Dependent on D.C.: The Rise of Federal Control Over the Lives of Ordinary Americans
434
Dependent on D.C.: The Rise of Federal Control Over the Lives of Ordinary Americans
434eBook
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Product Details
| ISBN-13: | 9781250102744 |
|---|---|
| Publisher: | St. Martin's Press |
| Publication date: | 05/21/2025 |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 434 |
| File size: | 3 MB |
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Dependent on D.C.
The Rise of Federal Control over the Lives of Ordinary Americans
By Charlotte A. Twight
St. Martin's Press
Copyright © 2002 Charlotte A. TwightAll rights reserved.
ISBN: 978-1-250-10274-4
CHAPTER 1
THE EVOLUTION OF DEPENDENCE
FROM PERSONAL AUTONOMY TO DEPENDENCE ON GOVERNMENT
The shift from personal autonomy to dependence on government is perhaps the defining characteristic of modern American politics. In the span of barely one lifetime, a nation grounded in ideals of individual liberty has been transformed into one in which federal decisions control even such personal matters as what health care we can buy — a nation now so bound up in detailed laws and regulations that no one can know what all the rules are, let alone comply with them. Despite the Framers' original vision of the United States as a nation with a government of limited powers, today each of us is heavily dependent on the federal government in most areas of our lives — for our incomes, our retirement security, our education, our health care, the viability of our businesses, and much more. We in America have traded individual liberty piecemeal for dependence on government, without revolution, without reflection, often without systemic understanding. How could such unchecked federal power have developed in a society with values historically rooted in individual liberty?
This book describes both how it happened and why it has been tolerated. Politicians often talk about how they plan to "grow the economy." This book shows how federal officials have systematically "grown the government." Deliberately manipulating our ability to stop their power quest, federal officials have used techniques that systematically increase people's personal costs of resistance. The chapters that follow lay bare these techniques.
The results are no accident. But the political strategies described in this book do not entail conspiratorial plans made in any monolithic or aggregate way. Rather, this book describes actions taken by individuals pursuing their own separate agendas, trying to get their way in policy and politics. Conspiracy theorists would have us believe that if we just prevented certain elite groups from working their will on the rest of us, all would be well. The actual problem is much more complex and difficult to remedy. The strategies described in this book simply work in politics, so they are used over and over again, creating an institutional structure now highly resistant to change. We will see that people who "do politics well" use these strategies repeatedly, not because someone tells them to, but because these techniques enable them to obtain more of what they want in (and from) the American polity.
Of course, one can hold no illusions about a halcyon American past with individual freedom universally respected. Slavery was inconsistent with the libertarian aspect of colonists' beliefs from the start. Moreover, as the economic historian Jonathan Hughes has shown, government regulation in the colonies at the local level was broad, intrusive, and sometimes draconian.
Yet the scale and scope of federal government intrusion today is without precedent in the United States. Sustained for decades across administrations controlled by both major political parties, this bipartisan expansion of federal authority offers little solace to those seeking restoration of individual autonomy and personal responsibility. Political leaders of both parties have actively employed resistance-manipulating techniques to create and sustain this enormous governmental power. Even now, many who mock the government's ineptitude still fail to perceive the nature and extent of the institutional lock-in that secures and perpetuates federal power over our personal and business lives. With constitutional barriers to expansion of federal authority long ago willfully discarded, political debate today centers chiefly on distribution of the spoils, not the legitimacy of the take nor its consequences for economic and civil liberty.
This book reveals a process begun decades ago. A paper trail of congressional hearings, presidential documents, court rulings, and other records exposes the manipulative strategies and often cynical intentions accompanying the creation and extension of the core institutions of the modern American state — including Social Security, income tax withholding, Medicare, and federal laws governing public education and government data collection. The magnitude and power of today's U.S. government, along with the enormous information-gathering system it has spawned, in turn raise the book's ultimate question: Is our dependence on the federal government ever likely to be reduced, and if so, how? A close look at the last decade's astonishing growth in, and increasing sophistication of, federal control levers must underlie an informed answer to that question.
If we are to hope for a future blessed with civil liberty, private property rights, free markets, and personal autonomy, it is imperative that we understand what has happened and how it has happened. It is not enough to vilify the system and bravely predict a return to more limited political power. Those who have worked so diligently to expand the power of the central government understand full well the key institutional changes they have engineered and now maintain. Generations of young people have been systematically stripped of the intellectual tools that would enable them to defend the institutions crafted by the Framers of our Constitution. The existing system's architects and beneficiaries will not willingly relinquish such hard-won victories.
