The Crux: Federal vs State

Unconstitutional Spending

John Tamny, 11.30.09, 12:01 AM ET

The U.S. Constitution's 10th Amendment is arguably the most important of all the amendments in the brilliant document that helped shape the United States. The 10th amendment made plain that "the powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."

What the 10th amendment tells us is that the powers of the federal government are quite limited, and that any powers not enumerated to Washington in the first nine amendments automatically revert to the states. This was the founders' way of keeping the federal government small so that individuals could choose the kind of government they wanted based on the state in which they chose to live.

Of course, with politicians on both sides of the aisle driven by incentives that have told them to ignore the 10th amendment, Americans suffer under laws and bureaucracies created in Washington that would not exist had politicians adhered to the Constitution's limiting ways. Simply put, nothing in the Constitution allows for the existence of the Departments of Education, Commerce and Energy (to name a few), government-sponsored entities such as Fannie Mae and Freddie Mac, or ineffective bureaucracies such as the SEC and the FDA.

Throughout this decade, under Presidents Bush and Obama, economic "stimulus" packages have similarly been foisted on the U.S. economy by a federal government possessing nothing not already taxed or borrowed from the private sector. Nothing in the Constitution mentions "economic growth" as one of the federal government's powers--the founders knew that with freedom came economic growth--but politicians being politicians, they've never let economic crises of their own making go to waste--Constitution be damned.

Where simple spending is considered, Washington's disdain for the Constitution becomes even more unsettling. As the Heritage Foundation's Brian Riedl recently noted in the Washington Times, federal spending includes $2.6 million for the training of "Chinese prostitutes to drink more responsibly on the job," $3.9 million for the SEC to rearrange "desks and offices at its Washington headquarters" and nearly $1 million for the shipping of "two 19-cent washers from South Carolina to Texas," along with the improper use of government credit cards for the purchase of goods including "lingerie, iPods, XBoxes, jewelry, Internet dating services and Hawaiian vacations."

Clearly none of this wasteful spending was needed for the federal government to handle the very limited powers enumerated to it by the Constitution, and that was the whole point of the 10th amendment. Washington's powers would be limited so that citizens could choose their governments locally while keeping an eye on their activities.

That there were no federal income taxes until early in the 20th century was a certain offshoot of the meaning of the 10th amendment. The Founders' knew well that governments only grow, so in explicitly limiting the role of the federal government in our lives, citizens could wisely choose the government regime (and the level of taxation) they would live under. If lots of services and powerful politicians floated their boats, they could live in New York, while if they wanted to live in a state that spent and taxed much less, they could, for instance, move to Texas.

With government activities and spending based locally, Americans were essentially free to choose how much or how little power they would hand over. The federal tax burden was meant to be the smallest of all, precisely because the Constitution made plain that Washington's powers would once again be limited to what the first nine amendments allowed.

At present, the vision of the founders has been turned on its head. Rather than being able to choose the government of their liking on a state-by-state or city-by-city basis, Americans are captives of a federal government that has blatantly ignored the Constitution on the way to ascribing itself myriad powers and a taxing authority meant to pay for activities that, at best, should be left to cities and states.

This should be remembered the next time there's a discussion of federal taxation in the U.S. Indeed, while the freedom-loving may long for a simplified federal flat tax, in ascribing the power of taxation to the federal government to pay for all sorts of unconstitutional programs, we are blindly handing Washington powers never intended for it.

The better path at this point would be for all of us to demand more from our elected leadership. Specifically, we should demand that they cease talking of reduced federal spending and taxes in favor of a real discussion of the proper role of the federal government itself. Politicians need to be reminded that the Constitution is real, and that as opposed to reducing various programs that are unconstitutional, those programs should be abolished.

So while the level of federal taxation is important when it comes to economic growth, it to some degree misses the point. Federal spending is an equally huge burden on the economy for Washington taxing and borrowing from the private sector in order to fund initiatives that a proper reading of the Constitution would not allow.

In short, if we truly desire a greatly reduced tax burden, it's well past time we force politicians to consider the constitutionality of the various spending programs and bureaucracies that burden us. Only then will we see power returned to the cities and states such that levels of taxation actually decline.

John Tamny is editor of RealClearMarkets, a senior economist with H.C. Wainwright Economics and a senior economic adviser to Toreador Research and Trading. He writes a weekly column for Forbes.

