Congressional Record, Volume 149 Issue 16 (Wednesday, January 29, 2003)

[Congressional Record Volume 149, Number 16 (Wednesday, January 29, 2003)]
[House]
[Pages H232-H239]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

REPUBLIC VERSUS DEMOCRACY

The SPEAKER pro tempore. Under the Speaker's announced policy of
January 7, 2003, the gentleman from Texas (Mr. Paul) is recognized for
60 minutes as the designee of the majority leader.
Mr. PAUL. Mr. Speaker, at the close of the Constitutional Convention
in 1787, Benjamin Franklin told an inquisitive citizen that the
delegates to the Constitutional Convention gave the people a Republic,
if you can keep it. We should now apologize to Mr. Franklin. It is
obvious that the Republic is gone, and we are wallowing in a pure
democracy against which the Founders had strongly warned.
Madison, the Father of the Constitution, could not have been more
explicit in his fear and concern for democracies. ``Democracies have
ever been spectacles of turbulence and contentions, have ever been
found incompatible with personal security or the rights of property,
and have in general been as short in their lives as they have been
violent in their deaths.''
If Madison's assessment was correct, it behooves those of us in
Congress to take note and decide, indeed, whether the public has
vantaged when it occurred and what to expect in the ways of turbulence,
contention and violence, and above all else what can we and what will
we do about it.
The turbulence seems self-evident. Domestic welfare programs are not
sustainable and do not accomplish their stated goals. State and Federal
spending and deficits are out of control. Terrorism and uncontrollable
fear undermines our sense of well-being. Hysterical reactions to
dangers not yet seen prompt the people at the prodding of the
politicians to readily sacrifice their liberties in vain hope that
someone else will take care of them and guarantee their security.
With these obvious signs of a failed system all around us, there
seems to be more determination than ever to antagonize the people of
the world by pursuing a world empire. Nation-building, foreign
intervention, preemptive

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war and global government drive our foreign policy.
There seems to be complete aversion to defending the Republic and the
Constitution that established it. The Founders clearly understood the
dangers of a democracy. Edmond Randolph of Virginia described the
effort to deal with the issue at the Constitutional Convention: ``The
general object was to produce a cure for evils under which the United
States labored; that in tracing these evils to their origins, every man
had found it in the turbulence and follies of democracy.''

{time} 1400

These strongly held views regarding the evils of democracies and the
benefit of a constitutional republic were shared by all the Founders.
For them, a democracy meant centralized power, controlled by majority
opinion, which was up for grabs and, therefore, completely arbitrary.
In contrast, a republic was decentralized and representative in
nature, with the government's purpose strictly limited by the
Constitution to the protection of liberty and private property
ownership. They believe the majority should never be able to undermine
its principle and that the government must be tightly held in check by
constitutional restraints.
The difference between a democracy and a republic was simple. Would
we live under the age old concept of the rule of man or the enlightened
rule of law?
A constitution in and by itself does not guarantee liberty in a
republican form of government. Even a perfect constitution, with this
goal in mind, is no better than the moral standards and desires of the
people.
Although the United States Constitution was by far the best ever
written for the protection of liberty, with safeguards against the
dangers of a democracy, it, too, was flawed from the beginning. Instead
of guaranteeing liberty equally for all people, the authors themselves
yielded to the democratic majority's demands that they compromise on
the issue of slavery. This mistake, plus others along the way,
culminated in a civil war that surely could have been prevented with
clearer understanding and a more principled approach to the
establishment of a constitutional republic.
Subsequently, the same urge to accommodate majority opinion while
ignoring the principles of individual liberty led to some other serious
errors. Even amending the Constitution in a proper fashion to impose
alcohol prohibition turned out to be a disaster. Fortunately, this was
rectified after a short time with its repeal.
But today, the American people accept drug prohibition, a policy
equally damaging to liberty as was alcohol prohibition. A majority vote
in Congress has been enough to impose this very expensive and failed
program on the American people even without bothering to amend the
Constitution. It has been met with only minimal but, fortunately,
growing dissent. For the first 150 years of our history, when we were
much closer to being a true Republic, there were no Federal laws
dealing with the serious medical problem of addiction.
The ideas of democracy, not the principles of liberty, were
responsible for the passage of the 16th amendment. It imposed the
income tax on the American people and helped us usher in the modern age
of the welfare warfare State. Unfortunately, the 16th amendment has not
been repealed as was the 18th. As long as the 16th amendment is in
place, the odds are slim that we can restore a constitutional republic
dedicated to liberty. The personal income tax is more than symbolic of
a democracy; it is a predictable consequence.
The transition from republic to democracy was gradual and insidious.
Its seeds were sown early in our history. In many ways, the Civil War
and its aftermath laid the foundation for the acute erosion that took
place over the entire 20th century.
Chronic concern about war and economic downturns events caused by an
intrusive government's failure to follow the binding restraints of the
Constitution allowed majority demands to supercede the rights of the
minority. By the end of the 20th century, majority opinion had become
the determining factor in all that government does. The rule of law was
cast aside, leaving the Constitution a shell of what it once was, a
Constitution with rules that guaranteed a Republic with limit and
regional government and protection of personal liberty.
The marketplace, driven by voluntary cooperation, private property
ownership, and sound money was severely undermined with the acceptance
of the principles of true democracy. Unfortunately, too many people
confused the democratic elections of leaders in a Republic for
democracy by accepting the rule of majority opinion in all affairs. For
majorities to pick leaders is one thing. It is something quite
different for majorities to decide what rights are, to redistribute
property, to tell people how to manage their personal lives, and to
promote undeclared, unconstitutional wars.
The majority is assumed to be in charge today and can do whatever it
pleases. If the majority has not yet sanctioned some desired breach of
action demanded by special interest, the propaganda machine goes into
operation and the pollsters relay the information back to politicians
who are seeking legitimacy in their endeavors. The rule of law and the
Constitution have become irrelevant, and we live by constant polls.
This trend toward authoritarian democracy was tolerated because,
unlike a military dictatorship, it was done in the name of benevolence,
fairness, and equity. The pretence of love and compassion by those who
desire to remold society and undermine the Constitution convinced the
recipients and even the victims of its necessity.

