Of Majority Rule and Minority Freedom

November 23, 2021 1 Comment

Photo by Davide Ragusa on Unsplash

The majority rules, the minority be damned.  That is the heart of a democracy.  The Founders of the United States wisely chose a different course.  They recognized that popular majorities are inherently unstable, ever shifting, never constant, with little patience for the minority.  Each of us, however, is always and ever part of some minority.  The Founders sought a durable nation that would accommodate variety, so they established a republic.  More precisely, they established a democratic republic, where representatives are chosen by democratic action.

A republic works, and can only work, by respecting and accommodating one another sufficient to find agreement, which is often elusive.  A representative legislature by definition gathers delegates who have their own minds, who carry with them divergent views and interests, and who cherish rights to be respected.  From my personal experience I have observed that no one in Washington is your ally or your opponent all the time.  I find that reassuring, and occasionally surprising.

This structure accommodates several things that we hold dear.  Our republic accommodates differences of opinion, or even better said, varieties of opinion.  I have rarely been in a conversation with more than two people where all were in agreement on every point raised.  I have similarly rarely been in such a conversation where I did not benefit from the interplay of ideas.  We often can reach a consensus, but it is not consensus on all things.  A republic embraces this. 

In a republic no majority mandates our tastes.  Our republic, for example, allows for an assortment of cultures.  It had to or would never have been created.  I like to bring flags to our family reunions, symbolizing our cultural heritages, from my parents’ families to those of the new in-laws as our children have married.  With preeminence for the Stars and Stripes—reminding us of the attraction of this nation—our family unity makes enjoyment of those cultural influences an enrichment, in our clothes, in our menus, in our games and sports, in our traditions.  I see that in other families.  In much the same way, the constitutional foundation of our republic fosters a commonality upon which a cornucopia of good things thrives.

A republic requires several things that we find necessary, embedded in our Constitution.  It requires freedom of religion, free speech, private property, a market economy, separation of powers, a federal system of government, among other things.  God Himself implores freedom of religion on His earth, free hearts with devotion to be freely extended to Him and expressed in love to His children.  A market economy means that we are free to exchange our time, talents, and resources with one another, without being limited to choices that only the majority favors, hence the incredible selection of goods and services, often some only favored by a few (like my argyle socks).

The Founders understood a principle of governance also articulated in scripture:

“We have learned by sad experience that it is the nature and disposition of almost all men, as soon as they get a little authority, as they suppose, they will immediately begin to exercise unrighteous dominion.” (Doctrine and Covenants 121:39)

Best to reduce the chance, especially should one profess to represent the majority of the people.  Safer, as in our federalized republic, to divide such power.  I recall Senator Phil Gramm, for whom I worked for many years, saying how frustrated he was when first elected to Congress at how little one person could accomplish in Washington.  He added that after a while that gave him great comfort.

Filed under Congress, Constitution, democracy, federalism, free speech, God, government, markets, religious freedom, republics Tagged with , , , , , , , , ,

Of I and We

July 17, 2021 Leave a comment

Photo by Ilona Frey on Unsplash

Perhaps you have been chary of letting other people speak for you.  I know that I have.  I tend to bristle when someone announces what “we” are going to do without consulting with the “I”s in the “we.”  I feel much the same when I hear someone declare what “we” think without caring to learn what I and the other components of “we” think. 

Sometimes it is necessary or unavoidable to have someone speak for me.  I think of representative government.  A Congress of 330 million people will either get nothing done, or it will devolve into rule by a dictator who has, as an effective demagogue, arranged for enough of all of us to cede to him their will.  The city states of ancient Greece experienced both failings of genuine democracy—mob rule and dictatorship—and displayed how it never worked for long.

The Romans, inhabiting a city state governed by a king, threw off their king and created a democratic republic that flourished for several hundred years.  They elected Senators to represent them.  The Romans did not like a king who spoke for them without asking, but they thrived under a system of Senators who spoke for them, but only after obtaining the Romans’ permission.  That worked for centuries until the process of gaining permission—elections—became corrupted.  The Senators concurrently became corrupted, unwilling to face blame for making decisions.  The democratic republic was replaced by a government of emperors and Caesars.  Rome afterwards oscillated between civil strife and dictatorship on the way to collapse and invasion.

In the years following 1776 we, as a people of free individuals, united to shake off our king who claimed the privilege of referring to himself as “We” when speaking.  In 1787 “We the People,” through our chosen representatives, also established a democratic republic.  That followed the formation of democratic republics in each State.  Both sides in the debate to ratify the new Constitution emphasized keeping representatives tied closely to the represented.  Skeptics wondered whether that would actually happen or long endure if it did.

