Sunday, April 19, 2009

The Reagan Revolution - Not

I recently read the transcript of a lecture by Stephen F. Hadley delivered on April 13th in the Bradley lecture series, and it moved me to write this diary, and how I view what Mr Hadley said applies to the April 15th Tea Party events. One of the main premises in his speech is that President Reagan was not calling for a Revolution, but instead he was calling for a Restoration of constitutional government as the Founders intended it to be.

It is necessary first to understand the unity of Reagan's statecraft, and second, to note the way in which Reagan perceived his statecraft in constitutional terms. Understanding the unity of Reagan's domestic and foreign statecraft is not easy, partly because telling the story of Reagan's domestic record is much more complicated. It lacks the personal drama of the Cold War against the Evil Empire. Reagan never stood in front of the Federal Trade Commission or the Environmental Protection Agency and said, "Mr. Regulator--tear down this rule!"

But this distinction between Reagan's presidential performance in domestic policy and in foreign policy is fundamentally unsound: his statecraft needs to be seen as a unity for one crucial reason: he saw it as a unity. Lincoln once wrote that all nations have a central idea, from which all its minor thoughts radiate. The same can be said of leading statesmen. Reagan's central idea can be summarized as the view that unlimited government is inimical to liberty, both in its vicious forms such as Communism or socialism, but also in its supposedly benign forms, such as bureaucracy.

President Reagan in his own words

There is a threat posed to human freedom by the enormous power of the modern state. History teaches the dangers of government that overreaches--political control taking precedence over free economic growth, secret police, mindless bureaucracy all combining to stifle individual excellence and personal freedom. Now, I'm aware that among us here and throughout Europe there is legitimate disagreement over the extent to which the public sector should play a role in a nation's economy and life. I know you're not all as freedom-loving as me and Margaret Thatcher--but on one point all of us are united: our abhorrence of dictatorship in all its forms.

In this present crisis, government is not the solution to our problem. Government is the problem. . .It is time to check and reverse the growth of government, which shows signs of having grown beyond the consent of the governed.

It is my intention to curb the size and influence of the Federal establishment and to demand recognition of the distinction between the powers granted to the Federal Government and those reserved to the States or to the people. . . Now, so there will be no misunderstanding, it is not my intention to do away with government. It is rather to make it work--work with us, not over us; to stand by our side, not ride on our back.

From time to time, we have been tempted to believe that society has become too complex to be managed by self-rule, that government by an elite group is superior to government for, by, and of the people. But if no one among us is capable of governing himself, then who among us has the capacity to govern someone else?

What others have said about President Ronald Reagan

Former Speaker of the House, Newt Gingrich -

Ronald Reagan is the only coherent revolutionary in an administration of accommodationist advisers. The problem was that Reagan's people were so excited by victory, they forgot they didn't control the country. They didn't control the House and they didn't really control the Senate. They didn't in fact have real power, but psychologically they acted as if they did.

Indiana Gov. Mitch Daniels -

The Reagan years will be for conservatives what the Kennedy years remain for liberals: the reference point, the breakthrough experience--a conservative Camelot. At the same time, no lesson is plainer than that the damage of decades cannot be repaired in any one administration.

conservative intellectual William F. Buckley Jr. -

The most powerful man in the world is not powerful enough to do everything that needs to be done.

Gary McDowell, one of Ed Meese's Justice Department aides who worked on the original intent portfolio -

Domestically Ronald Reagan did far less than he had hoped, he did far less than he had promised, less than people wanted--and a hell of a lot more than people thought he would.

liberal intellectual Robert Maynard Hutchins -

The notion that the sole concern of a free society is the limitation of governmental authority and that that government is best which governs least is certainly archaic. Our object today should not be to weaken government in competition with other centers of power, but rather to strengthen it as the agency charged with the responsibility for the common good.

While this is not revolutionary, it is controversial, as it challenges the basic premises of the modern, centralized administrative state. Unlike Hutchins and other liberals, Reagan didn't think Jefferson's philosophy was archaic. Reagan remains the beau-ideal of a modern conservative statesman, whose skills and insights are worthy of the closest study and emulation.

