HOW THE UNITED STATES IS BEING
DESTROYED
Introduction
At the close of the Constitutional Convention
in 1787, Benjamin Franklin told an inquisitive citizen that the
delegates to the Constitutional Convention gave the people “a
Republic, if you can keep it.” We should apologize to Mr.
Franklin. It is obvious that the Republic is gone, for we are
wallowing in a pure democracy against which the Founders had
strongly warned.
Madison, the father of the Constitution, could
not have been more explicit in his fear and concern for democracies.
“Democracies,” he said, “have ever been
spectacles of turbulence and contention; have ever been found
incompatible with personal security or the rights of property;
and have in general been as short in their lives as they have
been violent in their death.”
If Madison’s assessment was correct,
it behooves those of us in Congress to take note and decide,
indeed, whether the Republic has vanished, when it occurred,
and exactly what to expect in the way of “turbulence,
contention, and violence.” And above all else,
what can we and what will we do about it?
The turbulence seems self-evident. Domestic
welfare programs are not sustainable and do not accomplish their
stated goals. State and federal spending and deficits are out
of control. Terrorism and uncontrollable fear undermine our sense
of well-being. Hysterical reactions to dangers not yet seen prompt
the people at the prodding of the politicians to readily sacrifice
their liberties in vain hope that someone else will take care
of them and guarantee their security. With these obvious signs
of a failed system all around us, there seems to be more determination
than ever to antagonize the people of the world by pursuing a
world empire. Nation building, foreign intervention, preemptive
war, and global government drive our foreign policy. There seems
to be complete aversion to defending the Republic and the Constitution
that established it.
The Founders clearly understood the dangers
of a democracy. Edmund Randolph of Virginia described the effort
to deal with the issue at the Constitutional Convention: “The
general object was to produce a cure for the evils under which
the United States labored; that in tracing these evils to their
origins, every man had found it in the turbulence and follies
of democracy.”
These strongly held views regarding the evils
of democracy and the benefits of a Constitutional Republic were
shared by all the Founders. For them, a democracy meant centralized
power, controlled by majority opinion, which was up for grabs
and therefore completely arbitrary.
In contrast, a Republic was decentralized
and representative in nature, with the government’s purpose
strictly limited by the Constitution to the protection of liberty
and private property ownership. They believed the majority should
never be able to undermine this principle and that the government
must be tightly held in check by constitutional restraints. The
difference between a democracy and a republic was simple. Would
we live under the age-old concept of the rule of man or the enlightened
rule of law?
A constitution in and by itself does not guarantee
liberty in a republican form of government. Even a perfect constitution
with this goal in mind is no better than the moral standards
and desires of the people. Although the United States Constitution
was by far the best ever written for the protection of liberty,
with safeguards against the dangers of a democracy, it too was
flawed from the beginning. Instead of guaranteeing liberty equally
for all people, the authors themselves yielded to the democratic
majority’s demands that they compromise on the issue of
slavery. This mistake, plus others along the way, culminated
in a Civil War that surely could have been prevented with clearer
understanding and a more principled approach to the establishment
of a constitutional republic.
Subsequently, the same urge to accommodate
majority opinion, while ignoring the principles of individual
liberty, led to some other serious errors. Even amending the
Constitution in a proper fashion to impose alcohol prohibition
turned out to be a disaster. Fortunately this was rectified after
a short time with its repeal.
But today, the American people accept drug
prohibition, a policy as damaging to liberty as alcohol prohibition.
A majority vote in Congress has been enough to impose this very
expensive and failed program on the American people, without
even bothering to amend the Constitution. It has been met with
only minimal but, fortunately, growing dissent. For the first
150 years of our history, when we were much closer to being a
true republic, there were no federal laws dealing with this serious
medical problem of addiction.
The ideas of democracy, not the principles
of liberty, were responsible for passage of the 16th Amendment.
It imposed the income tax on the American people and helped to
usher in the modern age of the welfare/warfare state. Unfortunately,
the 16th Amendment has not been repealed, as was the 18th. As
long as the 16th Amendment is in place, the odds are slim that
we can restore a constitutional republic dedicated to liberty.
The personal income tax is more than symbolic of a democracy;
it is a predictable consequence.
Transition to Democracy
The transition from republic to democracy
was gradual and insidious. It seeds were sown early in our history.
In many ways, the Civil War and its aftermath laid the foundation
for the acute erosion that took place over the entire 20th century.
Chronic concern about war and economic downturns — events
caused by an intrusive government’s failure to follow the
binding restraints of the Constitution — allowed majority
demands to supersede the rights of the minority.
By the end of the 20th century, majority opinion
had become the determining factor in all that government does.
The rule of law was cast aside, leaving the Constitution a shell
of what it once was- a Constitution with rules that guaranteed
a republic with limited and regional government and protection
of personal liberty. The marketplace, driven by voluntary cooperation,
private property ownership, and sound money was severely undermined
with the acceptance of the principles of a true democracy.
Unfortunately, too many people confuse the
democratic elections of leaders of a republic for democracy by
accepting the rule of majority opinion in all affairs. For majorities
to pick leaders is one thing. It is something quite different
for majorities to decide what rights are, to redistribute property,
to tell people how to manage their personal lives, and to promote
undeclared, unconstitutional wars.
The majority is assumed to be in charge today
and can do whatever it pleases. If the majority has not yet sanctioned
some desired egregious action demanded by special interests,
the propaganda machine goes into operation, and the pollsters
relay the results back to the politicians who are seeking legitimacy
in their endeavors. The rule of law and the Constitution have
become irrelevant, and we live by constant polls.
