I wish I could say that House Speaker John Boehner’s developing plan to sue President Obama for abuses of executive power is a good idea. I really do. The record of such abuse is long and significant, from unilaterally suspending and delaying portions of Obamacare to altering fundamental aspects of immigration law by executive order. Indeed, the U.S. Supreme Court recently and unanimously reversed the president’s abuse of power in making executive recess appointments that were not, in fact, during a congressional recess. There is ample evidence for the proposition that President Obama has fundamentally altered the Constitutional balance of power among the branches of government in ways that should be reversed.
But is this a problem for which the courts are an appropriate solution? Unfortunately, for both legal and political reasons, the answer is “no.” And the sooner Speaker Boehner and his Republican colleagues realize that such a lawsuit against the president will be a legal failure and, like Senator Ted Cruz’s attempt to shut down the federal government over Obamacare, a political bust, the better.
Although Boehner has not fully revealed the basis for his suit against Obama, the legal analysis must start by recognizing that there is no real precedent for Congress to sue the President for failing to execute the law. A primary reason for this is that courts generally find that Congress as a plaintiff lacks “standing,” or any kind of personal and concrete damage that a court would legally recognize. Battles over the balance of power among the branches of government are more “political questions” which courts have long recognized need political, not judicial, resolution. Given the lack of precedent for it, such a suit would almost certainly lose in the first round in federal district court, and political pressure against the matter would mushroom immediately.
The real purpose of the suit then would seem to be more political than legal, creating a bit of theater in which two very unpopular branches of government, the executive and legislative, duke it out in front of the third branch, the judiciary. And frankly, the people have no patience for this. President Obama’s popularity is lower than anyone could have believed possible a few years ago, with his recent selection in a Quinnipiac University poll as the worst American president since World War II. And Congress is, if it is possible—and apparently it is—even less popular, with 9% approval in the most recent poll. Who wants to see these “losers”, whom everyone agrees are in gridlock and doing essentially nothing about the problems and needs of the country, staging a fight over who is overreaching in power? It will be like Ted Cruz trying to shut down the government, where the noise over his tactics was louder than the central point (does anyone even remember it was about healthcare?) he was trying to make.
Further, a lawsuit against the president over executive power opens Republicans to reasonable claims of hypocrisy, since they are the ones always complaining about judicial activism. Conservatism should not be content to pursue conservative ends by any means, but should consistently demonstrate a commitment to conservative means as well. As a consequence, pursuing an unprecedented legal attack on presidential power through the courts puts House Republicans right where they don’t belong, seeking a judicial solution to a political problem.
No, what Speaker Boehner and House Republicans should do is to pursue President Obama’s abuse of executive power in the mid-term elections in November, not in a federal court in July. Deliver a political rebuke to the President, take away his party’s control of the U.S. Senate, and send a message that Obama and the Democrats have overreached and are taking the presidency and the country in the wrong direction.
Tags: Healthcare Reform, Supreme Court
You can bet on hand-wringing and outrage about judicial activism and political motives behind the 5-4 U.S. Supreme Court decision in the Hobby Lobby case but, in fact, this case was all but decided in 1993 when Congress passed the Religious Freedom Restoration Act (RFRA). Both the liberal justices who dissented in the case, and others who attack the decision as conservative activism, should instead be aiming their arguments at Congress for enacting that law, because today’s court opinion is a relatively straightforward and narrow application of the RFRA.
Unhappy with a Supreme Court decision that narrowed religious freedom (Department of Human Resources of Oregon v. Smith, 1990), Congress took matters into its own hands and passed the RFRA. Whereas the Court in Smith said that “neutral, generally applicable laws could be applied to religious practices even when not supported by a compelling governmental interest, “ the RFRA provides that “Government shall not substantially burden a person’s exercise of religion even if the burden results from a rule of general applicability.” Few may understand that Congress, as a co-equal branch with the Supreme Court under the Constitution, has the power to pass laws and, in some cases, thereby alter constitutional interpretation through legislation.
The Religious Freedom Restoration Act, then, established a high bar for any law impacting religious liberty, saying that not only must the government have a compelling interest in doing so, but it must use the “least restrictive alternative” available to accomplish its purposes. That is to say, if there is another way to accomplish the government’s purpose with a lesser restriction on religious liberty, that is what is required. In the case of contraceptive services, the Affordable Care Act (ACA) had already created such an alternative for religious nonprofits (churches and religious associations), providing that insurance administrators make those services available to individuals without imposing any cost-sharing on the religious organization. The Court in Hobby Lobby simply, and narrowly, said: Apply that same alternative to family businesses that have religious objections to the contraceptive services required by the ACA. Nothing dramatic or even surprising here—any politics or activism came in passing the RFRA, not in the Supreme Court’s application of it in Hobby Lobby.