HOW MUCH DEPENDENCE? A BRIEF OVERVIEW
Today a nation whose people more than two hundred years ago fought a revolutionary war over comparatively low taxation by the British stands passively by while its governments seize more than one third of everything Americans produce each year, burdening us with marginal tax rates often exceeding 50 percent. Total taxes as a percent of income were estimated to be 33.8 percent in 2001. In 2000 the federal tax take alone was 20.6 percent of the total value of all final goods and services produced in the United States ("gross domestic product," or GDP); the federal government reported that total government receipts — federal, state, and local combined — stood at 30.5 percent of GDP in 2000, not counting the regulatory burdens borne by individuals and firms. From the perspective of typical families, total taxes at all levels amounted to 39 percent of the median two-income family's budget and 37.6 percent of the median one-income family's budget in 1998. Tax activists, hoping to stir a quiescent public, now annually recalculate "tax freedom day" in each of the fifty states — the day on which the average citizen would have paid off his tax "bill" by devoting his entire salary to taxes from the first day of the year forward. As the typical "tax freedom day" moves ever later into May, little effective public resistance is manifest.
Yet our daily entanglement with government is far greater than the tax numbers suggest. The extraordinary expansion of federal involvement in our personal lives and in the conduct of our businesses is well documented.While some older Americans still may be shocked at the change, young people have known nothing else. Wherever one turns today, federal officials armed with thousands of pages of detailed, sometimes contradictory, often indecipherable statutes and regulations stand ready to tell each of us what we can and cannot do regarding the minutest details, as well as the most important decisions, of our lives. Thomas D. Hopkins, an economist at the Rochester Institute of Technology, forecast annual "hidden" costs to businesses of complying with federal regulations of approximately $721 billion in 2000, with the burden falling disproportionately on small businesses; policy analyst Clyde Wayne Crews of the Competitive Enterprise Institute reported regulatory compliance costs of $788 billion in 2000. The economist Richard Vedder estimated "regulatory drag" on the U.S. economy to have reduced U.S. GDP by one-fifth compared to the level it would have attained "if the regulatory buildup since the beginning of the Johnson administration had not occurred." In 2000 some 4,699 federal rules and regulations were under consideration, and the Federal Register contained 74,258 pages of proposed and final rules and regulations for that year alone. To enforce the rules, legions of bureaucrats collect, sift, and analyze vast amounts of information about our business and personal activities. We often cannot even know in advance what is lawful and what is not, since we are dependent on government officials for interpretations of the ever-changing laws and regulations.
Despite popular political rhetoric about reducing the size of government, federal authority to guide and control our daily activities continues to expand. From the perspective of individual liberty, that is the key issue: authority to control, not the specific controls imposed at a particular point in time. In the twentieth century, as most of the original constitutional impediments to federal action were eviscerated by overreaching courts, legislatures, and presidents, central government authority became all-pervasive. While partial U.S. deregulation in recent years has altered here and there what the government is now choosing to do, it has not reduced what it claims power to do — quite the contrary — and power is what matters most to those who seek to govern. Constitutional authority to reregulate airlines or agriculture or any other "deregulated" enterprise remains (as agriculture's fresh subsidies illustrate), and industries face new regulations at the government's pleasure. In recent years the Microsoft corporation as well as the tobacco, health care, and pharmaceutical industries have been targeted; next year it will be another firm or industry. Nominal private ownership with largely unlimited government authority to control remains the prevalent politico-economic system at the dawn of the twenty-first century in America.
Virtually anything of significance any of us endeavors to accomplish now triggers the application of a plethora of federal rules and policies. Private land use, water use, banking, international trade, science, technology, education, health care, broadcasting, retirement — all and more are bound in a cocoon of federal regulations. Federal agencies continue to proliferate, burdening people with endless regulations that often determine life or death, health or illness, prosperity or bankruptcy for affected individuals. Regulations spew forth unabated from the Occupational Safety and Health Administration (OSHA), the Food and Drug Administration (FDA), the Federal Communications Commission (FCC), the Internal Revenue Service (IRS), the Federal Trade Commission (FTC), the Consumer Product Safety Commission (CPSC), the Environmental Protection Agency (EPA), and many others. Hiring policies and practices must satisfy the Equal Employment Opportunity Commission (EEOC) and comply with the Fair Labor Standards Act (FLSA), the Americans with Disabilities Act (ADA), and other statutes. Terms of employment are constrained by a host of federal rules. Few important private decisions now escape federal scrutiny and influence.
