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To put a matress under a falling giant pales in comparison to placing a sign on Wall Street, reading “No giants allowed.”

In April of 2010, President Obama gave a speech in New York City to counter what he called “the furious efforts of industry lobbyists” trying to weaken or kill new financial regulations that he claimed are needed to stave off a second Great Depression.  It is telling that the banks that contributed to the financial crisis of 2008 were trying to diminish any new regulation. The President wanted more consumer protections, limits on the size of banks and the risks they can take, reforms on executive compensation and greater transparency for controversial securities known as derivatives.  He maintained that each of these areas must be in any bill that he signs. In giving the speech with some of the banking titans in the audience, the President wanted to confront the financial industry more directly through a sharp speech. After castigating their “failure of responsibility” in recent years, he called on them to stop resisting tighter regulation through the army of lobbyists now staked out on Capitol Hill. The president’s address at Cooper Union in Lower Manhattan circled back to another speech he had given at the same location in March 2008 warning of financial manipulation, market bubbles and the concentration of economic power.

Analysis:

At the time of his speech, the President was supporting the bills coming out of the House and Senate, neither of which forestall or minimize market bubbles and reduce the concentration of economic power.  Regarding the latter, it is my understanding that nothing in either bill limits the the size of the big banks.  For the President to say that the bill reaching his desk must include something limiting the size of institutions in the US financial sector yet also say that he supports the bills coming out of Congress does not make sense as it involves a contradiction. On the eve of the President’s speech, Fox News pointed out that the President’s chief of staff had met behind closed doors with reps of Wall Street firms. The message was reportedly: we’ve got to trash you in public, but know that we will take care of you in private.  While Fox News was at the time certainly no friend of the President, the account would explain why the President would contradict himself concerning the size issue.   Given the inevitable lag of regulators amid the fast pace of innovation in product development on Wall Street, simply regulating existing products would not forestall another crisis; the concentration of private capital in the form of large banks must be reduced for “too big to fail” to be effectively mitigated.  Sadly, the President will probably get away with demanding limits on the banks’ size while signing bills that do not contain such language.  That he received just under a million dollars from Goldman Sachs in his Presidential campaign is just part of the story, for once elected the President was undoubtedly focused on 2012.  Recalling Andrew Jackson, who successfully took on the bank of the US by refusing to fund it in 1832, and Theodore Roosevelt, who supported the Sherman Anti-trust Act in 1911, I must admit to thinking that Barak Obama does not have their guts to take on the big guys. How many of us in the twenty-first century remember Jackson or Roosevelt?  We are more likely to make our current President the default from which we measure.  I submit that this is a mistake.  If we ignore or are ignorant of the strong points in our history, we cannot benefit from them and we are doomed to repeat the weak points.

Source: http://www.nytimes.com/2010/04/23/business/economy/23prexy.html?hp

The US Senate is “absurd.” So said Katie Connolly of MSNBC in 2010.  She was referring to Sen Shelby (R-AL) being able to singlehandedly place a hold on all pending nominations.  Citing a congressional scholar, Johathan Chait noted that a blanket hold has never been used before. Connolly argued that Shelb was doing it “because he wants a European corporation to build some planes in his state.”  Such a reason would be ubiquitous if not squalid enough in either body of the US Congress, so it is certainly plausable.  One might recall the money Sen. Ben Nelson got for Nebraska by agreeing to the health care reform bill.  In needing all 60 votes from the democrats and two independents, that bill gave us all a reminder of what an international body is like where each member has a veto.  In singlehandedly blocking all pending nominations before the US Senate, Sen Shelby was drawing on this theory as well.  While it is easy to trounce on each Senator (or each state) having a veto, I would argue that it is far less sordid than Shelby’s reason (i.e., more pork).  Because every state in the Union is semi-sovereign (and enjoys residual sovereignty as per the tenth amendment), there is constitutional support for any state represented in the US Senate having a veto on any legislation or appointment.  Because the veto is based on governmental sovereignty (i.e., the US Senate being in this respect an international body—unlike the US House), Alabama can use its veto even for reasons we might find disgusting.

So if each Senator (who represents his or her state as a political body even though he or she is elected by the citizens of his or her state) having a veto makes the US Senate “absurd” (and I join with those who are frustrated by it), we might want to consider the consequences that would be involved in depriving the political members of the Union of their vetos in the General Government (ie., Washington).  We could expect an acceleration in the consolidation of power in the General Government at the expense of the state governments—resulting in one size fits all in a heterogenous empire-scale Union (i.e., empire).  Any state government objecting to Washington taking over yet another domain of power would be powerless to stop that train without breaks running down the tracks toward a central state.  Meanwhile, that train would be able to pass more legislation through the US Senate, further accelerating its speed.