Constitutionally Correct vs Politically Correct

From the Horses' Mouths: The 'Politically Correct' View of Our Founders by Bob Heinritz Posted 11/24/2009 ET "The right of having and using arms for self-preservation and defense is justly called the primary law of nature, so it is not, neither can it be in fact, taken away by the law of society." Blackstone, Commentaries on the Laws of England. "Arms in the hands of individual citizens may be used at individual discretion...in private self-defense." John Adams, A Defense of the Constitutions (1787-88). "The Constitution shall never be construed to prevent the people of the United States who are peaceable citizens from keeping their own arms." Samuel Adams, during Massachusetts' U.S. Constitution Ratification Convention (1788). "The Constitution preserves the advantage of being armed which Americans possess over the people of almost every other nation...(where) the governments are afraid to trust the people with arms." James Madison, The Federalist #46. "Firearms stand next in importance to the Constitution itself. They are the American people's liberty teeth and keystone under independence." George Washington. "No free man shall ever be debarred the use of arms." Thomas Jefferson, Proposed Virginia Constitution (1776), Jefferson Papers 344 (J. Boyd, ed. 1950). "The great object is, that every man be armed...Everyone who is able may have a gun..." Patrick Henry, 3 Elliott Debates 386. "Arms discourage and keep the invader and plunderer in awe, and preserve order in the world as well as property. Horrid mischief would ensue were the law-abiding deprived of the use of them." Thomas Paine, Thoughts on Defensive War (1775). "Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. Whenever you give up that force, you are ruined." Patrick Henry, during Virginia's ratification convention (1788). "Before a standing army can rule, the people must be disarmed; as they are in almost every kingdom in Europe. The supreme power in America can not enforce unjust laws by the sword, because the whole body of the people are armed, and constitute a force superior to any band of regular troops that can be, on any pretense, raised in the United States." Noah Webster, An Examination Into the Leading Principals of the Federal Constitution (1787). "To disarm the people; that it was the best and most effectual way to enslave them..." George Mason, 3 Elliott Debates (on the Constitution) 380. MILITIA "A militia, when properly formed, are in fact the people themselves...and include all men capable of bearing arms. To preserve liberty it is essential that the whole body of people always possess arms..." Richard Henry Lee, Additional letters from The Federal Farmer 53 (1788). "I ask, sir, what is the militia? It is the whole people...To disarm the people is the best and most effectual way to enslave them." George Mason, during Virginia's ratification convention (1788). "Congress has no power to disarm the militia. Their swords, and every other terrible implement of the soldier, are the birth-right of an American...The unlimited power of the sword is not in the hands of either the federal or state governments, but, where I trust in God it will ever remain, in the hands of the people." Tench Coxe, Pennsylvania Gazette, February 20, 1788. Current law: "The militia of the United States consists of all able-bodied males at least 17 years of age. The classes of the militia are (1) the organized militia, which consists of the National Guard, and (2) the unorganized militia, which consists of the members on the militia who are not members of the National Guard." Title 10, Section 311(a) of the United States Code. "On every question of construction let us carry ourselves back to the time when the Constitution was adopted, recollect the spirit manifested in the debates, and instead of trying to determine what meaning can be squeezed out of the text, or invented against it, conform to the probable one in which it was passed." Thomas Jefferson. "VALUES" REGARDING OUR GOVERNMENT "We have staked the whole future of the American civilization, not upon the power of the government (but) upon the capacity of each and all of us to govern ourselves, to control ourselves, to sustain ourselves according to the Ten Commandments of God." James Madison. "Our Constitution was made for a moral and religious people. It is wholly inadequate for the governance of any others." John Adams. "I feel no anxiety at the large armament designed against us. The remarkable interposition of Heaven in our favor can not be too gratefully acknowledged. He who fed the Israelites in the wilderness, who clothed the lilies in the field, and who feeds the young ravens when they cry...will not forsake a people engaged in so righteous a cause...if we remember His loving kindness." Abigail Adams, June 18, 1776. "As one studies history, especially the history of the Western Hemisphere, it is difficult to dismiss the premise that God had a plan for America." George Will. "Men by their constitutions are naturally divided into two parties: 1) Those who fear and distrust the people 2) Those who identify themselves with the people, have confidence in them, cherish and consider them as the most honest and safe depository of the public interest." Thomas Jefferson. "A government which does not trust its citizens to be armed is not itself to be trusted." Niccolo Machiavelli. "They that give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety." Benjamin Franklin, Historical Review of Pennsylvania (1759). "In Switzerland, where the citizens are most armed, they are most free." Niccolo Machiavelli. "When firearms go, all goes. We need them every hour." George Washington. MORE RECENT QUOTES "The State, in its criminal code, forbids citizens to have firearms or other weapons, but does not undertake to defend them." Alexander Solzhenitsyn, The Gulag Archipelago. "I blame the deaths of my parents on those legislators who deny me my right to defend myself." Dr. Suzanna Gratia Hupp (referring to the incident at Luby's cafe in Killeen, TX, in which a murderer killed her parents and 22 other people in her presence). "The most foolish mistake we could possibly make would be to permit the conquered Eastern peoples to have arms. History teaches us that all conquerors who have allowed their subject races to carry arms have prepared their own downfall by doing so." Adolph Hitler, Hitler's Table-Talk at the Fuhrer's Headquarters, 1941-1942. "Those who can not remember the past are condemned to repeat it." George Santayana. "Gun registration is not enough." Attorney General, Janet Reno, December 10, 1993 (A.P.). "The most effective means of fighting crime in the United States is to outlaw the possession of any type of firearm by the civilian population." Attorney General, Janet Reno, 1991 speech to B'nai B'rith in Fort Lauderdale (St. Louis Post-Dispatch, August 25, 1996, p. 3B). "What good does it do to ban some guns? All guns should be banned." Sen. Howard Metzanbaum. "Our task of creating a socialist America can only succeed when those who would resist us have been totally disarmed." Sara Brady, Chairman, Handgun Control, to Sen.Howard Metzanbaum, The National Educator, January 1994, p. 3. "We're going to have to take this one step at a time, and the first step is necessarily— given the political realities— going to be very modest. Our ultimate goal—total control of all guns—is going to take time. The first problem is to slow down the increasing number of handguns being produced and sold in this country. The second problem is to get handguns registered, and the final problem is to make possession of all handguns, and all handgun ammunition totally illegal." Nelson T. (Pete) Shields, III, founding Chair of Handgun Control, Inc. "The only real justification (for the assault weapons ban) is not to reduce crime but to desensitize the public to the regulation of weapons in preparation for their ultimate confiscation." Charles Krauthammer, "To Control Crime, Control Guns" (St. Louis Post-Dispatch, April 7, 1996, p.3B, emphasis added). "There are more instances of abridgment of freedom of the people by gradual and silent encroachments...than by violent and sudden usurpations." James Madison, June 16, 1788. "All military type firearms are to be handed in immediately...The S.S., S.A., and Stahlhelm give every respectable German man the opportunity of campaigning with them, therefore, anyone who does not belong to one of the above organizations and who unjustifiably keeps his weapon...must be regarded as an enemy of the national government." SA Oberfuhrer of Bad Tolz (March, 1933). "I see creeping fascism in America, just as in Germany, a drip at a time: a law here, a law there, all supposedly passed to protect the public. The German people really believed that only hoodlums owned such (unregistered) guns. What fools we were. It truly frightens me to see how the government, media, and some police groups in America are pushing for the same mindset." Theodore Haas, survivor of Dachau and the Holocaust. "The authority of the (state) is not limited by checks and controls, by special autonomous bodies or individual rights. The concept of personal liberties of the individual as opposed to the authority of the state had to disappear. There are no personal liberties of the individual which fall outside of the realm of the state. The Constitution is therefore not based upon a system of inborn and inalienable rights of the individual." Ernst Huber, 1933 speech to National Socialist Workers (NAZI) Party, quoted in The Ominous Parallels, Leonard Peikoff (Stein & Day, N.Y. 1982) p.6. "Citizens! Turn in your weapons." English translation of Soviet Union Poster (1919). "Armas para que?" ("Guns for what?") Fidel Castro, 1959, in a speech urging the people to turn in their guns because they were no longer needed with him in control. "In today's Cuba, only those who hold absolute power over the people are armed." Max Jorge (Cuban exile). Contrast with: "There is only one fundamental right (all the others are its consequences or corollaries): A man's right to his own life. The Bill of Rights was not directed against private citizens, but against the government— as an explicit declaration that individ-ual rights supersede any public or social power." Ayn Rand, "Man's Rights," The Virtue of Selfishness, at 108, 110-112 (Signet Books, N.Y., 1970). "The strength of the Constitution lies entirely in the determination of each citizen to defend it. Only if every single citizen feels duty bound to do his share in this defense are constitutional rights secure." Albert Einstein. "The right of the citizens to bear arms is just one more guarantee against arbit-rary government, one more safeguard against a tyranny which now appears remote in America, but which historically had proved to be always possible." Senator Hubert Humphrey. "Freedom is never more than one generation away from extinction." Ronald Reagan. BACK TO THE FUTURE? "You need only reflect that one of the best ways to get yourself a reputation as a dangerous citizen these days is to go around repeating the very phrases which our founding fathers used in their struggle for independence." Charles A. Beard. THERE IS NO "NEW" WISDOM! Thomas Jefferson carefully hand-copied the following passage into his personal journal from renown 18th century criminologist, Cesare Beccaria, On Crimes and Punishment, 87-88 (Henry Palolucci trans., 1964. 1764). Beccaria is generally regarded as the founder of criminology. The complete quotation, without editing: "False is the idea of utility that sacrifices a thousand real advantages for one imaginary of trifling inconvenience; that would take fire from men because it burns, and water because one may drown in it; that has no remedy for evil, except destruction. The laws that forbid the carrying of arms are laws of such a nature. They disarm those only who are neither inclined nor determined to commit crimes. Can it be supposed that those who have the courage to violate the most sacred laws of humanity, the most important of the code, will respect the less important and arbitrary ones, which can be violated with ease and impunity, and which, if strictly obeyed, would put an end to personal liberty -- so dear to men, so dear to the enlightened legislator -- and subject innocent persons to all the vexations that the guilty alone ought to suffer? Such laws make things worse for the assaulted and better for the assailants; they serve rather to encourage than prevent homicides, for an unarmed man may be attacked with greater confidence than an armed man. They ought to be designated as laws not preventive but fearful of crimes, produced by the tumultuous impression of a few isolated facts, and not by thoughtful consideration of the inconveniences and advantages of a universal decree." (Emphasis added.) FROM: THE DECLARATION OF INDEPENDENCE Second Continental Congress July 4, 1776 "We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed." Unanimous Declaration of the Second Continental Congress. Bob Heinritz is an honors graduate in management, economics, law and a member of the Bar of the states of Arizona, Illinois and Missouri. He is a former trial lawyer, and now is a business attorney and management consultant, specializing in strategic planning, productivity and business turnarounds.

