Voice For Liberty

Category: United States government

  • Obama not first with trillion dollar deficit

    A Wall Street Journal column from last year highlights the lack of honesty in government accounting. The column speaks of fiscal year 2008. That period of time ended on September 30, 2008.

    It has been widely noted that 2009 will have the first “trillion-dollar deficit” in American history. Actually it’s the second. In fiscal 2008, the national debt increased from $9 trillion to slightly over $10 trillion. Yet the budget deficit in the last fiscal year was officially reported as being $455 billion. How could the national debt have increased by considerably more than twice the “deficit”? Simple. Just call the money borrowed from the Social Security trust fund an “intragovernmental transfer” and exclude it from the calculation of the deficit.

    Corporate managers have gone to jail for less book cooking than that.

    More about the fictional Social Security trust fund is at Social security trust fund needed now.

  • Social security trust fund needed now

    Almost overlooked in the news this week is the fact that Social Security will pay out more in benefits this year than it receives in contributions from payroll taxes. It had been thought that this milestone would not be reached until 2017 or later.

    The New York Times article Social Security to See Payout Exceed Pay-In This Year reports on this. The news article doesn’t come right out and tell us not to worry, but it does report on the large balance in the Social Security trust fund. This balance, the article says, will be used to make up the difference between payroll tax contributions and benefits paid out.

    The problem is that there really is no trust fund, at least not in any economically meaningful sense. The Times article does contain this: “Although Social Security is often said to have a ‘trust fund,’ the term really serves as an accounting device, to track the pay-as-you-go program’s revenue and outlays over time.” But the article doesn’t tell us the entire story behind this accounting device. We’ll have to look somewhere else for that.

    An article from the Heritage Foundation (Misleading the Public: How the Social Security Trust Fund Really Works) explains the workings of the trust fund:

    There is no cash in the Social Security trust fund, and there never has been any. The Social Security trust fund is merely an accounting device filled with IOUs that future taxpayers must repay. … Private-sector trust funds invest in real assets ranging from stocks and bonds to mortgages and other financial instruments. However, the Social Security trust funds are only “invested” in a special type of Treasury bond that can only be issued to and redeemed by the Social Security Administration. … In short, the Social Security trust fund is really only an accounting mechanism. The trust fund shows how much the government has borrowed from Social Security, but it does not provide any way to finance future benefits. The money to repay the IOUs will have to come from taxes that are being used today to pay for other government programs.” (emphasis added)

    At the Cato Institute, a 1999 article Pointless Debate over Social Security Trust Fund also explains the truth behind the trust fund:

    Starting in 2014, the situation will reverse. Social Security will no longer run a surplus but instead will run a deficit. Social Security will begin spending more on benefits than it is taking in through taxes. To continue to pay those benefits, it will have to start redeeming the bonds in the trust fund. But, as President Clinton’s own fiscal year 2000 budget admits, those bonds are not real economic assets. Rather, “they are claims on the Treasury that … will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures.” … There is no way to actually leave the Social Security surplus in Social Security. The surplus must be used to purchase bonds, the purchase of the bonds will generate revenue for the government, and that revenue must be spent. … Social Security taxes should be invested in real financial assets, not government promises to raise future taxes. (emphasis added)

    In 2008 Allan C. Sloan wrote:

    How can I say that, given Social Security’s $2.3 trillion (and growing) trust fund? It’s because the fund owns nothing but Treasury securities. Normally, of course, Treasury securities are the safest thing you can hold in a retirement account. But Social Security’s Treasuries won’t help cover the program’s cash shortfall, because Social Security is part of the federal government. Having one arm of the government (Social Security) own IOUs from another arm (the Treasury) doesn’t help the government as a whole cover its bills.

    Here’s why the trust fund has no financial value. Say that Social Security calls the Treasury sometime in 2017 and says it needs to cash in $20 billion of securities to cover benefit checks. The only way for the Treasury to get that money is for the rest of the government to spend $20 billion less than it otherwise would (fat chance!), collect more in taxes (ditto), or borrow $20 billion more (which is what would happen). The spend-less, collect-more, and borrow-more options are exactly what they would be if there were no trust fund. Thus, the trust fund doesn’t make it any easier for the government to cover Social Security’s cash shortfalls than if there were no trust fund. (emphasis added)

    As you can see by the dates mentioned in these articles from the past, the day of reckoning for Social Security arrived earlier than predicted.