Some time back, I asked Sandra Day O’Connor of the US Supreme Court why she wasn’t objecting to the US Government going beyond its enumerated powers.  She replied to the small group that Congress was acting like a state legislature.  Disgust was palpable in her voice.  In a sense of futility, she added that it takes five on the US Supreme Court to have a majority decision (meaning that a majority would not go along with her on the enumerated powers matter).   You might be wondering what is wrong with Congress acting like a state legislature. The problem is that the US is in scale (and its make-up) commensurate with an empire by today’s standards.  In other words, most of our states are equivalent to countries.  You just can’t (or shouldn’t) run a combination of countries as though it were one country.  For one thing, a combo is inherently diverse.  Also, its center is further from the people.  It means less democracy or republican principles of representation because there are far fewer US Reps and Senators than state Reps and Senators.  Also, the US Government is designed as an empire-level polity.  Whereas the states’ Senates represent citizens (just as the states’ assemblies do), the US Senate (unlike the US House) represents political entities (the states) rather than US citizens.  In other words, both US citizens and US states are members of the US.  The US Government isn’t fashioned like a state government because the Union is a combination of such states (whereas a state is not a combo of republics in turn).

So we ought to be very careful about kneejerk reactions to fix the “absurd” US Senate.  To be sure, holding up appointments to get pork is squalid even by a pig’s standards, but turning the US Senate into a state senate would drastically alter what the US are.   Even though we use “the US” as a singular noun, the entity itself and its government were formed and designed with it as a plural noun (the states) in mind.  The US constitutional convention delegates invented modern federalism to suit this new genus of an empire: the Union.  The EU has since come into being along similar principles because it is of the same genus.  To treat either the US or EU as though it were commensurate with one of its states would be to treat something other than what it is.  That can only lead to a downfall.   So perhaps rather than change the US Senate to fit our understanding, we might alter our understanding to fit what the US are. This would entail taking the pressure off of the US Senate by returning most of the domestic legislation to the state governments (where there is more democracy).  Consider the coherence in having the US Senate  mainly involved in foreign policy (and regulating between the states) and having a filibuster (which is close to the principle of international organization).  That is, the state governments meet in the US Senate technically on an international basis. Moreover, the U.S. Constitution forms a hybrid between or composed of international and national governance.  This unique situs fits with the empire-scale of the United States, especially as they have expanded to fifty. 
Treating the US Senate as a state legislature…legislating on everything from healthcare to education…is a gross departure from this coherence.  It is indeed absurd—only we have the arrows reversed.  It is our use of the US Senate that is absurd—not the Senate’s principles (even though they can be abused, such as by Nebraska and Alabama). Treating the US Senate (and the Union) as other than what it is can only lead to the fall of our empire…our Union of States. To be sure, every empire that rises must fall.  So why write?  I’m merely trying to stay the fall a bit, but the outcome is certain.  In the meantime, let’s not help it along.  This will take more humility and much less presumptuousness in what we think we know about our system of public governance.  With more humility, perhaps more of us will be content to get involved in our state governments.  As it is, we overlook them and advocate changing the US Senate into our own image of what it should be, presuming the extant Senate is "absurd" (perhaps it is sheer hubris to make such a summary judgement?).
Source: http://blog.newsweek.com/blogs/thegaggle/archive/2010/02/05/need-more-evidence-the-senate-is-absurd-look-no-further.aspx

WASHINGTON - Republican leaders expressed renewed skepticism Tuesday about President Barack Obama’s call for a bipartisan forum on health care, raising questions about how much can be achieved at the televised event later this month. “This is a clever tactic by the president to try to put the Republicans on the defensive,” said John Feehery, a GOP consultant and former congressional aide. With the two sides at such odds, some Republican activists privately worry that their party’s leaders might be walking into a trap on Feb. 25 designed to portray their health care proposals as thin. The House’s top two Republican leaders openly questioned Obama’s sincerity and hinted they might skip the meeting if he uses the Democratic bills as the starting point for discussions.

Analysis: 