Liberal Judicial Overreach - A Prime Example

Health Care Mandate is Consitutional

By Ruth Marcus

WASHINGTON -- Is Congress going through the ordeal of trying to enact health care reform only to have one of the main pillars -- requiring individuals to obtain insurance -- declared unconstitutional? An interesting debate for a constitutional law seminar. In the real world, not a big worry.

"This issue is not serious," says Walter Dellinger, acting solicitor general during the Clinton administration.

But it's being taken seriously in some quarters, so it's worth explaining where the Constitution grants Congress the authority to impose an individual mandate. There are two short answers: the power to regulate interstate commerce and the power to tax.

First, the Commerce Clause. Spending on health care consumes 16 percent --and growing -- of the gross national product. There is hardly an individual activity with greater effect on commerce than the consumption of health care.

If you arrive uninsured at an emergency room, that has ripple effects through the national economy -- driving up costs and premiums for everyone. If you choose to go without insurance, that limits the size of the pool of insured individuals and -- assuming you are young and healthy -- drives up premium costs.

The clause empowers Congress "to regulate commerce ... among the several states," which may not sound terribly sweeping. But since the New Deal, the Supreme Court has interpreted this authority to cover local activities with national implications.

In the 1942 case of Wickard v. Filburn, the justices ruled that even though an activity may "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."

Thus, the court said, Congress was entitled to tell Roscoe Filburn how much wheat he could grow to feed his own chickens. Surely, then, Congress could require Filburn's grandson to buy health insurance.

The court has narrowed the reach of the Commerce Clause in recent years -- but also reaffirmed Wickard. The times it has found that Congress overstepped involved situations where the connection to interstate commerce was strained: carrying guns near schools or engaging in gender-based violence.

In United States v. Lopez, the court found that the Gun-Free School Zones Act "is not an essential part of a larger regulation of economic activity, in which the regulatory scheme could be undercut unless the intrastate activity were regulated."

The individual mandate is "the mirror image of Lopez as a Commerce Clause case," says Harvard Law School professor Laurence Tribe.

Granted, there is a difference between regulating an activity that an individual chooses to engage in and requiring an individual to purchase a good or service. Granted, too, there is a difference between making automobile insurance compulsory, as a condition of the privilege to drive a car, and making health insurance compulsory, whether an individual wants it or not.

But the individual mandate is central to the larger effort to reform the insurance market. Congress may not be empowered to order everyone to go shopping to boost the economy. Yet health insurance is so central to health care, and the individual mandate so entwined with the effort to reform the system, that this seems like a different, perhaps unique, case.

Congress clearly has authority to, in effect, require employees to purchase health insurance for their old age by imposing a payroll tax to fund Medicare. It's odd for the same conservatives bemoaning a government takeover of health care to complain about requiring that people turn to the private marketplace.

Which brings us to the alternative source of congressional authority, the "Power to lay and collect Taxes, Duties, Imposts and Excises."

The individual mandate is to be administered through the tax code: On their forms, taxpayers will have to submit evidence of adequate insurance or, unless they qualify for a hardship exemption, pay a penalty.

Yale Law School professor Jack Balkin likens this to Congress raising money for environmental programs by taxing polluters. "Congress is entitled to raise revenues from persons whose actions specifically contribute to a social problem that Congress seeks to remedy through new government programs," he concludes.

Balkin cites a 1950 Supreme Court case upholding a tax on marijuana distributors. "It is beyond serious question that a tax does not cease to be valid merely because it regulates, discourages, or even definitely deters the activities taxed," the court said. "The principle applies even though the revenue obtained is obviously negligible, or the revenue purpose of the tax may be secondary."

Sounds like the individual mandate to me. (Did you follow that logic?-Steve)

Copyright 2009, Washington Post Writers Group

Healthcare - A Right?

Do We Have a Right to Equal Healthcare?

by Carson Holloway

November 24, 2009

Calls for health-care reform confuse the basic right to healthcare and a desire for healthcare that is in all ways equal.

The liberal argument for the Democratic healthcare proposals currently before Congress depends for its force on the claim that healthcare is a right. The case for such reforms begins from the observation that some Americans cannot afford to purchase health insurance, which is important to getting healthcare. These bare facts, however, do little to make the current proposals seem compelling. After all, it can be said of many good things in life that many Americans—and indeed many people in any free economy—cannot afford them. Accordingly, liberals are forced to suggest that this factual situation presents an injustice because healthcare is a right.

