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Not So Fast, Bud!
Subject: Statism: Part I – The Growth of the Regulatory State

    Come gather 'round people, wherever you roam
    And admit that the waters around you have grown
    And accept it that soon you'll be drenched to the bone
    If your time to you is worth savin'
    Then you better start swimmin' or you'll sink like a stone
    For the times they are a-changin'.

    Bob Dylan

Well I doubt that when Dylan penned these lyrics back in 1963 he had the same thought in mind as I, but yes, today the times certainly are still a-changin'! More recently, our president had promised us "Hope and Change," but hope for what sort of change exactly?

From the founding of the United States and through most of the 19th century, with the very notable exception of slavery, Americans were generally free to pursue their lives and interests without intervention by the state. For example, according to Wikipedia, "For most of Western history, marriage was a private contract between two families" and licenses did not begin to be required until after the Civil War. People were allowed to train for and pursue their chosen work as they best saw fit, with very few professions being licensed. Immigration was generally unrestricted and citizens were free to acquire open land and improve it as their own property—a policy codified into law with the Homestead Act of 1862. Taxes were generally low and consisted predominantly of tariffs imposed upon imported goods. Although a temporary income tax was levied during the Civil War, it was rescinded shortly thereafter. And of course, slavery was eventually abolished.

This unprecedented level of freedom allowed the rise of self-made businessmen such as Rockefeller, Carnegie, Schwab, Hill, Vanderbilt, Stanford, Edison, Ford, and many others who transformed the industries of Oil, Steel, Transportation, Finance, Energy, Textiles and Agriculture, and in the process, dramatically increasing the average standard of living. In America, between 1850-1910, life expectancy rose 40%, from 38 to 53 years. And during the period from 1820-1913, the GDP per capita surged by 422% (in constant dollars), allowing the US economy to grow to well over twice the strength of any other country!

Despite these extraordinary results, starting in the latter part of the 19th century and then accelerating in the 20th, the United States began significantly tacking away from freedom and towards statism, replacing the sovereign autonomy of the individual with the collectivist notion of an all powerful authoritarian government ruling over and controlling its citizens.

By statism, I mean:
    Statism:   [via]

    1) the principle or policy of concentrating extensive economic, political, and related controls in the state at the cost of individual liberty.

The rise of statism in America has advanced in a series of spurts, but the overall trend has been one of an expanding government asserting control over an ever widening array of activities in which individuals were once free to engage without intervention.

In this article, we will take a brief historical survey of the major pieces of regulatory legislation that have been imposed upon the American people, investigate some of the reasons for their adoption, and then conclude with a review of the impact that all this has had on the erosion of our liberty over the past 100 years.

Note: There are many links provided in this document which you may follow when desired, in order to explore these issues in greater detail.

The Magical Mystery Tour is Coming to Take You Away – The Beatles

It requires a bit of prestidigitation coupled with a great deal of misdirection in order to get people to sit back and quietly accept that their rights are being stripped away.

The majority of the 19th century was dominated by Classical Liberalism, a philosophy grounded in the principles of individual liberty and constitutionally-constrained government. And it was understood that the idea of liberty extended fully into the economic realm. Quoting from Wikipedia:
    Freedom was maximized when the government took a "hands off" attitude toward industrial development and supported the value of the currency by freely exchanging paper money for gold.

Unconstrained freedom is what allowed personal ambition to be translated into advancement and success, and it produced the spectacular results previously noted.

Yet, despite these achievements, there were those who feared liberty, believing instead that society's problems could only be solved through "modern", "efficient", "scientific", centralized government planning and control. And thus was born Progressivism. Consider the following two quotes. First, from educator George M. Forbes:
    [W]e are now intensely occupied in forging the tools of democracy, the direct primary, the initiative, the referendum, the recall, the short ballot, commission government. But in our enthusiasm we do not seem to be aware that these tools will be worthless unless they are used by those who are aflame with the sense of brotherhood...The idea [of the social centers movement is] to establish in each community an institution having a direct and vital relation to the welfare of the neighborhood, ward, or district, and also to the city as a whole.

And this from historian William Leuchtenburg:
    The Progressives believed in the Hamiltonian concept of positive government, of a national government directing the destinies of the nation at home and abroad. They had little but contempt for the strict construction of the Constitution by conservative judges, who would restrict the power of the national government to act against social evils and to extend the blessings of democracy to less favored lands. The real enemy was particularism, state rights, limited government.

And there you have it—the rejection of both fundamental pillars of classical liberalism.

As Forbes makes crystal clear, concern for the rights of the individual are nowhere to be seen. What matters is the welfare of the group—any group—whether it be the neighborhood, ward, district, or city. It is communal brotherhood that is the moral ideal, not self-directedness and personal responsibility.

And as Leuchtenburg informs us, the progressive has nothing but contempt for the constitution and the idea of limited government. The goal was to reverse the classical liberal model. Rather than a world consisting of a constrained government and unconstrained citizenry, they sought to establish an unconstrained, all-powerful government which would then impose any manner of constraints upon the subservient individual, all done in the name of social justice.

What we have here is the reemergence of the age old battle between individualism and collectivism.

Individualism holds that every person is an end in themselves, possessing the inalienable right to their own life, which grants them sole authority to set their purpose and direct the course of their existence.

Collectivism, a species of statism, declares one or another group as sovereign, with individual members then forced to submit to the group's collective will. Each person's existence is contingent upon their usefulness and service to the group.

By the early 20th century the battle was engaged as the collectivists began to chip away at liberty. Unfortunately, 120 years after its ratification, the general populace was no longer prepared to mount a proper defense of the ideals of freedom guaranteed by the U.S. Constitution.

Woodrow Wilson Beginning in 1913, the Woodrow Wilson (1913-20) administration earned dubious distinction for politically kicking off the progressive era through a series of legislative acts which included:
  • Enacting the sixteenth amendment to the U.S. Constitution, permanently cementing in place the progressive Income Tax and establishing, in law, that the product of your efforts now belonged to society, not you.