At the same time, income tax laws arbitrarily determine how much of our lawfully earned income each of us is allowed to keep. From the government's perspective, it is simply not our money: occasional tax reductions allowing us to keep more of it are now called "subsidies"! Transfer programs too diverse to enumerate offer inducements to poor and non-poor alike, with rewards usually tied to alterations in private behavior desired by government officials. Social Security law hinders our ability to save and invest, undercutting our capacity to provide for our old age and often preventing low-income families from accumulating assets that would lift their children out of poverty. Taxes on capital gains further impede efficient investment, particularly when inflation disguises real losses and allows them to be taxed as gains. Double taxation of savings, scarcely known in the industrialized world outside the United States, reduces our ability to provide for our families while eroding a key source of investment capital. Many readers will readily identify, from their own knowledge and experience, additional examples of the countless powers now exercised by our omnipresent federal government.
Today one cannot hire or fire employees, educate one's children, save for one's retirement, work during retirement, open or close a business, develop one's property, purchase medical care or pharmaceutical drugs, or market many common products without encountering myriad federal laws and regulations redirecting private choice. Nor can law-abiding citizens effectively maintain their privacy, given the increasingly intrusive databases now maintained by the federal government or compelled of private firms. From the perspective of most government officials, such public dependence is a benefit, ripe with opportunities to shape private activity while drawing comfortable salaries funded by nonconsenting taxpayers. From the perspective of individual liberty, it is a disaster whose full consequences are yet to unfold. Enmeshed in these rules, always having to ask the permission of government officials, seldom trusted to choose and to bear risks on our own, we are no longer treated as adults by our government.
Without doubt, government is necessary to provide certain core functions essential to civil society, with national defense and the rule of law high atop the list. I do not attempt to isolate these core functions in this book, however. Rather, I start with the premise, now embraced across a broad political spectrum by persons of widely divergent ideologies, that the federal government is today operating far outside the bounds of most people's concept of these core functions. In the language of modern business, government has moved far beyond its "core competencies." In the chapters that follow, I explain how this came to pass and illustrate the increasing boldness with which government control is being extended.
Compared with the local regulations imposed during colonial times, the change in the nature and scope of government authority in the United States during the past century has been astonishing, involving wholesale transfer of expanded redistributive and regulatory powers first to state governments and then to the federal government. Abdication by the U.S. Supreme Court of the central precepts of the original U.S. Constitution has been crucial to this process. As a means of restraining the power of the central government, the checks and balances carefully crafted in 1787 have become largely illusory.
CONSTITUTIONAL UNDERPINNINGS OF GOVERNMENT'S GROWTH
In the twentieth century, judicial reinterpretation served as a vehicle for, in effect, rewriting the U.S. Constitution without using the constitutional amendment process. By reinterpreting constitutional provisions to legitimize a vastly more powerful central government, the Supreme Court gave license to like-minded Congresses and presidents. The interstate commerce clause and the due process clauses of the Fifth and Fourteenth Amendments provided key constitutional pillars on which the new governmental powers were erected.
The interstate commerce clause, originally intended to authorize the federal government to prevent states from establishing trade barriers against each other, served as a pretext for empowering the federal government to regulate virtually any economic activity, no matter how local. The die was cast when the Court held in the 1942 case of Wickard v. Filburn that the federal government could, under cover of the interstate commerce clause, regulate even an individual wheat farmer's production of wheat for consumption on his own farm. The rationale was that, if he hadn't grown the wheat for his family's use, perhaps he would have purchased wheat that had moved in interstate commerce! The Court gutted the distinction between local (intrastate) and interstate commerce, and indeed between commerce and noncommerce:
But even if appellee's activity be local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce, and this irrespective of whether such effect is what might at some earlier time have been defined as "direct" or "indirect." ... That appellee's own contribution to the demand for wheat may be trivial by itself is not enough to remove him from the scope of federal regulation where, as here, his contribution, taken together with that of many others similarly situated, is far from trivial. ... But if we assume that it is never marketed, it supplies a need of the man who grew it which would otherwise be reflected by purchases in the open market. Home-grown wheat in this sense competes with wheat in commerce.
Since almost every economic activity, however local and noncommercial, "competes" with interstate commerce in this sense, the Wickard v. Filburn ruling flung open the door to virtually unfettered federal regulation of all economic activity under the auspices of the interstate commerce clause. A constitutional power designed to prevent governmental interference by states in the marketplace thus became a fulcrum for federal interference in personal and business conduct.
(Continues...)
Excerpted from Dependent on D.C. by Charlotte A. Twight. Copyright © 2002 Charlotte A. Twight. Excerpted by permission of St. Martin's Press.
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