Since it was never a precipitous departure from the Republic, the
gradual erosion of liberty went unnoticed, but it is encouraging that
more and more citizens are realizing just how much has been lost by
complacency.
The resolution to the problems we face as a result of this profound
transition to pure democracy will be neither quick nor painless. This
transition has occurred even though the word ``democracy'' does not
appear in the Constitution and the Declaration of Independence. The
Founders explicitly denounced it.
Over the last hundred years the goal of securing individual liberties
within the framework of a constitutional republic has been replaced
with incessant talk of democracy and fairness. Rallying support for our
ill-advised participation in World War I, Wilson spoke glowingly of
making the world safe for democracy and never mentioned national
security. This theme has to this day persisted in all our foreign
affairs. Neoconservatives now brag of their current victories in
promoting what they call ``hard Wilsonism.''
A true defense of self-determination for all people, the necessary
ingredient of a free society is ignored. Self-determination implies
separation of smaller governments from the larger entities that we
witnessed in the breakup of the Soviet Union. This notion contradicts
the goal of pure democracy and world government. A single world
government is the ultimate goal of all social egalitarians who are
unconcerned with liberty.
Today, the concepts of rights and property ownership are completely
arbitrary. Congress, the courts, Presidents and bureaucrats arbitrarily
legislate on a daily basis, seeking only the endorsement of the
majority. Although the Republic was designed to protect the minority
against the dictates of the majority, today we find the reverse. The
Republic is no longer recognizable.
Supporters of democracy are always quick to point out one of the
perceived benefits of this system is the redistribution of wealth by
government to the poor. Although this may be true in a limited fashion,
the champions of this system never concern themselves with the victims
from whom the wealth is stolen. The so-called benefits are short lived
because democracy consumes wealth with little concern for those who
produce it. Eventually, the programs cannot be funded, and the
dependency that has developed precipitates angry outcries for even more
fairness.
Since reversing the tide against liberty is so difficult, this
unworkable system inevitably leads to various forms of tyranny. As our
Republic crumbles, voices of protest grow louder. The central
government becomes more authoritarian with each crisis. As

[[Page H234]]

the equality of education plummets, the role of the Federal Government
is expanded. As the quality of medical care collapses, the role of the
Federal Government in medicine is greatly increased.
Foreign policy failures precipitate cries for more intervention
abroad and an even greater empire. Cries for security grow louder and
concern for liberty languishes.
A tax on our homeland form a massive increase in the bureaucracy to
protect us from all dangers seen and imagined.
The prime goal of the concern of the Founders, the protection of
liberty, is ignored. Those expressing any serious concern for personal
liberty are condemned for their self-centeredness and their lack of
patriotism. Even if we could defeat the al Qaeda, which is surely a
worthwhile goal, it would do little to preserve our liberties, while
ignoring the real purpose of our government. Another enemy would surely
replace it, just as the various groups of so-called barbarians never
left the Roman Empire alone once its internal republican structure
collapsed.
Once it becomes acceptable to change the rules by majority vote,
there are no longer any limits on the power of the government. When the
Constitution can be subverted by mere legislative votes, executive
orders or judicial degrees, constitutional restraints on the government
are eliminated. This process was rare in the early years of our
history, but now it is routine.
Democracy is promoted in the name of fairness in an effort to help
some special interest group receive a benefit that it claims it needs
or is entitled to. If only one small group were involved, nothing would
come of the demands, but coalitions develop and the various groups ban
together to form a majority, to vote themselves all those things that
they expect others to provide for them.
Although the motivating factor is frequently the desire for the poor
to better themselves through the willingness of others to sacrifice for
what they see as a good cause, the process is doomed to failure.
Governments are inefficient and the desired goals are rarely achieved.
Administrators who benefit perpetuate the programs. Wealthy elites
learn to benefit from the system in a superior fashion over the poor
because they know how to skim the cream off the top of all the programs
designed for the disadvantaged. They join the various groups in
producing the majority vote needed to fund their own special interest.