Individual people, representatives and represented, are imperfect, as the Founders understood.  We each prize our individuality and the liberty to live it.  We each can also be tempted to exert our will over others.  Consider the occasional neighborhood “WE BELIEVE” yard signs.  Are these an expression of personal faith or a declaration that you and I ought to consider ourselves included in the “WE”?  I wonder about the latter when I see decrees by federal officials, state governors, and local mayors extending government force to the seemingly anodyne slogans ornamenting the signs.  The man who today sits in the oval office, who would not dare to call himself a czar, has appointed a man (previously rejected by a national election) to be the nation’s “Climate Czar.”

We are scheduled to reach 250 years of our democratic republic when the 17-year cicadas next return.  Will they emerge in a nation still governed by “We the People”?  Or might they come out of the ground where the voices of the I’s have been subsumed by other Czars who announce what We think, do, and say?  Creeping political correctness, which has been chastising free speech for decades, telling us what not to say, has lately become enforced by governments, workplaces, media, and schools.  As the prophet Isaiah warned, a man is made “an offender for a word” (Isaiah 29:21).

By the way, the titles “Czar” and “Kaiser” are derivatives of the Latin title “Caesar.”

Filed under Constitution, democracy, free speech, government, individual worth, mobs, republics, rights, Rome, tyranny Tagged with , , , , , , , , ,

Of Unity and the Tenth Commandment

February 27, 2021 Leave a comment

Photo by Luis Lara on Unsplash

It may be a commonplace to comment on popular culture’s war on the Ten Commandments, but it merits the effort. At best they are treated in Hollywood and other secular Zions of pop culture as the Ten Old Fashioned Ideas. Undeniably, Moses was after all just another one of those old white men, whom many with public microphones wish would fade from the contemporary scene (as long as they keep paying the bills).

Yet there seems to linger in the hearts and minds of most people in America who are not cultural trend setters an enduring if vague respect for Ten Commandment concepts such as the preeminence of God, the duties to parents, abhorrence of murder, the value of marriage covenants, the evils of theft, and that telling the truth is still better than lying. These are basic concepts that even children have little trouble understanding.

I must confess, however, that as a child I had difficulty understanding the tenth commandment, “Thou shalt not covet” (Exodus 20:17). “Covet” is not a word much found in a child’s vocabulary, or in anyone else’s for that matter. It required explaining to me. Then it was not overly hard to take in as an idea. I did wonder, though, why it had an exalted place with the other nine commandments. The gravity of theft, murder, sacrilege, lying, not going to Church on Sunday, and even dishonoring parents I could sense as a child, but why make such a big deal about coveting? Very bad things happen from breaking those other commandments. Sure, coveting, as explained to me, led to other sins, such as stealing, murder, lying and the rest, but where was the great evil in the thing itself? You could go to jail for breaking some of the other Ten Commandments, and you certainly were on the high road to hell if you did. Coveting might make you feel unhappy or dislike someone who had something you wanted—not good, but was it really so bad?

I have come to learn, with time and experience, that the answer is, Yes, it is very bad. The Ten Commandments address, first, our relationship with God; second, our relationship with family; and finally our relationship with our neighbors and in the communities where we live. Coveting is a powerful corrosive acid in community relationships. It dissolves kindness and respect and love for our fellows, leaving an envy that has hate at its root.

Indulged in, coveting insidiously works to separate us from those who have what we might want. One need not act on the coveting, one need not steal, lie, cheat, commit adultery, or engage in other offenses for the wedge of coveting to work its evil within society. Neighbors become cold, businessmen and workers become self-centered, helping hands become harder to find, envy and jealousy increasingly push compassion and cooperation aside. The poor hate any richer than they, and those who are better off lose their pity and concern for those whom they might otherwise be quick to help and encourage.

I am not one who looks to our political leaders to be moral leaders, but I do look to them to be virtuous. Morality must be a fundamental qualification for those to whom we give authority to make, execute, and judge the laws if we want our laws and their administration to be based upon virtue. We do not and should not derive our morality from these people, but we should expect them to act morally in the exercise of the duties and powers that they derive from the people whom they govern.

It is more than irresponsible, then, that coveting is in fact advocated for the nation to embrace as a defining element of economic policy. This national call to covet is dangerous to our community. Look again at how the evil was described on Mount Sinai:

Thou shalt not covet thy neighbour’s house, thou shalt not covet thy neighbour’s wife, nor his manservant, nor his maidservant, nor his ox, nor his ass, nor any thing that is thy neighbour’s. (Exodus 20:17)

All sharing in the tax burden is a necessary element of self-government. Self-government does not work without all the individual selves in society pitching in fairly.  What Congress enacts as national policy should be carried by those who compose the nation.