This trend toward authoritarian democracy
was tolerated because, unlike a military dictatorship, it was
done in the name of benevolence, fairness, and
equity. The pretense of love and compassion by those who
desire to remold society and undermine the Constitution convinced
the recipients, and even the victims, of its necessity. Since
it was never a precipitous departure from the republic, the gradual
erosion of liberty went unnoticed.
However, it is encouraging that more and more
citizens are realizing just how much has been lost by complacency.
The resolution to the problems we face as a result of this profound
transition to pure democracy will be neither quick nor painless.
This transition has occurred even though the word “democracy”
does not appear in the Constitution or in the Declaration of
Independence, and the Founders explicitly denounced it.
Over the last hundred years, the goal of securing
individual liberties within the framework of a constitutional
republic has been replaced with incessant talk of democracy and
fairness.
Rallying support for our ill-advised participation
in World War I, Wilson spoke glowingly of “making the
world safe for democracy,” and never mentioned national
security. This theme has, to this day, persisted in all our foreign
affairs. Neo-conservatives now brag of their current victories
in promoting what they call “Hard Wilsonism.”
A true defense of self-determination for
all people, the necessary ingredient of a free society, is
ignored. Self-determination implies separation of smaller government
from the larger entities that we witnessed in the breakup of
the Soviet Union. This notion contradicts the goal of pure democracy
and world government. A single world government is the ultimate
goal of all social egalitarians who are unconcerned with liberty.
Current Understanding
Today the concepts of rights and property
ownership are completely arbitrary. Congress, the courts, presidents
and bureaucrats arbitrarily “legislate” on a daily
basis, seeking only the endorsement of the majority. Although
the republic was designed to protect the minority against the
dictates of the majority, today we find the reverse. The republic
is no longer recognizable.
Supporters of democracy are always quick to
point out one of the perceived benefits of this system is the
redistribution of wealth by government force to the poor. Although
this may be true in limited fashion, the champions of this system
never concern themselves with the victims from whom the wealth
is stolen. The so-called benefits are short-lived, because democracy
consumes wealth with little concern for those who produce it.
Eventually the programs cannot be funded, and the dependency
that has developed precipitates angry outcries for even more
“fairness.” Since reversing the tide against liberty
is so difficult, this unworkable system inevitably leads to various
forms of tyranny.
As our republic crumbles, voices of protest
grow louder. The central government becomes more authoritarian
with each crisis. As the quality of education plummets,
the role of the federal government is expanded. As the quality
of medical care collapses, the role of the federal government
in medicine is greatly increased. Foreign policy failures
precipitate cries for more intervention abroad and an even greater
empire. Cries for security grow louder, and concern for liberty
languishes.
Attacks on our homeland prompt massive increase
in the bureaucracy to protect us from all dangers, seen and imagined.
The prime goal and concern of the Founders, the protection of
liberty, is ignored. Those expressing any serious concern for
personal liberty are condemned for their self-centeredness and
their lack of patriotism.
Even if we could defeat al Qaeda, which surely
is a worthwhile goal, it would do little to preserve our liberties,
while ignoring the real purpose of our government. Another enemy
would surely replace it, just as the various groups of barbarians
never left the Roman Empire alone once its internal republican
structure collapsed.
Democracy Subverts Liberty and
Undermines Prosperity
Once it becomes acceptable to change the rules
by majority vote, there are no longer any limits on the power
of the government. When the Constitution can be subverted by
mere legislative votes, executive orders or judicial decrees,
constitutional restraints on the government are eliminated. This
process was rare in the early years of our history, but now it
is routine.
Democracy is promoted in the name of fairness
in an effort to help some special-interest group gain a benefit
that it claims it needs or is entitled to. If only one small
group were involved, nothing would come of the demands. But coalitions
develop, and the various groups ban together to form a majority
to vote themselves all those things that they expect others to
provide for them.
Although the motivating factor is frequently
the desire for the poor to better themselves through the willingness
of others to sacrifice for what they see as good cause, the process
is doomed to failure.
Governments are inefficient and the desired
goals are rarely achieved.
Administrators, who benefit, perpetuate the
programs.
Wealthy elites learn to benefit from the system
in a superior fashion over the poor, because they know how to
skim the cream off the top of all the programs designed for the
disadvantaged. They join the various groups in producing the
majority vote needed to fund their own special projects.
Take Public Housing . . .
Public financing of housing, for instance,
benefits builders, bureaucrats, insurance companies, and financial
institutions, while the poor end up in drug-infested, crime-ridden
housing projects. For the same reason, not only do business leaders
not object to the system, but they also become strong supporters
of welfare programs and foreign aid.
Big business strongly supports programs like
the Export/Import Bank, the IMF, the World Bank, farm subsidies,
and military adventurism. Tax-code revisions and government contracts
mean big profits for those who are well-connected. Concern for
individual liberty is pushed to the bottom of the priority list
for both the poor and rich welfare recipients.
Prohibitions placed in the Constitution against
programs that serve special interests are the greatest threat
to the current system of democracy under which we operate. In
order for the benefits to continue, politicians must reject the
rule of law and concern themselves only with the control of majority
opinion. Sadly, that is the job of almost all politicians.
It is clearly the motivation behind the millions spent on constant
lobbying, as well as the billions spent on promoting the right
candidates in each election.
Those who champion liberty are rarely heard
from. The media, banking, insurance, airlines, transportations,
financial institutions, government employees, the military-industrial
complex, the educational system, and the medical community are
all dependent on government appropriations, resulting in a high-stakes
system of government.
Democracy encourages the mother of all political
corruption — the use of political money to buy influence.