  • Instituting the Federal Reserve System (FED) which effectively nationalized the money supply and banking system.

  • Creating the Federal Trade Commission (FTC) to track and regulate business and industry practices.

  • Passing the Clayton Antitrust Act to further curtail business independence and freedom of action.

  • Passing the Federal Farm Loan Act, the precedent for the 2,238+ programs currently listed in Catalog of Federal Domestic Assistance [CFDA].

  • Regulating the labor markets through passage of the Adamson Act and the later-to-be-determined-unconstitutional, Keating-Owen Act.

  • Reinstituting the military draft during World War I, making it explicit that your life belonged to society, not you.

  • In response to WWI, agricultural markets were regulated and certain prices fixed through the creation of the U.S. Food Administration. Subsequently, Wilson issued a proclamation calling for the public to voluntarily observe "wheatless Mondays and Wednesdays", "meatless Tuesdays" and "porkless and sweetless Saturdays", while mandatory food restrictions were imposed on the baking industry.

  • Energy markets were also regulated through the creation of the Federal Fuel Administration, which took complete control over coal, and to a lesser degree the oil and natural gas industries. Here, the public was urged to observe "heatless Mondays", "gasless Sundays" and "lightless nights". The government determined what were classified as "nonessential factories", which were then order closed.

Herbert Hoover As Hans Sennholz has reported, during the next fifteen years many of these Wilsonian agencies and policies interfered with normal self-correcting market mechanisms, while the manipulation of the money supply under the aegis of the newly created FED, were together ultimately responsible for the massive credit expansion and resulting stock market crash in 1929. Faced with a recession, the Herbert Hoover (1929-32) administration responded as follows:
  • Increased the top personal tax bracket from 25% to 63%. Well, it had already been made clear that the government did not consider it to be your money.

  • Increased corporate taxes. Same principle for businesses.

  • Instituted the Smoot-Hawley Tariff Act, raising tariffs on over 20,000 imported goods to near record levels and triggering retaliatory tariffs from other countries. The results? U.S. imports decreased by 66% and exports decreased by 61% during the four years of the Hoover administration.

During 1930, the economy had been showing signs of slow recovery. However, each of Hoover's actions was like a shock to the economic system, creating uncertainty, discouraging investment, and severely disrupting international trade. Adding this on top of the Wilsonian interventions which remained in place, and the result was to induce a full fledged heart attack in the recovering patient, plunging the U.S. into the throws of the Great Depression.

Franklin D. Roosevelt In 1933, happy days were here again, with the election of Franklin D. Roosevelt (FDR) (1933-45) to the presidency. Despite having campaigned on a platform opposing Hoover's deficits, and calling for "drastic reductions of all public expenditures", "abolishing useless commissions and offices", and for a "sound currency", immediately upon his inauguration he turned his back on his promises and launched into his explicitly anti-capitalist New Deal programs, saddling us with:
  • The Glass-Steagall Act which regulated financial speculation (i.e., business risk-taking), while also creating ...

  • The Federal Deposit Insurance Corporation (FDIC), which nationalized future banking system failures while producing the unintended consequence of training depositors to no longer worry about or investigate the credit-worthiness of their financial institutions.

  • The Securities and Exchange Commission (SEC), which began regulating the stock exchanges and all other financial markets.

  • The Social Security Ponzi scheme, and its FICA Payroll Witholding Tax which hid from view the full impact of the tax burden being born by the typical worker.

  • An increased standard marginal tax rates, up to 91%—and with Executive Order 9250, the creation of a 100% marginal rate on salaries over $25,000. Wake up folks, it's simply not your money!

  • The Thomas Amendment, which authorized currency expansion (i.e., inflating the money supply) at the whim of the president.

  • Currency devaluation through Executive Order 6102. Private ownership of gold was declared illegal, and once confiscated from all citizens it was then repriced from $20.67 to $35.00 an ounce—an inflation of just under 70%—profiting government at the expense of everyone else left holding significantly devalued paper dollars.

  • The creation of the Internal Revenue Service (IRS), to enforce tax compliance.

  • The Federal Housing Administration (FHA) and the U.S. Housing Authority, which nationalized the construction of low-cost public housing and provided mortgage and insurance subsidies.

  • The National Industrial Recovery Act (NIRA), which granted the president the power to regulate industry and authorize monopolies as desired, bypassing the newly minted anti-trust laws on a whim. NIRA is a poster child for the method of handing off regulatory law-making from the legislative to the administrative branch of government. According to Wikipedia:

    NIRA, as implemented by the [National Recovery Administration], became notorious for generating large numbers of regulations. The agency approved 557 basic and 189 supplemental industry codes in two years. Between 4,000 and 5,000 business practices were prohibited, some 3,000 administrative orders running to over 10,000 pages promulgated, and thousands of opinions and guides from national, regional, and local code boards interpreted and enforced the Act.

    In 1935, the Supreme Court unanimously held the NIRA to be unconstitutional.

  • Despite his 1940 campaign promises to keep America out of the war, Roosevelt reinstituted military conscription during that same year—the first peacetime draft in U.S. history. The Selective Service System which mandated draft registration was also recreated.

  • The National Labor Relations Act, granting the government the power to regulate interactions between unions and employers, imposing constraints on what actions would be permitted to either group, and thereby extinguishing the right to freedom of association.

  • The Fair Labor Standards Act, which regulated pay levels and instituted the Minimum Wage.

  • The Public Utility Holding Company Act of 1935 which nationalized electric power generation. The federal government forced divestiture of private energy holding companies and regulated the industry, including pricing. The government also went into electrical production with the acquisition of private companies and the creation of public utilities, including the Tennessee Valley Authority, then the largest federally-owned corporation in America.