By the way, I am not aware of any religion that condones coveting.  But even if the fear of God does not make you slow to covet, objective love for the nation as a whole and the integrity of the society should cause you to recoil from a political platform based upon feeding the fires of envy.

Filed under civilization, commandments, covetousness, culture, demagoguery, God, government, morality, sin, unity Tagged with , , , , , , , , ,

Of Viruses and Governors

February 3, 2021 Leave a comment

Photo by Jeffrey Hamilton on Unsplash

I have a close correspondent in Europe, with whom I have exchanged ideas for years.  Most recently he shared with me his worries and frustration with how Germany has been responding to the virus that has occupied so much attention these past months.  Here are thoughts from the response I shared with him.  I shall call him Walter.

  

Dear Walter,

Thank you for your note.  The virus lockdown and response situation in Germany sounds worse than I thought.  We don’t hear much about it in our media.  Most of what I pick up from Europe is from British commentators boasting about how glad they are that they got out of the EU just in time.  They claim to be way ahead in vaccine administration, particularly compared with Macron’s record in France.

Here in the U.S. we have been witnessing a general overreaction but we also experience the benefits of a federal system.  The variety of states are following a variety of policies, and people can see what works better (if the news can get through the big media channels).  The general pattern seems to be that the more the lockdown the higher the incidence, which these governors then use to justify even tighter lockdowns.  But even the worst states, like New York and California, are starting to realize that they have gone overboard.  Virginia is starting to ease up, perhaps because they have elections this year for governor and legislature (where Democrats have very thin majorities).  Schools are starting to reopen—despite the teachers unions who want to stay closed—but who also want their teachers first in line for the vaccines.  Children have been hardest hit, not by the virus but by the policies.

Politicians do talk to one another.  The virus gave a good excuse for heads of the executive branches to enjoy making decisions without working with the other branches of government.  The Chinese Government showed how, by engaging in a sharp, heavy lockdown of Wuhan, including control of information.  I don’t claim that they told governors here and leaders around the world what to do, but they did show them what to do and how to use the virus as the excuse. 

In the U.S., most governors with the early heavy-handed policies were Democrats, and the media were by and large in deep sympathy, quickly pitching stories to support what the governors wanted to do, helping to hype the hysteria on which the governors’ decrees were based.  Once the governors issued their first round of decrees they got to like it, but they needed to keep going to keep their legislatures off balance.  A few judges here and there, eventually, ruled that some of the governors had gone too far, rolling back some of the policies.  Many judges found ways to stay out of it, considering these to be policy matters, not judicial issues.

The thorn in the side of these governors has been other governors, who followed more reasonable approaches, such as the governors in Florida, Tennessee, Texas, even South Dakota, among others.  That is the beauty of a federal system.  It has worked imperfectly, but it has been a salvation, particularly as people have seen better results—from the point of view of the virus and of the economy—in these other states.  It has worked to keep the debate somewhat alive, even with media working hard to silence alternative voices.

This all shows the importance of a constitution, with personal freedoms and diffused government.  But it also demonstrates the importance for people to insist on observance of their rights.  Bless those who have had willingness and means to go to court and judges who have been willing to take the cases and support the Constitution.  The biggest tool that people have is perhaps economic, and there have been economic responses that have been penalizing states that have it wrong. 

Another important tool will be elections.  A few states, such as Virginia, have elections this year, and there has been a rising tide of resentment to the policies.  Throwing out of government the officials who have violated rights and pursued destructive policies would send a powerful message to other parts of the nation.  What we hope for now are good candidates, the ability to get their message out through the media opposition, and integrity in the elections (plenty to worry about there).

Anyway, a long answer.  But I understand your frustration.  I am, however, hopeful.

Wayne

Filed under children, China, Constitution, courts, elections, European Union, federalism, government, Great Cessation, rights, United Kingdom Tagged with , , , , , , , , , ,

Of Freedom and Federals

May 7, 2020 1 Comment

Photo by Tim Mossholder on Unsplash

News Flash, Washington:  The national government sometimes gets it wrong.

Another News Flash, Elsewhere:  So do the States.

Of course, this is no news to anyone, rather old news to everyone.  We all know that the national government is neither perfectly right nor wrong.  The same is true for state governments.  All are staffed by human beings, like you and me, with the similar packages of wisdom and foolishness.

For nearly two decades I worked in the U.S. Senate for a very wise man.  I once heard him say that when he came to Washington he was frustrated at how little one person could get done.  He said he soon came to rejoice in the fact.  Yes, it is hard for one person to achieve the good that he envisions, but it is even harder for one person to impose on everyone else the good that he envisions.