    Liberals dispute the true nature of the trust fund, contending that there really is money in the fund that can be used to pay benefits.

  • Why I’m not a great fan of the Constitution

    One of the reasons that I’m not as much of a fan of the Constitution as some are is that the Constitution means what the courts, particularly the Supreme Court, say it means. The courts say the Constitution means some pretty crazy things, while at the same time, the idea of the Constitution limiting government has morphed into a tool for promoting the growth of government.

    I quote at length from Murray N. Rothbard’s book For a New Liberty: The Libertarian Manifesto. Perhaps this will help explain why I am a libertarian and not a conservative.

    First, from page 48. A constitution must be interpreted and enforced by men:

    It is true that, in the United States, at least, we have a constitution that imposes strict limits on some powers of government. But, as we have discovered in the past century, no constitution can interpret or enforce itself; it must be interpreted by men. And if the ultimate power to interpret a constitution is given to the government’s own Supreme Court, then the inevitable tendency is for the Court to continue to place its imprimatur on ever-broader powers for its own government. Furthermore, the highly touted “checks and balances” and “separation of powers” in the American government are flimsy indeed, since in the final analysis all of these divisions are part of the same government and are governed by the same set of rulers.

    Then from page 66. Instead of limiting government, courts use the Constitution to legitimize growing government:

    Certainly, the most ambitious attempt in history to impose limits on the State was the Bill of Rights and other restrictive parts of the United States Constitution. Here, written limits on government became the fundamental law, to be interpreted by a judiciary supposedly independent of the other branches of government. All Americans are familiar with the process by which John C. Calhoun’s prophetic analysis has been vindicated; the State’s own monopoly judiciary has inexorably broadened the construction of State power over the last century and a half. But few have been as keen as liberal Professor Charles Black — who hails the process — in seeing that the State has been able to transform judicial review itself from a limiting device into a powerful instrument for gaining legitimacy for its actions in the minds of the public. If a judicial decree of “unconstitutional” is a mighty check on governmental power, so too a verdict of “constitutional” is an equally mighty weapon for fostering public acceptance of ever greater governmental power.

    From page 69, the solution is given:

    Thus, even in the United States, unique among governments in having a constitution, parts of which at least were meant to impose strict and solemn limits upon its actions, even here the Constitution has proved to be an instrument for ratifying the expansion of State power rather than the opposite. As Calhoun saw, any written limits that leave it to government to interpret its own powers are bound to be interpreted as sanctions for expanding and not binding those powers. In a profound sense, the idea of binding down power with the chains of a written constitution has proved to be a noble experiment that failed. The idea of a strictly limited government has proved to be utopian; some other, more radical means must be found to prevent the growth of the aggressive State. The libertarian system would meet this problem by scrapping the entire notion of creating a government — an institution with a coercive monopoly of force over a given territory — and then hoping to find ways to keep that government from expanding. The libertarian alternative is to abstain from such a monopoly government to begin with.

  • United States Government customer service: think twice

    United States Postal Service: We CareUnited States Postal Service: We Care

    For those who argue that we should turn over more activity — such as health care — to the federal government, take a close look at a government monopoly that’s been around for a long time.

    The United States Postal Service has a monopoly on the delivery of first class mail. As an example of its level of service, consider my bank statement. When it hadn’t arrived by its usual time, I called the bank. The bank assured me it had been mailed.

    Today the statement arrived in a plastic bag explaining that it had been damaged during processing. I can understand that happening once in a while. Machines are not perfect, and sometimes improving their reliability can be very expensive when compared to the benefit received.

    So what was the delay caused by the malfunctioning machine? One day? Two or three days?

    The piece was postmarked February 2. It arrived on February 22. The delay — realizing that mail delivery is not guaranteed — is around 18 days.

    How does a piece of mail being damaged in a machine cause it to be delivered nearly three weeks late? And it’s not bulk or junk mail — my bank statement is first class mail.