Keep in mind that had it been within the power of the GOP establishment in 1980, the party's presidential nomination would surely have gone to Gerald Ford, George Bush, Howard Baker, Bob Dole, or John Connally before Reagan. Having been in the minority for so long, many Washington Republicans had come to absorb the premises of establishment liberalism, preferring to offer a low-budget version of the Democratic platform.

So the picture is decidedly mixed: Reagan transformed the Republican Party into a party much more in his own image, just as FDR did with the Democrats in the New Deal transformation. He successfully curbed some of the excesses of liberalism, though he did not turn back liberalism itself. The inexorable logic of modern American government is to expand by degrees--the intended legacy of the Progressive and New Deal transformations, which were constitutional in purpose and effect.

Why didn't Reagan succeed more in reducing the size and influence of the federal government in domestic affairs? Reagan was more successful rolling back the Soviet empire than he was in rolling back the domestic government empire chiefly because this is a harder problem.

Reagan was the first president since FDR who spoke frequently and substantively about the Founders and the Constitution. This is a remarkable and telling fact. It is largely overlooked today that FDR spoke often about the Founding and the Constitution, but quite differently than Woodrow Wilson did. While Wilson was openly critical of the Founding, FDR's references to the Founding were mischievous--appearing to be defending or proposing a restoration of the principles of the Founding while in fact attempting a wholesale modification of the meaning of our constitutional order. After FDR, our presidents practically ceased making reference to the Founding or the Constitution--until Reagan arrived.

So, did Reagan succeed in curbing the size and reach of the federal government? Measuring in terms of spending, the answer appears to be No, at least if a permanent reduction in the growth of federal spending or the size of the federal bureaucracy are used as the main metrics. Although Reagan had some effect in restraining the growth of government spending below what it would have been under a second term of Jimmy Carter (indeed, far below what Carter's last five-year budget plan had projected), over the long run the Reagan years appear to have been a small speedbump on the road to serfdom. Between 1981 and 2006, inflation-adjusted federal spending grew 84 percent, while population grew only 30 percent. If per capita spending had grown only at the rate of inflation, federal outlays in 2006 would have been $800 billion lower than they were--under, remember, a Republican president and Republican Congress.

I think there is a concerted deliberate effort to incorrectly frame the narrative of the purpose and motives of the Tea Party events. The narrative they are creating is that these Tea Party events are just a bunch of far right wing extremists who want to overthrow the government and descend into anarchy. They are saying this is just a bunch of Archie Bunker NASCAR fan rubes who are too stupid to realize that they are not currently paying more in taxes. They are saying that this is a GOP operation that some right wing extremists personalities from Fox and conservative talk radio created, and none of this was going on over the increased spending that took place in the previous administration.

This narrative they are projecting is so ridiculously wrong that I believe it is going to backfire on them big from now through the next two election cycles. The people who attended these Tea Party events are the children of the families around this country who strongly supported President Reagan. They know about the glory of when President Reagan spoke in Berlin and the words he directed to the Soviet Premier Gorbachev, and it fills them with pride. They also sense that an equal degree of success in restoring a constitutional government as the Founders intended it to be has not yet occurred. The people who attended these Tea Party events are like an attractive available single lady who is looking for Mr. Right. I believe the Republican Party does have the best opportunity to woo this lady, but they are going to have to speak to her in terms of principled Founding Father values and not in terms of political obfuscations that try to defend the indefensible spending sprees and binges that the elected Republicans exhibited.

Tuesday, April 14, 2009

Slouching Toward Compassion and a Tea Party

I just finished reading Slouching Toward Gomorrah and The Tragedy of American Compassion. I have also been thinking a lot about a Tea Party on April 15th, hence the title. Both of these books and what I have seen and read about Tea Parties indicate an American human condition that extends past partisan politics and current events. I now understand no immediate fixes of an election or SCOTUS change are going to make everything all better. There needs to be a pendulum swing back to core principles that do not have an expiration date.

Robert Bork wrote about radical individualism and radical egalitarianism he especially saw while teaching at Yale. The individualism he is talking about is no civil rules, accountability, or personal responsibility for actions by an individual. The attitude that if it feels good then do it. The radical egalitarianism he is talking about is how no one should achieve more, accomplish more, or obtain more wealth than another person. Those who do have more are required to give this up to those who have less so that social justice will be met.