The most obvious response available for those who oppose the proposals before Congress is to deny that healthcare is a right, or at least that it is a right in the sense implied by liberals. Opponents of Democratic healthcare reforms could contend that healthcare is not, as liberals imply, a positive right, a right that obligates society to take positive steps to provide something for those who cannot attain it by their own efforts. This argument might suggest that healthcare is properly understood only as a negative right, a right that obliges society to stand aside and not impede individuals in their pursuit of something by their own means. On this understanding, the argument would continue, the right to healthcare is already established in America. All Americans are free to seek healthcare without artificial restraint and to purchase as much as they can afford.

Such a response might at first appear attractive because of its clarity and simplicity, as well as its tendency to confine government to a strictly limited role. Nevertheless, these opponents should not embrace a wholesale denial that healthcare is a positive right. Taken to its logical conclusion, the insistence that healthcare is only a negative right would lead us to conclude that nothing wrong happens when someone is denied life-saving medical care simply because he cannot afford to pay for it. Most Americans—even those who are most committed to individualism and strictly limited government—sense that there is an intrinsic dignity in the human person that requires society to render him some positive aid, at least in his necessities, when society can afford to do so. It would be ridiculous to deny, however, that healthcare is in many cases a necessity, or to overlook the fact that America, as one of the world’s most prosperous nations, is able to render such assistance. In this light, it would be difficult to deny that healthcare is, at least to some extent, a positive right.

Nevertheless, even the understanding that healthcare is a positive right does little to justify the changes that the Democrats are proposing—changes admitted on all sides to require a serious extension of government control over the healthcare system, and hence over a large sector of the American economy and over an important aspect of every American’s life. The weakness in the case for the Democratic proposals stems, in the first place, from the fact that some positive right to healthcare is undoubtedly being largely secured under existing conditions. In the United States, hospital emergency rooms may not lawfully refuse to treat patients who cannot pay. In addition, American federal and state governments offer a program, Medicaid, to provide healthcare for the poor. Moreover, American society provides at least some additional free access to healthcare through clinics established specifically to serve the poor. If we understand the “right to healthcare” as a positive right to at least some minimal medical services, then the right is currently being respected.

Proponents of liberal health reforms, as a result, must argue that the right to healthcare should be understood as a right to “adequate” or “decent” healthcare, and that an adequate or decent standard is not currently being achieved. This claim raises the question: how are we to determine what is adequate or decent? Stripped of the normative terminology, the case for reform depends on the factual observation that some Americans are not getting as much access to healthcare as they want, even though the health services they seek do exist and could be provided. Most Americans would agree that this situation should be considered not only empirically but also morally, in light of a concern with what is owed to human dignity.

Nevertheless, if we consider the situation only in light of the facts as stated above, we see that the Democratic healthcare proposals will effect no uniform improvement. Instead, they will simply rearrange the distribution of dissatisfactions. If the extension of access to the healthcare system is not to bankrupt the country, it must involve some effort to control costs and therefore to limit the amount of healthcare that is provided. Since it is beyond even the power of Congress to repeal the laws of supply and demand, it is economically impossible simultaneously to increase the use of a service and keep prices down, without generating some kind of compensating scarcity. This is admitted, more or less openly, by the more candid advocates of the Democratic proposals. The end result of their reforms will be that many Americans will still not be getting as much access to healthcare as they want. Some will have to endure longer waits for services—delays that in some cases may result in irreversible damage to their health. In other cases a government provider will have to rule out some treatments for some patients because they are too costly. If, then, such proposals will generate nothing more than a variation on the situation that now exists, but with different people who are underserved, we seem not to have advanced the positive right to healthcare at all.

Liberals will respond that this statement of the case ignores important differences between the two sets of dissatisfactions involved. The currently underserved are largely the lower class, but this will not be the case under the system to be established. Under that system, they may sometimes still be denied, if what they seek is found to be too costly. They will not be denied, however, simply because of their inability to pay for what they seek. According to this view, under society’s existing healthcare arrangements some people are getting inadequate healthcare, while others are getting more than adequate healthcare. Thus the virtue of the new system will be that everyone will get at least adequate healthcare, even though this will involve the cost that some will not get as much as they used to under the old system. Hence the positive right to healthcare will be better fulfilled.

This returns us again, however, to the question: what is the standard according to which we are judging that the healthcare provided to lower class Americans under existing conditions is not adequate or decent? The complaint that the current system fails in this regard ignores the fact that the quality of health and medical services has increased dramatically over the last fifty years. Admittedly the lower class today does not have access to healthcare as good as that available to the rich and the middle class. Nevertheless, they today do have access to healthcare that is better—markedly better—than was available to the rich and middle class even a generation ago. On this view, even assuming (though not conceding) that the healthcare provided to the lower class by our current arrangements is not adequate, we have reason to hope it will become more and more adequate. Such considerations argue powerfully in favor of keeping the current system, which provides at least a minimum of care to all citizens but that also operates over time to raise the objective quality of that minimum.

This, I think, gets us to the core of the dispute. In arguing for a positive right to healthcare, the American Left does not in fact have in mind an objective standard, derived from human nature or from an understanding of genuine human needs, of what is adequate or decent in the realm of healthcare. Rather, what they find so intolerable about the current system is the mere existence of the differences it tolerates. Their objections are ultimately grounded in their egalitarianism. What is at work is not the need to provide humane conditions for human beings: the existing arrangements have been making conditions more and more humane already. Rather, what is at work is what Alexis de Tocqueville presents, in Democracy in America, as one of democratic society’s most powerful inclinations: the unreasoning desire for more and more equality. As Tocqueville observes, under aristocratic conditions, the most egregious inequalities pass unnoticed. When by birth one man rules and another serves, it will hardly be noted that the former can see a physician while the other cannot. Democracy, in contrast, abolishes such distinctions of rank and opens the way to all to rise according to the success of their own efforts. Once democracy establishes this fundamental equality, however, all remaining inequalities stand out all the more, irritating the democratic mind and calling for conquest.

Of course, Tocqueville’s account does not perfectly describe the most powerful intellectual reflexes of all Americans. Such egalitarian impulses are restrained in many Americans by their commitment to notions of individual responsibility that they derive from their religious traditions or from the Founding’s emphasis on individual rights. Tocqueville’s account does, however, offer a compellingly accurate description of the dominant inclinations of the American Left, the segment of society that is least committed to traditional religion or to the principles of the Founding, and which accordingly is most powerfully moved by the democratic social state’s egalitarian desires. This explains why American liberals can declaim so indignantly on the “right to healthcare” in a nation that provides all of its members with better health and medical services than have been available to almost all people in human history.