    It’s lack of competition. What motivation does the United States Postal Service have to do a better job?

    Think about this as we consider moving activity from the private sector to government.

    A related story from a friend of mine is Postal service?

  • Spalding lecture examined liberty, progressivism

    This Tuesday in Emporia, constitutional scholar Matthew Spalding
    delivered a lecture titled “Liberty and the Constitution.” An important topic presented in this lecture is that modern American progressivism is in opposition to the principles of liberty as expressed in the founding of the United States.

    Spalding said that the great theme of the American founding was self-governance. America is unique, he said, because we laid down ideas on paper in the form of our Constitution. Prior to this, politics had been based on who had the most power.

    Private property and religious freedom were important aspects of the American founding. To the founders, property rights were deeply moral and philosophical. Property is not just land, but intellectual creations, too.

    Religious liberty was an important theme of the American founding. Prior to this, there was no such thing as religious liberty, Spalding said. Your religion would be determined by the religion of your king. Sometimes other religions were tolerated, but as in England, it simply meant they “wouldn’t burn you.”

    Rule of law is another important aspect of liberty. Man creates laws, and we are ruled by those laws. Because Americans valued law so much, we did something that no other country had done: we wrote it down in the form of a Constitution. Other counties had constitutions, but they were merely writings of history, not rules for how law should operate.

    All men possessed the same rights, because of nature, because we are human beings. Rights do not come from governments, or kings, or courts. That, the American founders said, is self-evident.

    After the Civil War, different world views arose. In particular, Germany in the late nineteenth center was the hotbed of technology and transformation of government.

    When Americans went overseas to study Europe after the Civil War, we became aware of the radicalism of the French Revolution. It was anti-religious. Everything was to be torn down, even the calendar. That changed the European tradition, and new sets of ideas came into fashion.

    These ideas that were imported into the United States included relativism (there is no self-evident truth) and historicism (all things change). These ideas are in opposition to the principles of the Constitution, and are the basis of modern progressivism, which holds these beliefs: There is nothing permanent. Everything changes. Rights are not grounded in the nature of human beings; instead rights evolve and change. Because rights change, government changes, too. When rights expand, so does government. With more rights, there is more for government to secure.

    Germany had invented the administrative state, or the bureaucracy. Based on their belief in science, they invented new, scientific ways of organizing government. There were to be experts: people to run things.

    In America, power and authority which the Constitution delegated to the legislature and executive was instead given to the bureaucracy. Congress created agencies.

    There also arose the idea of a “living” Constitution. The founders’ Constitution was old and viewed by progressives as a barrier to progress. By interpreting it differently, it became a living document.

    The culmination of progressivism was the Great Society on the 1960s. Congress passed huge, vague laws that gave authority to bureaucrats. “Congress passed a law: clean the water.” How to do that was left to bureaucrats.

    The present wave of progressivism — like the others before — is based on an intellectual, moral, and cultural attack on the ideas of the American founding. Progressives believe the American founders were wrong. Limited government is a constraint, they say, and to make any progress, we must have more government.

    Spalding said that if we were to read Woodrow Wilson’s speeches during the 1912 election and substitute the word “change” for “progress”, we’d see a similarity to the debate of today. Healthcare, he said, was proposed in the progressive platform of 1912, based on the German model of health insurance.

    The argument of modern academics is that the growth of government is inevitable and good. Today, the progressive argument about government growing and expanding without limit, the question has never been settled by the American people. “The American people, as civil-minded as they are, still think they govern themselves, and they object when someone says they will govern for them.” That is good, Spalding said.

    There are two grand choices we face today. One path is progressive liberalism, based on the French Revolution arguments that deny rights, liberties, and the Constitution. The goal of this path is to transform America into something different with a new form of government: bureaucratic and centralized, efficient and European.

    The other path is to recover a form of constitutionalism. Spalding says that the immediate future — perhaps the next few years or decades — is the time to give serious consideration to this choice. The present path of government is unsustainable, and we must decide if there are to be limits on the size of government.

    The current healthcare proposal that says we must buy insurance provides an example, he said. “If the commerce clause of the United States Constitution gives Congress the authority to regulate the doing of nothing, then government is truly unlimited.”