  • Numerous government make-work programs through agencies such as the Federal Emergency Relief Administration (FERA), Civilian Conservation Corps (CCC), and the Works Progress Administration (WPA). At one point, over three million civilian workers were being directly subsidized, accounting for just under 7% of the entire GDP—assuming of course that you are willing to classify much of these agencies make-work programs as actual domestic product!

  • The Reconstruction Finance Corporation, used to pick winners and losers by making targeted loans to state and local governments, banks, railroads, mortgage lenders and other businesses.

  • The Agricultural Adjustment Administration, which taxed producers of farm products and then paid subsidies directly to farmers to kill their livestock and to not grow crops on their land, forcing food prices up for everyone else. Never will you find a clearer example of the "fallacy of the broken window!"

  • The Federal National Mortgage Association (Fannie Mae), a government-sponsored enterprise (GSE) which securitized mortgages in the secondary market with the intent of increasing home ownership.

Does any of this sound familiar?

It is generally acknowledged that despite the New Deal's Keynesian program of massive tax increases, large-scale injection of funds into the economy through deficit spending, and the replacement of free market mechanisms with central planning, the overall impact on improving the economic health of the country was minimal. By 1939, although federal spending was then three times greater than it had been in 1929, private sector unemployment remained above 17% (Lebergott) and the GDP was still only 90% of what it had been a decade earlier.

Is this starting to ring a bell?

While each of the above programs constituted a massive expansion of the federal government's intrusion into personal and business affairs, the most significant shift in the relationship between citizen and government was made explicit in FDR's 1941 State of the Union address in which he outlined the four fundamental freedoms (i.e., rights) that all people should be accorded:
  1. Freedom of speech and expression

  2. Freedom of worship

  3. Freedom from want

  4. Freedom from fear

While the first two items were merely a restatement of inherent rights acknowledged by the First Amendment, the remaining items turned the concept on its head. Whereas rights had previously pertained exclusively to the arena of freedom of action in service of one's own life, this declaration of a "freedom from want" and a "freedom from fear" inverted the meaning of a right, changing it into an entitlement—a guarantee of economic and physical security that was not to be earned through one's own efforts, but was owed to all, apparently as a simple matter of one's existence. And who would be responsible for supplying these goods and services? Well, somebody else!

Here we witness the philosophical birth of the full blown American entitlement state. By 1944, FDR had expanded the principles into his Second Bill of Rights in which he called on Congress to guarantee:
  • Full Employment

  • A Living Wage

  • A Market for One's Goods and Services

  • Freedom from Unfair Competition

  • Decent Housing

  • Medical Care and Good Health

  • Economic Protection from Accidents

  • Retirement Security

  • Quality Education

As each of these "entitlement rights" required a good or service be provided to some at the expense of others, the net result was the transformation of government from the role of equal protector of the inherent rights of all, into an agent of forcible wealth transfer from the productive members of society to the needy. What went unacknowledged was the fact that the fulfillment of each "entitlement right" required the erosion of the very rights of life, liberty and property that the Constitution had empowered the government to protect.

In the span of a short 30 years (1913-1943), despite supposed Constitutional protections, the fundamental nature of American government had been completely reversed, and a once free and independent populace had been transformed into classes of serfs and wards of the omnipresent state. Any expectation of retaining and practicing one's constitutionally guaranteed rights was now nothing more than a fiction—a fading illusion.

After FDR's death, the Truman administration made it its goal to cement in place the programs of the New Deal by expanding public works projects, increasing subsidies and entitlements, and further interfering into the affairs of business, labor and employment. Eisenhower and Kennedy generally continued to support these policies throughout their respective administrations.

Lyndon B. Johnson Channeling the New Deal from thirty years earlier, Lyndon B. Johnson (1963-68) instituted his Great Society program, including his War on Poverty, once again dramatically expanding the size and role of the federal government while adding a new array of regulations and entitlements through the creation of:

By 1969, along with the cost of the Vietnam War, all of the new federal spending required by the War on Poverty produced an inflation rate of 4.7% and resulted in spiraling deficit spending that rose 525% during Johnson's six year term, increasing the national debt by over 16%. Interest rates had also increased to their highest level in a century.

Richard Nixon Being a Republican, one might expect Richard Nixon (1969-74) to stand up for free-market principles. One would be wrong. In addition to his well known ethical failings, during his tenure he managed to commit the following acts:

As any Austrian economist would have predicted, the combination of Johnson's excessive spending spree, coupled with Nixon's counterproductive actions, resulted in a severe recession that lasted through the Ford and Carter administrations. Other cyclical recessions were to follow as a consequence of maintaining these and other government interventions in the market.

The period during the Ford (1974-76), Carter (1977-80), Reagan (1981-88), Bush Sr. (1989-92), Clinton (1993-2000) and Bush Jr. (2001-08) administrations was mixed. There were various instances of deregulation and periodic tax reductions, later followed by tax increases and new legislation. The scope of federal social and economic regulations seesawed up and down, but on average, continued to steadily increase. For example, during this period the country was treated to the following:
  • Creation of the Department of Energy (DOE), which established a federally mandated energy conservation policy for the entire country, backed up by a new regulatory bureaucracy. (Carter)

  • The establishment of the Department of Education, which began the process of centralizing the administration of education policies across the nation. (Carter)

  • The Job Training Partnership Act, which significantly expanded training subsidies for youth and unskilled adults. (Reagan)

  • The Americans with Disabilities Act (ADA), which imposed a complex new set of rules affecting employment, transportation, telecommunications, and all publically accessible existing and new construction, enforced through public lawsuits. (Bush Sr.)

  • The Children's Health Insurance Program (CHIP), which extended health coverage to the children of families that had incomes too high to qualify for Medicaid. (Clinton)

  • The No Child Left Behind Act, which imposed significant new education standards on state schools as a contingency for receiving federal funds. (Bush Jr.)