From the standpoint of a concern with what is owed to human beings as human beings, the liberal understanding of the positive right to healthcare appears groundless. They are not seeking to satisfy the requirements of human nature, but to satisfy an insatiable thirst for equality of conditions. This is why opponents of Democratic reforms are right to suspect that they are only a step on the way to fully socialized medicine. It is likely, as many have already observed, that a public-option health insurer will distort the market to the disadvantage of private health providers, rendering them less and less viable, and itself more and more the only alternative. It is, however, also almost certain, as Tocqueville teaches us, that whatever greater equality of conditions is generated by the proposed reforms, it will not be enough to satisfy the next generation of liberals, who will notice new inequalities against which to inveigh, new evidence that the ever expanding “right to healthcare” is being denied.

We have good reason to fear that Democratic healthcare reform will not only fail to satisfy the desires giving rise to it, but that it will also, in the long run, undermine the objective quality of healthcare for all Americans. If we are to attribute the half-century improvement in medical care to the existing balance of private enterprise and government assistance, then we must wonder whether such improvement will be slowed, stopped, or even reversed by reforms that undo that balance in favor of a much greater governmental role. Here again we may gain insight from Tocqueville. For, as he observes, the democratic demand for greater and greater equality more and more smothers all individual initiative, and hence the source of all social energy, under an oppressive blanket of government regulation and paternalism. There is no reason to think that this would be any less true in healthcare than in any field of human endeavor.


Carson Holloway is an Associate Professor of Political Science at the University of Nebraska at Omaha. He is the author of The Way of Life: John Paul II and the Challenge of Liberal Modernity(Baylor University Press).

Copyright 2009 the Witherspoon Institute. All rights reserved.

Fiscal Dishonesty

The Coming Deficit Disaster

The president says he understands the urgency of our fiscal crisis, but his policies are the equivalent of steering the economy toward an iceberg. By DOUGLAS HOLTZ-EAKIN

President Barack Obama took office promising to lead from the center and solve big problems. He has exerted enormous political energy attempting to reform the nation's health-care system. But the biggest economic problem facing the nation is not health care. It's the deficit. Recently, the White House signaled that it will get serious about reducing the deficit next year—after it locks into place massive new health-care entitlements. This is a recipe for disaster, as it will create a new appetite for increased spending and yet another powerful interest group to oppose deficit-reduction measures.

Our fiscal situation has deteriorated rapidly in just the past few years. The federal government ran a 2009 deficit of $1.4 trillion—the highest since World War II—as spending reached nearly 25% of GDP and total revenues fell below 15% of GDP. Shortfalls like these have not been seen in more than 50 years.

Going forward, there is no relief in sight, as spending far outpaces revenues and the federal budget is projected to be in enormous deficit every year. Our national debt is projected to stand at $17.1 trillion 10 years from now, or over $50,000 per American. By 2019, according to the Congressional Budget Office's (CBO) analysis of the president's budget, the budget deficit will still be roughly $1 trillion, even though the economic situation will have improved and revenues will be above historical norms.

The planned deficits will have destructive consequences for both fairness and economic growth. They will force upon our children and grandchildren the bill for our overconsumption. Federal deficits will crowd out domestic investment in physical capital, human capital, and technologies that increase potential GDP and the standard of living. Financing deficits could crowd out exports and harm our international competitiveness, as we can already see happening with the large borrowing we are doing from competitors like China.

At what point, some financial analysts ask, do rating agencies downgrade the United States? When do lenders price additional risk to federal borrowing, leading to a damaging spike in interest rates? How quickly will international investors flee the dollar for a new reserve currency? And how will the resulting higher interest rates, diminished dollar, higher inflation, and economic distress manifest itself? Given the president's recent reception in China—friendly but fruitless—these answers may come sooner than any of us would like.

Mr. Obama and his advisers say they understand these concerns, but the administration's policy choices are the equivalent of steering the economy toward an iceberg. Perhaps the most vivid example of sending the wrong message to international capital markets are the health-care reform bills—one that passed the House earlier this month and another under consideration in the Senate. Whatever their good intentions, they have too many flaws to be defensible.

First and foremost, neither bends the health-cost curve downward. The CBO found that the House bill fails to reduce the pace of health-care spending growth. An audit of the bill by Richard Foster, chief actuary for the Centers for Medicare and Medicaid Services, found that the pace of national health-care spending will increaseby 2.1% over 10 years, or by about $750 billion. Senate Majority Leader Harry Reid's bill grows just as fast as the House version. In this way, the bills betray the basic promise of health-care reform: providing quality care at lower cost.

Second, each bill sets up a new entitlement program that grows at 8% annually as far as the eye can see—faster than the economy will grow, faster than tax revenues will grow, and just as fast as the already-broken Medicare and Medicaid programs. They also create a second new entitlement program, a federally run, long-term-care insurance plan.

Finally, the bills are fiscally dishonest, using every budget gimmick and trick in the book: Leave out inconvenient spending, back-load spending to disguise the true scale, front-load tax revenues, let inflation push up tax revenues, promise spending cuts to doctors and hospitals that have no record of materializing, and so on.

If there really are savings to be found in Medicare, those savings should be directed toward deficit reduction and preserving Medicare, not to financing huge new entitlement programs. Getting long-term budgets under control is hard enough today. The job will be nearly impossible with a slew of new entitlements in place.

In short, any combination of what is moving through Congress is economically dangerous and invites the rapid acceleration of a debt crisis. It is a dramatic statement to financial markets that the federal government does not understand that it must get its fiscal house in order.

What to do? The best option would be for the president to halt Congress's rush to fiscal suicide, and refocus on slowing the dangerous growth in Social Security, Medicare and Medicaid. He should call on Congress to pass a comprehensive reform of our income and payroll tax systems that would generate revenue sufficient to fund its spending desires in a pro-growth and fair fashion.

Reducing entitlement spending and closing tax loopholes to create a fairer tax system with more balanced revenues is politically difficult and requires sacrifice. But we will avert a potentially devastating credit crisis, increase national savings, drive productivity and wage growth, and enhance our international competitiveness.

The time to worry about the deficit is not next year, but now. There is no time to waste.

Mr. Holtz-Eakin is former director of the Congressional Budget Office and a fellow at the Manhattan Institute. This is adapted from testimony he gave before the Senate Committee on the Budget on Nov. 10. Copyright 2009 Dow Jones & Company, Inc.

Saving the Revolution

Pence Issues Challenge to Preserve the Real American Revolution

by Human Events Posted 11/20/2009 ET

Washington, DC - U.S. Congressman Mike Pence, Chairman of the House Republican Conference, delivered the following remarks last night at the American Spectator Bartley Dinner.

"I stand before you today at an historic moment for the conservative movement and for this great country. The coming weeks and months may well set the course for this nation for a generation and beyond. How we as conservatives respond could well determine whether America retains her place as a beacon of hope in the world, or whether we slip into the abyss that has swallowed much of Europe in an avalanche of Socialism.