Public financing of housing, for instance, benefits builders,
bureaucrats, insurance companies and financial institutions while the
poor end up in drug-invested, crime-ridden housing projects. For the
same reason, not only do business leaders not object to this system but
they also become strong supporters of welfare programs and foreign aid.
Big business strongly supports programs like the Export Import Bank,
the IMF, the World Bank, foreign subsidies and military adventurism.
Tax Code revisions and government contracts mean big profits for those
who are well-connected. Concern for individual liberty is pushed to the
bottom of the priority list for both the poor and the rich welfare
recipients.
Prohibitions placed in the Constitution against programs that serve
special interests are the greatest threat to the current system of
democracy under which we operate. In order for the benefits to
continue, politicians must reject the rule of law and concern
themselves only with the control of majority opinion. Sadly, that is
the job of almost all politicians. It is clearly the motivation behind
the millions spent on constant lobbying, as well as the billions spent
on promoting the right candidate in each election.
Those who champion liberty are rarely heard from. The media, banking,
insurance, airlines, transportation, financial institutions, government
employees, the military industrial complex, the education system and
the medical community are all dependent on government appropriations
resulting in a high-stakes system of government.
Democracy encourages the mother of all political corruption, the use
of political money to buy influence. If the dollars spent in this
effort represent the degree to which democracy has won out over the
rule of law and the Constitution, it looks like the American Republic
is left wanting. Billions are spent on the endeavor. Money and politics
is the key to implementing policy and swaying democratic majorities. It
is seen by most Americans, and rightly so, as a negative and danger.
Yet the response, unfortunately, is only more of the same.
More laws tinkering with freedom of expression are enacted in hopes
that regulating sums of private money thrown into the political system
will curtail the abuse; but failing to understand the cause of the
problem, lack of respect for the Constitution and obsession with
legislative relativity dictated by the majority serve only to further
undermine the rule of law.
We were adequately warned about this problem. Democracies lead to
chaos, violence and bankruptcy. The demands of the majority are always
greater than taxation alone can provide. Therefore, control of the
monetary and banking system is required for democracies to operate.
It was no accident in 1913 when the dramatic shift toward democracy
became pronounced that the Federal Reserve was established. A personal
income tax was imposed as well. At the same time, popular election of
Senators was instituted, and our foreign policy became aggressively
interventionist. Even with an income tax, the planners for war and
welfare knew that it would become necessary to eliminate restraints on
the printing of money. Private counterfeiting was a heinous crime, but
government counterfeiting and fractional reserve banking were required
to seductively pay for the majority's demands.

{time} 1415

It is for this reason that democracies always bring about currency
debasement through inflation of the money supply.
Some of the planners of today clearly understand the process. And
others, out of ignorance, view central bank money creation as a
convenience with little danger. That is where they are wrong. Even
though the wealthy and the bankers support paper money, believing they
know how to protect against its ill effects, many of them are
eventually dragged down in the economic downturns that always develop.
It is not a new era that they have created for us today, but more of
the same endured throughout history by so many other nations.
The belief that democratic demands can be financed by deficits,
credit creation, and taxation is based on false hope and failure to see
how it contributes to the turbulence as the democracy collapses. Once a
nation becomes a democracy, the whole purpose of government changes.
Instead of the government's goal being that of guaranteeing liberty,
equal justice, private property and voluntary exchange, the government
embarks on the impossible task of achieving economic equality and
micromanaging the economy and protecting citizens from themselves in
all their activities.
The destruction of the wealth-building process, which is inherent in
a free society, is never anticipated. Once it is realized it has been
undermined, it is too late to easily reverse the attacks against
limited government and personal liberty. Democracy, by necessity,
endorses special interest interventionism, inflationism and
corporatism. In order to carry out the duties now expected of the
government, power must be transferred from the citizens to the
politicians. The only thing left is to decide which group or groups
have the greatest influence over the government officials.
As the wealth of the nation dwindles, competition between the special
interest groups grows more intense and becomes the dominant goal of all
political action. Restoration of liberty, the market, and personal
responsibilities are of little interest and are eventually seen as
impractical. Power and public opinion become crucial factors in
determining the direction of all government expenditures.
Although both major parties now accept the principles of rule of
majority and reject the rule of law, the beneficiaries for each party
are generally different, although they frequently overlap. Propaganda,
demagoguery, and control of the educational system

[[Page H235]]

and the media are essential to directing the distribution of the loot
the government steals from those who are still honestly working for a
living.
The greater problem is that nearly everyone receives some government
benefit and, at the same time, contributes to the Treasury. Most hope
they will get back more than they pay in and, therefore, go along with
the firmly entrenched system. Others, who understand and would choose
to opt out and assume responsibility for themselves, are not allowed to
and are forced to participate. The end only comes with the collapse of
the system, since a gradual and logical reversal of the inexorable
march toward democratic socialism is unachievable. Soviet-style
communism dramatically collapsed once it was recognized that it could
no longer function, and a better system replaced it. It became no
longer practical to pursue token reforms like those that took place
over its 70-year history.
The turmoil and dangers of pure democracy are known. We should get
prepared. But it will be the clarity with which we plan its replacement
that determines the amount of pain and suffering endured during the
transition to another system. Hopefully, the United States Congress and
other government leaders will come to realize the seriousness of our
current situation and replace the business-as-usual attitude,
regardless of political demands and growing needs of a boisterous
majority.
Simply stated, our wealth is running out, and the affordability of
democracy is coming to an end. History reveals that once majorities can
vote themselves largesse, the system is destined to collapse from
within. But in order to maintain the special interest system for as
long as possible, more and more power must be given to an ever-
expanding central government, which of course only makes matters worse.
The economic shortcomings of such a system are easily understood. What
is too often ignored is that the flip side of delivering power to
government is the loss of liberty to the individual. This loss of
liberty causes exactly what the government does not want: Less
productive citizens who can't pay taxes.
Even before 9-11 these trends were in place, and proposals were
abundant for restraining liberty. Since 9-11 the growth of centralized
government and the loss of privacy and personal freedoms have
significantly accelerated. It is in dealing with homeland defense and
potential terrorist attacks that the domestic social programs and the
policy of foreign intervention are coming together and precipitating a
rapid expansion of the state and an erosion of personal liberty.