If the dollars spent in this effort represent the degree to which
democracy has won out over the rule of law and the Constitution,
it looks like the American republic is left wanting. Billions
are spent on the endeavor.
Money in politics is the key to implementing
policy and swaying democratic majorities. It is seen by most
Americans, and rightly so, as a negative and a danger. Yet the
response, unfortunately, is only more of the same. More laws
tinkering with freedom of expression are enacted, in hopes that
regulating sums of private money thrown into the political system
will curtail the abuse. But failing to understand the cause of
the problem, lack of respect for the Constitution, and obsession
with legislative relativity dictated by the majority serve only
to further undermine the rule of law.
Be Prepared: The Dangers of Pure
Democracy are Known
We were adequately warned about the problem.
Democracies lead to chaos, violence and bankruptcy. The
demands of the majority are always greater than taxation alone
can provide. Therefore, control over the monetary and banking
system is required for democracies to operate. It was no accident
in 1913, when the dramatic shift toward a democracy became pronounced,
that the Federal Reserve was established. A personal income
tax was imposed as well. At the same time, popular election of
Senators was instituted, and our foreign policy became aggressively
interventionist.
Even with an income tax, the planners for
war and welfare (a guns and butter philosophy) knew that it would
become necessary to eliminate restraints on the printing of money.
Private counterfeiting was a heinous crime, but government counterfeit
and fractional-reserve banking were required to seductively
pay for the majority’s demands. It is for this reason that
democracies always bring about currency debasement through inflation
of the money supply.
Some of the planners of today clearly understand
the process and others, out of ignorance, view central-bank money
creation as a convenience with little danger. That’s where
they are wrong. Even though the wealthy and the bankers support
paper money — believing they know how to protect against
its ill effects — many of them are eventually dragged down
in the economic downturns that always develop.
It’s not a new era that they have
created for us today, but more of the same endured throughout
history by so many other nations.
The belief that democratic demands can be financed by deficits,
credit creation and taxation is based on false hope and failure
to see how it contributes to the turbulence as the democracy
collapses.
Once a nation becomes a democracy, the
whole purpose of government changes.
Instead of the government’s goal being that of guaranteeing
liberty, equal justice, private property, and voluntary exchange,
the government embarks on the impossible task of achieving economic
equality, micromanaging the economy, and protecting citizens
from themselves and all their activities. The destruction of
the wealth-building process, which is inherent in a free society,
is never anticipated. Once it’s realized that it has been
undermined, it is too late to easily reverse the attacks against
limited government and personal liberty.
Democracy, by necessity, endorses special-interest
interventionism, inflationism, and corporatism. In order to carry
out the duties now expected of the government, power must be
transferred from the citizens to the politicians. The only thing
left is to decide which group or groups have the greatest influence
over the government officials. As the wealth of the nation dwindles,
competition between the special-interest groups grows more intense
and becomes the dominant goal of political action. Restoration
of liberty, the market and personal responsibility are of little
interest and are eventually seen as impractical.
Power and public opinion become crucial
factors in determining the direction of all government expenditures. Although both major parties now accept the principles
of rule by majority and reject the rule of law, the beneficiaries
for each party are generally different, although they frequently
overlap. Propaganda, demagoguery, and control of the educational
system and the media are essential to directing the distribution
of the loot the government steals from those who are still honestly
working for a living.
The greater problem is that nearly everyone
receives some government benefit, and at the same time contributes
to the Treasury. Most hope they will get back more than they
pay in and, therefore, go along with the firmly entrenched system.
Others, who understand and would choose to opt out and assume
responsibility for themselves, aren’t allowed to and are
forced to participate. The end only comes with a collapse
of the system, since a gradual and logical reversal of the inexorable
march toward democratic socialism is unachievable.
Soviet-style communism dramatically collapsed
once it was recognized that it could no longer function and a
better system replaced it. It became no longer practical to pursue
token reforms like those that took place over its 70-year history.
The turmoil and dangers of pure democracy
are known. We should get prepared. But it will be the clarity
with which we plan its replacement that determines the amount
of pain and suffering endured during the transition to another
system. Hopefully, the United States Congress and other government
leaders will come to realize the seriousness of our current situation
and replace the business-as-usual attitude, regardless
of political demands and growing needs of a boisterous majority.
Simply stated, our wealth is running out,
and the affordability of democracy is coming to an end.
History reveals that once majorities can vote
themselves largesse, the system is destined to collapse from
within. But in order to maintain the special-interest system
for as long as possible, more and more power must be given to
an ever-expanding central government — which of course only
makes matters worse.
The economic shortcomings of such a system
are easily understood. What is too often ignored is that the
flip side of delivering power to government is the loss of liberty
to the individual. This loss of liberty causes exactly what the
government doesn’t want — less productive citizens
who cannot pay taxes.
Even before 9/11, these trends were in place
and proposals were abundant for restraining liberty. Since 9/11,
the growth of centralized government and the loss of privacy
and personal freedoms have significantly accelerated.
It is in dealing with homeland defense and
potential terrorist attacks that the domestic social programs
and the policy of foreign intervention are coming together and
precipitating a rapid expansion of the state and erosion of liberty.
Like our social welfarism at home, our foreign meddling and empire
building abroad are a consequence of our becoming a pure democracy.
Foreign Affairs and Democracy
As expected, the dramatic shift away from
republicanism that occurred in 1913 led to a bold change of purpose
in foreign affairs. The goal of “making the world safe for
democracy” was forcefully put forth by President Wilson.
Protecting national security had become too narrow a goal and
selfish in purpose. An obligation for spreading democracy became
a noble obligation backed by a moral commitment, every bit as
utopian as striving for economic equality in an egalitarian society
here at home.