The founders of the nation did not seek to perfect mankind.  They left that for God, as flawed humans cannot create perfect humans.  For now God has left governments to imperfect people (though He is willing to provide as much wisdom as people are willing to accept).  The wisdom of the founders, thousands of miles away from other nations, but drawing upon thousands of years of history, was to create a system of government that did not rest upon the wisdom and foolishness of one individual or even a small cadre of them.

The founders arrived at a system of government for the new nation that neither guaranteed nor expected officials to get it all right.  It was designed to make it harder for them all to get it all wrong.  Moreover, the founders worked to limit the field of that government, so that as much as possible of the getting things right and wrong was left to the people themselves in their myriad of daily activities, far too complex for a government to manage.

The arrangement divided governing responsibilities among many hands.  States have their responsibilities, which they share with local governments.  The national government has its share of duties and powers to be applied where appropriate for a national sphere.  Those powers are further divided among three interdependent branches, the executive, legislative, and judicial.  I say “interdependent,” because neither was given enough power to operate without involvement with the other two.

Impasse arises, frequently, because schemes for government to govern too much wreck upon the shoals of the diversity of our people and the multiplicity of their needs and preferences.  Such impasse is not a sign of inefficient government but of our system of government efficiently reminding us when it is trying to overreach, going beyond government’s competence.

The founders formed their plan as they realized that it was the only way to govern a nation so geographically broad, increasingly populous, and already socially diverse.  As the 13 states have become 50 from sea to sea, and the several million have become several hundred million, it is even truer today.  There are things that governments must do.  There are many more that need to be left to the governed.

In recent months we have witnessed waves of expanded government restrictions, probing the limits of government wisdom and power.  Space here will not allow an evaluation of the successes and failures, or the effect on individual freedom.

I rejoice in this federal system of government that allows for a diversity of approaches and accommodation of a diversity of conditions.  In my view, the governor where I live has gotten more wrong than right and is out of step with his state’s conditions.  I find the contrast of other examples a source of hope.  The purpose of dividing governmental power is to allow the exposure of mistakes and thereby preserve and promote individual freedom.

The division of error in our system offers hope of relief and recourse from error. It still leaves room, as well, for individuals to get it right and when they get it wrong to learn from the errors, with the freedom to try again and do better.

I will tattle, that the Senator for whom I worked for so long sometimes got it wrong.  Having been a college professor, he told us that we learned so much by working for him that we should pay tuition.  We did not agree.  He did not press the point.

Parting News Flash, New York:  The United Nations gets it wrong almost all the time.  Details, daily.

Filed under Constitution, federalism, freedom, government, hope, perfection Tagged with , , , , ,

Of Warming Planets and Cooling Economies

May 31, 2015 Leave a comment

Did you notice when the Obama Administration paused in its ballyhooing about global warming? President Obama and his officials had been busily hustling the warming of the planet and its attendant disasters—which they insist can only be fixed by increasing government control of our lives, from birthing to breathing. The President was in Florida, blaming the future hurricane season—which has not yet happened—on global warming. “The best climate scientists in the world are telling us that extreme weather events like hurricanes are likely to become more powerful.” What President Obama did not mention—anywhere in his speech at the National Hurricane Center in Miami—was that the scientists predicted a “below-normal” hurricane season for 2015. Was that mercy because of or in spite of global warming?

Perhaps we should not blame the President for leaving that little item of information out, since for each of the last several years the cited “best climate scientists” (whoever they are) had predicted extraordinarily active and destructive hurricane seasons. Since each season turned out to be unusually mild, the official forecasters have now changed their tune, putting themselves solidly in-sync with recent trends. Do not put yourself at risk with a long investment on it either way.

As for global warming, however, the President and those who say they agree with him insist that the debate is over (in either science or a free nation can the debate ever really be over?), meaning that it is unacceptable to disagree with them. If you can’t say something calamitous, then don’t say anything at all.

Then, suddenly and quite unexpectedly, the global warming talk stopped. There was a mercifully, if brief, moratorium on warming warnings. Instead of predicted calamity, a real calamity was at hand that required some ‘splaining. The most recent report on the nation’s economic growth was announced. Not only had growth slowed, as measured by government number crunchers, the economy had actually declined in the first 3 months of 2015. That seemed to come as a surprise to no one who is either without a job or working in a job that is something less than the job held before 2009. But it was unwelcome news to the Administration that has been working on economic revival for going on seven years.

Instead of global warming, the Administration needed cold weather to blame for the decline in economic activity during January, February, and March. The lead official White House explanative was, “harsh winter weather”. I did not make this up, and you are not supposed to notice how convenient White House excuses are. It was better that global warming talk was cooled for a moment lest people recognize the contradictions in the official propaganda and begin to wonder whether White House policies were working.

