legislative body held directly accountable for what it has wrought.  It is easy for legislators to complain about bad regulatory decisions, but too often, these are decisions that Congress never should have delegated to regulators in the first place.

Filed under bureaucracy, Congress, Constitution, Declaration of Independence, Federal Reserve, freedom, interest rates, progressives, rule of law, Supreme Court Tagged with , , , , , , , , ,

Of Platitudes and Political Attitudes

October 17, 2020 Leave a comment

Photo by Tim Mossholder on Unsplash

I am naturally optimistic.  So you will understand that I rejoiced to see several of my friendly neighbors, who sometimes disagree with me politically, place signs in their yards supporting positions consistent with the views of free market liberty-loving constitutionalists like myself.  That would appear to bode well for candidates in this election who also tend to trust markets, liberty, and constitutional rights.

I will confess that to some the signs might read like a public creed of platitudes.  Perhaps they are intended to present an impressionist attitude of some kind.  Here are the phrases, written in bumper sticker style.  See what you think.

To begin with, who could argue with the obvious truth that “Black Lives Matter”?  I personally know no one who does not naturally embrace the idea.  I do notice that those who in published media lionize the eponymous organization laying claim to the title reveal little material interest in the lives of black police officers, black small business owners, or unborn black children.  That may be why the lady running for Congress in Baltimore’s 7th Congressional District emphasizes that “all black lives matter.”

Next on the signs is the phrase, “No Human Is Illegal.”  That is surely the case in the United States as long as it remains a nation of law and order.  Things that some people do are illegal, but enshrined in the Declaration of Independence and the Constitution is the concept of individual worth.  The notion that people themselves can be illegal is reserved for socialist governments and monarchies, where large portions of the population can find themselves illegal.  That is a crucial reason why the American founders broke from the monarchy and why applying socialism here terrorizes lovers of liberty.

Third on the signs is the bromide, “Love Is Love.”  Surely it is.  Perhaps it appears because love is the core principle of many religions, such as Christianity, which rests on two commandments (also taught in the Old Testament):  Love God, and love your neighbor as yourself.  As Jesus taught, on these rest “all the law and the prophets.” (Matthew 22:40)  Jesus also taught that with the breakdown of law and order, “the love of many shall wax cold.” (Matthew 24:12)  I am thrilled that churches are being allowed to open again so that they might continue to teach their doctrine of love.

The phrase, “Women’s Rights Are Human Rights,” is given fourth billing on the signs.  That is absolutely true, even if it is violated in many parts of the world.  I am reminded, by my neighbors who have come to the United States from such nations where women’s rights are routinely violated, why I am grateful that my daughters and granddaughters live in a country where their rights are real and protected.

I am grateful that the signs include what is in danger of becoming a meaningless cliché, “Science Is Real.”  Our nation was midwifed by the enlightenment, a rejection of the medieval notion that scientific verities were determined by government or ecclesiastical agencies and votes of councils.  We are all indebted to courageous scientists who stood alone and refused to accept any scientific debate as “final,” who asked more questions that often led to better answers that have made mankind healthier, wealthier, and more flourishing.  May our nation of freedom encourage the continuation of that story.

The penultimate phrase on the signs is the prosaic declaration, “Water Is Life.”  I remember Barry Goldwater, Senator from Arizona, explaining to a skeptical Senate the importance of water rights.  There would appear to be a longtime tug of war in our government agencies about the importance of water management.  As with many important issues, relying upon our federal system of state and national interaction is most likely to give us the best management answers.  National mandates are likely to leave local communities dry.

The final phrase on the signs is the catchall, “Injustice Anywhere Is a Threat to Justice Everywhere.”  An unlimited aspiration, mankind has wrestled with it from the earliest times.  As this is to be an ongoing struggle of which we should not tire, the question is how best to proceed?  Our founders asked that question.  They recognized that arbitrary governments were the worst offenders.  The structure of liberty they established has fostered the multitudinous avenues for virtue that have not ceased to make progress in combating injustice.

I cheer such display of worthy attitudes of support for our nation’s growth in liberty.

By the way, there is a website where you may go to purchase these signs, $10 each.  Free enterprise is wonderful.