  • Faith-Based Initiatives: Legislation designed to make it easier to transfer increased federal funds to religious organizations. (Bush Jr.)

  • The Medicare Prescription Drug, Improvement, and Modernization Act, an overhaul to Medicare which provided new prescription drug entitlements to seniors, at a projected cost of an additional $549 billion over a ten year period. (Bush Jr.)

  • The initial $700 billion Troubles Asset Relief Program (TARP), used to directly bailout various financial institutions while nationalizing the financial and automotive sectors through the purchase of shares in AIG, Citigroup, General Motors, Chrysler, and other companies. (Bush Jr.)

As a measure of the growth of government over this period, the federal debt rose from $484 billion in 1974 to $10 trillion by 2008—a 20x increase. As a percentage of GDP, the debt went from 33.6% to 69.7%, an increase of over 100%.

    (Click on image for larger view)

Another measure of the growth in annual new regulations can be gauged by the size of the Federal Register, which almost doubled from 45,422 pages in 1974 to 80,700 pages by 2008. And remember, this is the annual regulatory output. During the Bush Jr. years alone, there were 614,293 new pages of regulations issued. So much for the complaint about deregulation during that administration!

Barack Obama All of which brings us to Barack Obama (2009-12). In less than one term the current administration has disregarded the Constitution, invalidated the rule of law, and been responsible for one of the greatest increases in the size and scope of the regulatory state through a series of acts, including:
  • Record Deficits: During the period from 2009 through 2012 (est.), the total deficit spending will be greater than $5.3 trillion, increasing the federal debt to more than $16.3 trillion, which represents over $52,100 of debt for every man, woman and child in the U.S, or more realistically, $208,400 for a typical household of four. The total debt is equal to 105% of GDP, as compared to the debt-to-GDP ratios of: Spain: 69%, Ireland: 104%, Portugal: 107%, Italy: 120%, Greece: 161%—good company, one and all!

    Of course, the above figures are made possible through the use of government accounting practices that would put any private citizen behind bars were they to use them. According to this USA Today story, where the federal government reports a deficit of $1.3 trillion for the previous year, standard accounting practices would properly show that figure to be $5 trillion! That is an underreporting by 260%. Today, in order to cover the total cost of all federal liabilities, each American household is now on the hook for over $561,000. Good luck with that!

  • The nationalization of the medical and insurance industries through the Patient Protection and Affordable Care Act (i.e., Obamacare), a 2,409 page bill rammed, substantially unread ("we have to pass the bill so you can find out what is in it", Pelosi), through Congress using the budgetary trick of reconciliation. It is now conceded by its supporters that rather than reduce medical costs, it will increase the average insurance premium by 20-30% by 2016. And like every other bureaucratized social medical scheme ever tried, it will produce untold inefficiencies and inevitably lead to health care rationing by impersonal panels of government administrators more concerned with cost than care. The constitutionality of the act, including its mandate to purchase insurance, is currently under review by the Supreme Court.

  • The American Recovery and Reinvestment Act (ARRA), an additional $831 billion in Keynesian economic "stimulus", over and above the previous $700 billion in TARP funds ($1.53 trillion total), with the primary purpose of creating jobs. The administration indicated that unemployment was expected to rise to 9%, but that with this stimulus it would remain under 8% and fall to less than 6% by mid-2012. Instead, despite the massive spending, unemployment increased to 10.1% (Oct. 2009) and remains at well above 8% today. Based upon the Congressional Budget Office's own figures, the average cost of each job created was between $228,056 and $631,538, although one report puts the figure as high as $4.1 million! Your mortgaged future at work—or more accurately, not at work!

  • The Dodd–Frank Wall Street Reform and Consumer Protection Act, which imposed massive new regulatory requirements on an already heavily regulated financial services industry. This included creation of the:

    With the government dictating much of the day-to-day operating parameters and reporting requirements for everything from banks to hedge funds to debt collectors, the freedom to react to market forces and innovate is significantly curtailed. As John Allison has commented:

    Dodd-Frank is a dramatic move toward statism as government bureaucrats can practically decide which industries, companies and consumers have available credit. Dodd-Frank encourages more consolidation in the banking industry and instead of eliminating "too big to fail," makes this practice a permanent public policy.

  • Expanding the size and powers of the Internal Revenue Service (IRS) by tasking it with the administration of the health care insurance mandate. Obama requested a budged increase of roughly $1 billion in order to hire thousands of additional agents.

  • The Health Care and Education Reconciliation Act, part of which fully nationalized the federally-insured student loan industry, curtailing competition and restricting student options while further driving up the cost of higher education.

  • The nationalization of the financial industry through the Public-Private Investment Program for Legacy Assets, intended to purchase "toxic assets" from failing financial institutions, thereby moving liability from the private sector onto the backs of American taxpayers.

  • The nationalization of the automotive industry through the government's acquisition of a majority stake in General Motors and Chrysler. After the takeover, the Obama administration then exerted fiat dictatorial control over these organisations, replacing the CEO at GM, invalidating contract law by simply tossing existing bondholders under the bus, awarding the UAW with an unlawful 40% stake in the restructured company, and selling off Chrysler to the Italian company, Fiat SpA. The Wall Street Journal indicates that there has been a $28.8 billion taxpayer loss on the GM and Chrysler bailouts.

  • The Car Allowance Rebate System (Cash for Clunkers), a $3 billion boondoggle where taxpayers were forced to subsidize new car purchases for reasonably wealthy Americans (those who could afford to purchase a new car) if they would trade in their older, less fuel efficient vehicles which were subsequently crushed! The net result was that: 1) total costs exceeded total benefits by $1.4 billion, 2) average fuel economy for all purchased vehicles increased by only 0.6 to 0.7 MPG, and 3) the destruction of all the trade-in vehicles caused a reduction in supply and corresponding price increases in the used car market, seriously harming low-income drivers.