Marvin Olansky wrote about the changes in caring for the needy from the time the Mayflower landed at Plymouth Rock to the present day. The major difference between then and now is the dominant view of human nature. Cotton Mather warned his church members in 1698: "Instead of exhorting you to augment your charity, I will rather utter an exhortation... that you may not abuse your charity by misapplying it." His view, held for most of the 18th and 19th century by many, was that many persons, given a choice between working and not working, would choose to sit. He and others viewed the poor not as standing on the bottom rung of the social ladder, with the only choices stagnation or upward movement, but as resting in the middle, capable of moving either upward to economic independence or downward to defeated and dependent state of mind. I sure wish that had remained the dominant view.

Marvin Olasky writes an excellent musical scale from A to G of seven seals of good philanthropic practice:

A=affiliation defined as family ties

B=bonding defined as a personal connection to a charity volunteer

C=categorization defined as seeing an applicant for charity as either

1. worthy of relief

2. needing work rather than relief

3. not entitled to relief

D=discernment defined as personally knowing the applicant enough to detect fraud

E=employment defined as a willingness to work for food and lodging

F=freedom defined as the opportunity to work and worship without governmental restriction. Freedom grasped when an individual takes responsibility with his opportunity.

G=God defined as a recognition that true philanthropy must take into account spiritual as well as physical needs.

In 1947, Horace Greeley, founder and editor of the New York Tribune, is one of the first to lead people in the wrong direction we find ourselves in. "The heart of man is not depraved, his passions do not prompt to wrong doing, and do not therefore by their action, produce evil. Social distinctions of master and servant, rich and poor, landlord and land-less are the cause of evil. The way to end evil is to redistribute wealth so that all receive an equal share; one way to begin will be to have government tax the better off and distribute food and funds to those less well off."

Edward Bellamy, author of Looking Backward, followed Greeley in 1888. In the novel Bellamy's protagonist, Julian West, goes to sleep in 1887 and wakes in the year 2000. West, impressed by the equal division of abundant wealth in what has become an American socialist paradise, asks, By what title does the individual claim his particular share? What is the basis of his allotment? The wise denizen of the future, Dr Lette, replies, His title is his humanity. The basis of his claim is the fact that he is a man.

The theologian and key figure in the early 1900's Social Gospel movement, Walter Rauschenbusch said straightforwardly, "God is against capitalism."

During the Progressive Movement era, journalistic powers, William Randolph Hearst and Scripps-McRae newspaper chains denounced crooked wealth and called for the government to provide guaranteed incomes.

Moving on to the Great Society era of LBJ, the National Council of Churches became one of the leading sellers of entitlement. Council reverends argued not only that all the poor had a right to a handouts, but that the better-off should be ashamed if they did not provide them. They argued that poverty was still with us because of the influence of unrestricted economic individualism. The council demanded that the federal government provide leadership in the creation of adequate mechanisms for income distribution and income maintenance in an affluent society. The NCC brushed off the biblical statement that the poor would always be with us, since it arose in the past when the primitive status of human technology and the scarcity of developed resources existed. Since then, however, technological breakthrough have allowed for adequate levels of living for all.

I especially appreciate this little nugget from Olasky:
It is the thought that counts. We are not supposed to think too long, however, since what could be called Nike philanthropy demands that we "Just Do It." Cotton Mather's exhortation "that you may not abuse your charity by misapplying it" has long been buried.

So I am going to go to Tea Party armed with a lot of powerful ideas from a couple of books I highly recommend. I know that T.E.A is an acronym for Taxed Enough Already, and I would like to add another acronym S.E.A. for Spent Enough Already. The long list of examples I've listed from the books I just read show an entitlement attitude has been cultivated for a long long time. This entitlement spending and mindset has hurt instead of helped the poor and needy. It will be better if the pendulum swings back so personal individual shame in moving downward to a defeated dependency is the mindset of the majority. It will be better if more folks see themselves in the middle rung of the social ladder with freedom of opportunity to move up to economic independence.

