Category Archives: Economics

Direct Democracy and the Safety Net

 I must admit I enjoy reading nineteenth century novels. Behind their dusty covers dwell men and women still deeply concerned about the dictates of morality, though like us they live within an increasingly modern, dehumanizing world.

Honest and good people there endure grim straits the likes of which our own poor and disadvantaged, protected by various welfare programs and not much limited by class distinctions, will never really know. Yet these fictional characters often strive to maintain their dignity, their values, and their independence.

I don’t enjoy such reading because I harbor any sadistic inclinations toward my fellow human beings: I simply recognize and appreciate the profound truth that even marginally good people, when individually burdened by the full weight of their own moral decisions, will often nobly rise to the occasion — and so receive the aid of those around them who judge their actions worthy of it. Yet I realize as well that these same marginally good people, if forever afforded the chance to shift a part of that moral burden onto others, may do so without much concern for the people who now must share the consequences of those same important decisions.

This dramatic human dynamic, of course, could be dismissed as just another element of good, effective fiction; and so it is. But the best fiction also rings true.  And the truth is that when our moral duty to one another is preempted by a government and its safety net provisions, the concept of morality itself becomes for many a vague, lazily appreciated abstraction.

It might be asserted — quite convincingly as well — that it would be better to eliminate opportunities for moral distinctions among us altogether than to subject the poor and disadvantaged to what might prove to be our moral failings. But if our beneficent government then fails to make the proper distinctions between those who merit aid and those who do not, thus exacting sacrifices from honest and moral people for the sake of supporting dishonest and immoral ones, not only have we forsaken our own sounder moral judgments and our strongest virtues to an increasingly immoral, collectivized state; but we may well be imperiling the state itself by so burdening the best among us in order to support the worst among us.

Properly designed,  a system of direct democracy provides the responsive, dynamic flexibility necessary to set and reset the aid given in each community to the poor and disadvantaged to the right balance between the private sector and the public sector — a balance that may well shift over time and between locales — hopefully always in the direction of replacing public sector aid with private sector aid and in the direction both of encouraging individual responsibility and of restoring financial solvency and civic good faith.

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The National Budget under Direct Democracy

 The so-called “power of the purse,” one among an enumerated few bestowed upon Congress in the Founders’ Constitution, has long since proven, to the surprise no doubt of fewer still, by far the most corrupting. Indeed this indispensable authority to appropriate tax revenue now represents the greatest threat to the future prospects of this nation. Naturally then it also constitutes one of the more challenging powers to tame and to integrate into the faithful service of a national system of direct democracy.

Currently many revenues raised and already appropriated by Congress may yet be blocked by a handful of powerful budget committee chairpersons  — according to whatever criteria might force or stay their hands. But neither these “gatekeepers,” nor even the committees over which they preside, were ever mentioned by the Founders in the Constitution: These were the innovations of subsequent Congresses.

In spite of — or perhaps owing to — these and other congressional innovations,  rare now are any full, year-round budgets appropriated and authorized by the various committees of Congress. Instead, many may pass but one continuing resolution after another in order to ensure the funding of the many agencies, departments and programs of the federal government.

And this proposed direct democracy, at least with respect to the federal budget, is itself a form of national continuing resolution.

All other departments, agencies, offices and courts of law not superseded or abrogated by this Constitution shall retain the same allotted percentage of public revenues, powers of regulation, oversight and enforcement, and restrictions under law as established prior to ratification, until a proposition alternative for reform of that government body or office, introduced by the People or by the principal officer of the government body or office in question, certified in at least ninety-five percent of precincts subject to its oversight and authority, receives an aggregate of fifty-one percent of votes among said precincts.

(from Article 1, Section 4)

As the priorities of the voting public naturally shift over time, this budgetary “frozen pie chart” might be altered in any national electoral initiative — altered perhaps concurrently with the election of a presidential candidate as a new form of electoral mandate akin to today’s party platform: Thus, with the election of a given candidate the defense segment of the budget, which now stands near 24% of the whole, might be reduced to the 22% health care is now allotted and vice versa.

If these important percentages stood unaltered longer than many might like, the actual revenues raised and spent, as ever, would depend upon existing fees and tax rates. The proposed constitution provides for its own major source of revenue akin to the abolished income tax. (see The Immoral Income Tax and Direct Democracy) A property usage fee, specifically, would serve as a progressive form of revenue generator that, unlike the income tax, neither discourages small business enterprise nor encourages mass resource exploitation and blind urban sprawl.