With the growing affection for democracy,
it was no giant leap to assume that majority opinion should mold
personal behavior. It was no mere coincidence that the 18th Amendment
— alcohol prohibition — was passed in 1919.
Ever since 1913, all our presidents have
endorsed meddling in the internal affairs of other nations, and have given generous support to the notion that
a world government would facilitate the goals of democratic welfare
or socialism. On a daily basis, we hear that we must be prepared
to spend our money and use our young people to police the entire
world in order to spread democracy. Whether in Venezuela or Columbia,
Afghanistan or Pakistan, Iraq or Iran, Korea or Vietnam, our
intervention is always justified with a tone of moral arrogance
that “it’s for their own good.”
Our policymakers promote democracy as a cure-all
for the various complex problems of the world. Unfortunately,
the propaganda machine is able to hide the real reasons for our
empire building. “Promoting democracy” overseas merely
becomes a slogan for doing things that the powerful and influential
strive to do for their own benefit. To get authority for these
overseas pursuits, all that is required of the government is
that the majority be satisfied with the stated goals, no matter
how self-serving they may be. The rule of law, that is, constitutional
restraint, is ignored. But as successful as the policy may
be on the short run and as noble as it may be portrayed, it is
a major contributing factor to the violence and chaos that eventually
come from pure democracy.
There is abundant evidence that the pretense
of spreading democracy contradicts the very policies we are pursuing.
We preach about democratic elections, but we are only too willing
to accept some for-the-moment friendly dictator who actually
overthrew a democratically elected leader or to interfere in
some foreign election.
This is the case with Pakistan’s Mushariff.
For a temporary alliance, he reaps hundreds of millions of dollars,
even though strong evidence exists that the Pakistanis have harbored
and trained al Qaeda terrorists, that they have traded weapons
with North Korea, and that they possess weapons of mass destruction.
No one should be surprised that the Arabs are confused by our
overtures of friendship. We have just recently promised $28 billion
to Turkey to buy their support for Persian Gulf War II.
Our support of Saudi Arabia, in spite of its
ties to al Qaeda through financing and training, is totally
ignored by those obsessed with going to war against Iraq. Saudi
Arabia is the furthest thing from a democracy. As a matter of
fact, if democratic elections were permitted, the Saudi government
would be overthrown by a bin Laden ally.
Those who constantly preach global government
and democracy ought to consider the outcome of their philosophy
in a hypothetical Mid-East regional government. If these people
were asked which country in this region possesses weapons of
mass destruction, has a policy of oppressive occupation, and
constantly defies UN Security council resolutions, the vast majority
would overwhelmingly name Israel. Is this ludicrous? No, this
is what democracy is all about and what can come from a one-man,
one-vote philosophy.
U.S. policy supports the overthrow of the
democratically elected Chavez government in Venezuela, because
we don’t like the economic policy it pursues. We support
a military takeover as long as the new dictator will do as we
tell him.
There is no creditability in our contention
that we really want to impose democracy on other nations. Yet
promoting democracy is the public justification for our foreign
intervention. It sounds so much nicer than saying we’re
going to risk the lives of our young people and massively tax
our citizens to secure the giant oil reserves in Iraq.
After we take over Iraq, how long would one
expect it to take until there are authentic nationwide elections
in that country? The odds of that happening in even a hundred
years are remote. It’s virtually impossible to imagine a
time when democratic elections would ever occur for the election
of leaders in a constitutional republic dedicated for protection
of liberty any place in the region.
Foreign Policy, Welfare, and 9/11
The tragedy of 9/11 and its aftermath dramatize
so clearly how a flawed foreign policy has served to encourage
the majoritarians determined to run everyone’s life.
Due to its natural inefficiencies and tremendous
costs, a failing welfare state requires an ever-expanding authoritarian
approach to enforce mandates, collect the necessary revenues,
and keep afloat an unworkable system. Once the people grow to
depend on government subsistence, they demand its continuation.
Excessive meddling in the internal affairs
of other nations and involving ourselves in every conflict around
the globe has not endeared the United States to the oppressed
of the world.
The Japanese are tired of us.
The South Koreans are tired of us.
The Europeans are tired of us.
The Central Americans are tired of us.
The Filipinos are tired of us.
And above all, the Arab Muslims are tired
of us.
Angry and frustrated by our persistent bullying
and disgusted with having their own government bought and controlled
by the United States, joining a radical Islamic movement was
a natural and predictable consequence for Muslims.
We believe bin Laden when he takes credit
for an attack on the West, and we believe him when he warns us
of an impending attack. But we refuse to listen to his explanation
of why he and his allies are at war with us.
Bin Laden’s claims are straightforward.
The U.S. defiles Islam with military bases on holy land in Saudi
Arabia, its initiation of war against Iraq, with 12 years of
persistent bombing, and its dollars and weapons being used against
the Palestinians as the Palestinian territory shrinks and Israel’s
occupation expands. There will be no peace in the world for
the next 50 years or longer if we refuse to believe why those
who are attacking us do it.
To dismiss terrorism as the result of Muslims
hating us because we’re rich and free is one of the greatest
foreign-policy frauds ever perpetrated on the American people.
Because the propaganda machine, the media, and the government
have restated this so many times, the majority now accept it
at face value. And the administration gets the political cover
it needs to pursue a “holy” war for democracy against
the infidels who hate us for our goodness.
Polling on the matter is followed closely
and, unfortunately, is far more important than the rule of
law. Do we hear the pundits talk of constitutional restraints
on the Congress and the administration? No, all we ever hear
are reassurances that the majority supports the President; therefore
it must be all right.