"While some are prepared to write the obituary on capitalism and conservative values, I believe we are in the midst of a great American awakening. And it is breaking out all across this land, in townhalls and tea parties, coffee shops and church halls, in New Jersey and Virginia, and in the hearts and minds of everyday Americans, who are fed up with runaway federal spending, bailouts and takeovers by both parties and are saying with one voice: enough is enough.

"The American people know what makes sense and what doesn't.

"On the foreign stage, the American people know that weakness arouses evil. They know that bowing and kowtowing to foreign dictators only diminishes our standing in the world. And they know that standing idly by while the Ayatollahs in Iran crush innocent civilians, clamoring for free elections, is totally inconsistent with our history of standing with those who stand for freedom around the world. Ronald Reagan didn't stand before the Brandenburg Gate and say, ‘Mr. Gorbachev, that wall is none of our business.' The American cause is freedom and in that cause we must never be silent again.

"And the American people know that trying terrorists like ordinary criminals puts international public relations ahead of public safety and makes a mockery of American justice. This administration's decision to try Khalid Sheikh Mohammed and his cohorts in our civilian criminal courts is the most naïve and dangerous decision I have ever witnessed the United States government make. We should not be granting terrorists their wish to be tried at the scene of the worst enemy attack in American history.

"We should not tell terrorists around the world that they have more rights if they kill Americans on our soil than if they kill Americans on the field of battle. The Obama administration must overturn this wrongheaded decision and try these enemy combatants in a military tribunal where they belong.

"And on the home front, the American people know we can't borrow and spend and bail our way back to a growing economy. And they know that one bailout after another, and one government takeover after another, will undermine our national character and relegate our national economy to the permanent economic decline.

"The freedom to succeed must include the freedom to fail. Even as Ben Bernanke told me this week, capitalism without bankruptcy is like religion without hell."

"When you look at the failed Democratic policies on stimulus, cap and trade and healthcare, it looks like their recovery strategy is, 'the beatings will continue until morale improves.' Democrat policies in Washington D.C. are taking our economy from bad to worse. The unemployment rate in this country reached a 26 year high, 10.2 percent, the worst since 1983 and the national debt reaches 12 trillion dollars.

"And where was President Obama this week? In China visiting our money and being lectured on monetary policy by communist dictators. But seriously, the image is striking: a President of the United States, flying on one more foreign junket, to one more glamorous capitol, as our nation continues to struggle in the city and on the farm and unemployment rises to record levels.

"To get this administration to focus on creating jobs, maybe the president should spend less time at the Great Wall of China and more time at Wal-Mart!

"The American people know what works and what doesn't. We know the time-honored path to recovery is fiscal discipline in Washington, D.C. and fast-acting tax relief for working families, small businesses and family farms. And, to borrow a line from a great American, more and more Americans realize every day that a recession is when your neighbor loses his job, a depression is when you lose your job, and a recovery is when Nancy Pelosi loses her job.

"Clearly we've had it. But we see here tonight and at town hall meetings, tea party rallies across this country, and in the march on Washington in Washington, D.C., it is not the orchestrated theater of liberal special interest groups. It's authentic and it's powerful and it's real and it's American. And the American people know this is not just about dollars and cents, it's about who we are as a nation.

"That became very clear to me about one year ago this weekend. It was in the aftermath of that Wall Street bailout vote. Along with a majority of House Republicans, I opposed that bailout not once, but twice. I just thought it was wrong to take $700 billion from Main Street and transfer it to Wall Street to pay for the bad decisions that had been made there.

"You remember how it went. We stopped that bill once but the White House passed it over in the Senate, brought it back and rolled us. After it passed, I got on a plane to fly back to Indiana. Now you can probably tell that I'm a pretty upbeat guy, but that Saturday morning I was a little bit down. I was heartsick about what I'd seen our country do. But I had promised to speak at a Boy Scout jamboree in New Castle, Indiana, and I meant to keep that promise.

"You know the scene. It was a cold October Saturday morning, a line of Boy Scouts, ties pulled to the side, one shirttail out, standing up straight. I gave them my best speech about American history and then a few adults waited to talk to me afterwards. A lot of them talked about the bailout vote from the day before, about where the economy was headed.¨

"But there was one man standing off to the side, modestly dressed. And when the other adults dispersed, he walked up to me, hat in hand, and said words I'll never forget. He said, ‘Congressman, I'd seen in the newspaper that you were going to be out here. I lost my job yesterday, but I came out here to thank you for voting against that Wall Street bailout.' I looked at him and I said, ‘Well, I'm sorry for your trouble, but I have to tell you, I admire your stand.' And that American looked me in the eye that cold October morning and said words that are now chiseled on my heart. He said, ‘Congressman, I came by to thank you because I can get another job, but I can't get another country.'

"That man got it and he said it better than I ever could. The agenda of the left is about changing the very nature of this country, from a culture of independence to a culture of dependence on the state. As President Reagan said in his famous 1964 speech, it's ‘about whether we abandon the American Revolution and confess that a little intellectual elite in a far-distant capital can plan our lives better for us than we can plan them for ourselves.'

"In 1999, Thomas Sowell predicted that the American left would attempt a ‘quiet repeal of the American Revolution.' So what was the American revolution and is it possible to abandon or repeal?

"For the answer, we need look no further than the writings of one of our founders, President John Adams. In response to a public debate that was raging over the origins of the American Revolution, John Adams wrote a series of letters over a period of several years, describing his views on the coming of the Revolution. In a letter addressed to Mr. Niles, written in Quincy on 13 February 1818, John Adams wrote:

‘But what do we mean by the American Revolution? Do we mean the American War? The Revolution was effected before the War commenced. The Revolution was in the Minds and Hearts of the People... The People of America had been educated in the habitual Affection for England as their Mother-Country; and while they thought her a kind and tender Parent (erroneously enough, however, for she never was such a Mother,) no Affection could be more sincere. But when they found her a cruel Beldam, willing, like Lady Macbeth, to "dash their Brains out," it is no Wonder if their filial Affections ceased and were changed into Indignation and horror. The radical Change in the Principles, Opinions, Sentiments and Affection of the People was the real American Revolution.'

"According to our second President, the real American Revolution was a revolution of self reliance and independence, casting off dependency on the crown, in the hearts and minds of the American people. It was a rejection of the spirit of dependence in favor of a society of free and independent people.

"As Thomas Sowell wrote, ‘What the American Revolution did was give the common man a voice, a veto, elbow room, and a refuge from the rampaging presumptions of his "betters."' And, I submit, it is that revolution of independence and self reliance that liberal elites are seeking to overturn. Barney Frank recently said, ‘We are trying on every front to increase the role of government.' Not just the size but the role.