Of course the additional pronouncement in today’s decision was the Court’s holding that such religious rights may be exercised by a business, not just individuals. But this is not unexpected either—lower federal courts, as well as the U.S. Supreme Court, have been laying the groundwork for the idea that individuals do not give up their constitutional rights based merely on the legal form in which their business operates. Indeed, the Dictionary Act, which courts follow in the absence of some special definition in a particular law, defines “person” to include “corporations, companies, associations, firms, partnerships, societies, and joint stock companies as well as individuals.” So again, disagree if you want, but your objection is really to those who passed the Religious Freedom Restoration Act without some special definition of “person” or with the Dictionary Act and its broad definition.
Indeed, even though the Court was clear that its Hobby Lobby decision only applied to a family-owned business, we should anticipate that one or more publicly-held companies will soon bring a follow-on case, claiming they also have religious rights. The Court commented in Hobby Lobby that this seemed “improbable” because of the “practical restraints” of a diverse set of shareholders sharing religious beliefs. But nothing in the RFRA or in the Court’s decision would prevent a publicly-held corporation from stating religious views and, as long as shareholders were aware of those when they purchased the stock, it would seem such rights should also be protected. In any event, it seems likely one or more such public companies will try.
In short, the Hobby Lobby decision should not have been a surprise. The underlying religious freedom issues were resolved 21 years ago when Congress passed the Religious Freedom Restoration Act. And the notion that corporations are people has been in the Definition Act since 1947. Dissenters argue that the increasing diversity of our society demands different definitions and outcomes, but this ignores two important points, one of process and one of substance: Let them amend the laws, if they wish, to make their point, rather than relying on judicial interpretation and activism, and allow their own understanding of a diverse society to include those committed to the free exercise of their religious beliefs.
The Call of American Liberty, by Ted McAllister
Books reviewed in this essay:
The New Deal and Modern American Conservatism: A Defining Rivalry, by Gordon Lloyd and David Davenport (Hoover Institution Press 2013).
The Crusade Years, 1933-1955: Herbert Hoover’s Lost Memoir of the New Deal Era and Its Aftermath, ed., George H. Nash (Hoover Institution Press, 2013).
New power emerges out of confusion—and ours is a confused age. No dominant historical narrative supplies us with a common story, and without a common story we belong neither to each other nor to shared ideals. When a people are unscripted by history, the past becomes raw material, to be processed via key moral and political vocabulary by those who would willfully impose “new modes and orders,” to quote Machiavelli.
Disordered times produce the search for order and the desire to impose order. Gordon Lloyd and David Davenport are in the former category. Their book The New Deal and Modern American Conservatism seeks to revise our historical understanding of the rise and development of American conservatism by tracing it to Herbert Hoover. What interests the authors just as much, if less directly, is examining how ideas and movements emerge in response to crisis moments. The New Deal, they claim, was just such a moment and Hoover’s long “crusade” against it provided what has been, ever since, the “defining rivalry.”
Two questions present themselves immediately: Was this a crisis moment? And did Hoover generate the philosophical-political response that would become the basis of an emerging “conservative movement”?
This is hardly an academic exercise on their part. By reclaiming the story of the crisis and the principles that became clear in response to it, Lloyd and Davenport aspire to offer a usable history to contemporary conservatives fishing around for an account of the American-ness of conservatism.
The most important, and challengeable, claim they make is that when Hoover confronted the “revolutionary” nature of the New Deal, he had a “Burkean moment.” To their thinking, the New Deal represented the third crisis of our Republic—the Founding and the Civil War being the first two. “Each of these crises defined or redefined the very nature of the American republic,” they assert.
It is certainly true that those first two “moments” forced an intense conversation about and examination of the nature of the nation and its political expression. To acknowledge those crises does not, however, require us to believe that there were no other crises before the 1930s, nor that the New Deal was itself a crisis. Lloyd and Davenport claim that it was America’s French Revolution—and on this historical claim, a great deal rests.
These are very contestable ideas. For instance, the transformations in American economy, society, culture, and intellectual life were more dramatic in the last two decades of the 19th century than any other period in American history. The subsequent political development after 1900 of Progressivism was the result (rather than the cause) of titanic changes in the very fabric of American life. The Industrial Revolution was the most visible part of a revolution in manners, morals, habits, and ideas that we are still working through. To my way of thinking, the third crisis of the Republic took place in those years and is best described as a crisis of authority.
Nonetheless, Lloyd and Davenport see in the New Deal the American equivalent of the French Revolution, a radical assault on the social and institutional order. Perhaps the Progressives of the previous generation were only interested in reforming that order. Here I must disagree with my friends (and indeed they are both good friends) because I see deep challenges to what Hoover called the “American System” well before Franklin Roosevelt took office.