The terrorists’ attacks on us, though
never justified, are related to our severely flawed foreign policy
of intervention. They also reflect the shortcomings of a bureaucracy
that is already big enough to know everything it needs to know
about any impending attack but too cumbersome to do anything
about it. Bureaucratic weaknesses within a fragile welfare
state provide a prime opportunity for those whom we antagonize
through our domination over world affairs and global wealth to
take advantage of our vulnerability.
But what has been our answer to the shortcomings
of policies driven by manipulated majority opinion?
We have responded by massively increasing
the federal government’s policing activity to hold American
citizens in check and make sure we are well-behaved and pose
no threat, while massively expanding our aggressive presence
around the world. There is no possible way these moves can make
us more secure against terrorism, yet they will accelerate our
march toward national bankruptcy with a currency collapse.
Relying on authoritarian democracy and domestic
and international meddling only move us sharply away from a constitutional
republic and the rule of law and toward the turbulence of a decaying
democracy, about which Madison and others had warned.
The Utopian Nightmare of One-World
Government
Once the goal of liberty is replaced by a
preconceived notion of the benefits and the moral justifications
of a democracy, a trend toward internationalism and world government
follows.
We certainly witnessed this throughout the
20th century. Since World War II, we have failed to follow the
Constitution in taking this country to war, but instead have
deferred to the collective democratic wisdom of the United Nations.
Once it’s recognized that ultimate authority
comes from an international body, whether the United Nations,
NATO, the WTO, the World Bank, or the IMF, the contest becomes
a matter of who holds the reins of power and is able to dictate
what is perceived as the will of the people (of the world). In
the name of democracy, just as it is done in Washington, powerful
nations with the most money will control UN policy. Bribery,
threats, and intimidation are common practices used to achieve
a “democratic” consensus-no matter how controversial
and short-lived the benefits.
Can one imagine what it might be like if a
true worldwide democracy existed and the United Nations were
controlled by a worldwide, one man/one vote philosophy? The masses
of China and India could vote themselves whatever they needed
from the more prosperous western countries. How long would
a world system last based on this absurdity? Yet this is the
principle that we’re working so hard to impose on ourselves
and others around the world.
In spite of the great strides made toward
one-world government based on egalitarianism, I’m optimistic
that this utopian nightmare will never come to fruition. I have
already made the case that here at home powerful special interests
take over controlling majority opinion, making sure fairness
in distribution is never achieved. This fact causes resentment
and becomes so expensive that the entire system becomes unstable
and eventually collapses.
The same will occur internationally, even
if it miraculously did not cause conflict among the groups demanding
the loot confiscated from the producing individuals (or countries).
Democratic socialism is so destructive to production of wealth
that it must fail, just as socialism failed under Soviet Communism.
We have a long way to go before old-fashioned nationalism is
dead and buried. In the meantime, the determination of those
promoting democratic socialism will cause great harm to
many people before its chaotic end and we rediscover the basic
principle responsible for all of human progress.
Paying for Democracy
With the additional spending to wage war against
terrorism at home, while propping up an ever-increasing expensive
and failing welfare state, and the added funds needed to police
the world — all in the midst of a recession —
we are destined to see an unbelievably huge explosion of deficit
spending.
Raising taxes won’t help. Borrowing the
needed funds for the budgetary deficit — plus the daily
borrowing from foreigners required to finance our ever-growing
current account deficit — will put tremendous pressure on
the dollar.
The time will come when the Fed will no longer
be able to dictate low interest rates. Reluctance of foreigners
to lend, the exorbitant size of our borrowing needs, and the
risk premium will eventually send interest rates upward. Price
inflation will accelerate, and the cost of living for all Americans
will increase. Under these conditions, most Americans will face
a decline in their standard of living.
Faced with this problem of paying for past
and present excess spending, borrowing and inflating of
the money supply has already begun in earnest. Many retirees,
depending on their 401k funds and other retirement programs,
are suffering the ill-effects of the stock market crash —
a phenomenon that still has a long way to go. Depreciating
the dollar by printing excessive money, like the Fed is doing,
will eventually devastate the purchasing power of those retirees
who are dependent on Social Security. Government cost-of-living
increases will never be able to keep up with this loss. The reality
is that we will not be able to inflate, tax, spend or borrow
our way out of this mess that the Congress has delivered to the
American people. The demands that come with pure democracy
always lead to an unaffordable system that ends with economic
turmoil and political upheaval.
Tragically, the worse the problems get, the
louder is the demand for more of the same government programs
that caused the problems in the first place, both domestic and
international. Weaning off of government programs and getting
away from foreign meddling because of political pressure are
virtually impossible. The end comes only after economic forces
make it clear we can no longer afford to pay for the extravagance
that comes from democratic dictates.
Democracy is the most expensive form of government.
There is no “king” with an interest in preserving the
nation’s capital. Everyone desires something, and the special-interest
groups, banding together, dictate to the politicians exactly
what they need and want. Politicians are handsomely rewarded
for being “effective,” that is, getting the benefits
for the groups that support them. Effectiveness is never
measured by efforts and achievements in securing liberty, even
though it’s the most important element in a prosperous and
progressive world.
Spending is predictable in a democracy, especially
one that endorses foreign interventionism. It always goes up,
both in nominal terms and in percentage of the nation’s
wealth.
Paying for it can be quite complicated. The
exact method is less consequential than the percent of the nation’s
wealth the government commands. Borrowing and central-bank credit
creation are generally used — they are less noticeable,
but more deceitful, than direct taxation (which would amount
to “pay as we go”). If direct taxation were accomplished
through monthly checks written by each taxpayer, the cost of
government would immediately be revealed, and the democratic
con-game would end much more quickly.