Like our social welfarism at home, our foreign meddling and empire-
building abroad are a consequence of our becoming a pure democracy. The
dramatic shift away from the Republic that occurred in 1913, as
expected, led to a bold change of purpose in foreign affairs. The goal
of making the world safe for democracy was forcefully put forth by
Wilson. Protecting national security had become too narrow a goal and
selfish in purpose. An obligation for spreading democracy became a
noble obligation backed by a moral commitment every bit as utopian as
striving for economic equality in an egalitarian society here at home.
With the growing affection for democracy, it was no giant leap to
assume that majority opinion should mold personal behavior. It was no
mere coincidence that the 18th amendment, alcohol prohibition, was
passed in 1919.
Ever since 1913, all our Presidents have endorsed meddling in the
internal affairs of other nations and have given generous support to
the notion that a world government would facilitate the goals of
democratic welfare or socialism. On a daily basis we hear that we must
be prepared to send our money and use our young people to police the
world in order to spread democracy. Whether it is Venezuela or
Colombia, Afghanistan or Pakistan, Iran, Iraq, Korea or Vietnam, our
intervention is always justified with the tone of moral arrogance that
it is for their own good. Our policymakers promote democracy as a cure-
all for the various complex problems of the world. Unfortunately, the
propaganda machine is able to hide the real reasons for our empire-
building.
Promoting democracy overseas merely becomes a slogan for doing things
that the powerful and influential strive to do for their own benefit.
To get authority for these overseas pursuits, all that is required of
the government is that the majority be satisfied with the stated goals
no matter how self-serving they may be. The rule of law, that is
constitutional restraint, is ignored. But as successful as the policy
may be on the short run, and as noble as it may be portrayed, it is a
major contributing factor to the violence and chaos that eventually
come from pure democracy.
There is abundant evidence that the pretense of spreading democracy
contradicts the very policies we are pursuing. We preach about
democratic elections, but we are only too willing to accept some for-
the-moment friendly dictator who actually overthrew a democratically
elected leader or to interfere in some foreign election. This is the
case with Pakistan's Musharraf. For a temporary alliance, he reaped
hundreds of millions of dollars, even though strong evidence exists
that the Pakistanis have harbored and trained al Qaeda terrorists, that
they have traded weapons with North Korea, and that they possess
weapons of mass destruction.
No one should be surprised that the Arabs are confused by our
overtures of friendship. We have just recently promised billions of
dollars to Turkey to buy their support for the new Persian Gulf War.
Our support of Saudi Arabia, in spite of its ties to the al Qaeda, is
financing and training. It is totally ignored by those obsessed with
going to war against Iraq. Saudi Arabia is the furthest thing from a
democracy. As a matter of fact, if democratic elections were permitted,
the Saudi Government would be overthrown by a bin Laden ally.
Those who constantly preach global government and democracy ought to
consider the outcome of their philosophy in a hypothetical Mideast
regional government. If these people were asked which country in this
region possessed weapons of mass destruction, had a policy of
oppressive occupation, and constantly defies U.N. council resolutions,
the vast majority would overwhelmingly name Israel. Is this ludicrous?
No. This is what democracy is all about and what can come from a one
man, one vote philosophy.
U.S. policy supports the overthrow of the democratically elected
Chavez government in Venezuela because we do not like the economic
policy it pursues. We support a military takeover as long as the new
dictator will do as we tell him.
There is no credibility in our contention that we really want to
impose democracy on other nations, yet promoting democracy is the
public justification for our foreign intervention. It sounds so much
nicer than saying we are going to risk the lives of young people and
massively tax our citizens to secure the giant oil reserves of Iraq.
After we take over Iraq, how long would one expect it to take until
there are authentic nationwide elections in that country? The odds of
that happening in even 100 years are remote. It is virtually impossible
to imagine a time when democratic elections would ever occur for the
election of leaders in a constitutional republic dedicated to the
protection of liberty anyplace in the region.
The tragedy of 9-11 and its aftermath dramatizes so clearly how a
flawed foreign policy has served to encourage the majoritarians
determined to run everyone's life. Due to its natural inefficiencies
and tremendous cost, a failing welfare state requires an ever-expanding
authoritarian approach to enforce mandates, collect the necessary
revenues, and keep afloat an unworkable system. Once the people grow to
depend on government subsistence, they demand its continuation.
Excessive meddling in the internal affairs of other nations, and
involving ourselves in every conflict around the globe has not endeared
the United States to the oppressed of the world. The Japanese are tired
of us, the South Koreans are tired of us, the Europeans are tired of
us, the Central Americans are tired of us, the Filipinos are tired of
us, and, above all, the Arab Muslims are tired of us. Angry and
frustrated by our persistent bullying, and disgusted with having their
own government bought and controlled by the United States, joining a
radical Islamic movement was a natural and predictable consequence for
Muslims.