If Hoover had a Burkean moment it seems to have come rather late in the game. My own sense is that Hoover did awaken to the dangers of the New Deal and become a crusader against all forms of “collectivism” because of this awakening, but that, unlike Burke, he had not been sufficiently prescient in seeing the logic of unfolding events. A darker image would be to think of Hoover as the Owl of Minerva whose flight at dusk reveals only what has already happened.
Then, too, Burke’s moment was rather conflicted. He famously asserted that an entire age—the age of chivalry—was one and that all the virtues that attended that age and its cultivated affections would be sundered. At least rhetorically, Burke presented himself as eulogist as much as prophet. This does not describe Hoover—he was a crusader (his word) and fought a battle of ideas and principles against the forces of collectivism, American and foreign. Whether their different rhetorical strategies supported programs that were similar—something we could call “conservatism”—is an open and interesting question. It seems clear that Burke was a Whig before he wrote Reflections and he was a Whig after. He did not become something new, a “conservative.” Rather he was engaged in a conserving task as a Whig.
What about Hoover—did he become a “conservative” as he awakened to the threat?
The question of our 31st President’s political philosophy is contested, but that he was considered a “Progressive” for much of his early career is clear, even if the meaning of the label is not. More importantly, by the standards of any previous chief executive, Hoover’s response to the economic crisis that began to emerge during his administration was energetic and radical. As we know, the administration of his successor, Franklin Roosevelt, folded many of Hoover’s programs and ideas seamlessly into the “first New Deal.”
All of this suggests an awakening, a change, a turning around on Hoover’s part. His fight against the New Deal and its principles was vigorous, sustained, and intellectually coherent. Whether or not he ought to have been concerned about the strains of Progressivism that challenged longstanding American ideals, Hoover’s post-presidential crusade treated the New Deal as a watershed in American history and his response to it as the necessary defense of the “American System,” then endangered. His principles were more like Calvin Coolidge’s after 1933, but his preaching in defense of the American System was all Hoover—vigorous and combative. In this sense, Hoover changed, turning the last decades of his long life (he died in 1964 at the age of 90) into a fight for the American soul.
We are still left with the question of whether Hoover should be considered the fountainhead of modern American conservatism in preference to, say, the usual list of intellectuals and journalists (Buckley, Hayek, Kirk, Meyer). This is of more than passing interest, for it goes to the heart of contemporary conservatism and its prospects.
Aid in answering this question can be found in a newly released, heretofore forgotten, manuscript of Hoover’s called The Crusade Years: 1933-1955, which has been edited and introduced by George H. Nash. Hoover had published so much over his lifetime that we might rightly question the value of publishing this long manuscript, much of it drawn from speeches and Hoover’s other writings. But it well rewards the reader. Nash’s masterful editing supplies not only thoughtful context but sufficient additions of fact so as to help the reader understand well Hoover’s arguments that were deeply entangled in nearly forgotten events or struggles. The volume is not a concise expression of the author’s philosophy of the American System, but it provides all the essentials while chronicling Hoover’s ongoing fight with the agents of collectivism. This is the Hoover—urgently absorbed in the controversies that enter his and the nation’s life—who has already passed through Lloyd and Davenport’s “Burkean moment.”
The Hoover of this memoir is best described as an American liberal rather than a conservative. The liberal identity (along with the modifier “American”) is in fact what links Hoover the Progressive and Hoover the crusader. As he put it in 1937, when he was four years out of office, “The New Deal having corrupted the label of liberalism for collectivism, coercion [and] concentration of political power, it seems ‘Historic Liberalism’ must be conservative in contrast.”
To differentiate the new from the inherited version we could call them collectivist liberalism versus self-rule liberalism, or perhaps authoritarian liberalism versus liberty liberalism. Either way, Hoover identified Americanism with the latter and saw the former as a pernicious European import incompatible with the native species. This was not a milder fight for being an intra-liberal one. Necessarily, it was not subject to compromise but could produce only victory or defeat: the American system of individualism and liberty will die if New Deal liberalism survives. This may strike most of today’s conservatives as hyperbolic, but the crusade flag planted by Hoover hangs over the movement as a pressing if unarticulated question.
At the center of Hoover’s liberalism is the “rugged individual.” Somewhat incongruously, this archetype is both a transcendent ideal and a product of the peculiar American experience—a tension that rests near the heart of all claims to American exceptionalism. In this case the individual is, while self-reliant, hardly atomistic. Living outside of the European corruption of aristocratic privilege, this individual is a font of creativity: developing the art of self-rule, the desire to take care of himself, while simultaneously fostering the dense web of voluntary institutions that help others learn the habits and virtues of rugged individualism. The liberty that attends American individualism gave rise to another kind of creativity in the sciences, economy, in all manner of inventions and improvements. Hoover was especially impressed with energetic tinkering and improving, the American need to change things, the obsession for efficiency.