The withholding principle was devised to make
paying for the programs the majority demanded seem less painful.
Passing on debt to the next generation through borrowing is also
a popular way to pay for welfare and warfare.
Inflation — The Most Sinister
Tax of All
Because the effect of inflating a currency
to pay the bills is difficult to understand, and the victims
are hard to identify, inflation is the most sinister method of
payment for a welfare state. It, too, grows in popularity as
the demands increase for services that aren’t affordable.
Although this appears to be a convenient and cheap way to pay
the bills, the economic consequences of lost employment, inflated
prices, and economic dislocation make the long-term consequences
much more severe than paying as we go. Not only is this costly
in terms of national wealth, it significantly contributes to
the political chaos and loss of liberty that accompany the death
throes of a doomed democracy.
This does not mean that direct taxes won’t
be continuously raised to pay for out-of-control spending. In
a democracy, all earned wealth is assumed to belong to the government.
Therefore any restraint in raising taxes, and any tax cuts or
tax credits, are considered “costs” to government.
Once this notion is established, tax credits or cuts are given
only under condition that the beneficiaries conform to the democratic
consensus. Freedom of choice is removed, even if a group is merely
getting back control of that which was rightfully theirs in the
first place.
Tax-exempt status for various groups is not
universal but is conditioned on whether their beliefs and practices
are compatible with politically correct opinions endorsed by
the democratic majority. This concept is incompatible with the
principles of private-property ownership and individual liberty.
By contrast, in a free society all economic and social decision-making
is controlled by private property owners without government intrusion,
as long as no one is harmed in the process.
Confusion Regarding Democracy
The vast majority of the American people have
come to accept democracy as a favorable system and are pleased
with our efforts to pursue Wilson’s dream of “making
the world safe for democracy.” But the goals of pure
democracy and that of a constitutional republic are incompatible.
A clear understanding of the difference is paramount, if we are
to remain a free and prosperous nation.
There are certain wonderful benefits in recognizing
the guidance that majority opinion offers. It takes a consensus
or prevailing attitude to endorse the principles of liberty and
a Constitution to protect them. This is a requirement for the
rule of law to succeed. Without a consensus, the rule of law
fails.
This does not mean that the majority or public
opinion measured by polls, court rulings, or legislative bodies
should be able to alter the constitutional restraints on the
government’s abuse of life, liberty, and property. But
in a democracy, that happens — and we know that today
it is happening in this country on a routine basis.
In a free society with totally free markets,
the “votes” by consumers “cast” through their
purchases, or refusals to purchase, determine which businesses
survive and which fail. This is “free-choice” democracy,
and it is a powerful force in producing and bringing about economic
efficiency.
In today’s democracy by decree,
government laws dictate who receives the benefits and who gets
shortchanged. Conditions of employment and sales are taxed and
regulated at varying rates, and success or failure is too often
dependent on government action than by consumers’ “voting”
in the marketplace by their spending habits. Individual consumers
by their decisions should be in charge — not governments
armed with mandates from the majority.
Even a system of free-market money (a redeemable
gold-coin standard) functions through the principle of consumers
always voting or withholding support for that currency. A gold
standard can only work when freely converted into gold coins,
giving every citizen a right to vote on a daily basis for or
against the government money.
The Way Out
It’s too late to avoid the turbulence
and violence that Madison warned about. It has already started.
But it’s important to minimize the damage and prepare the
way for a restoration of the republic. The odds are not favorable,
but not impossible. No one can know the future with certainty.
The Soviet system came to an abrupt end with less violence than
could have ever been imagined at the height of the Cold War.
It was a pleasant surprise.
Interestingly enough, what is needed is a
majority opinion — especially by those who find themselves
in leadership roles, whether political, educational, or in the
media — that rejects democracy- and support the rule of
law within the republic. This majority support is essential for
the preservation of the freedom and prosperity with which America
is identified.
This will not occur until we as a nation once
again understand how freedom serves the interests of everyone.
Henry Grady Weaver, in his 1947 classic, “The Mainspring
of Human Progress,” superbly explains how it works. His
thesis is simple. Liberty permits progress, while government
intervention tends always to tyranny.
Liberty releases creative energy; government
intervention suppresses it. This release of energy was never
greater than in the time following the American Revolution and
the writing of the U.S. Constitution.
Instead of individual activity being controlled
by the government or superstitious beliefs about natural and
mystical events, activity is controlled by the individual. This
understanding recognizes the immense value in voluntary cooperation
and enlightened self-interests.
Freedom requires self-control and moral
responsibility. No one owes anyone
else anything and everyone is responsible for his or her own
acts. The principle of never harming one’s neighbor, or
never sending the government to do the dirty work, is key to
making the system tend toward peaceful pursuits and away from
the tyranny and majority-induced violence. Nothing short of a
reaffirmation of this principle can restore the freedoms once
guaranteed under the Constitution. Without this, prosperity for
the masses is impossible, and as a nation we become more vulnerable
to outside threats.
In a republic, the people are in charge. The
Constitution provides strict restraints on the politicians, bureaucrats
and the military. Everything the government is allowed to do
is only done with explicit permission from the people or the
Constitution. Today, it’s the opposite. The American people
must get permission from the government for their every move,
whether it’s use of their own property or spending their
own money.
Even the most serious decision, such as going
to war, is done while ignoring the Constitution and without a
vote of the people’s representatives in the Congress. Members
of the global government have more to say about when American
troops are put in harm’s way than the U.S. Congress.
The Constitution no longer restrains the government.
