Consolidation and Tyranny

0:00I'm here today, this afternoon, to talk a little bit about my new job in Montgomery, my new boss, Governor Fobb James, some of the lessons that I've learned about state government so far, and a little bit of my own research on political economy. First a word about my old boss, Lew Rockwell. I want to thank Lew for the 15 years of the Ludwig von Mises Institute. It's been an honor, a true honor and a privilege to be affiliated with the Institute and I feel like one of the luckiest academics alive to have been affiliated with the Institute for so long and I want to thank everybody here, the members of the Institute, for making all that possible. But having such a great job at the Mises Institute, it made the idea of going to work for state government a difficult decision.

0:50Mr. Perry Elford always used to tell me, however, that Austrian economics, to be effective, has to be a practical matter as well. You have to take those principles and put them into effect in the real world. You can't just be a classroom academic. You can't just work on the blackboard. You have to take these principles, these theories, out into the real in the real world and try to make a difference and his urges made my decision a lot more easier and it's been a very pleasant surprise. My topic today is consolidation of government power and tyranny. Everybody in here knows, of course, that we have a big government, we have a big central government. I don't need to make that point.

1:38In terms of tyranny, I don't think we have to really argue the existence of tyranny here in the United States. If you've been following the IRS hearings this week or campaign finance reform hearings, you know what's going on in Washington, D.C. You know what we have is basically a Leviathan government. The central government basically takes as much as it possibly can from us, no more and no less. So I'm not really here to argue the fact that we have a big government in tyranny, that we already have consolidation of power. But I want to look briefly today at the causes of the consolidation of power and some of the cures.

2:27Obviously, the cause of big government and tyranny is the consolidation of power in Washington, D.C., the centralization of power. And I think the cures are primarily education and political. Things like the U.S. Constitution, states' rights, secessionism, anything to reverse the forces of consolidation. I'm going to try to make my case here today that in order to try to control this tyranny that we do need some political solutions and that within the democratic framework one of those solutions involves the reapportionment of Congress and that we actually, ironically, need a larger government in the sense that we need a larger legislature.

3:19What have I learned so far working in state government? Well, from day one, I can tell you that Austrian economics matters a whole lot. It's everything I learned in economics turned out to be true right there in day one. Actually, before I actually officially started working, I could see that Austrian economics was very helpful in understanding what was going on in state government. I can also tell you that ideas can matter. Politics rules, money does rule in terms of government, but ideas can make a difference. Second, I've seen the failure of a number of certain types of reforms, reforms that have already been tried in the past in state government and in government in general.

4:05For example, the decentralization of government, breaking government up from a large program into smaller programs, passing it down to the local level, handing it out to non-profit groups, ideas that are attractive, the idea of breaking up government and government programs up into smaller units, but very often these decentralization efforts actually make things much worse. I've seen this in terms of welfare, mental health, all various programs of state government, which in the past have been reformed by trying to break them up and hand them down to the local level simply hasn't worked. It's actually made real reform and cutting the size of government more difficult.

4:52Other things like term limits, ethics reform, campaign finance laws and regulations don't seem to do much good. However, the main lesson that I've learned, and I guess one of the nicest surprises, is in the sense that when I was asked to work for the state government, I was really more interested in national policies. Well, it turns out I was all wrong, that state government really is where all the national policies take place. And as a matter of fact, states, state governments are basically nothing more than franchises of the federal government or the national government. There's no longer much of a break between the state and the federal government.

5:40State governments are like a Kentucky fried chicken restaurant, a franchise of the national chain. Of course, except it doesn't sell chicken, it hands out pork. We're basically a giant welfare machine. How does the federal government control state governments? Well, there are a variety of ways in which the state government in Alabama and your states are controlled by the federal government. Federal funding, of course, plays a big role. The federal government actually gives us more than 50% of our budget. And obviously anybody who gives you more than 50% of your money, you tend to pay attention to.

6:27And this federal funds go into virtually all of our programs. Federal Matching Funds. This is a particularly interesting way in which the federal government grabs a hold of state governments, providing them with the economic incentive that states cannot refuse, that politicians generally cannot refuse. The federal matching program, for example, may say, if the state government contributes one dollar, the federal government will give you five dollars or ten dollars to build roads or to do whatever, as long as you build them or carry out the program according to federal regulations. So this is a very powerful incentive and it's one that most politicians can't overcome.

7:17Why? Because if you ignore these programs, your political opponents in the next election will simply campaign that they will bring the pork home from Washington, D.C. And then of course there are federal mandates. Federal mandates basically affect and direct every single program in state government. They direct through the monetary and through regulation every agency within state government. And through these mechanisms they push state government to expand, to become larger, to have larger budgets and higher taxes. The most recent one is a program to provide health insurance for children from low income families.