The rugged individual he so loved was the source of American greatness. Therefore the key to America’s future was the protection of the environment that fostered this human type. For this reason (though Hoover was vague about details), he accepted the reforms of the Progressive era as largely salutary because they prevented the individual from being overtaken by the privilege of concentrated power: economic power. For him the Progressive reforms—free enterprise but not laissez faire—were consistent with the Founding principles because they protected the individual from power too large for him to challenge. And, most important, perhaps, they were reforms that fit into a constitutional frame of government and so squared nicely with Hoover’s insistence on the American tradition of self-rule and limited government.
The New Deal was, in his view, a break from the Progressive tradition. It was as alien as European statism, for its goal—or at least its logical outcome—was the destruction of the rugged individual, and with it, liberty and creativity. Moreover, the New Deal sought to transcend the Constitution and replace a limited government of self-ruling individuals with administrative rule by elites unbounded by constitutional limits. When Hoover used the word “collectivism” he was in earnest, and The Crusade Years throws at it far more than platitudes, minutely taking apart very particular New Deal and Fair Deal policies. Something new was happening to America—it was for Hoover, as for Lloyd and Davenport, the American coming of the Jacobins.
The crusading Hoover looms large for Lloyd and Davenport because he represents the essential challenge to the New Deal understanding of government that they believe is still at work in America. The coauthors differ about what can be done about this. For Davenport one might say that Hoover’s fight was valiant but largely lost. The good species of liberalism has been routed—and so there is little to conserve. Lloyd holds out more hope, believing that beneath the ups and downs of electoral politics, Americans remain, in their bones, a “center-right” nation. The cause ahead for “conservatives” (who are quite properly, in light of the foregoing, describable as American liberals), is to teach the American story with particular emphasis on the heritage of liberties (economic, religious and political) and the great opportunity for self-rule that the Constitution provides. And a fine chapter in it is what Herbert Hoover did to affirm self-rule, limited government, and above all the Constitution, as the great symbol and source of our deliberative nature. For Lloyd, at least, the people remain culturally American—which is to say individualists, rightly understood.
Their joint assertion remains that today’s crisis is essentially a playing out of the New Deal revolution. To the degree that this assertion is taken to heart, it opens up heretofore settled subjects. Instead of accepting the New Deal ideas and programs as incorporated into the American system, and instead of thinking of the American conservative movement as having its origins after the New Deal and thus after the Revolution, Lloyd and Davenport call conservatives to a much more radical course than even they recognize. The question, again, is whether this new narrative of American conservatism will reconfigure our history, because as our history goes so will our future.
Link to LibertyLaw.org: http://www.libertylawsite.org/2014/05/28/the-call-of-american-liberty/
Ted McAllister is the Edward L. Gaylord Chair / Associate Professor of Public Policy at Pepperdine University. Author of Revolt Against Modernity: Leo Strauss, Eric Voegelin, and the Search for a Post-Liberal Order, he is currently working on a book about Walter Lippmann and the problem of modern liberation.
The case of the NBA vs. Donald Sterling illustrates how powerful the court of public opinion has become and how wide is its disconnection from a court of law. The latest is that basketball star LeBron James and some of his fellow players say they may boycott next season if Donald Sterling’s ownership of the Los Angeles Clippers isn’t resolved and removed in the mere months before then. In their view this a civil rights case that has already been opened and shut in the court of public opinion and a court of law had better well keep up the pace or the fans will suffer.
Of course the court of public opinion does not worry itself over legal niceties such as whether Mr. Sterling’s private statement to a friend should be legally actionable, or whether his privacy was violated in releasing the taped conversations. Constitutional matters such as the guarantee of free speech under the First Amendment are not relevant once the bandwagon of public opinion starts to roll. To what degree should a man’s private statements to a friend bear on his business? And never mind that business litigation involving a property worth as much as $1 billion would normally take years to resolve—if the court of public opinion has already spoken, a court of law should be able to mop up the details in short order.
As a legal matter—and rest assured that’s what taking away an owner’s franchise is—this is not a civil rights case but a question of property rights. The legal case, as opposed to the public opinion outcry, will be about the terms of the contract between Mr. Sterling as owner and the National Basketball Association, whether Sterling violated that business agreement by his words, and whether being forced to give up his franchise is an appropriate penalty under the terms of the contract. And the latest from the Sterling side is that, not surprisingly, he has hired a top business lawyer and is refusing to pay the fine assessed by the NBA Commissioner. Legal game on.
I suppose one way to look at the two cases—one in the court of public opinion and one in a court of law—is that one is the air war, one the ground war; one is the marketing war and the other is the contractual war. But I think what the players, and many others who have taken to the airwaves, are missing is that both are appropriate and necessary in our democratic republic. Mr. Sterling’s statements triggered offense and an outcry, and even a useful conversation, about racism in our society and the players were absolutely right to respond. But the other shoe takes longer to drop and it is equally necessary—removing a man’s ownership of a piece of property, the Los Angeles Clippers, and the court where that occurs, a court of law, is a ground war of time and patience.
