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This election season put before the nation a philosophy that many Americans gobbled up without questioning. That philosophy of "libertarianism" was promoted by Texas Rep. Ron Paul as he sought the Republican presidential nomination. He gathered little numerical support for his philosophy but considerable zeal for what he espoused. But what he proposed doesn't hold up to scrutiny as a solution to the problems of a modern advanced industrial nation or society.The two main thrusts to libertarianism are economic freedom (i.e. deregulation) and no taxes. On other secondary matters, such as reproductive rights, flag burning as protest, separation of church and state, morality, censorship, assembly, association, and dying without government interference, some libertarians may often appear to be closer to liberals than to conservatives, even if they don't recognize that.
This article will deal wish the two main factors of libertarianism; business regulation and paying of taxes (or nonpaying) in which it has a ironclad attachment with far-right conservatism. If there were a modern nation operating on the libertarian philosophy it might be the island nation of Haiti. That nation, is controlled by a small group of wealthy elites, who live separated from the people and pay no taxes on the wealth they gained in a regulation-free economy. Haiti, in which the majority of the population is destitute, is the poorest nation in the Western Hemisphere. The United States began its history as a libertarian nation in which the federal government had limited power of national defense, foreign relations and a uniform monetary system. That was under the Articles of Confederation (1781-89) which failed badly. If libertarianism failed in a simpler 18th Century in a nation of less that 4 million population there is little reason to believe it would succeed in a nation of more than 300 million people in a complicated 21st Century.
On deregulation, we have to look no further on the results of such folly. When I was in graduate school studying constitutional law, one professor stated that all regulations exist to counter evils present in the system, and when those regulations are removed the evils return.
Since the rise of conservative control of our nation, commercial regulations have been repealed or ignored and the evils have come flooding back. Ronald Reagan loosened the oversight on banking during his disastrous reign and we got the savings-and-loan failures and scandals that the taxpayers have had to clean up. After the dust cleared from that Reagan disaster, it was estimated that the cost of getting past Reagan's mess was $500 billion. Anyone with money in a savings account knows about the cost of that cleanup with interest payments close to all-time lows as that $500-billion bill was being paid. Reagan proudly declared that, "Government is not the solution to our problems, government is the problem." He was wrong. The truth is that "Reaganism is not the solution to our problems, Reaganism is the problem."
To see the folly of commercial deregulation we need not look past the frauds and crimes surrounding corporations as Worldcom, Adelphia, Tyco and Healthsouth. In each case, executives of the corporations looted the companies so they could live lives of kingly splendor while those who actually made the money for the companies lost their jobs, careers, homes and retirements. Owners of the corporations, the stockholders, lost much or all of their investments. The frauds and crimes were illustrated by million-dollar birthday parties in foreign lands for the CEO or $6,000 shower curtains in the CEOs home to accompany gold-plated bathroom fixtures.
Now we have the subprime mortgage scandal that threatens the nation's financial health. In this present mess, mortgages were sold under false promises to people who couldn't afford the interest rates that would come years later. The sellers then packaged the mortgages to unload on the financial market and pocket millions for themselves while their victims lost homes, credit ratings and reputation. Financial institutions that wound up holding those unsustainable mortgages were threatened with bankruptcy. Former Federal Reserve chairman Alan Greenspan ignored the looming crisis with the statement that bankers didn't need oversight because they would do nothing to harm the reputation of their industry. He was wrong.
The petroleum industry is now giving us a picture of what could happen when an important segment of commerce runs wild and does as it pleases. While it has apparently broken no laws or regulations, the industry is using speculation on the world petroleum market to enhance its already record profits at the expense of everything else. Family budgets are busted over the cost of gasoline or heating oil, shipping of goods is too expensive for many truckers to make a living, food prices that depend on that trucking are skyrocketing just as everything else that must be moved to market.
For the wonderful world of commercial deregulation and tax freedom we have to look no further than the success of Enron, the giant Texas energy-trading company that collapsed amid scandal and crime. Enron had managed to free itself from regulations and taxes through close affiliation to many politicians, contributing to their elections and helping draw up the energy program for the Bush administration as it took control of the nation in 2001.
Because Enron had successfully escaped taxation, it listed any income it had as profit thereby causing its stock price to soar. Executives then cashed in on the high stock price to enrich themselves while everyone else suffered. Employees lost the jobs, careers, life savings and retirements tied to Enron stock they were forbidden to sell. Investors lost billions.
