Government Growth and Heavy Debt
"The multiplication of public offices, increase of expense beyond income, growth and entailment of the public debt, are indications soliciting the employment of the pruning knife." THOMAS JEFFERSON, in a letter to Spencer Roane, 1821.
The size of government in-relation to the private sector grew to 40 percent in 2009. The scope of government intrusion into the economy has grown from 7 percent in 1930 to its present level and is beginning to reach levels matched only during World War II. The government made the mistake of spending more money instead of less during the Great Depression of 1929. Expenses doubled from 7 percent in 1930 to 15 percent in 1933. This excessive spending, beyond incoming revenue, greatly prolonged the depression. The years of World War II were particularly hard on the American people with 90 percent income taxes and rationing of goods.
The economy did not rebound for 18 years as a result of the slow decline of excessive spending and taxes by the federal government. Also, people naturally migrated to the U.S. from countries in ruins because we were basically unharmed by the bombing and other effects of the war.
We are on the same path towards destruction of our economy as we were during the 1930s, and seem determined to make the same mistakes. The government seeks to blame personal greed, foreigners, businessmen, corporations, the health care industry, and anyone else they can think of, rather than place the blame where it belongs, on government itself for over-spending.
Fiscal conservatives were up in arms over the excessive spending during the eight years George W. Bush was in office, aided and abetted by the Republicans in Congress. What happened in 2009 was the biggest catastrophe in history. Spending was totally out of control, in-relation to revenue, and primarily aimed at social engineering and entitlement programs that do nothing to enhance the economy, but are rather a severe drain on precious resources.
When Congress enacted the Economic Stabilization Act of 2008 (EESA), they did not follow their constitutional authority, to pass a law. What they did was, in effect, make Executive Branch officials into legislators. They gave the U.S. Treasury $700 billion and told them to do whatever they saw fit with regard to financial institutions, with no conditions or oversight. There is a distinct possibility that the EESA violated the non-delegation doctrine. Though the text does not specifically state it, the Constitution's logic and structure, particularly the separation of powers, implies limits on the size and kind of decisions that Congress may confer on the Executive Branch. Article I, Section 1, the Vesting Clause, states, "All legislative Powers herein granted shall be vested ina Congress of the United States..." All means all, therefore, none shall be vested anywhere else.
Writing in the New Republic, Jeffrey Rosen of George Washington University Law School argues, "The military spending scandals of WW II, exposed by the Truman Committee, showed the risks for corruption and fraud when the Executive Branch is given a free hand to spend vast amounts of money." Even in the unlikely event the Executive Branch exercises its excessive EESA discretion efficiently, the mere exercise would nevertheless subvert the separation of powers which, as Justice Louis Brandeis said, was adopted :"not to promote efficiency but to preclude the exercise of arbitrary power."
The Supreme Court has said, "That Congress cannot delegate legislative power to the president is a principle universally recognized as vital to the integrity and maintenance of the system of government ordained by the Constitution." The Court has said that properly delegated discretion must come with "an intelligible principle" and must "clearly delineate" a policy that limits the discretion. This is surely not true in the case of the EESA. And yet, there has not been a constitutional challenge brought before the Court in the validity of the EESA, better known as TARP. WHY?
Next, President Bush asked Congress for new authority to bailout automakers, since they did not fit the description of "financial institutions." After debate, Congress defeated the amendment that would have authorized Bush and Treasury Secretary Paulson to use TARP money for the bailout. Both the Bush and Obama administrations have violated the law and the Constitution, they did it in spite of congressional rejection. The Constitution plainly states, "No money shall be drawn from the Treasury, but in consequence of appropriations made by law," in Article I, Section 9, Clause 7. Both administrations claimed the auto bailouts were legal because they said so. They are blatantly unconstitutional and illegal. Billions more taxpayer dollars, funded by debt, down the drain. Why has there never been a constitutional challenge to these bailouts?
Then, the bailout of Fannie Mae and Freddie Mac. These bailouts are expected to cost up to $200 billion by the end of 2010. The necessity for the bailouts came from meddling in the sub-prime mortgage market by congressman Barney Frank, Senator Chris Dodd, now Treasury Secretary Timothy Geithner, as well as the Clinton, Bush, and Obama administrations. The government is doing everything possible to hide the details of these transactions from the American taxpayers, who have an unquestionable right to know. Judicial Watch was forced to file a Freedom of Information Act lawsuit to make the transactions public.The documents show that past Treasury Secretary Paulson and current Treasury Secretary Geithner forced the executives to take $250 billion from the government, thus giving the Treasury control of these two Government Sponsored Enterprises, all shrouded in secrecy, behind closed doors. Obama's promise of transparency doesn't seem to mean much.
Much of the TARP funds loaned to banks and other institutions have been repaid with interest. Rather than paying down the debt, reducing the defecit, to take some of the burden off the shoulders of the taxpayers, the government is keeping the money in a slush fund to finance more government intrusion into business and industry. On top of that, we now are facing unwanted health care reform that will put the government intrusion into the economy far over 50 percent.
Where is the outrage from Congress? Why is the American president allowed to ignore and trash the Constitution of the United States? If the Justice Department is so intent on prosecuting people for legal opinions, this looks like a great place to start.
"A rigid economy of the public contributions and absolute interdiction of all useless expenses will go far towards keeping the government honest and non repressive." THOMAS JEFFERSON, in a letter to Marquis de Lafayette, 1823.