The government restrains the people in all that they do. This
destroys individual creative energy, and the “mainspring
of human progress” is lost. The consequences are less progress,
less prosperity, and less personal fulfillment.
A system that rejects voluntary contracts,
enlightened self interest, and individual responsibilities permits
the government to assume these responsibilities. And the government
officials become morally obligated to protect us from ourselves,
attempting to make us better people and setting standards for
our personal behavior. That effort is already in full swing.
But if this attitude prevails, liberty is lost.
When government assumes the responsibility
for individuals to achieve excellence and virtue, it does so
at the expense of liberty, and must resort to force and intimidation.
Standards become completely arbitrary, depending on the attitude
of those in power and the perceived opinion of the majority.
Freedom of choice is gone.
This leads to inevitable conflicts with the
government dictating what one can eat, drink or smoke. One group
may promote abstinence, the other tax-supported condom distribution.
Arguments over literature, prayer, pornography, and sexual behavior
are endless. It is now not even permissible to mention the word
“God” on public property.
A people who allows its government to set
personal moral standards, for all non-violent behavior, will
naturally allow it to be involved in the more important aspects
of spiritual life. For instance, there are tax deductions for
churches that are politically correct, but not for those whose
beliefs that are considered out of the mainstream. Groups that
do not meet the official politically correct standards are more
likely to be put on a “terrorist” list. This arbitrary
and destructive approach to solving difficult problems must be
rejected if we ever hope to live again in a society where the
role of government is limited to that of protecting liberty.
The question that I’m most often asked
when talking about this subject is, “Why do our elected
leaders so easily relinquish liberty and have such little respect
for the Constitution?” The people of whom I speak are convinced
that liberty is good and big government is dangerous. They are
also quite certain that we have drifted a long way away from
the principles that made America great, and their bewilderment
continuously elicits a big “Why?”
There’s no easy answer to this and no
single explanation. It involves temptation, envy, greed, and
ignorance, but worst of all, humanitarian zeal.
Unfortunately, the greater the humanitarian
outreach, the greater the violence required to achieve it. The
greater the desire to perform humanitarian deeds through legislation,
the greater the violence required to achieve it. Few understand
this.
There are literally no limits to the good
deeds that some believe need to be done. Rarely does anyone question
how each humanitarian act by government undermines the essential
element of all human progress: individual liberty.
Failure of government programs prompts more
determined efforts, while the loss of liberty is ignored or rationalized
away. Whether it’s the war against poverty, drugs, terrorism,
or the current Hitler of the day, an appeal to patriotism is
used to convince the people that a little sacrifice of liberty,
here and there, is a small price to pay.
The results, though, are frightening and will
soon become even more so. Poverty has been made worse, the drug
war is a bigger threat than drug use, terrorism remains a threat,
and foreign wars have become routine and decided upon without
congressional approval.
Most of the damage to liberty and the Constitution
is done by men and women of good will who are convinced they
know what is best for the economy, for others, and foreign powers.
They inevitably fail to recognize their own arrogance in assuming
they know what is the best personal behavior for others. Their
failure to recognize the likelihood of mistakes by central planners
allows them to ignore the magnitude of a flawed central government
directive, compared to an individual or a smaller unit of government
mistake.
C. S. Lewis had an opinion on this subject:
Of all tyrannies a tyranny sincerely exercised
for the good of its victim may be the most oppressive. It may
be better to live under robber barons than under omnipotent moral
busybodies. The robber baron’s cruelty may sometimes sleep,
his cupidity may at some point be satiated, but those who torment
us for our own good will torment us without end for they do so
with the approval of their own conscience.
A system that is based on majority vote rather
than the strict rule of law encourages the few who thrive on
power and exerting authority over other people’s lives,
unlike the many driven by sincere humanitarian concerns. Our
current system rewards those who respond to age-old human instincts
of envy and greed as they gang up on those who produce.
Those individuals who are tempted by the offer
of power are quick to accommodate those who are the most demanding
of government-giveaway programs and government contracts. These
special-interest groups notoriously come from both the poor and
the rich, while the middle class is required to pay.
It’s not just a coincidence that, in
the times of rapid monetary debasement, the middle class
suffers the most from the inflation and job losses that monetary
inflation brings. When inflation is severe, which it will become,
the middle class can be completely wiped out. The stock market
crash gives us a hint as to what is likely to come as this country
is forced to pay for the excesses sustained over the past 30
years while operating under a fiat monetary system.
Eric Hoffer, the longshoreman philosopher,
commented on this subject as well: “Absolute power corrupts
even when exercised for humane purposes. The benevolent despot
who sees himself as a shepherd of the people still demands from
others the submissiveness of sheep.”
Good men driven by a desire for benevolence
encourage the centralization of power.
The corruptive temptation of power is made worse when domestic
and international interventions go wrong and feed into the hate
and envy that invade men’s souls when the love of liberty
is absent.
Those of good will who work to help the downtrodden
do so not knowing they are building a class of rulers who will
become drunk with their own arrogance and lust for power. Generally
only a few in a society yield to the urge to dictate to others,
and seek power for the sake of power and then abuse it.
Most members of society are complacent and
respond to propaganda, but they unite in the democratic effort
to rearrange the world in hopes of gaining benefits through coercive
means and convince themselves they are helping their fellow man
as well. A promise of security is a powerful temptation for many.
A free society, on the other hand, requires
that these same desires be redirected. The desire for power and
authority must be over one’s self alone. The desire for
security and prosperity should be directed inward, rather than
toward controlling others. We cannot accept the notion that the
gang solution endorsed by the majority is the only option. Self-reliance
and personal responsibility are crucial.