Some might believe that budgetary appropriations ought to be much more fluid, subject to constant voter correction. But these governmental expenditures are not mere figures on a page: resources are committed and lives changed. Were daily polls to decide the fate of previously authorized, let alone disbursed, government expenditures, the ensuing waste of resources would no doubt prove worse than what prevails today.

Yet the national budget need not be balanced from year to year, so long as debts arising from unforeseeable exigencies were borne by current citizens rather than passed on to future generations. Thus, a constitutional amendment explicitly precludes the transfer of debt:

Amendment X – No law enacted by electoral initiative or otherwise shall establish a debt, project or fiscal program where the financing thereof would obligate future citizens to the financial commitments of current voters. Appropriations shall be drawn from revenues collected within one year of their appropriation through floating debt and the collection of these fees and revenues only:

-Usage fees levied upon persons whose activities degrade or monopolize public property;
-Usage fees levied upon persons enjoying exclusive use of land, in proportion to its acreage and the volume, mass and scarcity of natural resources therein;
-Usage fees levied upon foreign governments for involvement of United States military personnel, equipment or weaponry in operations outside the territory of the United States, at the request of said governments, which would otherwise be the responsibility of any sovereign nation to itself;
-Misusage fees levied upon persons whose activities, whether intentional or negligent, damage public property;
-Misusage fees levied upon persons whose activities damage the private property of another person, or impede its exclusive use by barring lawful access to it, or operation of it; physically altering it or its value; or otherwise converting or making improbable its peaceable, lawful, exclusive enjoyment; thereby necessitating the intervention of law enforcement or courts of law;
-Misusage fees levied upon persons who assume unnecessary risks or file frivolous complaints that require emergency public services or courts of law;
-Sales of forfeited, seized property;
-Sales of goods processed or manufactured by state-confined workers; or revenues from the contracting-out of their services;
-Sales of government property to allies of the United States, upon a two-thirds majority vote among the Governors and a unanimous vote between the President and the Cabinet—or the Defense Cabinet, in the case of military property;
-Duties, imposts and excises;
-Safety-inspection and handling charges;
-Any fiscal-program income deduction annually re-authorized by electoral initiative.

All fees shall reflect the actual duration and costs of use or misuse, so that collections in anticipation of use may necessitate reimbursement.

No law enacted by precinct electoral initiative shall institute or increase an appropriation from revenues derived in part or in full from another precinct, unless with a fifty-one percent consenting vote within the latter precinct, or unless authorized by this Constitution; nor withhold or disburse revenues lawfully collected for and due to a city, county or state government, or the federal government.

While congressional committees and their distinguished chairs would no longer hold the national purse strings, outlays of revenues would yet require close supervision and control. That critical supervisory role would be granted to the extra-congressional organizations already established under the current system — e.g. the SEC, IRS, FTC — and duly reauthorized by the incoming Cabinet, a process shepherded by the new Attorney General — now an elected official running on the same ticket with the President and the Vice President, third in succession to the highest office. (see The Presidency, the Vice Presidency and Direct Democracy)

Amendment XI – The power to appropriate revenues and the exercise of oversight, investigative and regulatory authority formerly delegated to the United States Congress by the original Constitution, where not previously delegated by the former, shall be delegated by the Attorney General to, and in turn by, the appropriate executive appointees, whose official acts may be halted by the President, the Attorney General, or by a three-fifths majority of the Governors, when deemed unlawful, wasteful or predominantly political in nature…

In most cases, the People themselves surely lack the time and the enduring interest to study the issues concerned, to weigh their competing priorities, and to stipulate the requirements for each prospective budgetary appropriation. The proliferation of the internet, doubtless, will broaden the capacity of the voting public to determine even the minutiae of appropriations democratically; but until such time as a secure, reliable system were designed, approved, and disseminated, these responsibilities ought remain with dedicated professionals. 

The President, insofar as the budget were concerned, would be only a coequal to the Attorney General and the Governors of the States and would retain the veto power only over those legislative measures enacted as regulations by the agencies created or reauthorized by an acting Cabinet for that task.

We the People, however, through our electoral initiative process, would inherit the authority not only to enact and to alter existing statutory law; but, in rare instances and with rarer consensuses — to alter the American political system itself.