Monday, April 06, 2009

They Just Want Their Bank Back

The bizarro behavior that the current leaders of Congress and Pres. Obama are showing toward financial institutions is puzzling to some. There are rumors that some of these institutions have offered to repay some bailout money, and the offer is refused. So, what's up with that? Here is a thought...maybe they just want their bank back.

I used my handy dandy search engine for House bank scandal rubbergate. I came up with three excellent articles. Two were published on March 30, 1992, and the third was published on April 18, 1995. Two of these sources, Time and Newsweek, are much better than anything they are publishing these days. I encourage you to read them to refresh your memory of the kind of history the teachers in school do not mention.

From BusinessWeek The Secrets of Rubbergate

House seargeant-at-arms Jack Russ assigned each new member of the House a non-interest-bearing accounts at the House Bank. A lot of these folks were scratching their head wondering why anyone would want to put money in a non-interest-bearing accounts at the House Bank. The answer was never written down, but Hill veterans knew the secret: The bank provided free overdraft protection worth up to $2,000 a year and, indirectly, interest-free loans up to a members' net monthly salary, or about $7,000. This more than compensated for the lack of interest on deposits.

Congress exempts itself from regulation and oversight.

The House Bank had some of the trappings of a commercial banking institution--accepting deposits, offering checking accounts, and, indirectly through the overdrafts, making loans. But Congress has long insulated itself from the laws it imposes on others, from civil rights to workplace safety, and the House Bank was similarly exempt from the state and federal regulations that govern more traditional banks. It did not have to pay attention to rules requiring charters, capital reserves, examinations, and fees for deposit insurance.

What's more, an analysis of some of the arcane procedures at the bank suggests that despite denials by lawmakers, taxpayers' money was used to support the bank's operations. Every year, taxpayers footed the bill for the salaries and other administrative costs of running the bank, to the tune of at least $1 million. Furthermore, taxpayers may have helped finance House members' overdrafts. These were so pervasive that the staff included one person whose sole job was to ask members to cover their bad checks. When members overdrew their accounts by more than their next month's net salary, as was often the case, "technically and legally, they were dipping into public money," says Representative Fred Grandy (R-Iowa), one of six House members who investigated the bank scandal.


1 House members' paychecks placed in an account at Treasury to which House Bank had access. Riggs Bank was a conduit for other House Bank deposits

2 Members wrote checks to third parties such as dry cleaners, which were processed by the Federal Reserve's national check-clearing system and returned to the House Bank

3 The House Bank wrote checks on the Treasury account in amounts equal to the third-party checks it was called upon to pay. Riggs processed members' other checks free of charge

4 Checks written on insufficient funds were not bounced. Treasury funds, as well as deposits of other members, may have been used to cover overdrafts

From the Newsweek article you find the following-

The muck slopped over onto the House post office, the scene of embezzling and alleged cocaine dealing by employees. With Minority Leader Robert Michel saying there was evidence of "money laundering" at the facility, postmaster Robert Rota resigned-the second House officer in a week to do so under a cloud.

The post office might have redeemed stamps for cash, in effect allowing legislators or their staffs to steal public money. With the U.S. attorney for Washington, D.C., on the case, Speaker Thomas S. Foley could well declare that "the era of patronage is over." Promising to put a professional financial officer in charge of House transactions, Foley said he would eliminate some perks and impose real-world fees on others, like the free pharmacy and the nearly gratis gym.

From the Time article we learn about Mrs. Rubbergate-

Mrs. Solarz admitted that she knew her husband's House account was overdrawn when she ordered a congressional staffer to write a check for $5,200 in 1990. She is not expected to serve jailtime. Ex-Rep. Solarz, who himself had a large number of overdrafts from the House Bank, was cleared by a task force. It was the eleventh criminal charge to emerge from the 1992 "Rubbergate" scandal.

All this talk recently about how those greedy people in financial institutions were not regulated enough by Congress has reminded me of this scandal. Some things simply do not pass the smell test. If Congress wants to work on more regulations, then I suggest they begin by just regulating themselves, Remove exemptions of privileges to them that all of the rest of us have to put up with. Just a thought.