"With the role of the federal government tightening every day on our economy, our finances, our natural resources, and our everyday lives, the common American values of life, liberty and limited government are being trampled by the urgency of the moment and the judgment of people who ‘know better' than everyday Americans.

"The late Jack Kemp said words in 1996 at the Republican National Convention that speak to our time about the politicians and the political elites here in Washington. He said: ‘They don't have faith in people. They're elitists. They have faith in government. They think they know better than the people, but the truth is, there is a wisdom and intelligence in ordinary men and women far superior to the greatest so-called experts.'

"Washington D.C. is overrun with such politicians- people who consider the ideals of our Founding Fathers as quaint artifacts, as out of style as powdered wigs. Well, consider me quaint and out of style. I hold fast to the principles that minted this Republic: the unalienable rights to life, limited government, individual liberty, private property and due process of law. I took an oath to protect and defend these ideals. I vowed to bear obligation with true faith and allegiance. And if that's not quaint enough for you, I've even got a little of that powdered wig thing going.

"And I'm happy to report that House Republicans are fighting to turn things around. But the reality is we just don't have the numbers. But there is a force in America great enough to redeem our national government and reaffirm our revolutionary ideals - a minority in Congress, plus the American people, equals a majority.

"Our 16th president knew that as well. Passing through my home state of Indiana, Abraham Lincoln stopped at the Clay Pool Hotel on 11 February 1861. Headed to Washington to assume the presidency, he said words that are now chiseled in a modest bronze plaque, and I quote: 
'I appeal to you, to constantly bear in mind that it is not with politicians, it is not with presidents, it is not with office seekers, but with you is the question: Shall the union and shall the liberties of the country be preserved?' Lincoln went on to say, ‘It is your business if the union of these states and the liberties of this people shall be lost, and it is your business to rise up.'

"So what is our part to play? What is your role in this unfolding drama? It is to rise up. To do freedom's work. Like a great patron of conservative causes, the late J. Patrick Rooney of Indiana.

"At this dinner in 2005, featuring Justice Scalia's remarks, I sat with the late J. Patrick Rooney. We had an exchange at the table that has never left me. I told my mentor, and friend, that I admired him for staying in the fight when he could be on a golf course or on a beach instead of working the halls of Congress for school choice and health savings accounts. Pat scowled at me and said, ‘We are not put on this earth for our amusement or enjoyment, we are put on this earth to do our d--n duty.'

"Now comes the time for all of us to do our duty in this battle to preserve all that makes America great. If you can give, give. If you can speak, speak. If you can write, write. If you can run, run. But do all you can. Now is the moment.

"The Bible says, ‘If the foundations crumble, how can the righteous stand?' The foundations of this country are found in our Declaration of Independence, and in the spirit of personal responsibility and equality of opportunity that beats in the heart of every American.

"Through the work of American Spectator, you have done your part to preserve that foundation. Now we must do more. And we will not fight alone. Winston Churchill said before Congress in 1941, ‘He must indeed have a blind soul who cannot see that some great purpose and design is being worked out here below, of which we have the honor to be faithful servants.' There is a great purpose being worked out and, as President Bush said so many times, the Almighty's purpose is freedom.

"You have a role to play; a duty to fulfill. You are to be the faithful servants of freedom in this hour. You've gathered in this nation's Capitol to take your stand for what makes this country great. A Capitol filled with memorials to America's heroes, men and women whose faces are carved in bronze, whose names adorn monuments, and just across that river, whose remains lie quietly as testament to their heroism for our freedom. In their time they did their part. Now it's your turn.

"Let us do as generations of Americans have done before, let us stand for what has always been the source of American greatness: our faith in God and our freedom. And if we hold that banner high, I believe with all my heart, the good and great people of this land will rally to our cause. We will take this Congress back in 2010 and we will take this country back in 2012, so help us God."

HUMAN EVENTS is the news source President Reagan called his "favorite newspaper" and we still hold high the Reaganesque principles of free enterprise, limited government and, above all, a staunch, unwavering defense of American freedom.

What About the Constitution?

Unlawful health reform?

By George F. Will
Thursday, November 19, 2009

In 2006, long before there was an Obama administration determined to impose a command-and-control federal health-care system, a young orthopedic surgeon walked into the Goldwater Institute here with an idea. The institute, America's most potent advocate of limited government, embraced Eric Novack's idea for protecting Arizonans from health-care coercion. In 2008, Arizonans voted on Novack's proposed amendment to the state's Constitution:

"No law shall be passed that restricts a person's freedom of choice of private health care systems or private plans of any type. No law shall interfere with a person's or entity's right to pay directly for lawful medical services, nor shall any law impose a penalty or fine, of any type, for choosing to obtain or decline health care coverage or for participation in any particular health care system or plan."

Proponents were outspent five to one by opponents who argued, meretriciously, that it would destroy Arizona's Medicaid program, with which many insurance companies have lucrative contracts. Nevertheless, the proposition lost by only 8,687 votes out of 2.1 million cast, and Arizonans will vote on essentially the same language next November.

But does not federal law trump state laws? Not necessarily. Clint Bolick, a Goldwater Institute attorney, says, "It is a bedrock principle of constitutional law that the federal Constitution established a floor for the protection of individual liberties; state constitutions may provide additional protections."

In 1997, the U.S. Supreme Court held that under the Constitution's system of "dual sovereignty," states' "retained sovereignty" empowers them to "remain independent and autonomous within their proper sphere of authority." The court has been critical of the "federalism costs" of intrusive federal policies and recently has twice vindicated state sovereignty in ways pertinent to Novack's plan.

In 2006, the court overturned an interpretation of federal law that would have nullified Oregon's "right to die" statute. The court said states have considerable latitude in regulating medical standards, which historically have been primarily state responsibilities.

In 2000, Arizona voters endorsed an English immersion policy for students for whom English is a second language. Federal courts had issued an injunction against such policies because they conflicted with federal requirements of bilingual education. This year, however, the Supreme Court mandated reconsideration of the injunctions because they affect "areas of core state responsibility."

The court says the constitutional privacy right protects personal "autonomy" regarding "the most intimate and personal choices." The right was enunciated largely at the behest of liberals eager to establish abortion rights. Liberals may think, but the court has never held, that the privacy right protects only doctor-patient transactions pertaining to abortion. David Rivkin and Lee Casey, Justice Department officials under the Reagan and first Bush administrations, ask: If government cannot proscribe or even "unduly burden" -- the court's formulation -- access to abortion, how can government limit other important medical choices?

Democrats' health bills depend on forcing individuals to buy insurance or face severe fines or imprisonment. In 1994, the Congressional Budget Office said forcing individuals to buy insurance would be "an unprecedented form of federal action," adding: "The government has never required people to buy any good or service as a condition of lawful residence in the United States."