  • A $7,500 taxpayer subsidy (read wealth transfer payment) for the purchase of each plug-in electric vehicle. In addition, there are huge subsidies for the installation of electric charging stations for these vehicles.

  • Despite a failing economy, continuing to push the discredited Global Warming (i.e., Climate Change) agenda to the tune of $70 billion, and investing public funds in failed "green" initiatives such as the following examples: Solyndra ($535 million loss and bankruptcy), Evergreen Solar ($5.3 million federal, $50 million state loss and bankruptcy), SpectraWatt ($500,000 loss and bankruptcy), Mountain Plaza Inc. ($424,000 loss and bankruptcy), Fisker Automotive ($193 million loss, on verge of bankruptcy), Tesla Motors ($465 million loan, posting losses and falling sales), and many others.

  • Extending the regulatory powers of the Food and Drug Administration (FDA), to impose new user fees on drug and medical device makers, while expanding the agency's power to control raw materials used in manufacturing.

  • Extending unemployment benefits multiple times up to a total of 99 weeks.

  • The enactment of 21 new or increased taxes, many embedded within the health care legislation. In addition, President ("I do think at a certain point you've made enough money") Obama has called for increased marginal tax rates and minimum payments (Buffett Rule) on the wealthy.

  • Despite rising oil prices, by edict, Obama suspended new oil exploration and drilling, including the Gulf of Mexico, the Arctic Ocean, and along the Atlantic Coast. He blocked construction of the Keystone XL Pipeline and imposed federal regulation of the development of Natural Gas resources, and the process of Fracking. Consequently, automotive gasoline prices have more than doubled during his administration, increasing from $1.84/gal. (01-26-09) to $3.79/gal. (05-07-12).

  • In keeping with his campaign promise that his energy policies would ensure that "electricity rates would necessarily skyrocket", mission accomplished. Recent reports reveal massive increases in utilities—850% in some markets—in less than three years.

  • Legislating through regulatory department fiat and executive order:

Well, Obama did tell us that it was his plan to fundamentally transform the United States of America!

And during his inaugural address, when he spoke of America being "bigger than the sum of our individual ambitions", he made it clear where, in his view, the individual stands in relation to the collective state.

What A Long Strange Trip It's Been. – Jerry Garcia

What we observe from the above is a century of steadily expanding government, inserting its tentacles into every crevice of our existence and eroding the control we onced possessed to set the course and then proceed with our lives, unimpeded.

Your Education:

    Freedom of choice in the realm of education first went out the window in America when the Massachusetts Bay Colony made it compulsory back in 1642. However, after the Revolutionary War, it wasn't until 1849 when Connecticut became the first state to reintroduce mandatory school attendance—something that is nationwide today, notwithstanding the 13th Amendment's prohibition against involuntary servitude.

    Despite constant calls for increased funding and new initiatives, government education is a massive failure. A study by the Broad Foundation shows that the value of public schooling is perceived to be so low that 1.2 million students drop out each year. The study also indicates that 70% of 8th grader are unable to read proficiently, and that out of the top 30 industrialized nations, American students rank 21st in science and 25th in math. This despite many reports showing that government expenditures per student greatly exceeds those of private schools, while producing inferior results.

    Rather than address any of these facts pertaining to the abysmal results in the traditional subject areas of reading, composition, history, math, science and logic, the Obama administration has instead made a huge investment in the implementation of Service Learning—now active in roughly half of all government school. This new program requires that all students engage in mandatory community service work for a specified number of hours each year in order to be allowed to advance to the next grade. What types of work? Here are some examples:
    • Preparing and serving meals to homeless
    • Working in shelters
    • Clothing/food/book/toy drives
    • Participating in community clean-up projects
    • Supervising toddler recreation time
    • Campaigning for a political candidate   [Emphasis added]

    The time required for these activities can accrue to 200 hours or more (depending upon the school) of enforced labor in order for a student to be allowed to graduate. The idea is to indoctrinate the school children into a view of Service As A Social Norm. This is nothing less than a back-door effort in support of the administration's larger goal of instituting a mandatory program of universal National Service for all Americans, where up to two years of your life are taken over by government masters.

    As the above facts make clear, quality education of youth is not the primary goal of our government-run school system. Were that the case, then changes of a completely different nature would be instituted, allowing market-based competition among private schools, with parents able to to freely determine how to best spend their dollars in order to successfully train their children.

    Instead, what the evidence shows is that government seeks to control the educational system as a means of being able to indoctrinate one generation after another in its propaganda. Whether it is forcing very young children to parrot praise for our glorious supreme leader, creating an eco-Nazi police force, asking students to report family secrets, or being fed either the progressive viewpoint on diversity, climate change, and social justice, or the evangelical viewpoint on creationism, intelligent design, and abstinence-only sex education, the end goal is the creation of a culture of uniform, pliable minds that can be more easily mobilized into service by a centralized authority—something I previously discussed in my article Building Obama's Army.

Your Career:

    Once upon a time it was you who decided whether you had a skill of value to offer, and it was others who decided whether they agreed and were willing to trade with you for your services. But today, that's pretty much a fairy tale. Slowly, the various states began to arbitrarily declare that one profession after another was no longer yours to practice by right, but only by privilege. They started with the licensing of the medical, legal and teaching professions, and by 1920 had expanded into architecture, engineering, accounting, insurance, pharmacy, real estate, the building trades and even hair cutting. And although the common fiction was that these professions were being regulated in order to protect the public "health, safety and welfare", the truth was that in almost every case the restrictions were the result of heavy lobbying by business and trade associations for the express purpose of creating barriers to entry in the profession that would restrict competition and raise prices for its existing members. The onerous licensing requirement significantly increased the educational time and expense—including costly examination fees that can run into the thousands of dollars for certain professions—thereby excluding many qualified people from an otherwise viable career path. One unintended consequence of this was to actually lower rather than raise the overall level of professionalism.