8:06And the program says, no strings attached, it's always the case in the beginning, no strings attached, all you have to do is put up one dollar and the federal government will put up five dollars. As soon as they announce that program, the legislature goes wild about promising their constituents more benefits from Washington. Actually, the states have very little autonomy left. The only thing they have the autonomy to do, or the freedom to do, is to make things much worse than the Federal Government wants, very difficult to make it better. So we have a consolidation of federal and state government that has resulted in big government, because states aren't allowed to cut back in any area without suffering the consequences.

8:52and therefore we have this Leviathan government that maximizes the amount of taxes it takes in from us and maximizes the influence and regulation of our lives. We no longer have this limited government and we also have essentially government of one rule where people in every state basically work under the same set of federal government guidelines and so we have this national government, not a federal government And the national government dominates the states, controls the mercantile economy and smashes anyone who doesn't agree with them, that doesn't agree that the tyranny should continue. As Americans, we are free to do, we are completely free to do exactly what we're told.

9:40Now this is where Governor Bob James comes in. He's not the typical politician. He believes very strongly in the United States Constitution and particularly states' rights. These are the important issues for him. They're not just on the periphery. They're not just something he agrees to. These are the core values. At his inauguration in 1995, for example, on the Capitol steps behind the podium, there was a large banner of the Tenth Amendment. The 10th Amendment, which is virtually ignored, it is ignored in Washington, D.C., but it's the amendment that celebrates states' rights and limited government. And Governor James has persistently gone to Washington to defend states' rights and the Constitution.

10:32He turned down money for the Gold 2000 program. Eventually, the Feds were able to work that back in by saying he didn't have the authority to turn it down. They're very convincing. He defended an Alabama judge who hangs a copy of the Ten Commandments in his courtroom declaring that he would call out the National Guard to defend the judge's rights. He convened a meeting of the Alabama congressional delegation in Montgomery, Alabama, the first time it's ever been done, and asked them to relinquish federal control over the welfare programs, and to give us our tax money back. And finally, this summer, Governor James wrote a federal judge asking him to dismiss a case against an Alabama school prayer law, a law that Governor James also disagreed with, but who thought was constitutionally a matter of state government, not federal jurisdiction.

11:40And in his letter to the judge, which is a 35-page letter, Governor James clearly shows that the Constitution and the Bill of Rights does not apply to the states, as the Supreme Court would like. But rather, the Bill of Rights was meant to protect us from the Federal Government itself. He also shows that the Fourteenth Amendment does not apply the Bill Bill of Rights to the states. He shows that the due process clause does not apply the Bill of Rights to the states. He points out, of course, that all the state governments have a Bill of Rights, that they had a Bill of Rights before the Federal Bill of Rights, and as a matter of fact, that the states, their Bills of Rights were the model for the and the National Bill of Rights, and finally he shows that only recent judicial interpretation applies the Bill of Rights to the states. Now some would consider his efforts, the efforts of Governor James, as sort of as Don Chiodi tilting at windmills, but like other revolutionaries

12:54such as Thomas Jefferson, you must exhaust every legal and peaceful means of restoring and liberty and redressing grievances. You must bring these issues out. As a matter of fact, Alabama has a history of opposing consolidation of power and of tyranny. Our state motto is we dare to defend our rights. And of course, I think this is where we get our national reputation in the media. The media hates Alabama for some reason. I think I think it's this opposition and if in the 15 years that I've been in Alabama I've never seen an article in the New York Times accurately describe things in Alabama. It's usually filled with fabrications and lies. So the Constitution and the Bill of Rights. Personally I don't think the Constitution is a perfect document. I much prefer for example the Articles of Confederation or or which was mentioned earlier by Professor DiLorenzo, the Confederate Constitution.

14:03Got some people agreeing with me here. As much as it's to be admired, we have to remember that the Constitution was actually a compromise with big government nationalists like Alexander Hamilton and Madison. Madison, at the time of the Constitution, wanted to destroy state governments altogether. and Hamilton, of course, wanted a much more powerful presidency and a much more powerful and centralized central government. But as I said, it remains one of our main protectors of freedom. The original Constitution and Bill of Rights is no doubt still one of the great documents of all time. It's primarily the subsequent amendments and interpretation where we've lost liberty, where we've consolidated power and where government has become more powerful.

14:59It's actually quite amazing how good the first ten amendments are and how bad the rest of the amendments are. However, there is one proposed amendment that I want to talk about in some detail here and that has to do with reapportionment. The reapportionment in Congress was never dealt with in the Constitution. All it says is every state gets at least one representative and you can have no more than one representative for every 30,000 people. It doesn't say how large the House of Representatives should be, how the representatives should be divided amongst the states, or even how the representatives should be chosen within the states. So this is something that's left open in the Constitution.

15:46The Constitution, the founding fathers recognized this and it was one of the first issues, the first amendment, the first proposed amendment to the Constitution was a reapportionment bill. Unfortunately, that amendment failed to pass by one state. Massachusetts mysteriously did not act and the amendment died one state short. Now, reapportionment is basically how we reset the Congress in terms of the number of congressmen and how many congressmen go in each state and so on. And there are two main methods that were proposed in the early days of this union. The first method was proposed by Thomas Jefferson.

