Topic: Government and Politics

Obama’s So-Called Stimulus Scheme: Good for Government, Bad for the Economy

After eight years of higher spending and more intervention, some of us were hoping for change. Unfortunately, President Obama apparently wants to be George Bush on steroids. I explained in a previous video (http://www.cato-at-liberty.org/2008/12/15/are-we-all-keynesians-now/) why Keynesian economics was misguided. The much-anticipated sequel is now available for your viewing pleasure.

This new video looks at the details of Obama’s $825 billion plan to make America more like France. At the risk of spoiling the conclusion, there is no reason to think that big government will work any better for Obama than it did for Bush.

Obama’s Constitution

At the beginning of his inaugural address, President Obama observed that

“America has carried on, not simply because of the skill or vision of those in high office, but because we the people have remained faithful to the ideals of our forebears and true to our founding documents.” [my italics]

Although Obama had taught constitutional law for 12 years, the rest of his address raises a question whether he has ever read the Constitution. For he spells out his vision by committing his administration to a wide range of activities for which there is little or no authority in the Constitution.

“We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together. We will restore science to its rightful place and wield technology’s wonders to raise health care’s quality and lower its cost. We will harness the sun and the winds and the soil to fuel our cars and run our factories. And we will transform our schools and colleges and universities to meet the demands of a new age.”

Moreover, he asserts, our government should be judged by “whether it works – whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified,” not by such “stale political arguments” as whether the policies that might generate these outcomes are constitutional and generate benefits higher than the costs.

Nor are the commitments of his administration to be limited to those of greatest concern to Americans.

“To the people of poor nations, we pledge to work alongside you to make your farms flourish and let clean waters flow, to nourish starved bodies and feed hungry minds. And to those nations like ours that enjoy relative plenty, we say we can no longer afford indifference to the suffering outside our borders; nor can we consume the world’s resources without regard to effect.”

“What is required of us now is a new era of responsibility – a recognition, on the part of every American, that we have duties to ourselves, our nation, and the world.”

President Obama is intelligent and charming –- but not wise. The Constitution only authorizes the president to be the chief executive of the federal government and the commander-in-chief of the armed forces, ample challenges to the most skilled person, but the president is not the sole leader of the federal government, the American nation, or the free world. Based on his inaugural address, President Obama has no apparent sense of the limits of what he can and should do –- and that will reduce his effectiveness in addressing those issues within his clear authority.

Little Hope for Change on Judges Until the Judiciary Stops Legislating

In a recent editorial, the Washington Post issued a “hope for improvements” from the vitriol, partisan rancor, and blocking of qualified candidates that has increasingly dominated nominations to the federal bench.  Don’t hold your breath; this is one hope that will not inspire change during the course of the Obama administration.

No, the poisoning of the judicial appointment process won’t end till courts stop acting as policymakers, finding powers in the Constitution that aren’t there and limiting rights that are.  Thus the problem with judicial nominations has less to do with cynical politicians and embittered ideologues than it does with a ”living Constitution” that has been stretched over the years beyond any Founder’s recognition.  In failing to enforce the constraints on federal powers – and to protect the rights retained by the people under the Ninth Amendment (along with those covered by the Fifth Amendment’s takings clause and the Fourteenth Amendment’s privileges or immunities clause, to name but the most maligned) – what Alexander Hamilton called the “least dangerous branch” has devolved into a disfunctional policymaking body that understandably attracts political passions. As various parties wrestle to direct the government’s expanded powers in their favor constituents, as my boss Roger Pilon wrote in 2002, “everything is politics, nothing is law.”

Until we reset the balances of power among the branches and the government again abides by its constitutional parameters, I’m afraid that the partisanship and politics of personal destruction surrounding judicial nominations will continue unabated – to the detriment of the nominees, the judiciary, and the country.  When so much is at stake, it can be no other way.  (You might as well ask elections to be less partisan or otherwise heated.)