This year, the Congressional Research Service delicately said "it is a novel issue whether Congress may use the [commerce] Clause to require an individual to purchase a good or service." Congress has the constitutional power to "regulate commerce . . . among the several states." But a Federalist Society study by Peter Urbanowicz and Dennis Smith judges it perverse to exercise coercion under the commerce clause "on an individual who chooses not to undertake a commercial transaction." As Sen. Orrin Hatch (R-Utah) says, there is "a fundamental difference between regulating activities in which individuals choose to engage" -- e.g., drivers can be required to buy auto insurance -- "and requiring such activities" just because an individual exists.

House Majority Leader Steny Hoyer (D-Md.) says Congress can tax -- i.e., punish -- people who do not buy insurance because the Constitution empowers Congress to tax for "the general welfare." So, could Congress tax persons who do not exercise or eat their spinach?

When asked whether any compulsory insurance purchases are constitutional, House Speaker Nancy Pelosi was genuinely astonished: "Are you serious? Are you serious?" In 1803, in Marbury v. Madison, Chief Justice John Marshall wrote, "The powers of the legislature are defined and limited; and that those limits may not be mistaken, or forgotten, the Constitution is written." He was serious.

georgewill@washpost.com

Once Again - Tax Cuts Are The Answer

An Alternative Stimulus Plan

A payroll tax cut would add three to four million jobs at a fraction of the cost of the stimulus bill. By MICHAEL J. BOSKIN

While the economy has finally started to grow, the disturbingly high unemployment rate is increasing pressure from the left to double down on this year's poorly designed fiscal stimulus bill. Since the stimulus bill was signed, the ranks of the unemployed have grown by over three million (over four million if involuntary part-time and discouraged workers are included). The unemployment rate, which the Obama administration projected the stimulus would contain at 8%, is now 10.2%.

There is little likelihood that another round of similar fiscal stimulus would yield much more than the paltry return on the first one. The original transfer payments and tax rebates barely nudged consumer spending, and the federal spending has been painfully slow. The delayed infrastructure spending—the shovels are still in the shed—will have a bigger impact, though less than claimed. Some of the funds to state and local government did reduce layoffs. The stimulus bill surely ranks dead last compared to the natural dynamics of the business cycle, the Fed's zero interest rate policy, and the automatic stabilizers in the tax code (which have reduced taxes proportionally more than income) as far as explanations for the improvement in the economy.

But to evaluate the stimulus properly we should consider not just what we got for the $787 billion cost but the effects of alternative policies that might have been enacted.

My Stanford colleague Pete Klenow and Rochester economist Mark Bils estimated that cutting the payroll tax by six percentage points (of the 12.4% Social Security component) would, under standard assumptions, increase employment by three million to four million workers—an amount equal to all the job losses since the stimulus was passed.

The payroll tax cut would have reduced firms' costs by roughly the same amount as from the entire decline in employment. It would have cost less than half as much as the stimulus bill, gotten far more income into paychecks quickly and, most importantly, greatly reduced incentives for firms to lay off workers. In fact, it would have created incentives to hire.

Even using the administration's claims of one million jobs "created or saved," the stimulus program passed in early February is millions of jobs short of what a cheaper payroll tax suspension would have delivered (see nearby chart).

Yet the president and Congress are preparing vast new taxes on employment in the health-care reform and other legislation. Raising the federal top tax rate to 45% (from the current 35% with a 5.4% surcharge plus the expiration of the Bush tax cuts) will hit successful small businesses especially hard. The tax hike on capital gains and dividends hidden in the fine print of the health-care legislation will also raise the cost of equity capital, further weakening businesses (including banks) desperate for private capital. Many firms will also face either an 8% additional payroll tax or be forced to pay a higher share of health insurance premiums. Such tax increases will hit employment and wages hard.

It would be far better to junk part of the remaining stimulus in favor of a one-year partial payroll tax cut. Also accelerate spending that needs to be done eventually, such as replenishing depleted military equipment used up in Iraq and Afghanistan and adding a desperately needed two Army brigades.

There are five large interrelated headwinds to jobs and growth. First, continued deleveraging, unresolved toxic assets, and weak banks are constraining credit, especially for small business that is the source of most hiring. Second, household balance sheets depressed from declines in home values and portfolios are likely to constrain consumption growth. Third, government industrial-policy micromanagement with subsidies and mandates from pay to products is forcing noncommercial decisions on wide swaths of the economy from financial services and autos to energy and health care. Such policies have never worked before—ask the Japanese, Koreans and Europeans. Fourth, the explosion of spending, deficits and debt foreshadows even higher prospective taxes on work, saving, investment and employment. That not only will damage our economic future but is harming jobs and growth now. Fifth, the massive liquidity injections by the Fed raise the specter of future inflation.

By far the best response to these headwinds is to curtail the huge current and contemplated future government control of the economy with a clear, predictable exit strategy—before the programs become permanently entrenched, develop powerful dependent constituencies, and greatly increase the risk of rising interest rates, inflation and taxation. Doing so would more rapidly improve the outlook for permanent private-sector employment, investment and growth than any conceivable second stimulus. It would also allocate capital and labor to their highest value in providing goods and services that people actually want and need, not what government bureaucrats want them to have.

The jobs agenda must begin with a Hippocratic oath: First do no harm to employment. That means jettisoning or at least delaying job-killing energy and health-care legislation with their mandates, taxes and costs that especially hammer small businesses.

Also wind down, as soon as possible, the emergency measures which healthy businesses, households and investors fear will become permanent competitive impediments. Start with the Troubled Asset Relief Program, which the Treasury uses as a permanent revolving fund even for nonfinancial bailouts.

Financial regulation should focus on disclosure, transparency, effective clearing, capital adequacy, and new bankruptcy procedures. We also need a Plan B, modeled on the Resolution Trust Corporation cleanup of the savings and loans, in the event the losses on toxic assets are too large for time, profitability and economic recovery to manage. And the Fed must forestall future inflation by withdrawing its immense liquidity injections as soon and predictably as feasible (its initial steps are commendable).

Finally, if possible, we should complement these pro-employment policies with long-run fiscal reform: control entitlement cost growth, e.g. with price rather than wage indexing of Social Security, and real tax reform with the widest possible tax bases and lowest possible rates. America's corporate tax rate, the second highest among advanced economies, is especially damaging.

That is a far more consistent common-sense recipe for more and better jobs, far sooner than the current contradictory and ineffective policy mess emanating from Washington.

Mr. Boskin is a professor of economics at Stanford University and a senior fellow at the Hoover Institution. He chaired the Council of Economic Advisers under President George H.W. Bush. Copyright 2009 Dow Jones & Company, Inc.