16:33I'll refer to this as the good method. The citizens method basically said there'd be a fixed ratio, like in the Constitution it said 30,000 citizens or 30,000 population per representative. So that was something that allowed for a flexible size of the House of Representatives. More people in the country, a larger House of Representative. So you'd have a fixed ratio and the size of the House would be determined by the size of the population. and in Jefferson's method was flexible and definite and it favored the larger states such as Virginia. Now the other method was proposed by Alexander Hamilton and of course I'll refer to this as the bad method.

17:25Hamilton would set the size of the house at a certain number and then try to divide up the representatives amongst the states. Hamilton's method was inflexible, indeterminate, created a lot of political fighting possibilities, which we see today, and favored the small states. Jefferson's method was used from 1790 till right after his death in 1830. The size of the Congress increased from the original Congress In the 1940 census, we adopted the Hamiltonian method, which essentially reduced representation.

18:22What I mean by reduced representation is that each representative in the House represented more and more people. They actually reduced the size of the house by 17 and they forced states to elect members within monopoly districts. At this time, several states still elected representatives at large. So a lot of the good flexible ideas of the past were thrown out as the Hamiltonian vision took over with the 1840 census. And Hamilton's plan essentially stayed intact from 1840 until 1910. The House of Representatives still continued to grow a little bit each year, but it didn't keep up with population.

19:11It grew much slower than during the Jeffersonian period. In 1920, all of this changed. In 1920, there was no reapportionment. There was a big political battle after World War I. The Republicans who were in power essentially didn't want to give the power to the Democrats who were rising in voting strength. A big impasse ensued and nothing was essentially done with reapportionment for the first time. It was called the most notorious and inexcusable anomaly in our democracy. It's something that's never happened before and never happened since. And out of this stalemate came a push to limit the House of Representatives to 435 members, to permanently seal the House at that level.

20:05Now what was it that was necessary to change the basic form of government in the United States in such a drastic fashion? Well it turns out that they were just running out of room. That was the excuse. I didn't feel like they had enough room and that they couldn't build any more buildings to house more than 435 congressmen. They also said that it would threaten the efficiency of Congress if we had more than 435 members. The New York Times actually wanted it smaller. So you're probably getting the drift now of, you know, smaller, bigger, good and bad. Well, in any case, that's basically what happened. The limit was frozen at 435 and representation in this country has fallen dramatically.

20:58I have a little graph here that describes representation, the number of people represented by each house member. Down here is the Jeffersonian period where each representative represented about 30 to 35,000 Americans. You can see it's kind of flat. And then we have a period here where the Hamiltonian method dominates. The number of people per representative rises to over 200,000. And at that point, the size of the House of Representatives is permanently frozen at 435. And, of course, now we're up to the point where each representative represents, or tries to represent, or maybe doesn't try to represent, 600,000 Americans.

21:53And as a result, we've lost control of our Congress. We've lost control of our congressmen. There's been three congressmen in my district in Alabama since I've lived in Alabama, in Alabama, and I've never even been in one of the towns that they've lived in. It's that spread out. Now, if we went back to the old method, the Jeffersonian method, and we looked at the limit of what the Constitution would allow us, because this is still very possible. It would just take a law of Congress or an amendment. We could have as many as 9,000 congressmen. I know that's distasteful, but I'm going to try to put it in a positive light.

22:38For example, one of the things, having 9,000 congressmen in Washington is that I think the New York Times is right. It would harm the efficiency of Congress, but that's a good thing. That's what we want. The second thing is that it would make it very difficult for special interest groups to set up their special interest legislation. They'd have to pay off more than 5,000 congressmen instead of just 200. So it just wouldn't be as much fun anymore. And think of it, the small districts, 30, 40,000 people per district, it would make it a lot cheaper to run for for Congress, the average person could run for Congress because personal reputation would matter more, door-to-door campaigning would matter more, TV ads would be useless, there would be a hundred districts in the city of Atlanta, so no one congressman is going to put TV commercials on the air because you'd be just wasting your money.

23:44So there's a lot of benefits, I think the role of career politicians would be greatly is diminished. There would certainly be no problem with diversity and minority representation. And most importantly of all, you would know your representative and you would know where they lived. And this is the type of control that we need over government. So I'm suggesting to you today that we need to restore the Jeffersonian method, that he was right all along, that We should greatly enlarge the size of the House of Representatives and adopt Jefferson's method. Of course, as with all political solutions, this is not going to cure everything that's gone wrong in Washington D.C. It's not, I certainly would suggest it's the only thing we need to do, but I think it's something that we should do and that would make a big Difference, and we need to bring this issue back out of the Orwellian memory hole and make it a part of American political debate today.