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We believe bin Laden when he takes credit for an attack on the West,
and we believe him when he warns us of an impending attack, but we
refuse to listen to his explanation of why he and his allies are at war
with us. Bin Laden claims are straightforward. The U.S. defiles Islam
with bases on the Holy Land and Saudi Arabia, its initiation of war
against Iraq, with 12 years of persistent bombing, and its dollars and
weapons being used against the Palestinians, as the Palestinian
territory shrinks and Israel's occupation expands.

There will be no peace in the world for the next 50 years or longer
if we refuse to believe why those who are attacking us do it. To
dismiss terrorism as a result of Muslims hating us because we are rich
and free is one of the greatest foreign policy frauds ever perpetuated
on the American people. Because the propaganda machine, the media, and
the government have restated this so many times, the majority now
accept it as face value, and the administration gets the political
cover its needs to pursue a holy war for democracy against the infidels
who hate us for our goodness.
Polling on the matter is followed closely and, unfortunately, is far
more important than the rule of law. Do we hear the pundits talk of
constitutional restraints on Congress and the administration? No. All
we ever hear are the reassurances that the majority support the
President; therefore, it must be all right.
The terrorist attacks are related to our severely flawed foreign
policy of intervention. They also reflect the shortcomings of a
bureaucracy that is already big enough to know everything it needs to
know about impending attacks, but too cumbersome to do anything about
it. Bureaucratic weaknesses within a fragile welfare state provide a
prime opportunity for those whom we antagonize by our domination over
world affairs and global wealth to take advantage of our vulnerability.
What has been our answer to the shortcomings of policies driven by
manipulated majority opinion by the powerful elite? We have responded
by massively increasing the Federal Government's policing activity to
hold American citizens in check and make sure we are well behaved and
pose no threat, while massively expanding our aggressive presence
around the world. There is no possible way these moves can make us more
secure against terrorism, yet they will accelerate our march toward
national bankruptcy with a currency collapse.
Relying on authoritarian democracy and domestic and international
meddling only moves us sharply away from a constitutional republic and
the rule of law and toward the turbulence of a decaying democracy about
which Madison and others had warned. Once the goal of liberty is
replaced by a preconceived notion of the benefits and the moral
justification of a democracy, a trend toward internationalism and world
government follows. We certainly witnessed this throughout the 20th
century. Since World War II, we have failed to follow the Constitution
in taking this country to war, but instead have deferred to the
collective democratic wisdom of the United Nations.

{time} 1430

Once it is recognized that ultimate authority comes from an
international body, whether it is the United Nations, NATO, the WTO,
the World Bank or the IMF, the contest becomes a matter of who holds
the reins of power and is able to dictate what is perceived as the will
of the people in the world.
In the name of democracy, just as it is done in Washington, powerful
nations with the most money will control the United Nations policy.
Bribery, threats and intimidation are common practices used to achieve
a democratic consensus, no matter how controversial and short-lived the
benefits.
Can one imagine what it might be like if true worldwide democracy
existed and the United Nations were controlled by a world-wide, one
man/one vote philosophy? The masses of China and India could vote
themselves whatever they needed from the more prosperous Western
countries. How long would a world system last based on this absurdity?
Yet this is the principle that we are working so hard to impose on
ourselves and others around the world.
In spite of the great strides made toward one-world government based
on egalitarianism, I am optimistic that this utopian nightmare will
never come to fruition. I have already made the case that here at home
powerful special interests take over controlling majority opinion,
making sure fairness in distribution is never achieved. This fact
causes resentment and becomes so expensive that the entire system
becomes unstable and eventually collapses.
The same will occur internationally, even if it miraculously did not
cause conflict among the groups demanding the loot confiscated from the
producing individuals or countries. Democratic socialism is so
destructive to production of wealth that it must fail, just as
socialism failed under communism. We have a long way to go before old-
fashioned nationalism is dead and buried. In the meantime, the
determination of those promoting democratic socialism will cause great
harm to many people before its chaotic end and we rediscover the basic
principle responsible for all of human progress.
With the additional spending to wage war against terrorism at home,
while propping up an ever-expensive and failing welfare state, and the
added funds needed to police the world, all in the midst of a
recession, we are destined to see an unbelievably huge explosion of
deficit spending. Raising taxes will not help. Borrowing the needed
funds for the budgetary deficit, plus the daily borrowing from
foreigners required to finance our ever-growing account deficit, will
put tremendous pressure on the dollar.
The time will come when the Fed will no longer be able to dictate low
interest rates. Reluctance of foreigners to lend, the exorbitant size
of our borrowing needs, and the risk premium will eventually send
interest rates upward. Price inflation will accelerate and the cost of
living for all Americans will increase. Under these conditions, most
Americans will face a decline in their standard of living.
Facing this problem of paying for past and present excess spending,
the borrowing and inflating of the money supply has already begun in
earnest. Many retirees, depending on their 401(k) funds and other
retirement programs, are suffering the ill effects of the stock market
crash, a phenomenon that still has a long way to go. Depreciating the
dollar by printing excessive money, like the Fed is doing, will
eventually devastate the purchasing power of those retirees who are
dependent on Social Security. Government cost-of-living increases will
never be able to keep up with the loss. The elderly are already unable
to afford the inflated cost of medical care, especially the cost of
pharmaceuticals.
The reality is that we will not be able to inflate, tax, spend or
borrow our way out of this mess that the Congress has delivered to the
American people.
The demands that come with pure democracy always lead to an
unaffordable system that ends with economic turmoil and political
upheaval. Tragically, the worse the problems get, the louder is the
demand for more of the same government programs that caused the
problems in the first place, both domestic and international. Weaning
off of government programs and getting away from foreign meddling
because of political pressure are virtually impossible. The end comes
only after economic forces make it clear we can no longer afford to pay
for the extravagance that comes from the democratic dictates.
Democracy is the most excessive form of government. There is no
``king'' with an interest in preserving the nation's capital. Everyone
desires something, and the special-interest groups, banding together,
dictate to the politicians exactly what they want and need. Politicians
are handsomely rewarded for being ``effective,'' that is, getting the
benefits for the groups that support them. Effectiveness is never
measured by efforts and achievements in securing liberty, even though
it is the most important element in a prosperous and progressive world.