Economic Liberties in Direct Democracy

 We each value differently. Some of us don’t value a surplus of material goods, i.e. accumulated wealth, at all. Conversely, the valuations of some are largely socially comparative, such that the value of anything is contingent upon its value to a certain select group — therefore the more of such a thing the better.

Well, if an immoral act is one that, were everyone to engage in it, the world would be left a worse place — an act that at least indirectly harms the innocent — how would the accumulation of wealth — above and beyond a satisfaction of the necessities of life — rank in terms of its morality? Since we long ago ensured that future generations will no longer have to struggle against the ravages of nature itself, nor face any real threat of invasion, does not our continued, compulsive accumulation of material wealth for its own sake bring more harm to our environment than good to our society?

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Evolution has yielded at least two primary offspring survival strategies: The individuals within a species or sub-species may increase the likelihood of passing down their own genes to future generations by either having as many offspring as nature can sustain or by having only a few offspring very well provided for.

But in a species as generally successful as the human being has been, if success for many is at least unconsciously measured by the highest number of children marginally provided for — or even by the extent of wealth secured to only a very few children — then the consequent accumulation of humans and of wealth, which must come through the exploitation of a finite supply of natural resources, may well end up doing the world and its future generations more harm than good — all owing to a lack of awareness of strong drives inherited from eons past.

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The mere mention of a direct democracy surely stirs within the minds of many Americans a series of nightmarish scenes — tumultuous masses scaling and toppling capital monuments to titans of industry — invading then our very homes in search of the unearned and the over-prized — finally, triumphantly passing among themselves roughly equal shares in a newly confiscated wealth — a Michael Moore-as-Robespierre bloody revolution.

And were this proposed constitution not just the democratization of our polity but equally a redistribution of our wealth, this reflexive, fearful overreaction would indeed be justified. Surely it would then contemplate the very grimmest Orwellian purge to rid the nation not only of “undue ownership” but of the inherited talent — or the accidental ambition to develop that talent — that so often manifests itself in wide disparities of wealth in a capitalistic society.

Shall we be rid of capitalism then? Make everyone an equal owner in all things? If we were to adopt such a plan, long before a requisite human beneficence were enshrined within our figurative constitutions, we would surely invite far more harm than good. It would be immoral to blindly forsake the protections afforded us by our current system absent a realistic, improved alternative.

Amendment XII – Any self-sovereign, adult citizen shall be welcome to purchase or to lease property, or to contract services or employment, private or public, subject to equivalent qualifications and on equal terms. But no contract entered into with a minor, or made by force or fraud, shall be enforceable by law.

Yet neither ought we give free reign to capitalism, particularly in light of the learned and inherited drives we as humans seem so far from transcending. Simply to unleash the free market because it is the most efficient use of available resources yet begs the question: How much of this can we take? One who acts without moral awareness, let alone an ideal, is closer to a robot than a sentient being.

No corporation reporting no current earnings or profit, or a loss, shall award raises, bonuses or other extraordinary emoluments to its executives, for or during the same fiscal period, unless with the express, contemporaneous assent of all of its owners.

(from Amendment XIII)

The presented constitutional document is therefore designed to foster a greater understanding of the morality of conscientiousness, specifically with regard to harm done to the innocent. Thus it preserves the protections of life and property inherent to a moral society; it limits to local precincts the scope of our political ambitions; and it maximizes the public accountability placed upon both our leaders and upon ourselves.

Citizens shall retain the right to form workers unions whenever the labor at issue is a service for which any citizen can refuse to pay by refusing the service itself and the product of such service.

(The provision above effectively abolishes public service workers unions, which  use the power of the state to exact payments for services from tax-paying citizens who do not need or use those services.)

Lawful unions shall retain the right to strike whenever an interruption in work would not endanger public safety, withhold labor for which a prospective striker was previously paid, or withhold a service or product for which a person cannot lawfully refuse to pay.

(from Amendment XIII)

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Money is just a medium through which we express subjective valuations. On-the-spot bartering and trading had its limitations; thus we exchange paper symbols of value that we trust will hold their worth until we exchange them again in the future. If the number of these paper symbols were vastly increased, and not everyone received their proportionate share, then some consumers would be enriched relative to others. They could then outbid the rest for goods or services and pay back debts with paper that would no longer buy what it did when it was first lent, since the prices of most things would have been raised for all of us by this bidding between the newly enriched.