Winter weather is not a novel excuse for failed government programs. The old Soviet Union blamed repeated crop failures on harsh winters (in Russia? Who knew?). The similarity in excuses used by the Obama White House and the Soviet Politburo is not accidental. Central planners can survive only if they have at the ready a list of excuses of things beyond their control. The list could be a long one, since in the end there is not very much about the economy that central planners can control, if control means making things go they way intended. To quote the character Jayne Cobb, in Serenity, “what you plan and what takes place ain’t ever been exactly similar.”

Filed under Barack Obama, communism, demagoguery, economic growth, economics, environmentalism, free speech, freedom, future, global warming, government, jobs, recession, Russia, science, socialism, Soviet Union, statism Tagged with , , , , , , , , , , , , , ,

Of Signs and Deception

May 17, 2015 Leave a comment

It may seem immodest of me to point out how “insightful” was my posting, published at the very doorstep of the 2008 election of Barack Obama as President of the United States. I think I am in no danger, however, as the predictions were all too easy to make, the signs too clear then to justify special credit now. More significant, I believe, are how the lessons taught then apply as we enter another presidential election season. Give the greatest weight to what candidates do and what they have done, particularly when such evidence is distinctly at variance with what they say.

 

A well-known principle of propaganda is that if you are going to tell a lie, the bigger the lie the more believable it will be. Most people are so trusting that they do not want to believe in the enormity of a big lie. They do not want to believe that someone can intentionally say something appallingly false. Rather than disbelieve the liar, they will want to disbelieve the person who exposes the lie.

One of the biggest of lies is asserting something to be exactly the opposite of what it is. Such is the warmonger who claims to be the leading pacifist, the thief who claims to be the victim of theft—and accuses the real victim of being the criminal—or the bigoted radical who accuses opponents of intolerance.

In recent travels on the streets, roads, and highways I notice at this time of the year the beautiful Fall foliage—and the many political campaign signs. While for some there might be a distaste for seeing these, I feel to rejoice in the signs as evidence of a vigorous system of subjecting our political leaders to public vote.

Having said that, I do draw the line at the steady growth of the mega-yard and curb signs, the five-foot by eight-foot broadsides. So, already inclined to dislike such construction-size boards, I have been particularly disturbed to see what appears to be a planned series of Obama-Biden signs advocating policies that these two Washington insiders have long worked hard to oppose.

I have noticed three in this series. There may be others. The ones that I have seen show the names of the two candidates, followed by a motto reading something like, “Better Schools,” “Lower Taxes,” and “Energy Independence.”

If facts matter, and I believe that they still do (even if they are optional in the mass media), such messages on the signs of these two politicians should be jarring to the honest in heart. The political record of Obama and Biden are unequivocal on these three issues. They both have strongly and consistently opposed school reform, supporting doing more of the same old stuff that has been steadily undermining the quality of government-run schools since the 1960s.

Both have been leading advocates for raising taxes and opposing tax cuts. Even in the current campaign they advocate new tax hikes. They try to disguise their intentions with the assertion that their proposals supposedly would reduce taxes on 95% of Americans (including the 40% who pay little or no income taxes), while raising them on the rest. Either they failed with the simple math, or they hope that voters cannot or will not be able to apply simple math, but you cannot get enough taxes out of 5% to pay for genuine tax cuts for 95%. In fact, their proposals are just another camouflage for the old tried and failed policies of tax and spend. Not only does that always put more power into the hands of the politicos who take and then redistribute, but it is a highly dangerous thing to do in the teeth of an economic downturn. Taxes fall on income and investment, and whatever you tax you get less of. Now is not the time for less income and investment.

And as for energy independence, both Obama and Biden support programs that will yield little and have yielded very little new energy—at very high expense in government subsidies—while staunchly opposing expanded use of the energy resources that are abundant in the United States, particularly oil, coal, and nuclear energy. Independence seems to me to increase reliance on your own resources. Obama and Biden are consistent supporters of policies that keep U.S. energy resources under lock and key.

This should not be surprising from two candidates who campaign on change while advocating the oldest political formula in the history of government, that government knows best, that decisions about spending, whether for health, education, or job creation, are best made by power brokers in the halls of Washington power centers, rather than by families in their homes. Calling that change may be the biggest lie of all.

(First published November 2, 2008)

Filed under Barack Obama, deception, education, elections, energy, government, investment, media, politics, recession, statism, taxes Tagged with , , , , , , , , , , ,

Of the Federal Reserve and Taking from Savers

April 4, 2015 Leave a comment

Ben Bernanke has a blog. You can find it here, courtesy of the Brookings Institution. Of course, what would the former Chairman of the Federal Reserve Board write about, other than decisions he made as Chairman, and why people who take issue with them are wrong? One would expect no less, and reading the light he sheds on previous decisions—offered in Fedspspeak at the time that they were made—is surely the chief lure of Ben Bernanke’s blog. Allowed to communicate in regular English, not worried about how Fed Watchers might construe or misconstrue everything he says and does not say, Ben is more able to speak his mind clearly.