    A question from the audience from someone who identified himself as a progressive said that progressives aren’t trying to make America like a European nation. It’s social Darwinism that upsets progressives, he said, citing the lack of child labor laws and robber barons as examples. Today, there are powers and corporations that are destructive, and progressives need to reclaim power and participation in government.

    Spalding replied that social Darwinism (from the right), like progressivism (from the left), deny human nature. Both use the state to achieve their objectives, and that’s the problem. Neither believe in self government. Many modern ideologies, stemming from the French Revolution, reject the deeper philosophical ideas of the American founding.

    The questioner asked “Equality, liberty, fraternity: this is a rejection of the human condition?” Spalding replied yes, the American and French Revolutions are deeply at odds with each other. “The fact that I would point to is the French Revolution did not lead to constitutional government. George Washington died in bed peacefully. The French Revolution lead to the guillotine.”

    Matthew Spalding is the Director of the B. Kenneth Simon Center for American Studies at Heritage and is the author of We Still Hold These Truths: Rediscovering Our Principles, Reclaiming Our Future (ISI Books, 2009). He is also the editor of the Heritage Guide to the Constitution, an indispensable collection of essays on the founding document.

    Emporia State University history professor Gregory L. Schneider created the Lectures on Liberty series last year. For more information, contact Dr. Schneider, gschneid@emporia.edu, 620-341-5565.

    Two additional lectures have been scheduled for the 2010 season. Jonathan Bean, a professor of history at Southern Illinois University, will be speaking on liberty and race in American history on Feb. 23. Benjamin Powell, professor of economics from Suffolk University in Boston, will be speaking April 8 on the topic, “In Praise of Sweatshops.”

    The Lectures on Liberty series is underwritten by the Fred C. and Mary R. Koch Foundation in Wichita.

  • Scott Brown, Republican, wins in Massachusetts

    At any moment Martha Coakley will concede that she has been defeated in her effort for the Democrats to hold on to the late Sen. Edward M. Kennedy’s seat in the United States Senate, dealing a blow to President Obama’s prestige and the future of Democratic Party efforts to control increasing sectors of the American economy.

    Today the Wall Street Journal released poll results indicating that Americans are already weary of the big-government policies of Obama and his administration:

    For the first time, a majority of Americans — 53% — disapprove of the government’s increased role in the economy since the financial crisis, up from 44% in March. And 48% said Washington was doing too many things better left to businesses and individuals, a plurality seen in polling since September.

    The government’s takeover of General Motors, the biggest economic intervention that happened solely on Mr. Obama’s watch, drew the strongest negative reaction. Nearly two-thirds of Americans surveyed, 65%, disapproved of the government’s taking a majority stake in the troubled auto maker. Independents were highly critical of the move, as were Republicans.

  • Obama faces earmark test

    A test for President Barack Obama is coming up soon.

    When campaigning for the presidency, Obama pledged to end earmark spending. As reported earlier this year in Time Magazine: “… both Obama and Republican nominee John McCain tried to outdo each other with their pledges to rid Washington of the notorious pet projects that legislators slip into spending bills. Obama, who authored 2007 legislation to overhaul congressional ethics rules governing lobbying and earmarks, runs a real credibility risk when he makes exceptions to his own rules.”

    But did he make a pledge to end earmarks? MediaMatters says he didn’t make a specific pledge. But he certainly criticized the earmark process.

    At any rate, a bill loaded with earmarks is heading to the president for his signature. As reported in the New York Times: “The bill includes 1,720 earmarks costing $4.2 billion for lawmakers’ pet projects, according to the watchdog group Taxpayers for Common Sense.”

    Earlier this year, Obama signed a spending bill that contained earmarks. His defenders said that it was “last year’s business.”

    Fair enough. Obama inherited certain conditions upon assuming office. But now — at least as far as this spending bill is concerned — it’s all his own doing.

    We’ll know soon how Obama really feels about earmark spending.

  • GovTrack.us helps citizens watch Congress

    The website GovTrack.us is a great resource for citizens who are interested in the United States Congress. With the rapid expansion of government in the recent past, this is something we should all be concerned with.