    While the politicians may not themselves have been initially interested in the true intent of professional licensing, they soon came to see two major benefits. First, there were the ongoing annual licensing fees that could be imposed upon an ever expanding segment of the population—and new sources of taxes are always a top priority. But more importantly, the politicians quickly realized that with the power to extend the right to work within a profession, also came the power to revoke that privilege. This placed the state in the position of being able to directly control the very livelihood of citizens—a new and powerful lever that could be used to exact compliance from an important segment of the voting public. With these incentives awaiting, the gold rush was on, and the number of licenses exploded. Today, pest control operator, locksmith, animal trainer, travel guide, log scaler and shampooer are among the more than 1,100 distinct professions requiring a license in one or more states. Here is a site listing 10,385 licensed occupations among the 50 states, while this link provides a comprehensive list of 194 occupations requiring a license in the state of North Carolina alone. During the 1950s, only 5% of American workers were licensed. By 2008 that number had grown to 23% of the workforce and is certainly higher today.

Your Business:

    As our little stroll down memory lane has shown, the 20th and 21st century attack on free-market business practices has been an unrelenting one. Every new regulation has created a government bureaucracy that has hobbled entrepreneurs' ability to respond to ever changing market forces, while burying them under a mountain of record keeping and reporting that diverts crucial resources away from productive activity.

    In 2010 and 2011, the size of the Federal Register exceeded 82,000 pages—each year! This provides some indication of the magnitude of the legislative burden being placed upon business. And as the Wall Street Journal reported, in 2008, the annual cost of complying with all federal regulations was greater than $1.75 trillion!

    Consider how many jobs are being destroyed by this direct government intervention. In 2010, the average national wage was $41,600. If we assume a generous 75% markup to cover non-salary expenses, this raises the business cost per employee to $72,800. If that $1.75 trillion were not being diverted to unproductive tasks, it could represent more than 24 million potential jobs, while the current unemployment rate is estimated to be 12.5 million!

    That same WSJ article indicates that the cost of these regulations is born disproportionately by smaller businesses:

    As a consequence, small businesses—those with fewer than 20 employees—incur regulatory costs 42% greater than firms with between 20 and 499 employees, and 36% greater than firms with more than 500 employees. The regulatory cost per employee for small businesses was $10,585, compared to $7,454 for medium firms and $7,755 for large firms.

    Since small business is the center for new job creation, if Obama were truly serious about increasing employment, then he should actively work to reduce the regulatory burden on all enterprise. Instead, his approach is exactly the opposite, so it's no mystery why economic recovery has not occurred.

    But the question still remains, if this level of misery is the result, then why are progressives so committed to impeding the golden goose that is business? And the simple answer is their fear of freedom. The mere idea of an unregulated business left to operate under its own direction is, in itself, so abhorrent, that they are more willing to suffer the consequential pain of applying the fetters.

Your Choices:

    Telling us that monopolies were bad, the government created antitrust legislation which it has then used to prosecute honest businesses from Standard Oil and Alcoa to IBM, Microsoft and Google. Of course, it is only bad when it is anyone other than the politicians doing the monopolizing.

    The U.S. Postal Service is a "good" monopoly, because .... well, because the government says it is. Between 2006–2011 the Post Office lost over $25 billion and is scheduled to lose another $14 billion during 2012. Despite these facts, profitable private companies such as DHL, FedEx and UPS are still prohibited from offering us their services in this area of standard mail delivery.

    Gambling is bad for you—unless it is the government that is raking in the proceeds, at which point it is actively encouraged. State governments maintain a monopoly on lotteries and spend millions each year advertising them with the intent of extracting billions of additional dollars ( $53.8 billion in 2006) from their residents. Go ahead and purchase your government tickets. Just don't you try this at home! When it comes to government, what's good for me is prohibited for thee.

    Where individuals once dealt directly with businesses vying with one another to provide us with various goods and services, over time the politicians stepped in and created government-sponsored monopolies that eliminating all competition. An early example was the building of roads, followed later by the control or outright takeover of one utility after another. The net result? Not happy with your electric rates, your trash collection or your cable service and would like to look elsewhere for something better? Well tough noogies. You options have been eliminated because there's now only one government-mandated game in town. Your right to choose has been replaced by expanded controls which force you to accept someone elses decisions. And despite the example of AT&T, where the end of the government-enforced monopoly led to rapid innovation, increased consumer choice and dramatically lower prices in the telecommunications industry, there is no will to repeat that success.

Your Property:

    "Government is instituted to protect property of every sort; as well that which lies in the various rights of individuals, as that which the term particularly expresses. This being the end of government, that alone is a just government, which impartially secures to every man, whatever is his own."

    James Madison   [Emphasis by Madison]

    A free people have the right to dispose of their property as they see fit. While this was generally true in the 19th and early 20th century, it is no longer the case.

    When it comes to your land, you are now regulated by zoning boards which limit not only what type of structures you will be allowed to build, but their placement, lot coverage, height, shape, permeability, construction materials, signage, lighting, landscaping, and often even the allowable colors will be dictated. For some projects, you may also be required to make "social concessions" such as paying for public amenities, turning over a portion of your land as a park, or building a certain number of subsidized units, in exchange (i.e., as a bribe) for obtaining zoning approval. Then there are the building inspectors, backed by many thousands of pages of codes and regulations, who will demand you make detailed submissions for their review, outlining every change or improvement intended for your property. This submission must typically be accompanied by a very large fee (tax) before the review will be conducted. The Fire Marshall or Army Corps of Engineers may also weigh in, along with many others officiating bodies, depending upon the nature of your project. Should you meet all of the requirement and finally receive building approval, then the inspectors will supervise all work to insure that you perform to their requirements. The concept of private property no longer exists. Government has asserted authority over all usage, and while you bear the financial liability for the construction and maintenance, you are really only a tenant of the land. And each year you will receive a property tax bill from the real owners to remind you of your leasehold status.