Filed under charity, Constitution, Declaration of Independence, freedom, individual worth, justice, markets, rights, rule of law, science, socialism Tagged with , , , , , , , , , ,

Of Liberty and Breaking the Rules

October 21, 2013 Leave a comment

Sometime in the 1990s, before the days of YouTube, I received a homemade video from a man who owned and operated a small business near Dallas, Texas. He ran a landscaping company, had a handful of employees, and, according to the video, was in violation of some rule or regulation of the federal government every day. He did not intend to be in violation. He did not want to be in violation. As he explained, it was just impossible to comply with all of the requirements.

The video began with the owner sitting behind his desk, explaining the problem. He stood up and took the camera with him as he walked through different parts of his operations, pointing out what was required of him, his business, and his colleagues.

In the main office he described the employment rules, the tax laws, the related mandates and regulations that applied because he had hired other people. He walked over to the equipment and described the numberless “safety hazard” regulations, from warning notices that had to be glued beneath the seats of garden tractors, to how he and his workers used, carried, and stored their tools, gear, and machines, and what they were supposed to wear while using them. He discussed the multitude of formal requirements for managing and applying the fertilizers, pesticides, and other chemicals that are commonly used in his business, including their handling, storage, clean up, and their transportation. Speaking of transportation, because his company used trucks and other vehicles, there was another long list of rules and regulations that applied to that part of the firm.

Added to all of this, there were numerous reports, applications, notices, and other papers to be filed with a variety of agencies on a regular basis. When he was through, he sat down again behind his desk and said, “I break the law every day. I don’t intend to, but I cannot avoid it. I can’t keep up with it all as long as I stay in business.”

How did we get here? Is this America? Is this the land of the free and the home of the brave? Is this a land of freedom sustained by law? It is an unknown America, too unknown to most but too familiar to people who run a business, especially the people who own a small company. The rest of us see little of it, though perhaps we suspect it is there. Some of us catch glimpses.

In a large business it takes longer for the regulatory burden to become overwhelming. For a while the boss can hire more people to help carry the load. In the large firms of America there is a host of employees who produce no goods or offer any services to any customers. They spend their careers complying with their slices of these federal rules, laws, and mandates so that some of the other employees can be involved in what the business is all about, providing something to a customer for which the customer is willing to pay.

The customer may not realize that a large share of what he pays for he never receives; it goes to pay those people who work to keep the business in compliance with the government rules. More than businessmen would be wealthier without this heavy, dead hand clamped on firms, factories, and farms. The necessities and luxuries of life would all be a lot cheaper. Or, another way to say it, we would get more of the goods and services we pay for, less of our money sunk into these hidden costs for unproductive activity.

America’s Founders sought to create a land of freedom, not dominated by government and the officiousness of government functionaries. To them “unregulated” was a goal, not a criticism. They also knew the danger of what could happen, even in America. James Madison wrote, “It will be of little avail to the people that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood. . .” (James Madison, Federalist no. 62)

And yet here we are. What the Texas businessman faced in the 1990s has not become any lighter since. When was the last time that you read the full text of a law? Who has read the Obamacare statute, the Dodd-Frank Act, or any of the other voluminous, incoherent laws recently enacted, each written on more than a thousand pages? For each page of law enacted by Congress today government bureaucrats write ten pages of rules and regulations, all of which are enforced as law though never voted on by anyone who himself has been voted into office by the people.

In the land of the free, whose founding document begins with “We the People”, why do we tolerate it? One of the complaints against the king of England in the Declaration of Independence reads, “He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people, and eat out their substance.” And yet we have done the same to ourselves. The Dodd-Frank Act alone created several New Offices and has already stimulated the hiring of more than a thousand new officers.

“I wear the chain I forged in life,” replied the Ghost. “I made it link by link, and yard by yard; I girded it on of my own free will, and of my own free will I wore it. Is its pattern strange to you?”

Scrooge trembled more and more.

“Or would you know,” pursued the Ghost, “the weight and length of the strong coil you bear yourself? It was full as heavy and as long as this, seven Christmas Eves ago. You have laboured on it, since. It is a ponderous chain!”
(Charles Dickens, A Christmas Carol)

There was a time when the chains had to be broken to restore the rule of law.

(First published August 8, 2013)

Filed under America, bureaucracy, Congress, Constitution, Declaration of Independence, Dodd-Frank Act, exceptionalism, freedom, government, healthcare, law, productivity, rule of law, statism, wealth