When gold coins were the currency they had a value all their own, with a supply that could not easily be manipulated. Later, when new paper bills were limited in number to the supply of exchangeable gold, this too helped to stabilize the value of the paper. What we have today, of course, affords us no such safeguarding of the value of this paper: The Federal Reserve may print new money at will; and banks may lend out most of the money they were entrusted to hold available in deposit.

Whether or not a new system of indirect value exchange might be adopted upon ratification of this Constitution — or yet a return to a barter and trade economy — will be entirely up to the People themselves — and to their Secretary of the Treasury, whom they entrust with the authority to stabilize the currency — and whom they have the power to replace every year.

The Secretary of the Treasury shall have the power to assess and collect the fees and revenues enumerated by this Constitution; to issue one-year Treasury notes on the credit of the United States; to pay the debts and expenses of the United States; to coin or print money, stabilize the value thereof, and of foreign money; to fix the standard of weights and measures; to establish uniform guidelines on the subject of bankruptcies; and to safeguard against the devaluation and counterfeiting of the securities and current money of the United States. But no money shall be drawn from the Treasury but in consequence of appropriations authorized by law; and a regular statement and account of the receipts and expenditures of all public money shall be published from time to time.

(from Amendment XI)

The overarching goal of this document is a moral one in nature — not one intended to optimize the free exchange of goods and services — so as to perpetuate unconscious evolutionary drives — nor to impose an economic equalization among the ingenious and the disingenuous alike — but to curb the harm we do to the innocents of today and tomorrow and thus secure unto the greatest majority of us all an enduring, moral way of life.

The Immoral Income Tax and Direct Democracy

 When the income tax was enshrined within our Constitution in 1913, it had already been imposed decades earlier by statutory law. The 16th Amendment essentially granted our government the right to collect income tax whether the source was our labor or our capital and without apportioning its collection so as to reflect the unequal populations within the states.

Between its ratification in 1913 and 1918 the top income tax bracket jumped from 7% to 77%. It then swept lower in the years leading up to World War II; and in 1945 it peaked at 94%. Today it hovers at 35%.

Not surprisingly, the size and scope of government has also ballooned. How big we allow it to swell ought to depend upon many real-world variables: No abstract political ideology, however finely principled, could credibly predetermine that size. The right answer requires an integration of actual criteria — population, availability of natural resources, willingness of humans to share or trade for them, propensity for and capacity of others to expropriate them — birth rates, death rates, climate, etc.

Contrary to purist political ideologies humans are not now held back from an Earthly paradise by government itself. The rule among humans is discord; the exception, cooperation. Thus government remains a necessary evil — if also an enduring sign of human failure.

But how we fund our government certainly ought to reflect our ideals and our eventual goal. There are moral implications in play here: When the government taxes an activity or a product we are discouraged from it. Ought the government then tax work and efficient productivity? Might it not tax activities and products we would be better rid of?

Crime obviously costs society on many levels — prevention, enforcement, adjudication, incarceration, etc. Would it be so unreasonable then if prisoners were made to work, repaying society for those costs? Or when citizens file frivolous lawsuits or defraud federal programs, ought not these activities be discouraged through the imposition of a fee or a tax?

When for that matter foreign governments around the globe call upon our U.S. military to protect their national borders, ought not these countries pay for our American sacrifices? And when multinational or American companies pollute our lands and waters, shouldn’t we consistently and fully discourage this activity, imposing taxes or fees equaling the totality of our present and our future costs?

The theoretical machinery underlying this moral system of taxation is Pavlovian to be sure, but the actual output generated by it is of moral and material benefit. It highlights the potential instructive role of a limited government —  linking the funding of its services to those citizens who make the services necessary in the first place.

We all require government, for instance, for the securing of our safety, our private property, and our state and national territory; so we all should pay a tax or fee in support of the maintenance of the police and military forces who guarantee these things to us.

Finally, under a direct democracy in particular, this moral system of taxation requires that no one voting block may arbitrarily impose expenditures upon another — not solely among different segments of the public in a given year but, perhaps more importantly, between current voters and all future generations of voters.