But the Post’s editorial is on the right track about one thing: the failure of Republicans to define the word “extremist” when speaking of likely Obama judicial nominees.  Democrats and their hard Left brethren were so unsuccesful in blocking John Roberts and Samuel Alito in large part because they had cried bigot about practically every previous lower-court nominee.  Instead, let’s define what is unacceptable practically and establish an objective standard for judicial nominees from the new administration.  Then it will only be a matter of measuring the degree of support or opposition when analyzing each one’s record.  I suggest the following: “An extremist judge is someone who puts policy views over the text of the law as written, someone whose record shows a propensity for rewriting statutes or the Constitution.”

If you don’t like the result you get when following the law or the Constitution, change the law or amend the Constitution. As Oliver Wendell Holmes said when asked whether he would be doing justice on the Supreme Court, “This is a court of law, young man, not a court of justice.”

Earmark Ban Only Treats a Symptom, Not the Problem

The Associated Press is reporting on the unsurprising attempt by special interests and their political benefactors to get around President Obama’s ban on earmarks in the massive “stimulus” bill taking shape in Congress.

They’re [lobbyists and lawmakers] just working around it — and perhaps inadvertently making the process more secretive. The projects run the gamut: a Metrolink station that needs building in Placentia, Calif.; a stretch of beach in Sandy Hook, N.J., that could really use some more sand; a water park in Miami. There are thousands of projects like those that once would have been gotten money upfront but now are left to scramble for dollars at the back end of the process as “ready to go” jobs eligible for the stimulus plan. The result, as The Associated Press learned in interviews with more than a dozen lawmakers, lobbyists and state and local officials, is a shadowy lobbying effort that may make it difficult to discern how hundreds of billions in federal money will be parceled out.

As distasteful and corrupting as congressional earmarking of taxpayer money is, earmarking is only a symptom of the problem – not the problem as some well-intentioned lawmakers imply.  The real problem is that few, if any, limitations remain on what our federal masters can spend our money on.  For example, it matters little if a water park in Miami is funded through a Senator’s explicit wishes in an appropriations bill or if it receives the money via one of the executive branch’s numerous “economic development” granting programs.  Thus, lawmakers upset with earmarking should devote more effort to killing the programs that allow for such expenditures to occur in the first place.  (For a perfect example of lawmaker inconsistency on this subject, see here.)

More from the AP story:

Instead, the money will be doled out according to arcane formulas spelled out in the bill and in some cases based on the decisions of Obama administration officials, governors and state and local agencies that will choose the projects. “Somebody’s going to earmark it somewhere,” said Howard Marlowe, a consultant for a coalition working to preserve beaches. Lobbyists are hard at work figuring out ways to grab a share of the money for their clients, but the new rules mean they’re doing so indirectly — and sometimes in ways that are impossible to track.

Tinkering with allocation formulas is a time-honored tradition in Congress.  HUD’s Community Development Block Grant program (CDBG), which would get an extra $1 billion in the current House version of the “stimulus,” offers a good example.  According to Cato’s Chris Edwards:

The Northeast-Midwest Institute represents a group of 18 states stretching from Vermont to Minnesota…Interestingly, this institute both lobbies for federal aid to its member states and receives federal aid itself. Audits show that the institute receives about $800,000 annually from 12 different federal grant programs. The Northeast-Midwest Institute’s website boasts about its lobbying prowess…The CDBG program…illustrates how technical the battles over aid can be. One item in the formula that distributes CDBG funding to the states is “housing built before 1940.” How did this obscure item get into the CDBG formula? The Northeast-Midwest Institute got a member of Congress to insert it into legislation in 1977 in order to tilt aid toward older cities.

The CDBG program formula has been stretched to the point that even relatively wealthy communities can get in on the fun.  And, just as has been the case with earmarked money, the result is often corruption.  For instance, a 2007 HUD Inspector General report found that the City of Chicopee, Massachusetts had spent $1.1 million in CDBG money on projects in an affluent neighborhood that just happened to contain the home of the city’s mayor.  In 2005, the mayor was arrested on extortion charges related to campaign contributions received from a developer the mayor tried to assist in obtaining CDBG-funded projects.

The Real Sprawl Problem: Government

Should we really give another trillion dollars to a government that doesn’t know how big it already is?

Agriculture Secretary Tom Vilsack… learned that his new workplace contains a post office, fitness centers, cafeterias and 6,900 employees. But he remained uncertain about exactly how many employees he supervises nationwide.

“I asked how many employees work at USDA, and nobody really knows,” he said.