The problem may well be that President Obama is trying to have his cake and eat it too—meaning that he is trying to draw on the credibility of a head of state (i.e., a neutral party who is presiding) while at the same time being the captain of one of the partisan teams.  This is a structural conflict of interest that is centered in having the head of state also be the head of one of the contending political parties.  Even in how he characterizes what is not bipartisanship, his bias is palpable. “Being bipartisan cannot mean that Democrats give up everything they believe in, find the handful of things that Republicans have been advocating for, and we do those things, and then we have bipartisanship.”  To make such a statement literally from the presidential podium undercuts the presiding nature of the office.  To consistently side with one side in a house over which one is presiding undercuts one’s credibility to preside.  In presiding, one is looking out for the good of the whole, and coming down on one side or the other can legitimately only be done when the whole is in jeopardy.  Hence, Andrew Jackson came down against Congressional encroachment on the states in vetoing a Congressional appropriation for a road completely within Missouri’s borders; he feared the precedent would ruin the system of federalism (which must be balanced to be viable). Shortly thereafter, he sent the US Army down to South Carolina after it passed the Nullification Acts by which the South Carolina government claimed it could nullify any federal law that was not in the state’s interest.  Jackson’s involvement in taking sides was both for the states and the federal government because his only criterion was the long term viability of the Union.  To take sides on lesser matters tends to reduce one to an ideology, hence to one of the partisan groups.  This undercuts the credibility of the presiding officer for people in the other parties.  To “spend” that credibility for expedient purposes (an ideological agenda)—trying to get the most out of the power of the office—is to lose the kind of power that the office of the US Presidency was designed to have.  No wonder most occupants of the office have failed.  Barak Obama on health care is only the latest. Had Barak pushed the need for health-care reform without taking sides as the legislators debate possible plans, he would be treated as much more credible in hosting a meeting.  In other words, the seriousness of the conflict of interest can be gaged by the trepidation of the Republican leaders.  A partisan evoking the credibility of a figure head is inherently duplicitous and bound to lead to failure.

Source: http://www.msnbc.msn.com/id/35313584/ns/politics-health_care_reform/

Secondary Source: http://www.nytimes.com/2010/02/10/us/politics/10obama.html?hpw

A Republican US President pushes hard for the US Government to play a more active role in K-12 education via “No Child Left Behind.”  A Democratic US President pushes hard for the US Government to play a more active role in health-care.  In regard to the latter, proponents of the health-insurance law argue that Congress acted within its authority under the Constitution’s Commerce Clause.  However, Ken Cuccinelli, the attorney general of Virginia, says the U.S. Supreme Court has never ruled that the clause allows Congress to require citizens to purchase a good or service like health insurance. Cuccinelli’s complaint also argues that the Virginia law that outlaws the federal government from forcing state residents to purchase health insurance trumps the federal law because it is a matter assigned to the states under the Constitution’s 10th Amendment. That amendment says that all powers not explicitly granted to the federal government remain with the states.

In spite of being semi-sovereign (plus having the residual sovereignty beyond that which is enumerated for them and for the US Government), the State governments have generally been sleeping through federal encroachments for decades.  This is understandable, as past efforts to thwart federal encroachment have failed.

In 1830, Andrew Jackson sent federal troops into South Carolina because its legislature had decided that it could nullify federal law encroaching on its domains of governmental sovereignty.  The South Carolina legislature relented (though its succession document would be retreived in 1858 after the Congress passed a tariff on rice and cotton exports).

In 2010, one would think that the lesson against nullification had suddenly been lost on several of the State governments.  In March, the Senate defeated an amendment that would have allowed states to opt out of the health-insurance requirement.  Yet the governor of Virginia signed the nullification bill into law nonetheless.  The policy argument against nullification stresses that state opt-outs would reduce the size of the insurance pool and thus preempt the anticipated cost-savings.  There is also the point that if access to health-care is indeed a redistributionist right, then it could be argued that it ought to exist in the entire Union.  However, such a right could be argued to be basic law, and thus requiring an amendment to the US Constitution.  Alternatively, it could be argued that the determination of whether a right is involved ought to reside with the states.  In terms supremacy and nullification, if the power to require health-insurance is not within the commerce clause, then the federal law would not override state laws to the contrary.  However, it is commonly thought that preemption and supremacy go with any US law.  Yet this has not stopped states from reasserting their constitutional prerogatives.

Gov. Mike Rounds of South Dakota, a Republican, signed a bill into law on March 12, 2010 declaring that the federal regulation of firearms is invalid if a weapon is made and used in South Dakota. On the day before, Wyoming’s governor, Dave Freudenthal, a Democrat, had signed a similar bill for that state. The same day, Oklahoma’s House of Representatives approved a resolution that Oklahomans should be able to vote on a state constitutional amendment allowing them to opt out of the federal health care overhaul. In Utah, lawmakers embraced states’ rights with a vengeance in the final days of the legislative session that week. One measure said Congress and the federal government could not carry out health care reform, not in Utah anyway, without approval of the Legislature. Another bill declared state authority to take federal lands under the eminent domain process. A resolution asserted the “inviolable sovereignty of the State of Utah under the Tenth Amendment to the Constitution.” Alabama, Tennessee and Washington are considering bills or constitutional amendments that would assert local police powers to be supreme over the federal authority. Rhode Island, Vermont and Wisconsin — none of them known as conservative bastions — are considering bills that would authorize, or require, governors to recall or take control of National Guard troops, asserting that federal calls to active duty have exceeded federal authority.