In the larger picture, the framers of our system of government greatly feared that factions would form that, in the passion of the moment, would dominate questions of policy and politics and roll over the rights of others. This is precisely what is occurring today in our legal system. When it was learned that the CEO of Mozilla Firefox had donated money to the “wrong side” of California ballot proposition 8 in 2008, he was essentially run out of office. No matter that the majority of Californians who voted on the matter took the view he supported, or that the President of the United States himself was on that side of the question only a few years ago, we can’t let a man be CEO of a public company if he once held those views. The court of public opinion had spoken and the CEO didn’t even make it to the court of law.
Even Donald Sterling deserves his day in court, not only in the court of public opinion on civil rights and offensive speech, but also in a court of law on questions of contract and property rights. Let’s hope there is sufficient rationality and moderation left in our republic to allow that to take place.
President Obama’s approval ratings have hit an all-time low, but he is clearly tops in at least one category.
According to a recent report, the federal government set a new record in 2013 by issuing regulations and rules totaling some 26,417 pages in the Federal Register. According to the Competitive Enterprise Institute, the total cost of regulatory compliance is around $1.9 billion a year, or nearly $15,000 per household in hidden costs.
Probably the two best ways to measure the growth of the federal government are to calculate its spending in relation to GDP, and to measure the amount of regulation added to the books. By both of these measures, big government has hit a record-setting pace.
What we need is a return to good, old-fashioned federalism, where we ask, first, does government need to do this? If so, we then must ask which branch and which level. Sounds like nobody in Washington is asking enough of the right questions these days.
Link to Townhall.com: http://townhall.com/talkradio/dailycommentary/698562
Tags: Supreme Court
The Supreme Court announced its much-awaited decision on whether prayer prior to a town board (city council) meeting violates the Establishment Clause of the First Amendment of the U.S. Constitution. The answer is such prayers are ok, but the vote was 5-4, meaning pray quickly in case the either the makeup of the court or the mind of one judge changes.
Still, it was an important decision in many respects. The primary reasoning of the Court is that such ceremonial prayers have long been practiced in this country at all levels, from the U.S. Senate to the local city hall. The long-held nature of the practice itself, the majority of the Court held, suggests that such prayers do not violate the Constitution. This answers a question I have entertained myself: how can a phrase like “one nation under God” in the Pledge of Allegiance be constitutional for decades until a single federal judge wakes up one morning and decides it’s not legal anymore. Is constitutional law so subject to change that things that are permissible for centuries suddenly, overnight are not anymore? So here’s a vote that history and practice mean something, at least.
Another important principle from the decision was the Court’s holding that a person’s discomfort with religious expression is not the same thing as religious coercion under the First Amendment. Those bringing the lawsuit were attending a town board meeting in Greece, N.Y. where a Christian prayer had been offered to open the meeting and they felt uncomfortable, as if they were forced to participate against their will. But the Court noted that such prayers in the early moments of a council meeting were largely ceremonial, focusing on seriousness and tradition, and were addressed to the council itself, not the audience. People were free to come and go, not required to sit there like students at a high school graduation. In that context, the Court said that feeling offended or disrespected was not a violation of the First Amendment, adding that “offense . . . does not equate to coercion.”
The Court was clearly reluctant to get into the business of overseeing the actual language of public, ceremonial prayers. The 4 dissenting judges were uncomfortable with the heavily Christian nature of some of the prayers, but the majority held that such content was not objectionable. The majority ruled explicitly against an evolving religious diversity marginalizing Christian prayer, holding that the “decidedly Christian nature of these prayers must not be dismissed as a relic of a time when our Nation was less pluralistic than it is today.” As long as the prayer opportunity does not proselytize or advance or disparage some particular faith or belief, judges will not oversee its content.
Somewhat surprisingly, even the dissenting judges (Elena Kagan, Stephen Breyer, Sonia Sotomayor and Ruth Ginsburg) acknowledged that a public forum such as a town hall or legislative session “need not become a religion-free zone.” That seems to be the goal of most of these challenges to religious expression, to cleanse the public square of religion. But this, of course, is not what the Establishment Clause requires, and it’s encouraging that all nine justices essentially agreed on that point. What the dissenters would have preferred was greater diversity among those leading the prayers and more neutrality of language. But the majority thought it was a mistake for courts to engage in that kind of detailed scrutiny of public prayer, so long as there was no coercion.
This was one more chapter in the unfolding drama of constitutional interpretation. The “living constitution” judges feel that changes in the diverse nature of our society must continue to transform constitutional standards such as First Amendment Establishment Clause litigation. A narrow majority has held that history and tradition still mean something, and that diversity must itself be more tolerant, even to the point of discomfort and offense, but not to the point of the constitutional prohibition against religious conversion. That’s settled law for now—by one vote on the Supreme Court.