Spending is predictable in a democracy, especially one that endorses
foreign interventionism. It always goes up, both in nominal terms and
in percentage of the nation's wealth.

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Paying for it can be quite complicated. The exact method is less
consequential than the percent of the nation's wealth the government
commands. Borrowing and central bank credit creation are generally used
and are less noticeable, but more deceitful, than direct taxation to
pay as we go.
If direct taxation were accomplished through monthly checks written
by each taxpayer, the cost of government would immediately be revealed,
and the democratic con game would end much more quickly.
The withholding principle was devised to make paying for the programs
the majority demanded seem less painful. Passing on debt to the next
generation through borrowing is also a popular way to pay for welfare
and warfare. The effect of inflating a currency to pay the bills is
difficult to understand and the victims are hard to identify. Inflation
is the most sinister method of payment for a welfare state. It, too,
grows in popularity as the demands increase for services that are not
affordable.
Although this appears to be a convenient and cheap way to pay the
bills, the economic consequences of lost employment, inflated prices
and economic dislocation make the long-term consequences much more
severe than paying as we go. Not only is this costly in terms of
national wealth, it significantly contributes to the political chaos
and loss of liberty that accompany the death throes of a doomed
democracy.
This does not mean that direct taxes will not be continuously raised
to pay for out-of-control spending. In a democracy, all earned wealth
is assumed to belong to the government. Therefore, not raising taxes,
cutting taxes, or granting tax credits are considered ``costs'' of
government. Once this notion is established, tax credits or cuts are
given only under condition that the beneficiaries conform to the
democratic consensus. Freedom of choice is removed, even if a group is
merely getting back control of that which was rightfully theirs in the
first place.
Tax-exempt status for various groups is not universal but is
conditioned on whether their beliefs and practices are compatible with
politically correct opinions endorsed by the democratic majority. This
concept is incompatible with the principles of private-property
ownership and individual liberty. In contrast, in a free society, all
economic and social decision-making is controlled by private property
owners without government intrusion, as long as no one is harmed in the
process.
The vast majority of the American people have come to accept
democracy as a favorable system and are pleased with our efforts to
pursue Wilson's dream of making the world safe for democracy. But the
goals of pure democracy and that of a constitutional republic are
incompatible. A clear understanding of the difference is paramount, if
we are to remain a free and prosperous Nation.
There are certain wonderful benefits in recognizing the guidance that
majority opinion offers. It takes a consensus or prevailing attitude to
endorse the principles of liberty and a constitution to protect them.
This is a requirement for the rule of law to succeed. Without a
consensus, the rule of law fails. This does not mean that the majority
or public opinion, measured by polls, court rulings or legislative
bodies should be able to alter the constitutional restraints on the
government's abuse of life, liberty and property. But in a democracy
that happens, and we know today that is happening in this country on a
routine basis.
In a free society with totally free markets, the votes by consumers
through their purchases or refusal to purchase determine which
businesses survive and which fail. This is free-choice democracy, and
it is a powerful force in producing and bringing about economic
efficiency. In today's democracy by decree, government laws dictate who
receives the benefit and who gets shortchanged. Conditions of
employment and sales are taxed and regulated at varying rates, and
success or failure is too often dependent on government action than by
consumers' voting in the marketplace by their spending habits.
Individual consumers by their decisions should be in charge, not
governments armed with mandates from the majority.
Even a system of free market money, a redeemable gold coin standard,
functions through the principle of consumers always voting or
withholding support for that currency. A gold standard can only work
when freely converted into gold coins, giving every citizen a right to
vote on a daily basis for or against the government's money.
It is too late to avoid the turbulence and violence that Madison
warned us about. It has already started. But it is important to
minimize the damage and prepare a way for the restoration of the
Republic. The odds are not favorable, but not impossible. No one can
know the future with certainty. The Soviet system came to an abrupt end
with less violence than could ever have been imagined at the height of
the Cold War. It was a pleasant surprise.
Interestingly enough, what is needed is a majority opinion,
especially by those who find themselves in leadership roles, whether
political, educational or in the media, that rejects democracy and
supports the rule of law within the Republic. This majority support is
essential for the preservation of the freedom and prosperity with which
America is identified.
This will not occur until we as a Nation once again understand how
freedom serves the interests of everyone. Henry Grady Weaver, in his
1947 classic, ``The Mainspring of Human Progress,'' explains how it
works. His thesis is simple. Liberty permits progress, while government
intervention tends always to tyranny. Liberty releases creative energy;
government intervention suppresses it. This release of energy was never
greater than in the time following the American Revolution and the
writing of the U.S. Constitution.
Instead of individual activity being controlled by the government or
superstitious beliefs about natural and mystical events, the activity
is controlled by the individual. This understanding recognizes the
immense value in voluntary cooperation and enlightened self-interests.
Freedom requires self-control and moral responsibility. No one owes
anyone else anything and everyone is responsible for his or her own
acts. The principle of never harming one's neighbor, or never sending
the government to do the dirty work, is key to making the system tend
to peaceful pursuits and away from the tyranny and majority-induced
violence. Nothing short of a reaffirmation of this principle can
restore the freedoms once guaranteed under the Constitution. Without
this, prosperity for the masses is impossible; and as a Nation we
become more vulnerable to outside threats.
In a Republic, the people are in charge. The Constitution provides
strict restraints on the politicians, bureaucrats and the military.
Everything the government is allowed to do is only done with explicit
permission from the people or the Constitution.
Today, it is the opposite. The American people must get permission
from the government for their every move, whether it is the use of
their own property or spending their own money. Even the most serious
decisions, such as going to war, are done while ignoring the
Constitution and without a vote of the people's representatives in the
Congress. Members of the global government have more to say about when
American troops are put in harm's way than the U.S. Congress. The
Constitution no longer restrains the government. The government
restrains the people in all they do. This destroys individual creative
energy, and the ``mainspring of human progress'' is lost. The
consequences are less progress, less prosperity, and less personal
fulfillment.
A system that rejects voluntary contracts, enlightened self-interests
and individual responsibilities permits the government to assume these
responsibilities. And the government officials become morally obligated
to protect us from ourselves, attempting to make us better people and
setting standards for our personal behavior. That effort is already in
full swing. But if this attitude prevails, liberty is gone.
When government assumes the responsibility for individuals to achieve
excellence and virtue, it does so at the expense of liberty and must
resort to force and intimidation. Standards become completely
arbitrary, depending on the attitude of those in power and the
perceived opinion of the majority. Freedom of choice is gone.
This leads to inevitable conflicts with the government dictating what