    Or consider another example. Do farmers have a right to the use of their own cattle? Wisconsin Circuit Court Judge Patrick J. Fiedler emphatically declared that they do not! In a case where the judge proclaimed that the farm families "do not have a fundamental right to consume the milk from their own cow," he went even further, stating that Americans "do not have a fundamental right to produce and consume the foods of their choice."

    Then there are federal asset seizures which have risen over the years to epidemic proportions. This is where regulatory and enforcement agencies are given the power to confiscate property without Fifth Amendment protection of due process. As the Wall Street Journal reports, in 2010 alone:

      "forfeiture programs confiscated homes, cars, boats and cash in more than 15,000 cases. The total take topped $2.5 billion"

    In the meantime, innocent people are being caught in this unrestrained fishing net. Ostensibly, these seizures of ill-gotten goods are supposed to be returned to victims, but a 1984 federal law allows state and local agencies to retain up to 80% of what is taken, creating what Scott Bullock of the Institute for Justice points out is an "improper profit incentive."

    So much for your property rights.

Your Income:

    Your income is the product of your thought and labor. In a free society it should be recognized as your property by right, to save, invest, spend or give away as you—and only you—wish. But this is not the view of contemporary government. They see your earnings as their property, to be disposed of in a manner of their choosing. By their grace, politicians leave you with a percentage of what you make, but then confiscate the remainder to fund their programs, schemes, junkets and wars. We have already examined the case where FDR imposed a 100% marginal tax rate on income above a certain level, stating in unequivocal terms that should anyone in that position choose to work, they were fully slaves of the state. The following two recent events reinforce this point:

    In April, Barbara Boxer (D-CA) introduced Senate bill S.1813 reauthorizing federal highway funding. But hidden within that bill was a provision to revoke the passport of anyone owing more than $50,000 to the IRS. By restricting citizens from leaving the country, this would effectively erect a virtual "Berlin Wall" around America, caging its citizens, who may only depart if and when granted permission.

    Then, in May, in response to Facebook co-founder Eduardo Saverin's decision to renounce his citizenship and reside in Singapore, Senators Chuck Schumer (D-NY) and Bob Casey (D-PA) proposed the Ex-PATRIOT Act (S. 3205), which would impose a 30% tax on the investments of any person renouncing their American citizenship. In addition, these people would be barred from reentering the U.S., permanently walling them out.

    The vitriol exhibited by both Schumer and Casey made crystal clear their belief that Saverin was "stealing" from both them and the U.S. government the millions of tax dollars to which they had a rightful claim but would now be denied, due to Saverin's actions.

    Some might argue that the typical progressive is motivated by their radical egalitarianism to work for equality among all people. Not the "equality under the law" that the Founding Fathers recognized, but "equality of outcomes" that promotes uniformity across the entire social spectrum. However, this view crumbles under close examination. Given a choice of proposals, where one promotes that the less well off apply themselves and raise their standard of living towards a more equal stature, while another relies upon the confiscation of property and the restraining of ability of those better off so as to bring them down, the progressive will inevitably select the latter. They do so because it is not empathy and love for the less fortunate that motivates them, but envy and hatred for their betters that fuels their passion. Refer to the actions of Boxer, Schumer and Casey for a case in point.

Your Purchases:

    Once the government had exacted its pound of flesh through taxes, it would be nice if you were then left to spend the remainder of your earnings as you liked. But no, the politicians are not through with you just yet. They have an opinion as to just how you should use that money. They know what's best for you.

    For example, they think it would be great if you owned a house instead of renting. And it would be swell if you would donate some of your income to charities rather than spend it on yourself. Of course, they have a vested interest in seeing you improve your job skills, since they get more tax revenue as your pay-level increases. So they nudge you in their direction by offering tax deductions for these and other desirable activities.

    Or maybe these benevolent fairy god mothers who watch over us all have decided that our behavior should conform to their more "socially desirable" ideals. For example, maybe they would like to see you be more environmentally conscious by weatherizing your home or purchasing an electric car. They accomplish these objectives by taking money from someone else and offering it to you as a bribe.

    An when it looks like gentle economic persuasion may not be sufficient to accomplish their goals, then they invent a new trick and simply tell you that you will be forced to make a certain purchase as in the case of the Obamacare health insurance mandate.

Your Family:

    For centuries two people freely decided to marry and then did so. But at some point the government simply asserted that individuals no longer possessed that right and would henceforth be required to seek permission from the state, with the state determining exactly who may or may not wed, and under what conditions. Of course there was also the matter of the ever present fee (i.e., tax). And was the imposition of the marriage license done to better secure the union? No. Its purpose was to prevent interracial marriages, just as today it remains a tool to control or prevent same-sex marriages. The marriage license is nothing more than one more instrument used to control personal behavior and restrict choice.

Your Personal Life:

Is there anything at all that I can still do on my own?

    Now, that is a very good question!

    Channeling Marvin Gaye, today's politicians would say:

      There ain't no mountain high enough
      Ain't no valley low enough
      Ain't no behavior small enough
      To keep me from regulating you

So, what's the point?

    The point of this historical overview is to expose what is normally hidden from view. The corrosion of our rights has been occurring for decades. Each generation has faced its own smaller set of issues, and at each juncture a tiny percentage of the populace has fought back against the intrusions, with a few battles being won and many more lost. Then society as a whole settles back into abject complacency and learns to accept the new shackles that have been imposed upon it ... at which point the process is ready to repeat, ratcheting yet another notch closer to total enslavement.

    The point is to take in the larger picture as a whole and to be horrified by the sight!

    For every abridgement of freedom proposed throughout human history, there are an untold number of rationalizations that have been offered up to justify its necessity. At one point a little finesse was required in order to convince people to accept being reamed with the sharp end of the stick, but after a century's worth of abuse—not to mention indoctrination through government schools—the best that today's leader could muster was:

      "I had to abandon free market principles in order to save the free market system." – Bush Jr.

    and apparently that was good enough for most!