Therefore, in order to optimize this moral system of taxation, this Constitution must specifically prohibit such transfers of debt:

Amendment X – No law enacted by electoral initiative or otherwise shall establish a debt, project or fiscal program where the financing thereof would obligate future citizens to the financial commitments of current voters. Appropriations shall be drawn from revenues collected within one year of their appropriation through floating debt and the collection of these fees and revenues only:

-Usage fees levied upon persons whose activities degrade or monopolize public property;
-Usage fees levied upon persons enjoying exclusive use of land, in proportion to its acreage and the volume, mass and scarcity of natural resources therein;
-Usage fees levied upon foreign governments for involvement of United States military personnel, equipment or weaponry in operations outside the territory of the United States, at the request of said governments, which would otherwise be the responsibility of any sovereign nation to itself;
-Misusage fees levied upon persons whose activities, whether intentional or negligent, damage public property;
-Misusage fees levied upon persons whose activities damage the private property of another person, or impede its exclusive use by barring lawful access to it, or operation of it; physically altering it or its value; or otherwise converting or making improbable its peaceable, lawful, exclusive enjoyment; thereby necessitating the intervention of law enforcement or courts of law;
-Misusage fees levied upon persons who assume unnecessary risks or file frivolous complaints that require emergency public services or courts of law;
-Sales of forfeited, seized property;
-Sales of goods processed or manufactured by state-confined workers; or revenues from the contracting-out of their services;
-Sales of government property to allies of the United States, upon a two-thirds majority vote among the Governors and a unanimous vote between the President and the Cabinet—or the Defense Cabinet, in the case of military property;
-Duties, imposts and excises;
-Safety-inspection and handling charges;
-Any fiscal-program income deduction annually re-authorized by electoral initiative.

All fees shall reflect the actual duration and costs of use or misuse, so that collections in anticipation of use may necessitate reimbursement.

No law enacted by precinct electoral initiative shall institute or increase an appropriation from revenues derived in part or in full from another precinct, unless with a fifty-one percent consenting vote within the latter precinct, or unless authorized by this Constitution; nor withhold or disburse revenues lawfully collected for and due to a city, county or state government, or the federal government.

Healthcare Reform: Reason and Direct Democracy

 The strong and inelastic demand for healthcare in America — our demand for the very latest technological advances in diagnosis and treatment — sends soaring skyward the prices we pay for medical testing and procedures, far above the reach of the average American. Hospitals, to be competitive with one another,  attract the better doctors using generous fee-based pay schemes, whereby doctors, who are always vulnerable to malpractice suits anyway, are financially incentivized to perform services that might not be effective or even necessary.

Hospitals must also recover the costs of multi-million dollar medical equipment that attracts both the finest physicians and the privately insured. So even when existing medical equipment is working well, an innovation in technology imposes pressures upon hospital administrators to update their equipment in order to retain market competitiveness.

But there are other causes for this pricing predicament: Doctrinaire free market advocates would ascribe it to our government’s market interference — its limiting of nationwide insurance competition, its mandating that illegals and the indigent receive treatment, and its insufficient reimbursement models for Medicare and Medicaid.

Doctrinaire liberals, on the other hand, would bewail the corporate, profit-driven denial to Americans of our right to healthcare treatment, carried out through lobbyist influence and the consequent legislative blocking of a universal single-payer system.

But the healthcare issue is far more complex than this.

What if, for example, we Americans had no fear to face either the social stigma of disease or the blank unknown of death? What if we dutifully treated our common illnesses and injuries but accepted the onset of a fatal disease or the infliction of a mortal wound with a selfless dignity rather than with a mortal desperation? And if we refused all expensive, life-extending measures?

The consequent fall in the demand for emergency medical care might be well reflected in lower prices paid by all. So ought we struggle to forestall and overturn the verdict of Nature, even at great cost to family or to society? Is that a civil right?

The human genome is surely devolving in consequence, as diseases that might have killed yesterday’s adults are instead cured by modern medicine. The underlying pathogenic genes responsible for the disease are still passed to the next generation — whereas such genes in past generations would have brought about their own demise. Who knows how this concentration of pathogenic genes will affect future generations?

But is an enlightened attitude toward life, disease and death required in a country whose medical field advances so quickly? It seems quite likely that another century will not pass before genetic therapies have overtaken the spread of disease in humanity. Perhaps then we can “back-engineer” our own human evolution.

For now, unfortunately, we find ourselves caught in a very expensive transition to that medical paradise — that future when perhaps medical costs will have become negligible for everyone — of no import whether universally covered or privately paid.

So, assuming that an enlightened life perspective is out of the question, how do we get there from here? The advancement of medical research and technology must not be slowed; yet the costs of care today ought to be curtailed — or else this, our pricey purgatory, will prevail longer than necessary.