[[Page H238]]

one can eat, drink, smoke, or whatever. One group may promote
abstinence, the other tax-supported condom distribution. Arguments over
literature, prayer, pornography and sexual behavior are endless. It is
now not even permissible to mention the word ``God'' on public
property. A people who allows its government to set personal moral
standards for all nonviolent behavior will naturally allow it to be
involved in the more important aspects of spiritual life. For instance,
there are tax deductions for churches that are politically correct, but
not for those whose benefits are considered out of the mainstream.

{time} 1445

Groups that do not meet the official politically correct standards
are more likely to be put on the terrorist list.
This arbitrary and destructive approach to solving difficult problems
must be rejected if we ever hope to live again in a society where the
role of government is limited to that of protecting freedom.
The question I am most often asked when talking about this subject is
why do our elected leaders so easily relinquish liberty and have so
little respect for the Constitution? The people of whom I speak are
convinced that liberty is good and big government is dangerous. They
also are quite certain that we have drifted a long way from the
principles that made America great, and their bewilderment continuously
elicits a big ``why?''
There is no easy answer to this and no single explanation. It
involves temptation, envy, greed and ignorance, but worst of all
humanitarian zeal. Unfortunately, the greater the humanitarian
outreach, the greater the violence required to achieve it. The greater
the desire to perform humanitarian deeds through legislation, the
greater is the violence required to achieve it.
Few understand this. There are literally no limits to the good deeds
that some believe need to be done. Rarely does anyone question how each
humanitarian act by government undermines the essential element of all
human progress: individual liberty.
Failure of government programs prompts more determined efforts, while
the loss of liberty is ignored or rationalized away. Whether it is the
war against poverty, drugs, terrorism, or the current Hitler of the
day, an appeal to patriotism is used to convince the people that a
little sacrifice, here and there, of liberty is a small price to pay.
The results, though, are frightening and will soon even become more
so. Poverty has been made worse. The drug war is a bigger threat than
drug use. Terrorism remains a threat, and foreign wars have become
routine and decided upon without congressional approval.
Most of the damage to liberty and the Constitution is done by men and
women of goodwill who are convinced they know what is best for the
economy, others, and foreign powers. They inevitably fail to recognize
their own arrogance in assuming they know what is the best personal
behavior for others. Their failure to recognize the likelihood of
mistakes by central planners allows them to ignore the magnitude of a
flawed central government directive compared to an individual or a
smaller unit of government mistake.
C.S. Lewis had an opinion on this subject: ``Of all tyrannies, a
tyranny sincerely exercised for the good of its victim may be the most
oppressive. It may be better to live under robber barons than under
omnipotent moral busybodies. The robber baron's cruelty may sometimes
sleep, his cupidity may at some times be satiated, but those who
torment us for our own good will torment us without end for they do so
with the approval of their own conscience.''
A system that is based on majority vote rather than the strict rule
of law encourages the few who thrive on power and exerting authority
over other people's lives, unlike the many driven by sincere
humanitarian concerns. Our current system rewards those who respond to
age-old human instincts of envy and greed as they gang up on those who
produce. Those individuals who are tempted by the offer of power are
quick to accommodate those who are the most demanding of government-
giveaway programs and government contracts. These special interest
groups notoriously come from both the poor and the rich, while the
middle class is required to pay.
It is not a coincidence that in the times of rapid monetary
debasement, the middle class suffers the most from the inflation and
the job losses that monetary inflation brings. When inflation is
severe, which it will become, the middle class can be completely wiped
out. The stock market crash gives us a hint as to what is likely to
come as this country is forced to pay for the excesses sustained over
the past 30 years while operating under a fiat monetary system.
Eric Hoffer, the longshoreman philosopher, commented on this subject
as well. ``Absolute power corrupts even when exercised for humane
purposes. The benevolent despot who sees himself as a shepherd of the
people still demands from others the submissiveness of sheep.''
Good men driven by a desire for benevolence encourage the
centralization of power. The corruptive temptation of power is made
worse when domestic and international interventions go wrong and feed
into the hate and envy that invade men's souls when the love of liberty
is absent.
Those of goodwill who work to help the downtrodden do so not knowing
they are building a class of rulers who will become drunk with their
own arrogance and a lust for power. Generally only a few in a society
yield to the urge to dictate to others and seek power for the sake of
power and then abuse it. Most members of society are complacent and
respond to propaganda, but they unite in the democratic effort to
rearrange the world in hopes of gaining benefits through coercive means
and convince themselves they are helping their fellow man as well. A
promise of security is a powerful temptation for many.