The former Fed Head chose for his first blog post a vigorous defense of price controls on interest rates. In the process Bernanke demonstrates the assumption that we are safe letting government economists control the economy—an assumption continually disproven by real-world experience.

In fact, as a result of entrusting much of our economic freedom in the United States to government economists, we do not have a free market for interest rates, at least not short term rates, and we pay for that every day. The Federal Reserve sets short term rates in this country, and so far the market has had zero success in moving rates from the near zero interest rate range that the Federal Reserve has decreed and maintained for some years. Keep that in mind the next time you wonder why you earned $1.73 in interest on your savings account last year.

If you borrow money—when you can get a loan—then you might consider yourself lucky. The biggest borrower of all, in the whole world, is the United States Government. Uncle Sam must be feeling very lucky, because he is paying comparatively little on the $18 trillion of U.S. Government debt, increased by another half trillion dollars last year.

If you save money, though, especially for your retirement—and if you have to live off of those savings in retirement—you might not feel so fortunate. By keeping interest rates lower than the market would set them, the Federal Reserve is daily transferring many billions of dollars from savers to the Federal Government. And you thought that only the IRS takes your money.

Let me illustrate with an example. For the last three months of 2014, all of the banks in the United States, all of them together, paid no more than $11 billion to people who had their money in banks. Is that a lot of money? It depends. When that is the interest paid on nearly $12 trillion in deposits, the answer is, no, that is not very much money at all.

Do not blame the banks, though. They are in the saving and lending business, too. Try as they might, with the Federal Reserve controlling interest rates, banks could not pay any more interest to depositors. If a bank did, it would have more money than it could lend as people shifted their deposits where they could get a better return. To pay interest on deposits, banks cannot get much more interest from the loans they make than the Federal Reserve price controls allow, and many relatively good loans present more repayment risk (banks do need to be paid back) than those low interest rates would cover. Low interest earned means low interest paid.

All the banks in the nation have a little over $15 trillion in loans and other assets, on which they earned last year about the same amount as they did five years ago, when they had $2 trillion less in loans and other assets. In an environment of low interest rates, banks have to concentrate their lending on the safest borrowers.

That is how the low interest rates controlled by the Federal Reserve are oppressing the economy. When savers and lenders can only get a few cents on a hundred dollars lent, they place their money with the very safest of borrowers, since they cannot afford to take any losses. Someone who has a really good idea—which like all good ideas may or may not succeed the first time—has trouble getting the money to give his idea a go and hire people to help him try.

Ben Bernanke claims that the Federal Reserve’s near zero interest rate policy—called ZIRP—has been stimulating the economy. If so, where is the stimulation? Why has the recovery been so weak? There has been stimulus, but it has gone primarily to support Federal Government spending and to pay down the debt of the largest and healthiest businesses that can trade in their higher cost loans for the Federal Reserve’s lending bargains. The biggest increases in bank loans have been in Treasury debt and deposits at the Federal Reserve.

Ben Bernanke, in his blog, reminds me of the story of the lawyer representing a client charged with stealing a car and returning it damaged. The lawyer says, first, that his client never had the car; second, that he returned it in perfect condition; and, third, that it was already irreparably damaged when his client took it.

Bernanke begins by explaining that the Federal Reserve does not set interest rates, or that at most its ability to do so is only “transitory and limited.” He pleads that the Fed can only affect short term rates “in the short run.” He does not explain how seven years of ZIRP can be considered the short run. Then he progresses in his blog to describe how the Federal Reserve “influences” interest rates and then how the “Fed’s actions determine” interest rates. His argument, after denying that the Fed can set rates, is that the economy has been so weak that the Fed has had to lower interest rates for the nation’s own good. Bernanke next argues that the economy has remained so troubled (he does not say, despite ZIRP) that the Federal Reserve has had no choice but to continue with ZIRP, concluding that it is the economy after all the forces the Fed to do what it does. Do not blame the Fed Governors, they had no choice but to continue doing what they cannot do because it has not done any good so far. I think you need to have a Ph.D. in economics to make such an argument.

We cannot do it, we did what we had to do, and since it has not helped we cannot stop. I wonder how he reacted to those kind of explanations from his teenagers. Any responsible parent would reply, no, you cannot have the car, give me back the keys.