President Obama and the independent Congressional Budget Office (CBO) recently released their dueling views of the federal budget over the next ten years. The President is quick to celebrate a reduction in the federal deficit—that is the amount being added to the national debt every year. It’s the age-old government ploy to assert bragging rights for spending reductions when, in fact, all they’ve really done is reduce the rate of increase. But, as the CBO points out, even this reduction is only short-term, with annual deficits again increasing in 2018, while the overall national debt itself has risen at a shocking rate, from $10.6 trillion when Obama took office in 2009 to $17.5 trillion today and still growing strong. An independent Harvard study indicates that it would take a bonus payment of $106,000 from each American to pay the debt.
But here are surprising contemporary questions about public debt: Does it really matter? Does anyone really care? There was a time when our presidents spoke of government debt in moral terms, with Calvin Coolidge in the 1920s referring to “carelessness” in the “expenditure of public money” as a “condition characteristic of undeveloped people, or of a decadent generation.” And Coolidge—nicknamed “The Great Refrainer” by recent biographer Amity Shlaes—did something about it, lowering the post-war debt from $22.3 billion in 1923 to $16.9 billion in 1929 by meeting with his budget director almost weekly, cutting government spending wherever he could. President Herbert Hoover at first tried to hold down spending in the late Twenties and early Thirties, finally giving in to less austerity and more stimulus spending in the face of the Great Depression. Still, Hoover famously said, “Blessed are the young for they shall inherit the national debt.”
Somehow much of our national thinking has evolved to the point where we think of debt less as a moral or even a financial obligation and more as a mere instrument or tool of economic policy. Debt has become one more knob we turn toward “open” as a countercyclical tool of fiscal policy when the economy is slow, not fully appreciating its long-term consequences. As one of my Italian colleagues pointed out in the height of the recent worldwide recession, the big difference between the Italians and Americans now is that you can still print money, and your politicians are busy doing that, by issuing more currency and building more debt. But we can no longer print lira, he added, we have to wait for Germany to decide whether to print more euros.
Is it really true that government debt should be viewed now as a mere tool of economic policy, rather than a moral or financial obligation to be repaid? I think not. For one thing, other countries (especially China) own a good deal of our debt instruments and they will expect ongoing repayment. Indeed, though our projected debt to GDP ratios are still well below those of Greece and other marginal economies, that could eventually become a concern to our trading partners. As former chairman of the Joint Chiefs of Staff, Mike Mullen, pointed out, “the single biggest threat to our national security is our debt,” with former Defense chief Robert Gates adding, “at some point, financial insolvency at home will turn into strategic insolvency abroad.”
There is also the ongoing moral question of transferring obligations from one generation to the next. It would be a far more appropriate use of debt to be spending on long-term infrastructure projects, from which capital growth and multi-generational benefits might arise. But, in fact, the U.S. is using debt to finance short-term spending (Social Security and Medicare payments, for example) that really should be covered on a pay-as-you-go basis through taxes. That does raise a serious moral question: is it right to simply shift forward the year-to-year costs of one generation to the next?
In his book Debt: The first 5000 Years, author David Graeber wrestles with a woman’s simple yet profound conversational comment: “Surely one has to pay one’s debts.” It is, as Graeber points out, not just an economic statement, but also a moral statement. Or, as George Washington put it, such debts “ungenerously throw upon posterity the burden which we ourselves ought to bear.” Before we blithely redefine the moral and financial obligations of government debt to become just another instrument in the economic toolkit, one must consider all the implications of debt: financial, moral, generational, diplomatic and strategic.
Dealing with the New Deal, by Gordon Lloyd & David Davenport from History News Network in Hoover Digest April 11, 2014Posted by daviddavenport in Op/Eds.
The debate surrounding the Affordable Care Act continues—remarkably—more than three years after it was signed into law. Liberals and conservatives alike seem to understand that this is not only the signature accomplishment of Barack Obama’s presidency but the most important extension of the New Deal since the adoption of Medicare and Medicaid in the 1960s. Indeed, the health care debate is a reminder that after eighty years, the New Deal remains the basic framework of American domestic policy and is still going strong.
When we go back to examine the debates between Franklin D. Roosevelt and Herbert Hoover about the New Deal in the 1930s, we get a better understanding of the principles underlying public policy debates today. Both Roosevelt and the incumbent, Hoover, agreed that the quarrel of the 1932 election was, as Hoover said, “more than a contest between two men, more than a contest between two parties.” It as a contest, said Hoover, “between two philosophies of government” that would decide “the direction our nation will take over a century to come.” Roosevelt agreed: March 4, 1933 (his inauguration as president), marked the transformation of America. It was a historic clash between liberty and democracy.
Starting with his 1932 Commonwealth Club campaign speech and continuing through his Second Inaugural Address in 1937, Roosevelt proclaimed that the old American order of “the financial Titan” and do- nothing laissez-faire government had come to an end.