Enron was free of regulation and used that freedom to engineer power shortages in many markets but even the money it extorted from its victim-customers wasn't enough to prevent its collapse from the crimes it committed under both deregulation and tax freedom.
Business regulations can rightfully be called "economic law and order" but those who want to control our private lives with "law and order" don't want lawful economic behavior, even though we give government power to confront commercial crimes through our Constitution. Deregulation basically enables the dishonest businesses to have an unfair advantage over reputable firms, that then must adopt dishonest practices to compete and we all lose in the process.
And the destruction of unions in America may do something for the economic freedom of the aristocratic elite, it has done nothing for the working class's economic freedom, which should include the freedom from want.
To justify their disastrous actions, conservative libertarians will ever argue that regulations either do no good or actually harm the businesses being regulated.
That's total nonsense. But, if it ever it were true there is a simple solution that wouldn't lead to the disaster deregulation always seems to lead to. Article I, Section 8, paragraph 18, of the Constitution says that all laws are to be "necessary and proper" in order to be constitutionally legal. Corporations have multimillion-dollar legal departments usually devoted to courting and paying politicians to get the harmful deregulation they desire. Corporations could use those legal departments to argue in court that a regulation or series of regulations that do nothing are unnecessary. The overpaid lawyers in those legal departments could argue that a regulation that harms the business is not proper. Any competent judge in America would then void such unnecessary and improper regulation or regulations. It might be less expensive to go to court for a corporation rather than legally "bribe" hundreds of corrupt politicians and we would have a more-honest government in return. But corporations don't go to court on these issues because they know they have no, or few, compelling arguments. It might be noteworthy to observe that George W. Bush has been busy appointing incompetents to the federal bench.
There is an idiotic notion on the "libertarian" far right that there is no law requiring Americans to pay taxes on their incomes. For anyone to believe that they would have to be out of touch with reality.
The United States first imposed an income tax to pay for the Civil War, but that tax was declared unconstitutional by the Supreme Court after the war because it was a direct tax on individuals, forbidden by the Constitution at that time, rather than a tax on the states, based on their population. The states then taxed individuals, which made it an indirect tax from the point of view of the national government, which was constitutional. To pay for World War I, Congress proposed an amendment to legalize an income tax. Congress drafted and passed the proposal, then sent it to the states, which also passed it to make it part of "the supreme law of the land."
But righties of libertarian persuasion want us to believe that Congress then forgot to make a law to collect that tax. The right propagandizes the point constantly, and yet Congress doesn't notice and pass an income-tax collection law? Right-wing nut cases have been arguing, and losing, in court for years that there is no law requiring them to pay an income tax, but still Congress neglects to pass a law to collect the taxes? Are we to believe that of the hundreds of laws concerning taxes that Congress has passed over the years not one requires a tax collection? That we are told to believe even though the Constitution says "The Congress shall have to power to lay and collect taxes on income ..."
Please note, the amendment doesn't specifically say that Americans have to pay the income tax because that statement would be totally superfluous as the 16th is clear in stating that Congress has power to collect income taxes; that is the law. To impede Congress' power of collection, or subvert its intention, is a crime. The Constitution states what government has power to do, not what citizens or residents must do or cannot do.
To counter such a clear statement of purpose, the "libertarian" right-wingers counter by saying that the Fourth Amendment prohibits government from requiring the filing of a tax return without a warrant. But the Fourth says a warrant is required only for "searches and seizures" and a tax return involves neither. If someone lies (perjury) about their taxes, government could send someone to examine all financial papers and information the reluctant taxpayer possesses. When that agent goes to a home or business to look over information and takes those papers for evidence, that is search and seizure, which requires a warrant.
When the righty loses that argument, he or she resorts to the Fifth Amendment, claiming revealing income facts constitutes testifying against oneself. But the Fifth pertains to criminal trials, not collection of information. The Fifth clearly says "criminal cases" and filing a tax return isn't a criminal case. Most Americans are familiar with the phrase in the Miranda decision that "what you say can be used against you" in court. So what you say on a tax return can be used against you in court. Plus, if one is capable of reading between the lines of the Fifth, the clear intention of what James Madison was talking about becomes evident. But when a "libertarian" can't adequately read what is on the lines, reading between them is impossible.
To understand the issue, one must be able to use reasoning. Because of the statement that "Congress shall have the power to lay and collect taxes on income ..." we have to understand that any law based on that statement must also address the power grant in the statement. That is, all laws must empower the collection of taxes, and don't need to state what a taxpayer "must" do, although most do. Congress established the Internal Revenue Service to collect the taxes, and that is all one needs to know.