    But the rationalizations simply don't cut it. When you add everything up, it soon becomes clear that our liberty has not been cashed in to save our country. It was not used as a down payment on maintaining our "way of life". It wasn't sacrificed in service of our fellow man. It was not traded for universal fairness and equality. It's loss has not resulted in brighter, happier people, or the elimination of business failure, or made the trains run on time.

    We've exchanged our freedom for the promise of safety and security, and yet we remain unprotected from the Madoffs and Enrons of the world. We find our government-mandated health and retirement systems bankrupt, leaving us exposed and vulnerable. Our entire economy is on the verge of collapse and we are mired in an undeclared and undefined perpetual state of war that cannot be quantified and therefore will never end. We have taken a once productive and self-sufficient people and imbued in a sizable percentage, learned helplessness, creating a class that is no longer capable of taking responsibility for themselves.

    For any contract to be valid, each party must gain something of value. In the case of this so called "social contract" that has been rammed down our throats by force, we have paid the very steep price of our liberty. What have we received in return?
      Absolutely nothing of value!

    I declare this contract null and void.

    The point is that we now have a government that no longer honors the limits imposed upon it by the U.S. Constitution, and has come to see citizens as members of three fundamental classes: wards, slaves and rulers.

    The point is that we started out with a magnificent proclamation that all men were equal, possessing unalienable rights, and that among these were life, liberty and the pursuit of happiness. Yet, three hundred years later, we have arrived at a point where your life is no longer your own.

    The point is that the rationalizations given by our politicians for their acts are just part of the magic and misdirection use to cloud people's minds in order to keep them from identifying the simple and obvious truth: rulers are in it to rule! Today's politicians are small-minded opportunists who enjoy wielding power for power's sake and will pragmatically tell a lie as soon a truth if they deem it will further their ends. These people do not view you as an equal, but see you as a ready mark to be manipulated.

    The point is that at the birth of this country men were prepared to take up arms and fight to defend their right to exist on their own terms—not be dictated to by some external controlling force. Today you are not just being taxed and regulated into oblivion, you are being told how to salt you food!

    The point is, how much are you willing to take?

    The point is, what are you prepared to do about it?

Freedom's Just Another Word – Kristofferson/Foster

    The people are sick'ningly funny---
    They want more freedom and growth
    And more of somebody's money.
    Comedians promise them both.

    Brian Royce Faulkner

For some of us, it's not a laughing matter.

What is freedom?
    Freedom:   [via]

    3) the power to determine action without restraint.
    5) personal liberty, as opposed to bondage or slavery.

Political freedom is the absence of force. This is the fundamental social requirement necessary in order to allow individuals to pursue their own definition of happiness and flourish in life as a consequence of their own efforts. And this is why Ayn Rand states that a "right" is "a moral principle defining and sanctioning a man's freedom of action in a social context." It is every person's right to act in service of their own interests, without restraint, so long as they extend the same right to all others.

The United States was founded on a recognition of this principle, and the purpose of the Constitution was to create a government that would respect and protect every individual's right to their freedom of action by banning the initiation of force between all people. Furthermore, the constitutional framework for the federal government was designed with the intent of strictly limiting its scope so that it would not itself transform into a tyrannical oppressor.

As Thomas Jefferson expressed it:
    "The policy of the American government is to leave their citizens free, neither restraining nor aiding them in their pursuits."


    "A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned — this is the sum of good government."


    "The strongest reason for the people to retain the right to keep and bear arms is, as a last resort, to protect themselves against tyranny in government."

Unfortunately, as our little tour above has shown, these preventive measures have failed.

Today, we suffer under a government that has lost all respect for the rights of the individual. Instead, it wields its power in order to compel citizens to do its bidding in any area it chooses. This is the exact opposite of freedom. It is nothing less than slavery, no better illustrated than by the recent story of a Texas honor student being jailed for truancy.

The idea of personal autonomy has all but been abandoned. While our politically-correct society focuses on group and class distinctions such as race, color or sex, there is no recognition of the truly singular differences that exist between individual people. That we each vary in our capabilities, knowledge, skills, outlooks, desires, aspirations, psychologies, personalities, values, goals, and basic approaches towards life is of no concern to our government masters. We are treated as interchangeable cogs in the social machinery. Whether it pertains to bike helmets, marriage, energy, education or health care, to name but a few, when the government becomes involved, everyone is forced onto a single track with a single process and a single result. When the state asserts control, individualism inevitably yields to collectivism.

You are unique. Whether it is the government bureaucrats or your nosy neighbors down the street, none of them know or care what personal circumstances you face, or the inner life that defines who you are as a person. And therefore, none of them is in a position to know what choices are best for you. Only you can make that determination. And that is what freedom is all about. It is a social framework that allows individuals to take responsibility for their own lives—both the decisions and the consequences.

In America, we have arrived at a critical crossroad. The question is whether we will continue our transformation towards statism, relinquishing the tattered remnants of individual freedoms that still remain, or do we instead push back against those forces that seek to subjugate us, reasserting the sovereign right to our own lives, and restoring government to its proper, strictly limited role as the defender of the principle of individualism?

For those who choose to engage in the struggle to redeem our lost liberty, success requires that we pursue that goal with consistency. To demand the freedom to act on behalf of our own life, we must be willing to extend that same freedom to others. Just as free speech requires us to accept that others may occasionally say things that we find distasteful, liberty demands that we tolerate behavior by others that we would personally shun. Mutual toleration of differences is the the cornerstone for rebuilding a society free from the use of force, and that is a down payment I gladly make in the cause of restoring liberty.

To be continued ....

P.S.: I would like to extend a big thanks to Garret Seinen, who reviewed a first draft of this article and contributed many very good ideas for improvements, most of which I have shamelessly incorporated into this final version.

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