If free market advocates had their way, their resulting open market would not ameliorate the increasingly expensive medical-technology and doctors-fee competition between hospitals: People are so desperate to prolong life, even a few weeks or another month, that the demand for healthcare would remain inelastically high at any price.

And if the liberals prevailed — laying aside the absurdity of one person having a “right” to be treated medically by another human being — at a price point — then presumably a bureaucrat, or a body of bureaucrats, would be officially charged with administering a new universal system. Faced with finite financial resources, they would either make distinctions between those who merit treatment and those who do not; or they would ration resources across all patient care, making little distinction between a patient injured or ill through no fault of his own and one whose actions directly caused his condition, e.g. a chain smoker or a bungee jumper. But such official injudiciousness and arbitrary magnanimity by the state more injuriously debases morality and delegitimizes government than the free market in its fullest operation.

The solution then?

Because demand is inelastic, prices must be kept artificially down. The free market functions for all consumers only when both supply and demand are elastic in relation to price. But to individually set the price of every medical procedure and of all medical equipment would require endless bureaucracy and thus invite unlimited favoritism and red tape.

The real answer requires a broader principle than this.

From libertarians we find an objection to state licensing of professionals because, they argue, such government intervention places artificial limits upon the number of doctors and medical professionals in the field and upon the nature and the number of medical devices and treatments available to all.

But rather than dropping state licensing requirements altogether, why not make explicit the link between state licensing and state price controls?

In other words, if medical professionals and medical suppliers wish to receive the imprimatur of the state and whatever legitimacy accompanies such certification, the value exchanged for this bona fides would include a limitation upon the fees charged by professionals for their services and a limitation upon suppliers for the prices charged to consumers for their products:

No person to whom any of the several states or the United States has granted a license to render a service, or to own or operate a device intended to provide such a service, or to provide a good shall retain the same upon exacting a rate, a fee or a price that exceeds twenty times the federal minimum wage; two times both the actual costs of operation of the device and the resulting marginal dimunition of its functioning life, as applied to its replacement cost; or two times the cost to replace the good, respectively.

(from Amendment XIII)

Under this system the state licensing of professionals might well fall into relative disuse, likely concurrent with an explosion of unlicensed or privately licensed practitioners. The more the merrier, as this greater number of providers would better meet the constant high consumer demand, in this case for medical care, thus lowering the price for the average healthcare consumer. Yet those who retained their state licensing and abided by the fee and price limitations, no doubt true humanitarians, would exercise a secondary price-competition pressure upon unlicensed providers, keeping prices lower across the industry.

And any medical professionals and medical suppliers opting to operate outside of state licensing could still charge private patients, insured or cash payers, whatever the market dictated. Private hospitals could operate with only private licensing, or none at all, perhaps charging for the highest quality care and for the latest technology the fees that only the most affluent could afford. Even so, the technology competition between separate private facilities would fuel medical research and technology advancement and thus extend the progress of medical science for all.

That this state licensing in a direct democracy constitutional amendment was extended to all industries reflects an attempt to avoid legislatively targeting a single industry, avoiding a de facto bill of attainder. As for those citizens who, even with price controls linked directly to state licensing, still could not afford healthcare, they might either rely upon private charities — adopt an enlightened attitude toward life and death — or limit their health risks and unnecessary expenditures, perhaps even their number of children.

Thus, for the greatest number of people we preserve the usefulness of the state and the better elements of the free market system, limiting the ability of state licensed professionals to benefit from state power in exacting from their customers prices that do not reflect their actual costs — the costs that would prevail given full competition among the largest number of suppliers.

And thus we, the People, find ourselves the beneficiaries of more affordable products and services for the foreseeable — and well into the rapidly advancing- future.

Human Nature and Regulation

 When the Founding Fathers within Article 1 Section 8 of the newly signed Constitution granted to Congress the power to regulate commerce, these distinguished gentlemen naturally knew nothing of gasoline, electricity, or bacteria. At the time, workplace and product safety standards constituted for them nary an afterthought. In a nation built upon the backs of slaves this hardly seems surprising.

But after years watching the nation falter under the Articles of Confederation — years of state to state tariff wars, deep recession with dire inflation in state currencies, and both rising debt and unremitted taxes — simply wresting from these foundering states their power to erect tax barriers that impeded foreign and interstate trade was one of their most pressing goals.

Yet in modern America we taxpayers now spend over $2.5 trillion per year footing the bill for both government regulatory enforcement and for public and private compliance.

Possessed of today’s scientific knowledge, would our Founders have designed such an economic burden as a part of their “original intent?”