“The day of enlightened administration has come,” Roosevelt concluded. It was time for a “new deal” to secure a decent life for “the forgot- ten man.” We need to realize, Roosevelt proclaimed, that democracy is actually “a quest, a never-ending seeking for better things.” We needed a reappraisal of American values articulated in the Declaration of Independence as well as the Constitution and Bill of Rights, away from the earlier attachment to Jeffersonian individualism and states’ rights and toward an interdependent “national democracy.” We needed to turn away from a focus on the negative rights of the individual that constrains a government already constitutionally divided against itself and move toward a united centralized administration that secures the positive rights of “everyone.”
In his First Inaugural Address, Roosevelt reinforced his intention to move the country away from congressional deliberation to presidential action: “I shall ask the Congress for the one remaining instrument to meet the crisis: broad executive power to wage a war against the emergency, as great as the power that would be given to me if we were in fact invaded by a foreign foe.”
And in his Second Inaugural, Roosevelt declared “the challenge to democracy: I see one-third of a nation ill housed, ill clad, and ill nourished. . . . We are determined to make every American citizen the subject of his country’s interest and concern. . . . The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.”
Former president Hoover, however, was shocked by the excesses of the New Deal in the 1930s, seeing Roosevelt’s philosophy and governmental programs as “a challenge to (individual) liberty” and a deliberate effort to replace robust, even “rugged” American individualism and a limited but constructive government—what Hoover called the exceptional American system—with a European version of regimented community. The New Deal programs, he argued, represented “a radical departure from the foundations of one hundred fifty years which have made this the greatest nation in the world.”
To be sure, the American system contained imperfections, Hoover acknowledged, but these problems were at the margin rather than system- ic. Besides, the really “forgotten man” was a much lower percentage of the population than Roosevelt claimed. Accordingly, Hoover argued, there was no need to engage in a radical transformation of basic values, regiment the lives of a majority of the people, or treat constitutional principles as the plaything of lawyers. The New Deal “steps off the solid highways of true American liberty into the dangerous quicksands of governmental direction,” Hoover said. There was no need for “a gigantic shift of government from the function of umpire to the function of directing, dictating, and competing in our economic life.” Hoover urged Americans to resist the temptation to adopt the regimented European system.
This is precisely the debate that continues today. In order to deal with a relatively small percentage of Americans who were unable to obtain health insurance, Obama and his fellow progressives sought to implement a transformation of the entire health care system. Realizing now that they do not have the “liberty” the president promised of keeping their own policies, the American people are even more unhappy with the transformation than before. Progressives and conservatives alike acknowledge that the Affordable Care Act is doubtless an interim step toward a single-payer (government) system.
The two icons of the 1930s, Hoover’s “rugged individual” and Roosevelt’s “forgotten man,” must learn to coexist. There must be room for both individual liberty—in this case, allowing people to earn and keep their preferred health policies—and coverage for those who cannot otherwise get coverage. The American people seem to understand that ObamaCare tips the scales too heavily away from liberty and toward government regimentation. Let’s hope our leaders in Washington get that message soon.
Link to Hoover Digest article: http://www.hoover.org/publications/hoover-digest/article/175141
Reprinted in Hoover Digest by permission of History News Network. Licensed under Creative Commons.
To understand how policy changes in this country, consider the case of income inequality. First comes a huge marketing campaign to change the conventional wisdom about the topic. From President Obama, who has decided it is “the defining challenge of our time,” on down, everyone is talking about income inequality, how it has grown and why that is a problem. Then policy alternatives are discussed: we should increase the minimum wage or raise taxes on the rich. Finally, our elected leaders feel compelled to “do something” and end up passing laws that may not be needed at all, probably won’t solve “the problem” and will be loaded with unintended consequences. That’s the bandwagon we’re on right now with income inequality.
What is needed is a deeper look at the issue itself, whether it is appropriate or feasible for government to act, and what solutions might work. Of course a dialog of this depth rarely occurs, even (especially?) on the floor of the U.S. Senate. Instead the subject is reduced to sound bites and marketing campaigns, followed by a move to take action, some action, any action, regardless of likely impact.
In an effort to slow the income inequality bandwagon, and bring about a more realistic conversation and, ultimately, a more reasoned conventional wisdom about it, consider these inconvenient truths about income inequality:
• Only the incomes of the top 0.01% have really grown—the Lady Gagas and Bill Gates and Tiger Woods. These are people whose brands have gone global, or who built wildly successful companies. Many of them, like Bill Gates, have not grown their piece of the pie at the expense of the poor or anyone else, rather they have grown the pie for everyone. Your average doctor, lawyer, investment banker in the rest of the 1% have seen little growth and even a decline in their share of wealth.
