Yes, the title of this resolution is so long that blogger would not allow me to type the full name out… and, similarly, this resolution is so far off the deep end that I have to wonder if Representative Craig Frank (R – District 57, Cedar Hills) has run out of space in his mind to create real bills that actually do something.
Now, to be fair, one of the joys of resolutions is that you can practically say or do anything with no real consequences. As I have said before, resolutions usually act as a suggestion for people to follow. So why do I even bother stressing over S.J.R. 17? Well, in short, it is due to the fact that it is so full of partisan rhetoric that it makes me want to either laugh or cry.
The concept is tied up in the title of the bill: Urging Congressional And Presidential Opposition to Federal Bailouts and Promotion of Fiscal Responsibility. Representative Frank clearly is not a fan of the stimulus package and, more specifically the bank and auto makers bailout that occurred late last year. Now I am not here to debate the stimulus itself, rather the conclusions that Representative Frank thinks is so abundantly apparent…along with his oh so sounds conclusions.
Ah, but where to begin picking apart this resolution? I can start almost at the beginning. “the Community Reinvestment Act of 1977 (was) crafted to allow activist attorneys to force otherwise responsible financial institutions to issue mortgages to low-income, credit-risky individuals.”OOOOOH I HATE THOSE ACTIVIST ATTORNEYS, TRYING TO MAKE THINGS BETTER FOR LOW-INCOME PEOPLE!
“(T)he United States Senate added one hundred fifty million dollars in additional unnecessary spending to the (Emergency Economic Stabilization) Act.” Now one of these days I am going to have to write a post concerning one mans pork being another mans stimulus spending. Long blog post short – who do you think builds the buildings and staffs the offices? Rich people who don’t need the jobs?
“(D)eregulation allowed financial institutions to overextend and over-leverage their credit in pursuit of toxic assets like Mortgage Backed Securities…”…I actually kinda agree with this one, sorry.
“(S)ince January 2007, prior to the bailouts, Congress had already been authorizing 2.8 billion dollars of additional deficit spending per day, proving beyond question that deficit spending as an economic stimulus strategy fails to forestall economic recession…” O.K. 1) You don’t honestly think that in an $13.84 trillion a year GDP is suddenly going to turn itself around in a month with $84 billion (.6% of the economic output); 2) who is to say that this spending hasn’t made some progress in dampening the recession?
But this one is my personal favorite: “(Treasury Secretary Paulson) would instead “inject equity” directly into banks, a process that effectively nationalized a significant portion of the nation’s banking system, moving the free market-based economy another step closer toward unconstitutional socialism.” Please, representative Frank, show me exactly where socialism is unconstitutional? Name one article, one amendment, or one preamble that mentions any sort of economic system at all? Show me one Supreme Court ruling that established that capitalism is a penumbra of the Constitution? Try me.
In the end this resolution will pass, if only because the legislature is full of howling monkeys who baulk at the idea of any sort of government spending (though I am sure they won’t mind the stimulus money coming to our state shortly). Furthermore, as I said, it is a resolution, not a law, that just makes us look even more idiotic than usual in the eyes of the nation.
“Name one article, one amendment, or one preamble that mentions any sort of economic system at all?”
Amendment 5, which states in pertinent part, “…nor shall private property be taken for public use, without just compensation.
Two things here. Private property includes money; wages, winnings, earnings, dividends, whatever. The Constitution forbids the government from taking it without compensating the person from whom it was taken.
Ever notice how the excuse is never, “We needs this for [insert valid public purpose here],” but always “You have too much money anyways,” or “you’re too greedy.”
That brings me to the second point: the last two words, “just compensation.” The ONLY way that private property can be taken justly is with some form of compensation. But the emphasis is on the word “just.”
The Constitution is designed to protect the individual from government tyranny. Therefore, it naturally follows that the party with the sole discretion of what is just in such a taking is the party from whom the property was taken.
Socialism cannot meet this requirement and is therefore unconstitutional. Our Constitution was designed in part to protect private property. Show me how Socialism protects private property. Try me.
Wow, Trenton, aggressive much?
The 5th Amendment’s eminent domain clause helps my argument more than it does yours.
Corporations, in a legal sense, are treated as an entity similar to an individual – they can be sued, they can be taxed, and they can own property.So, yes, the Constitution forbids the government from taking a corporations property without just compensation – One form of property that corporations own is stock (along with individuals).
Here is where eminent domain comes in – it is in the citizens best interest for large corporations not to go out of business. Jobs are lost, tax revenues decrease up and down the scale, and the intangibles such as distress and distrust of various systems rises.
So, under eminent domain, the government purchases stocks to infuse more money into a business in an attempt to get it back on its feet and stave of these negatives while helping the citizenry.
In short, the governments purchasing of stock is justified under the Constitution in order to promote the citizenry.
Second, minor, point. Though the Constitution is designed to protect the individual from government and social tyranny, it does not naturally follow that the party with whom the property is taken way is allowed to decide what is just. Rather, the decision of what is just must be decided by an unbiased citizenry overseeing the purchase – the government will try to undercut the price and the individual will try to inflate the price. It is for the unbiased group to decide what is the fair market value either inside or outside of the justice system.
Though our Constitution was designed in part to protect private property, other parts were designed to promote the general welfare. It is in this regard that socialism could be justified within the confines of the document.
Finally, I would just like to point out that it is not the intention of the bailouts to permanently own companies – rather it is designed to give companies the cash infusions they need to become solvent. Once the economy improves, the companies will buy back the stocks and compensate the government – in short the government is acting as a lender of last resort.
“OOOOOH I HATE THOSE ACTIVIST ATTORNEYS, TRYING TO MAKE THINGS BETTER FOR LOW-INCOME PEOPLE!”
Actually, I only disagree with (not hate) those activist attorneys who force the banks to make risky loans, and then when the loans fail it causes a huge banking crisis and requires more government intervention and waste than ever before.
Promoting the general welfare might also mean that the government should allow corrupt and inefficient businesses to fail so that better run and managed businesses can take their place, thus making everybody more successful.
As to showing where socialism is unconstitutional, the fact that there are not specific references to socialist programs in the constitution is what makes it unconstitutional, as made explicit by the 10th amendment.
As to one of the founder’s perspective on this, Thomas Jefferson once explained in a letter, “Congress has not unlimited powers to provide for the general welfare, but only those specifically enumerated.”
It is my belief the economic freedom (capitalism) benefits the general welfare more than large government programs. Under capitalism, business does better, more jobs are created, the percentage of folks living below the poverty level drops.
The more you take money out of the public’s hands and feed it to the political machine, where it gets spent according to who’s scratching who’s back and who’s paying for lunch, the more waste is introduced, and the number of people that money could actually help is reduced.
Remember, every dollar I give to the government to “bail out” a car manufacturer is one dollar less that I can spend on a new car, or other goods and services of American businesses. Who’s to say the auto industry is more deserving than my local thrift shop?
p.s. Sorry for rambling.