Must we yet speculate? They died.

We the People must today answer for ourselves which if any measures are necessary and which would best ensure the safety of honest, productive citizens in the free exchange of goods and services — in our daily commerce. No doubt every political ideology will have its own argument for the proper regulator — whether government agencies, private associations — or no regulators at all..

But within both the public and private sectors the one inescapable constant is human nature itself: the power corrupts us; favoritism takes hold; complacency grows; and money talks.  Behold the current global financial crisis. Moody’s Corporation and Standard & Poor’s, two private rating services, were no more trustworthy or reliable than the SEC, a government regulatory agency, in warning Americans of our impending financial securities meltdown.

Fallible human beings man every organization, public and private.

Is the answer then no regulation at all? Ought we discover then only after a high-rise apartment collapsed that the foundation was laid with faulty concrete? Are compensatory lawsuits enough justice, or low rents enough inducement, for the harm visited upon honest, unwitting citizens and their surviving relatives?

Any regulator, public or private, might at any time prove derelict in its duties. But this cannot be reason enough to forsake reasonable public standards, particularly within industries where the public safety is at risk.

In the IT world we see competing models of innovation with widely divergent industry standards: the closed-source operating system and the open-source system. Public safety is nowhere here at risk; and innovation is thriving without such regulation. Let then the hand of the free market and the demand of the consumer determine the course of commerce.

Required is a common-sense rule of thumb, a rule with which to gauge the propriety of imposing a regulation: Does it directly, materially enhance public safety while minimizing costs of compliance — minimized to a degree that would still justify the enterprise in the first place?

But here we return to our human nature: Who shall write such regulations and for which industries? Who shall enforce them? And shall any citizens enjoy immunity from them? What will be the consequences for over-regulation, for under-regulation, and for non-compliance?

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First and most importantly, no one must be immune from the law.

And it would be public employees not private interests or even associations of private interests who surely would make for the most impartial enforcers of public safety regulations.  Private self-governance of public safety, where profit and market share would always be in play, more widely opens a backdoor to our darker human nature.

Industry experts, logically, ought to write the specific standards within their respective fields of mastery. And our own elected representatives, each subject to the recall vote, ought to select such experts as impartially as this our human nature allows.

Finally, we the People, as jurors within the courts of law, will decide both culpability and consequences for the misuse and violation of such regulations.

And the rule of thumb?

No administrative rule or regulation, except those indispensable to the protection of public safety, shall be enforceable where, regarding the regulated, a presumption of malice, neglect, or imbecility inheres to the requirements thereof: But any injury to person or to property, private or public, whose proximate cause is a business or governmental standard or procedure violative of due care and common sense shall nullify the limited liability or the official immunity of the authorizing and enforcing officers, respectively, both in civil and in criminal suits.

(from Amendment XIII)

Some might object here that revocation of the limited liability of CEOs and the official immunity of politicians opens wide the front door to endless litigation. But is this not what hurts us most today — their immunity from accountability?

The broader expansion of citizen accountability — of personal accountability — will serve as the foundation of our collective moral growth. No citizen, and particularly not those in positions of responsibility and power, ought enjoy immunity from our collective judgments and from their own accountability.

So, what then would constitute “due care and common sense?” That would be a definition in our own collective hands, as jurors at trial, to decide — a de facto form of common law for we the People. And this same critical judgment would be brought full circle against ourselves and our own frivolous lawsuits by a provision written as a revenue source into this new direct democracy constitution:

Misusage fees levied upon persons who assume unnecessary risks or file frivolous complaints that require emergency public services or courts of law;

(from Amendment X)

Morality and the Minimum Wage

 Were America to be invaded by a massive foreign force and all able-bodied, law-abiding citizens called upon to act courageously in defense of our common homeland, would it not then seem a vulgar injustice after repelling this formidable enemy were any such patriots then relegated to working at wages below a level providing even a subsistence lifestyle — while yet others returned to their newly secured private wealth and their well-paying positions? Ought not the diligence and the integrity that protects and preserves the free enterprise system for all citizens at least earn for hard-working individuals an escape from a life of dependency, indebtedness and drudgery?

Here our common values and our underlying morality are on trial. Does honest work merit an honest pay? Is there inherent value in integrity and hard work? Let us leave aside for the moment those who free ride upon society and even those who bring children into poverty. Must single working Americans in order to live independently as adults toil at more than one job, live with relatives, and assume personal debt for training and education — all as the price for survival in a supposedly just nation?

