Not So Fast, Bud!
Subject: Statism: Part I – The Growth of the Regulatory
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'.
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 Although a temporary income tax was levied during the Civil War, it was rescinded shortly thereafter.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:
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.
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:
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:
And this from historian William Leuchtenburg:
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.
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.
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.
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:
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:
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.
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.
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:
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%.
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!
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
the sum of our individual ambitions", he made it clear
where, in his view, the individual stands in relation to the collective
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.
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:
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.
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.
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:
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.
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.
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:
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.
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.
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 Personal Life:
I can drive wherever I desire.
Well, you had better
Is there anything at all that I can still do on my own?
Channeling Marvin Gaye, today's politicians would say:
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 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:
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?
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
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?
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:
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 ....