(Article changed on February 21, 2013 at 06:12)
SAN FRANCICSCO, Feb. 21, 2013 -- On October 24, 2012, San Francisco District Court Judge William Alsup dismissed a suit seeking findings of misrepresentation by the Treasury, re multi-billion dollar reductions in the public debt, on the grounds that the government had a natural "bully pulpit" right to lie.
This week the plaintiff, Dr. Clifford Johnson, filed an appeal brief in the Ninth Circuit, arguing strongly against this "unprecedented extension of government speech doctrine," and urging the development of a limiting "government deception doctrine." Johnson v. United States Department of the Treasury, No. 12-16775. The government's response is due March 21.
At issue are estimates of the benefit that would accrue to the government if all Federal Reserve $1 bills were replaced with $1 United States coins. Last year, this "coin-swap" was proposed in Senate bill S. 2049. It died in committee.
Johnson, a petitioner for the coin-swap, alleges that the Treasury is complicit in grossly understating the reduction to the public debt that would automatically result from the coin-swap. Assuming the same coin issue and bill retirement schedules as the Government Accountability Office (GAO), Johnson alleges:
"[The Treasury-mentored] 2011 GAO report estimates initial losses for four years, and a net benefit after 30 years of only $5.6 billion, if that. In fact, the government would also benefit from: (a) an early gain of $13.75 billion; (b) a further gain in excess of $30 billion from coins added over the 30 years; and (c) a further $14.5 billion gain from 81.5% of the interest relief per note replaced by a coin. Hence, the net government benefit after 30 years would exceed $58 billion."
Johnson claims that this "matter of accounting fact" falsehood was intended to and obviously does impair his First Amendment right to petition for the coin-swap. He alleges that his message as to the correct amount by which the public debt would be reduced is drowned out by the government's authoritatively published falsified amount, which everyone else -- both for and against the coin-swap --adopts as objective. A footnote in Johnson's brief underscores this, and gives grounds for adding the GAO as a joint defendant:
"On remand, Johnson would add a November, 2012 GAO coin-swap report and hearing. The farcical underestimate persisted, although in March 2012 the GAO's report author and witness [Ms. Lorelei St. James] was directly informed by Johnson of the correct amount, and of this action."
Under the Administrative Procedures Act, Johnson is asking for findings of misrepresentation to remedy the impairment of his right to petition.
Accepting that the government speech doctrine reasonably immunizes "mere misrepresentation" so as to give the government enough "breathing space" to govern, Johnson proposes a four-factor "government-misrepresentation-with-special-circumstances" checklist. (1) The misrepresentation must be a matter of hard categorical or numeric fact. (2) The government must have published it authoritatively, as objective fact. (3) The government must have refused to correct it. (4) Some special further illicit circumstance must apply.
Johnson alleges three such special circumstances. (i) The Treasury misrepresentation is specifically designed to suppress Johnson's viewpoint. (ii) It entails independent violations of the constitution's money and tax clauses. (iii) The official record manifests institutional capture, by the Federal Reserve.
Judge Alsup would have none of it. Assuming that the Treasury is intentionally fostering gross misrepresentations re the public debt in order to defeat the coin-swap proposal, he ruled:
"[Johnson] seeks relief in the form of an injunction whereby this Court would regulate what the Treasury can and cannot say on this subject. This remarkable proposition has no support in the law. Our elected leaders necessarily adopt policy positions. By virtue of their 'bully pulpit,' they necessarily receive more attention than the rest of us. Nonetheless, it cannot possibly be the law that this circumstance violates anyone's right to say whatever they want about public policy. To rule otherwise would invite thousands of lawsuits by those seeking to regulate through the courts what elected officials and their appointees can and cannot say in support of public policy. This would be an unthinkable result. Mr. Johnson's claim is rejected on the merits."