Libertarians will claim that if they have to pay taxes to sustain the nation in which they live they are being "punished" by the government, usually "punished" for the magnificent success they have created all by themselves. That is a strange argument for it supposes that the very nation whose government created and protects the conditions that allowed this magnificent success doesn't need sustenance to continue conditions for success. And no one ever achieved success completely alone. We all need the society around us to succeed in any way. A business needs customers with purchasing power to succeed. A writer needs publishers to print and readers to read. An actor needs casting directors to offer jobs, producers and directors to make the product, which needs audience members paying money to make it all work. Teachers needs schools and colleges to have a job, and those schools and colleges need students and taxpayers. Insurance salesmen need customers who need insurance. We all need each other.
Then a libertarian refers to taxation as "robbery," which can only be interpreted as meaning that libertarian thinks the United States of America is a criminal entity, the men who wrote the Constitution that authorizes taxation are just a bunch of common thieves and the Constitution itself is a criminal conspiracy. But the Constitution is a creation of, "We the people." As James Madison, father of the Constitution said, "In the compound republic of America, the power surrendered by the people ..." That means we have given to the government the power to tax us. This is not a static one-time grant of power by Americans long dead, it is ongoing grant, and by living in the United States that authority continues to flow constantly from each of us. The only way to stop that flow of authority by an individual is to leave the jurisdiction of the nation receiving the power.
A libertarian wrote in a recent diary that, "To a libertarian the difference between paying a person or company for a good or service one desires and having the government take money by force (against ones will) is obvious." That is nonsense, because by continuing to reside in the United States that libertarian continues to give government power to tax him. That is self taxation, not force, and staying within the jurisdiction of the taxing government is completely voluntary.
Holding valid views of the role the Constitution plays on the issues of commercial regulation and taxation could get one accused by a staunch libertarian of advocating a police state or being a communist.
There is no single definition of "patriotism." To some, waving the American flag or wearing a flag pin on a lapel is patriotism. To others patriotism is howling support for a war regardless of its justification, but that's militarism, not patriotism. Some think patriotism is sporting "I Support Our Troops" on the bumper sticker of a gas-guzzling SUV that keeps us dependent on imported oil. To others patriotism is merely the political party one belongs to or adherence to their political ideology; blindly following a political leader regardless of what kind of, or how many, crimes he commits; shouting down anyone who holds a differing opinion or expressing disdain for anything foreign, even subjecting foreign nations to US demands or control. My definition of patriotism is two-part: putting the needs of the nation ahead of personal interests and strict adherence to the Constitution of the United States (which would include paying taxes, correcting and atoning for national sins and admitting the nation was founded on secular principles not religious). By this definition, no libertarian can be a patriot.
(Author's note: I grew up with libertarians and learned a valuable life lesson from a libertarian family. I became a professional artist in the fifth grade when David Niskanen paid me a nickel to draw a ghost for him on his Halloween greeting card being made in art class at Kenwood Elementary School in Bend, Oregon. David is the younger brother of William Niskanen, one of Robert McNamara's Whiz Kids during the Vietnam War, and who served in the Nixon administration's Office of Management and Budget, was a member of Ronald Reagan's Council of Economic Advisors from 1981 to 1985 and chairman since 1985 of the libertarian Cato Institute in Washington, DC, whose "scholars" have been furnishing crackpot economic theories to right-wing DC politicians for decades, the theories that continually lead us into economic trouble. In fairness, Bill is not a fan of the "starve-the-beast" mantra of the political right and is a balance-the-budget-before-cutting-taxes advocate, but received his doctorate degree in economics at the University of Chicago, another victim of Milton Friedman's economic teachings. The lesson I learned is that "them what got the nickels pay us who got the talents to do for them what they can't do for themselves." As mentioned above, nickel owners need talent possessers just as much as the talented need the nickel dispensers. It is also noteworthy that the Niskanen family, which owned the Trailways bus franchise in Oregon for many years, used the US court system and the economic regulations libertarians love to hate to sue Greyhound Bus Lines for restraint of trade and win a $23-million judgment ~ although probably settling for less in an out-of-court settlement to avoid endless appeals ~ and that represents a whole lot of brand-new nickels.)
We can end with paraphrasing Reagan again by noting that, "Libertarianism will not be the solution to our problems, libertarianism will be the problem."