Given the Nullification Crisis in the nineteenth century, the actions in the twenty-first seem likely to be dismissed by US Supreme Court. Given the structural conflict of interest, the federal high court has tended historically to interpret the Constitution in the federal government’s favor. It is like having a member of one of the teams as the umpire.  So it is easy to dismiss the state laws as political theater.  However, ignoring them would only stoke the fires of resentment and add to the pressure that could eventually dissipate the Union.

“Everything we’ve tried to keep the federal government confined to rational limits has been a failure, an utter, unrelenting failure — so why not try something else?” said Thomas E. Woods Jr., a senior fellow at the Ludwig von Mises Institute, a nonprofit group in Auburn, Alabama.  Article 6 of the US Constitution indicates that federal law is superior over state law where there is a conflict, but it wouldn’t make sense for this to apply outside of the federal government’s enumerated powers—for otherwise why even include the latter?  In other words, a constitution cannot be both consolidated and federal with the republics having some governmental sovereignty, or autonomy, from the government of the Union.  We can’t rely on elections to protect the balance of power necessary for our federal system to remain federal (and thus operate as a check on each government); there are too many other contending issues and character traits at issue in a given election.  “Whether the political impulse of states’ rights and nullification will become a direct political fault line in the national elections this fall is uncertain,” said Mr. Woods of the von Mises institute. Also, drawing the federal dividing-line by election presumes that the people understand federalism.  Even so representatives pushing for more of a balance miss it. “Who is the sovereign, the state or the federal government?” said State Representative Chris N. Herrod, a Republican from Provo, Utah.  In actuality, both governments have governmental sovereignty in the American federal system.  It is not “either or.”

States opting out is not unprecedented in federalism.  In the EU, for example, three States have opted out of the EU’s currency.  One State has opted out of the EU’s social program.  If the US Supreme Court will not allow us to do likewise, we can propose and ratify an amendment to the US Constitution instituting a process for it.  If we deem that as insufficient to restore a balance, we can propose and ratify an amendment stating that the supremacy and spending clauses pertain only to the powers that are enumerated expressly for the US Government.  Lastly, we can propose and ratify an amendment that puts sitting State Supreme Court Justices on the US Supreme Court (on a rotating or nominated basis) so to counter the conflict of interest in having a federal branch being the umpire on conflicts involving federalism questions.  The deck, as it were, is presently stacked against a healthy federal system in favor of a consolidated Union.  The individual republics standing up in protest by passing laws that will likely be cut down by the US Government Court may be counterproductive because people might assume the efforts are sufficient and go on to other things.  Proposing and ratifying amendments to the federal system take a lot of energy—it would be ashamed to dissipate it just when it could be used for structural changes…systemic change…real change.

Sources: http://www.msnbc.msn.com/id/35906430/ns/politics-the_new_york_times// ; http://politicalticker.blogs.cnn.com/2010/03/24/virginia-governor-to-sign-law-firing-back-at-health-care-bill/?fbid=UERb4EI-c6a#more-96318

I've been following politics less now that Obama has caved on his campaign pledge (or promise) not to extend the bush tax cuts for the rich.  The added growth expected in 2011 from ALL of the cuts is just a half of a percent of GNP growth.  I have read that the rich save their tax cuts rather than use them in ways that stimuate the economy.  As for savings, banks have enough capital to lend (this isn't why they are still skittish in 2010).  That the vacuous argument that tax cuts for the rich will somehow create lots of jobs and save the economy from another recession has had <em>any</em> weight or credance really discourages me about American political discourse.  That Obama didn't "just say no" is also discouraging. On December 14, 2010, Pat O'Reilly said on his Foxs News show that the "far left" is in retreat because Ameriicans have rejected it.  He said even Obama has rejected the left. I think the left has vanquished itself.  Perhaps it could be said that the left is willingly impotent. Where is Al Gore?  Ralph Nadar?  Micheal Moore?  silence.  Only the sound of Obama caving. He should have refused to sign a tax cut continuation for the rich and said the Repubs could refuse to extend the cut for lower and middle income people--it would be the Repubs provoking the resumption of higher taxes for everyone rather than just on those who can afford them.  We need a Teddy Roosevelt or an Andrew Jackson. Teddy stood up to Standard Oil, and Jackson stood up to the Second Bank of the United States. By contrast, Obama has operated largely in line with Wall Street (e.g., the bailout for the banks rather than foreclosed homeowners) and the health insurance industry (e.g. not even a public option, which was odious to the industry).  Barak Obama does not want to displease the powers that be; I suspect reelection has a lot to do with this state of affairs.  This raises the question: is there a counter in American politics to the selfishness of property?