Filed under banking, economic growth, economics, Federal Reserve, government, interest rates, markets, personal finance, recession, socialism, statism, Treasury debt Tagged with , , , , , , , , , , ,

Of Compromises and Congresses

January 7, 2015 3 Comments

The beginning days of 2015 have brought the convening of a new American Congress. It is fair to say that expectations and skepticism are high.

Both are merited. Our Constitution was inaugurated with high expectations, not that the end to all problems was at the door but that the means were available to deal effectively with the problems of government for the new nation. The people who wrote the Constitution and those involved with implementing it (many the same people) were also deeply skeptical of government, including the one that they had just created. Memorable and personal experiences had shaped their skepticism. For that reason, the adoption of the Constitution had been a close thing, the opposition coming chiefly from those who thought that it imposed too much government on the people. There may have been some contemporary views that the proposed national government would be too weak and light, but I have not found any examples.

No surprise, then, that an early use of the new Constitution was to adopt the Bill of Rights—a set of fundamental rights to protect individual people from their government. If this new government were really self-government (a misconception reflected today in such bromides as, “Don’t worry about the national debt, we owe it to ourselves,” and “we should not fear the government because we are the government,” as well as much similar foolishness), then these first ten amendments would all be unnecessary. They have since proven to be very necessary, sometimes breached by our government, but more often employed to preserve and protect us from government offense.

Much as with the convening of the First Congress in 1789, the 114th Congress convenes after a troubled period of bad government. Hopes and wishes abound that errors can be corrected, freedoms restored, troubles addressed. As then, so today patience is in order.

A great virtue of our Constitution, an intentional feature, is that no one person can do much, for good or ill, in the federal government. It takes a lot of people cooperating together to get things done. Both Houses of Congress, usually with significant majorities, must agree to identical—word for word identical—legislation for it to be sent to the President, who must agree enough to add his signature to make it law. And then the President and his colleagues in the executive branch must actually execute the law, which as we are seeing with this President is no sure thing, despite a solemn oath to do so.

All of that coming together of many people, with varying ideas and backgrounds and interests, seldom happens quickly. For a people who do not need a lot of laws and direction from government to know how to live their lives, that is a fact to be celebrated. As the Founders envisioned, making law requires compromise and accommodation of the many interests of the many who compose our great nation. That takes time, as it should.

It is a mistake to banish the use of compromise from republican government. Those who would eschew compromise in our Republic would doom us to the fate of the Roman Republic. The members of the Roman Senate lost the ability or willingness to compromise. In so doing, they were doomed to inaction—not just slow deliberation—in the face of crisis, followed by reliance upon dictators, whom they fancied they could limit if not control. They sometimes chose wise men, sometimes they trusted their liberties to demagogues, invested with nearly unilateral authority for an entire year. The Republic and Roman freedom regressively devolved into the rule of the Caesars.

I understand the impatience that many have with compromise, people who would wish bold and decisive action in response to the would-be Caesar currently in the White House. To these I would say, do not despair of the strength of the Constitution, even as the chief executive seeks to violate it. In such times strengthening the Constitution and reinforcement of its checks and balances are the orders of the day, not further erosion of accommodation and compromise that have held our nation together (even through a Civil War) for two hundred years and more. It is true that some compromises are bad; despotisms or anarchies are not much good.

One of the most important compromises involves idealism and realism. American legislation requires a marriage of idealism and realism. Idealism can offer the vision of a free and prosperous nation and the inspiration to action to protect and promote our liberties. Realism, when operating in the light of idealism, focuses our work on what can be achieved now, without exhausting our energies and resources on quixotic quests that may do little more than tear the national fabric. Realism would teach that much of the policy errors of years will take years to unravel. With idealism and realism together, we can know what can and should be done today to make things better and get national policy moving in the right direction.

While a realistic view of the doable is essential to good legislating in a Congress of free men and women, the key and fundamental principles of our idealism help us discern a good compromise—one that makes things better and enables further progress—from a compromise that walks us closer to the abyss. President Reagan made many compromises, but he had a vision and knew where he was going, each compromise uniting our nation for more prosperity, greater freedom, and stronger security.

We should rejoice that no one in the Republic by himself can bring about much change, however well meaning. That virtue of our Constitution is why it has taken many steps and many mistakes to come to the many calamities our nation now confronts. In the same way, because of this Constitution, it will take seemingly many steps along the way to optimal answers. Every reason to be about the work and not tire of it.

Filed under America, anarchy, Congress, Constitution, elections, freedom, government, law, national security, patience, perseverance, politics, republics, rights, Rome, Ronald Reagan, tyranny Tagged with , , , , , , , , , , , , , , , ,

Of Presidents and Derelicts

November 20, 2014 Leave a comment

Barack Obama is no fan of the Constitution. He has been known to criticize it for its focus on limiting government, for telling governments what they can and cannot do. He prefers a Constitution that focuses more on telling governments what they should do, at least telling governments to do what he would like, including seeing to the “redistribution of wealth,” or what he calls elsewhere “redistributive change.”