Might this be where a free market forces the hand of the invisible individual?

Is modest living and quiet dignity then impossible, or perhaps just unacceptable, for those who, though their skills are limited, would yet be content with their lives? Must fast food workers and janitors be ashamed of their stations? Ought we pity them? And is the price of being an American that all must ambitiously scramble toward the next tax bracket?

Instituting a minimum wage sufficient to guarantee a law-abiding full-time single worker his basic needs — food, shelter, clothing — would stand as proof that we Americans value the very values that sustain us. This would not, however, be a redistributive scheme for expropriating all wealth. Nor would any direct transfer of either an interest in, or the control of, private property be defensible — let alone feasible.

In fact with any hypothetical employee or stockholder control of business a more wasteful use of resources would likely follow: as each citizen would vote for his own self-interests, interests determined by both short-sighted and far-sighted perspectives and by the individual’s share of common sense — or lack of any. The result would be an averaging out of good with bad ideas. While the decision-making of a CEO is more often directed by experience and by a single-minded, highly competitive and so, more often than not, efficient use of resources.

By no means, though, ought the nation’s highest goal be the greatest economic output. Capitalism may indeed deliver the most efficient use of resources and provide us the highest floor of subsistence for all. But is this necessarily moral — or even wise? Ought irreversible environmental damage and mass species extinction be of eventual concern to us? And ought our system be measured by quantity of human life, instead of by the quality of it?

The idea of putting more capital into more hands, as the minimum wage seemingly would do, isn’t necessarily a desirable goal in itself. This would undoubtedly accelerate the destructive exploitation of our natural world through an overproduction of material goods. With more income most people would simply purchase more products and services — each requiring its own natural resources. And thanks to their marginal increase in wealth, some people would also have larger families — children who would themselves consume additional resources.

So what’s so good about a minimum wage then? Isn’t the consequent overpopulation and environmental destruction also immoral? Yes, of course it is. But because the minimum wage sets the wage floor artificially high — i.e. higher than would support the fullest employment possible — it also limits job opportunities and so exerts pressure on those who cannot afford children not to have them: it thereby moderates both population growth and economic growth — this otherwise-destructive, immoral, runaway economic growth — even as it rightly rewards honest work.

That our government currently provides a ready alternative to low-skill, low-wage labor in the form of welfare programs — food stamps, unemployment insurance, etc. — only rewards people for not working, for bringing more children into poverty, and for scamming honest citizens. These safety-net provisions would have to be sunsetted over the course of no more than a few generations, so that each successive generation would face increasingly fewer alternatives to responsible family planning and honest full-time work.

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Value itself is subjective. But values are indispensable. Honesty and hard work ought not be relegated to an economic model of subjective valuation. It stretches credulity to believe that the salary of a CEO is 500 times greater than the company’s lowest-paid laborers; either because the market “demands” such an arrangement, where in other companies it apparently does not; or because this disparity reflects an objectively demonstrable, just valuation of his unique contributions to the survival of the enterprise — as though CEOs, with their obnoxious salaries, weren’t often replaced.

The entire compensation system of the mid-sized or larger company could adjust to accommodate a higher minimum wage, as anyone who has any experience with the wasted time and resources, the general incompetence and the typical redundancy inside most companies could confirm. There are also fortunes spent on ineffective advertising and government lobbying — another advantage of direct democracy — and the consequent tax shelters and special provisions in law. Suffice it to say that most companies are grossly inefficient.

The federal minimum wage acts with a blind uniformity and with a public transparency. It helps those who are actively helping themselves. A regionalized CPI could be used to determine a level for the minimum wage that would provide a local resident sufficient means to afford the necessities of life in his area, as represented by a “basket” of goods and services that all independent, hardworking Americans deserve.

The most obvious alternatives to a moral minimum wage are to continue this amoral welfare state, which now threatens the fiscal life of the nation; or to be rid of the welfare state altogether and the minimum wage with it: Let then the free market flex its invisible hand. Perhaps all honest, low-skilled, hardworking Americans would earn only two dollars an hour; but the price of basic needs might drop in some relation to the lowered cost of labor; such that marginally more poor people could live in relatively more widespread poverty. And the planet could be exploited and overrun until we’re all equally damned.

Or we might express our sounder values through our policies and our polity. We might institute a moral minimum wage and ratify a direct democracy.