A free society, on the other hand, requires these same desires be
redirected. The desire for power and authority must be over one's self
alone. The desire for security and prosperity should be directed
inwardly rather than toward controlling others. We cannot accept the
notion that the gang solution endorsed by the majority is the only
option. Self-reliance and personal responsibility are crucial.
But there is also a problem with economic understanding. Economic
ignorance about the shortcomings of central economic planning,
excessive taxation and regulations, central bank manipulation of money,
and credit and interest rates is pervasive in our Nation's Capital. A
large number of conservatives now forcefully argue that deficits do not
matter. Spending programs never shrink no matter whether conservatives
or liberals are in charge. Rhetoric favoring free trade is cancelled
out by special interest protectionist measures. Support of
international government agencies that manage trade such as the IMF,
the World Bank, the WTO, and NAFTA politicizes international trade and
eliminates any hope that free-trade capitalism will soon emerge.
The Federal Government will not improve on its policies until the
people coming to Washington are educated by a different breed of
economists than those who dominate our government-run universities.
Economic advisors and most officeholders merely reflect the economics
taught to them. A major failure of our entire system will most likely
occur before serious thought is given once again to the guidelines laid
out in the Constitution.
The current economic system of fiat money and interventionism, both
domestic and international, serve to accommodate the unreasonable
demands for government to take care of the people, and this, in turn,
contributes to the worst of human instincts: authoritarian control by
the few over the many.
We as a Nation have lost our understanding of how the free market
provides the greatest prosperity for the greatest number. Not only have
most of us forgotten about the invisible hand of Adam Smith, few have
ever heard of Mises and Hayek and Rothbart, the individuals who
understood exactly why all economic ups and downs in the 20th century
occurred, as well as the cause of the collapse of the Soviet Union.
But worst of all we have lost our faith in freedom. Materialistic
concerns and desire for security drive our national politics. This
trend has been sharply accelerated since 9-11.

[[Page H239]]

Understanding the connection between liberty, prosperity and security
has been lost. The priorities are backwards. Prosperity and security
come from liberty. Peace and the absence of war come from a consequence
of liberty and free trade. The elimination of ignorance and restraints
on do-goodism and authoritarianism in a civilized society can only be
achieved through a contractual arrangement between the people and the
government, in our case the U.S. Constitution. This document was the
best ever devised for releasing the creative energy of a free people
while strictly holding in check the destructive powers of government.
Only the rule of law can constrain those who by human instinct look for
a free ride while delivering power to those few, found in every
society, whose only goal in life is a devilish desire to rule over
others.
The rule of law in a republic protects free-market activity and
private property ownership and provides for equal justice under the
law. It is this respect for law and rights over government power that
protects the mainspring of human progress from the enemies of liberty.
Communists and other Socialists have routinely argued that the law is
merely a tool of the powerful capitalists.
But they have it backwards. Under democracy and fascism, the
pseudocapitalists write the laws that undermine the Constitution and
jeopardize the rights and property of all citizens. They fail to
realize that the real law, the Constitution, itself guarantees the
rights and equal justice and permits capitalism, thus guaranteeing
progress.
Arbitrary, ever-changing laws are the friends of dictators.
Authoritarians argue constantly that the Constitution is a living
document and that rigid obedience to ideological purity is the enemy
that we should be most concerned about. They would have us believe that
those who cherish strict obedience to the rule of law in the defense of
liberty are wrong merely because they demand ideological purity. They
fail to demand that their love of relative rights and pure democracy is
driven by a rigid obedience to an ideology as well. The issue is never
rigid beliefs versus reasonable friendly compromise. In politics it is
always competition between two strongly held ideologies. The only
challenge for men and women of goodwill is to decide the wisdom and
truth of the ideologies offered.
Nothing short of restoring a republican form of government with
strict adherence to the rule of law, and curtailing illegal government
programs, will solve our current and evolving problems.
Eventually the solution will come with the passage of the liberty
amendment. Once there is serious debate on this amendment, we will know
that the American people are considering the restoration of the
constitutional republic and a protection of individual liberty.

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