Of course, that is a mischaracterization. Not a mischaracterization of Obama’s views but of what the Constitution says. It does limit government, but it also gives government specific responsibilities and the power to exercise those responsibilities. Article I, Section 8 provides a very clear list of the federal government’s duties. It is noteworthy that those enumerated responsibilities and powers are in the Article that establishes the Congress. The list includes such things as providing for the common defense, borrowing and paying government debts, regulating foreign and interstate commerce, establishing standards for weights and measures, and so forth.

There are plenty of other provisions that limit the powers of the government and how it operates. The Constitution is a balance of governmental duties within a structure intended carefully to limit the government. As a limited government our Republic has prospered. It has struggled either when its duties were neglected (as in the days of President Buchanan, who did nothing while he watched state after state rebel from the Union) or when the limitations have been eroded (as we have witnessed through much of the twentieth century and in the first 14 years of the twenty-first).

The President has specific powers and duties, too, nearly all of which are carefully linked with the role of the Congress. For example, while the President does not make the laws—Article I, Section 1 gives “All legislative Powers” exclusively to the Congress—the President is authorized to make proposals to Congress and has the authority to veto legislation (but not change it) that Congress has approved. Once an act of Congress becomes law, the President then has the explicit obligation to, “take Care that the Laws be fully executed” (Article II, Section 3).

Note the words, “fully executed”. The President takes an oath to fulfill those duties, and nowhere in oath or Constitution is the President authorized to execute the laws only as much as he likes or agrees with them. Once something has become a law, the President may not set aside this or that part of the law or decide that he will only enforce the law so far. His obligation is to take Care that the laws are fully executed.

Average Americans may not like this or that provision of law, but we are not at liberty to ignore any law that applies to us just because we do not like it. The President is not exempt from that common responsibility of all citizens, either. As the chief government executive, who sought to hold his high office of public responsibility, he is even more obligated not only to obey the laws but to execute them, fully. The President may not make the laws, he may not amend the laws, he may not change the laws, and he may not disregard the laws. His duty is to execute the laws, and when he does not he is derelict in his duties.

This is all in accordance with the important division of labor, the separation of powers that the Founders put into the very structure of the Constitution to combat the tendency of all humans to abuse power once it comes into their hands. By dividing the power of government among three separate but coequal branches, dividing legislative power even further between House and Senate, and yet again separating government power between federal and state governments, the Founders went to clear and elaborate lengths to create checks and balances.

Under the American system of government no branch, no person, no group of people in government, are to be able to do very much on their own without getting the other elements of government to go along. Where they are not able to agree, where there is no consensus, for the safety of our freedoms government is prevented by constitutional law from moving forward unless substantial consensus among the different branches can be reached. Those checks and balances again and again, throughout the more than two centuries of our Constitution, have forced the very human people in government to revisit their differences and come to terms with one another, however much they may disagree and be disagreeable. There is safety for you and me in that. And it helps keep our Union together, repeatedly forcing our leaders (and the parts of the nation that they represent and whose authority they exercise) to work with one another, like it or not.

Recently, President Obama has expressed impatience with the Constitution’s checks and balances. After all, he personally, in and of himself, embodies an entire branch of government. The other branches, Congress and the courts, have many different people with a messy variety of ideas. President Obama complains that Congress cannot decide what it wants to do as quickly as he can. In his view, why wait?

By design, Congress of course has something of a multiple personality. It is a gathering of elected representatives, reflecting the diversity of views among the people of the nation. Appropriately, it takes time to build a consensus that accommodates those views, as it should. But President Obama cannot wait. He sees the need to accommodate no ideas other than his own. He has decided that on this issue or that—today it is immigration laws—there is a limit, defined by himself, as to how much time Congress can take to consider things. When time is up, he, the executive branch, will take the matter into his own hands, and pretend to the authority to do it.

His tool of choice today is to abjure his duty to execute the laws fully and instead to execute them partially, just to the extent and manner that suit his own desires, as he engages in another round of redistributive change. That he is endeavoring to violate rather than execute our national, founding law, and his constitutional oath of office, apparently does not trouble him. It is the Constitution itself that troubles him.

But from where does he think he gets his authority to do anything. When he breaks the Constitution, does he not break his very authority to act in the office that the Constitution created?

Filed under Barack Obama, Civil War, Congress, Constitution, courts, duty, federalism, freedom, government, House of Representatives, immigration, law, republics, rule of law, Senate, tyranny Tagged with , , , , , , , , , , , , , , ,

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