But there is also a problem with economic
understanding. Economic ignorance about the shortcomings of central
economic planning, excessive taxation and regulations, central
bank manipulation of money, and credit and interest rates is
pervasive in our nation’s capital.
A large number of conservatives now forcefully
argue that deficits don’t matter.
Spending programs never shrink, no matter
whether conservatives or liberals are in charge.
Rhetoric favoring free trade is canceled out
by special-interest protectionist measures.
Support of international government agencies
that manage trade, such as the IMF, the World Bank, the WTO,
and Nafta politicizes international trade and eliminates any
hope that free-trade capitalism will soon emerge.
The federal government will not improve on
its policies until the people coming to Washington are educated
by a different breed of economists than those who dominate our
government-run universities. Economic advisors and most officeholders
merely reflect the economics taught to them. A major failure
of our entire system will most likely occur before serious thought
is given once again to the guidelines laid out in the Constitution.
The current economic system of fiat money
and interventionism (both domestic and international) serves
to accommodate the unreasonable demands for government to take
care of the people. And this, in turn, contributes to the worst
of human instincts: authoritarian control by the few over the
many.
We, as a nation, have lost our understanding
of how the free market provides the greatest prosperity for the
greatest number. Not only have most of us forgotten about the
invisible hand of Adam Smith, few have ever heard of Mises and
Hayek- two individuals who understood exactly why all the economic
ups and downs of the 20th century occurred, as well as the cause
of the collapse of the Soviet Union.
But worst of all, we have lost our faith in
freedom. Materialistic concerns and desire for security drive
all national politics. This trend has sharply accelerated since
9/11.
Understanding the connection between liberty,
prosperity, and security has been lost. The priorities are backwards.
Prosperity and security come from liberty. Peace and the absence
of war come as a consequence of liberty and free trade. The elimination
of ignorance and restraints on do-goodism and authoritarianism
in a civilized society can only be achieved through a contractual
arrangement between the people and the government — in our
case, the U.S. Constitution.
The Constitution was the best ever devised
for releasing the creative energy of a free people while strictly
holding in check the destructive powers of government. Only the
rule of law can constrain those who, by human instinct, look
for a free ride while delivering power to those few, found in
every society, whose only goal in life is a devilish desire to
rule over others.
The rule of law in a republic protects free-market
activity and private-property ownership and provides for equal
justice under the law. It is this respect for law and rights
over government power that protects the mainspring of human progress
from the enemies of liberty.
Communists and other socialists have routinely
argued that the law is merely a tool of the powerful capitalists.
But they have it backwards. Under democracy and fascism, the
pseudo-capitalists write the laws that undermine the Constitution
and jeopardize the rights and property of all citizens. They
fail to realize it is the real law, the Constitution itself,
which guarantees rights and equal justice and permits capitalism,
thus guaranteeing progress.
Arbitrary, ever-changing laws are the friends
of dictators. Authoritarians argue constantly that the Constitution
is a living document, and that rigid obedience to ideological
purity is the enemy we should be most concerned about. They would
have us believe that those who cherish strict obedience to the
rule of law in the defense of liberty are wrong merely because
they demand ideological purity. They fail to mention that their
love of relative rights and pure democracy is driven by a rigid
obedience to an ideology as well.
The issue is never rigid beliefs versus reasonable
friendly compromise. In politics, it’s always competition
between two strongly held ideologies. The only challenge for
men and women of good will is to decide the wisdom and truth
of the ideologies offered.
Nothing short of restoring a republican form
of government with strict adherence to the rule of law, and curtailing
illegal government programs, will solve our current and evolving
problems.
Eventually the solution will be found with
the passage of the Liberty Amendment. Once there is serious debate
on this amendment, we will know that the American people are
considering the restoration of our constitutional republic and
the protection of individual liberty.
You have just read:
AN ADDRESS TO THE U. S. HOUSE OF REPRESENTATIVES
BY THE HON. RON PAUL OF TEXAS ENTITLED, Sorry, Mr. Franklin,
“We’re All Democrats Now”
January 29, 2003
To make this subject perfectly clear, an excellent
example of democracy is a lynch mob. The majority wants to hang
the guy, and the guy to be hanged doesn't. So, they have a vote
and hang the guy. THERE ARE ABSOLUTELY NO RESTRAINTS OF ANY
KIND IN A PURE DEMOCRACY.
For additional copies of this booklet, contact
F.R.E.E.
About F R.E.E.
The Foundation for Rational Economics and
Education, Inc. is a 501(c)(3) non profit organization dedicated
to individual liberty and free-market economics. F.R.E.E. was
founded by Dr. Paul in 1976, when, as a freshman in the U.S.
Congress, he realized that a better educated and informed public
was our best hope for preserving the limited government our Constitution
proscribes, and thereby securing America’s liberty and prosperity
for the generations that will follow.
Having proposed the first term-limits legislation
in modern history, Dr. Paul left the House in 1984 after four
terms as his bill would have mandated, and expanded the educational
work of F.R.E.E., AN ADDRESS TO THE U. S. HOUSE OF REPRESENTATIVES
BY THE HON. RON PAUL OF TEXAS
January 29, 2003
Sorry, Mr. Franklin, “We’re All
Democrats Now” launched the National
Endowment for Liberty to produce the 13-part television series
“At Issue,” and continued to speak out on issues of
public policy at the national level. F.R.E.E. publishes Ron Paul’s
Freedom Report. For more information or to make a tax-deductible
donation to F.R.E.E, contact:
Foundation for Rational Economics and Education
P.O. Box 1776
Lake Jackson, TX 77566
(979) 265-3034
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Read more at www.pacinst.com
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