• Income mobility—your ability to move up and down the income scale—has remained about the same for 75 years. This is the more relevant question in an “equality of opportunity” (not an “equality of outcome”) society and the evidence remains strong that America is still a land of opportunity. As economist Thomas Sowell points out, most of us start in the bottom 20% but we rise, with more of us ending up in the top 20% than remaining at the bottom. People who started in the top 20% of incomes had the lowest rate of increase in their incomes.
• Changing demographics have a huge, but underreported, impact on the income figures. The fact is that we have more older people now—who have higher income and wealth, suggesting the figures need to be age-adjusted, which they are not. Household demographics have changed radically, with 2 or more income workers in a family now bringing in far more income at the top, and single people bringing in less at the bottom. Do we seriously want to change marriage policy to address this?
• When we count income, we leave out a great deal of relevant data—including food stamps and government welfare (intended to address the problem) and health and pension payments, which have grown rapidly. Let’s at least get the data right.
• And what is our goal? To transfer more wealth from Bill Gates and Lady Gaga to others? When is income appropriately equal? How serious a problem is it when 90% of Americans living below the poverty line have smart phones, cable TV and cars (70% with two cars)? In short, all incomes are up over time, so is this an appropriate government problem?
• What will the proposed solutions do? The Congressional Budget Office estimates, for example, that increasing the minimum wage to $10.10 will cause half a million people to lose their jobs. The big problem is that we aren’t creating enough jobs and people are leaving the workforce at an alarming rate. Jobs are what cure poverty, not government handouts.
Unfortunately policy is complicated, difficult stuff. A whole lot more work needs to be done to understand incomes, jobs, and poverty in the new global economy. Jumping on the income inequality bandwagon, in the face of these hard questions, will be part of the problem, not part of any constructive solution.
The timing is deliciously ironic. At the very moment college athletes are running up and down basketball courts in March Madness, earning over a billion dollars for TV networks, the NCAA, colleges and athletic conferences, a hearing officer of the National Labor Relations Board (NLRB) ruled that Northwestern football players are university employees, enabling them to unionize. This ruling, doubtless only the first step in a lengthy process, has sent shock waves through the NCAA and the academic world.
The legal argument was whether student-athletes are, in reality, employees of the University within the meaning of the law. The definition of an employee, established by the NLRB, is a person who performs services for another under a contract of hire, subject to the other’s control or right of control, and in return for payment. After examining the extensive payments to students and the very detailed control of the athletic department and football coaches over the student-athletes’ conduct for 40-60 hours a week, the hearing officer concluded that scholarship athletes were not “primarily students” who “spend only a limited number of hours performing their athletic duties,” but rather employees. So-called “scholarships” for athletes are not, says the hearing officer, truly grants in aid, but rather payments for services, although walk-on players are considered student-athletes in the traditional sense.
Is this a good development for the academic world? Of course not. Scholarship student-athletes are no longer purely students any more. They may vote to unionize, and the unions, in turn, will become their representatives in bargaining over working conditions, salary and the like. It swings the pendulum too far, completely changing the nature of the university and student-athlete relationship, rather than taking up the many issues that should be addressed on a case-by-case basis. Admissions, financial aid, student conduct and all sorts of other departments of the university may now find their policies subject to union negotiation. As a former university president, and before that general counsel, it’s crazy.
But the reality is that it will take a crazy swing of the pendulum like this to begin to address the power-mad and money-grubbing ways of the NCAA. We all know how dominant major revenue sports have become on college campuses, with coaches paid millions of dollars (while professors make thousands), special dorms and apartments constructed for student-athletes and so on. Less visible, perhaps, is that the so-called oversight body for all of this, the NCAA, has itself become a cash cow, producing over $70 million in excess revenues in 2012 (the last year for which figures are available). The power-happy NCAA has a nearly 500-page rulebook, which results in micromanagement of coaches and athletes, excessive limitations on student-athletes’ lives and budgets (they can’t even have jobs or accept dinners regular students can), and power imbalances between large and small schools.
Ultimately there was going to be some pushback to this kind of unchecked growth in the power and money of the NCAA and college athletics. The nation’s founders recognized that unchecked power results in abuse and so they built in checks and balances as well as balances of power in our Constitution. Unfortunately the NCAA, along with university leaders, has not been sufficiently concerned about that, and the money and power grew exponentially, on the backs of student-athletes. What do the Northwestern players say they want out of this? Reformed brain trauma study/prevention, a student opportunity fund (for emergencies, etc.), perhaps an incentive for players to graduate on time. Maybe a little more freedom and control over their college lives and budgets. All things the NCAA could have addressed on its own, but until forced to, would not.
Like ballot propositions, this kind of decision makes a better political statement than it does actual policy. But sometimes that’s where reform has to begin, by someone with a grievance finding just enough of a leverage point to stand up and speak truth to power. A few Northwestern football players and an NLRB hearing officer have done just that. Let the Madness begin.