    By using GovTrack.us, you can search for bills by their bill number, words in the bill, the bill sponsors, and other ways. Once you’ve found the bill, you can read its text and see its status as it works its way through Congress. What’s really useful is to add a tracker to the bill, so that you can be notified — either on the site itself or through email or RSS feed — when there’s new information about the bill.

    If you’re interested in information about particular members of Congress, you can find them by name, zip code, or by clicking on a map. Once found, GovTrack.us reports some useful information.

    One thing reported is the member’s position across the political spectrum. This is done through a statistical analysis of cosponsorship of bills. Kansas Sen. Brownback is identified through this analysis as a “far-right Republican,” while Sen. Roberts is also a “far-right Republican,” a change from his characterization as a “rank-and-file Republican” when I looked at this website in June.

    This analysis also reports that Roberts is “somewhere between a leader and a follower,” according to sponsorship of bills. Brownback is rated the same.

    The page for each member also reports approval ratings from SurveyUSA and an analysis of missed votes. It also holds a link to the page at the Center for Responsive Politics, which lets you see information about campaign contributions. Information about committee membership and bill sponsorship and cosponsorship round out this page.

    You can also add a member to your tracking page, so you can receive email updates when new information becomes available.

    This website is a useful resource for citizens to keep with with Congress.

  • Thoughts on Constitution Day

    Although Constitution Day has passed for this year, the article below contains important ideas for us to remember every day of the year. Thank you to Al Terwelp of Overbrook for authoring this submission. I apologize for missing it on Constitution Day.

    Thoughts on Constitution Day

    Today, September 17, is a little-remembered date in Kansas and arguably a day that eclipses even Independence Day in significance. On this day in 1787, occurred the signing of the U.S. Constitution. Not since the Magna Carta, (June 15, 1215) had there been such a progression by the purpose, mind and hand of mankind to peacefully join together to complete for themselves and their heirs guarantees of security against oppression.

    After the Revolutionary War was newly won our infant nation soon became adrift. Shey’s Rebellion in 1786 was evidence that we needed to jealously protect liberty and build a strong self government requiring secure checks and balances. The founders wanted a Republic ruled by law and purposefully avoided the tyranny of a superior few found in a monarchy or oligarchy and the overbearing force of the mob majority in a democracy.

    Unsatisfied with the Constitution’s original shortcomings and flaws, in 1789 anti-federalists and James Madison would introduce additional safeguards to the rights of man in a series of ten articles known as the Bill of Rights and would ultimately lead to the successfully completed ratification of the Constitution in 1790. Our Constitution has since been continually improved by a total of 27 amendments and has survived many challenges to become a near perfect example of governance and reference to human conduct. The result is the most unlikely, rare, opportunity and achievement in the chronicle of humankind.

    The American State Papers, (Declaration of Independence, Articles of Confederation, Constitution, Bill of Rights, Amendments), are a clearly written exhibition of the virtues given to us by our creator. This acquired and instilled virtue is infused via the action of our Constitutional laws thus additionally preserving and fostering it in our citizens. No government through its temporal laws can make good citizens. We have free will. Neither was the Constitution’s intention to create laws that forbid all vices in men. Why should it. Our Constitution does however, dictate reason and facilitate the virtue by which we chose to be governed thus habitualizing good behavior in the people.

    Lovers of liberty see the virtue in our founding documents and the advantage that exists in being obedient to reason. The Constitution’s chain of reasoning serves as our foundation of principles and the intellectual origins which guide the destinies of our lives. Like the Ten Commandments, the Constitution provides us knowledge that proceeds from theoretical deduction and gives us simple black and white reference points to be used as a compass star to pilot a world of complex, confusing, gray issues.

    The Constitution and the other state papers are also established and accepted statements of a new system of knowledge. One based not only on legal rights and human laws but on natural rights, natural laws and their demonstrated conclusions. All people are born with these universal rights and they are not contingent on human law or acquired from government. These are the truths that Jefferson held to be self-evident and unalienable. These endorsements of truth give us not only knowledge about a belief, but continually communicate to us when to hold a belief to be true. This unsurrenderable document that framed laws by men not perfect in virtue is much more than a contract from which government limits and derives its authority. Its words ultimately bind us in conscience from a higher eternal law.